Let's say I plan on building a consumer electronic system (some electronic product). This system would have a PCB and a plethora of various components: LEDs, transistors, resistors, light sensors, microphones, a power supply, etc. I would obtain these from a distributor or perhaps even directly from a manufacturer.

In addition to purchasing them from a supplier, do I also owe royalties or other licensing-based fees for each of these components? What criteria/factors drive this answer?

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    \$\begingroup\$ Whether or not your design uses any mechanisms or techniques described in an active patent which the component manufacturer does not already handle. \$\endgroup\$ – Ignacio Vazquez-Abrams Sep 4 '14 at 17:05
  • \$\begingroup\$ Thanks @IgnacioVazquez-Abrams (+1) - when you say "...which the component manufacturer does not already handle", what do you mean by "already handle"? If I buy a component from a distributor/manufacturer, are you suggesting that they are already paying royalties to patent owners, and as a result, in most cases I do not need to worry about such things? \$\endgroup\$ – smeeb Sep 4 '14 at 17:30
  • \$\begingroup\$ And I guess as an ancillary question, how do you know when a component you are purchasing is "covered" for royalties (that is, the distributor/manufacturer is already paying them) or not? Obviously it would be helpful to know if I'm about to use a component that I should be paying royalties on. \$\endgroup\$ – smeeb Sep 4 '14 at 17:31
  • \$\begingroup\$ They are not going to sue you for buying their part and using it. But nothing guarantees that their design doesn't violate somebody else's IP. And if they have some IP, they are not licensing you to buy somebody else's part and use it in place of theirs in their design. \$\endgroup\$ – The Photon Sep 4 '14 at 17:35
  • \$\begingroup\$ For example, audio or video codec chips. Some formats are patented, and the chip manufacturer may or may not have paid the required royalties for use, especially if the formats are "pluggable". Read very carefully the documentation provided by the manufacturer. \$\endgroup\$ – Ignacio Vazquez-Abrams Sep 4 '14 at 17:39

Purchase of components implies either explicitly (through language in the datasheets) or implicitly a license. Put another way, if someone sells you a component that allows you to do something, and then they sue you, they can easily be counter sued for entrapment. The real concern is if you are using a component that infringes on someone's else's patents or IP's. Then you need to discuss indemnification with them. It would be silly for a manufacturer to go after you for using their own components.

  • \$\begingroup\$ Great minds think alike. \$\endgroup\$ – The Photon Sep 4 '14 at 17:36
  • \$\begingroup\$ @ThePhoton or people with direct experience as being suppliers have the requisite knowledge. ;) I'll never ever claim to have a great mind ... \$\endgroup\$ – placeholder Sep 4 '14 at 17:37
  • \$\begingroup\$ It is possible to buy components that are not licensed for use in your particular (possibly particularly litigious) corner of the world. The world is a big place. Caveat emptor. \$\endgroup\$ – Spehro Pefhany Sep 5 '14 at 0:12
  • \$\begingroup\$ yep, sure is a big scary world... \$\endgroup\$ – placeholder Sep 5 '14 at 3:35

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