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More Legal Battles Brewing With Keurig's Coffee Pods?

By William Peacock, Esq. on September 02, 2014 11:03 AM

Keurig 2.0. It's the new version of Keurig's ubiquitous pod-based single-serve coffee machines. What's the 2.0 about? The machines come with DRM protection and the ability to brew larger pots.

DRM, if you're unfamiliar, stands for Digital Rights Management. In plain English, Keurig 2.0 machines will only take Keurig-authorized cups which have a special ink marker on their foil tops, reports The Verge. Except, that DRM may have already been broken by rival companies before the 2.0 machines even hit the market.

Unless the announced product was created pursuant to a licensing agreement, we could be looking at yet another round of Keurig in the courtroom.

Exhausted Patent

Before their patent expired in 2011, Keurig had a monopoly on the pod-based market. When the patent expired, competitors chipped away 8 percent of the multi-billion dollar coffee pod market.

In 2013, we covered their loss in the Federal Circuit. Keurig argued that rival pod-makers were inducing infringement of Keurig's method-based patents when they sold pods to consumers, but the Federal Circuit held that Keurig's method-based claims were exhausted upon first sale of the brewers.

The Federal Circuit called the inducted infringement lawsuit an "end-run around exhaustion."

Enter the Damn DRM

With their pod patent expired, and their method patents powerless to stop the competition from producing third-party pods, Keurig's next move was to introduce DRM to their brewers, a strategy most commonly used by printer manufacturers to prevent consumers from using third-party ink cartridges.

Rival manufacturers immediately threatened to file anti-trust lawsuits against Keurig though similar attempts against printer manufactures under the same theory failed. We also noted that lawsuits had been brought by printer manufacturers against generic ink cartridge makers under the Digital Millennium Copyright Act.

Those lawsuits, however, were mostly unsuccessful, so it is unknown how much luck either Keurig or the competition would have should this coffee rivalry return to the courtroom.

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