Aronson v. Quick Point Pencil Co.

440 U.S. 257 (1979)

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Aronson v. Quick Point Pencil Co.

United States Supreme Court
440 U.S. 257 (1979)

Facts

In October 1955, Jane Aronson (plaintiff) filed a patent application for a new form of keyholder. In June 1956, Aronson reached an agreement with the Quick Point Pencil Company (Quick Point) (defendant) to manufacture and sell her keyholder design. Under the agreement, Aronson would receive 5 percent of the keyholder sales, and Quick Point would retain the exclusive right to make and sell keyholders of that design. Additionally, the agreement stipulated that if Aronson was not granted a patent on the keyholder design within five years, Quick Point would pay her a reduced fee of 2.5 percent of the keyholder sales. Aronson was not granted a patent for the keyholder design within the specified time, and she received a final rejection in September 1961. Quick Point subsequently reduced the royalty payments per the agreement and continued making payments to Aronson for 14 years. In November 1975, Quick Point sought a declaratory judgment that the agreement was unenforceable on the basis that any state law supporting the agreement was preempted by federal patent law. The district court held the agreement to be valid, but the court of appeals reversed, holding that an obligation to continue paying royalties would be inconsistent with federal patent policy.

Rule of Law

Issue

Holding and Reasoning (Burger, J.)

Concurrence (Blackmun, J.)

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