Law on selling self-made electronic devices

Question

if I make a microcontroller or any electronic device and it has LEDs, it is not me who created these LEDs, I bought them, even chosen for the pack of transistors that I bought on Amazon, so if I want to market a device that uses these LEDs and transistors, do I pay copyright to the author / brand of these LEDs too? And what if I buy a ready-made Wi-Fi card or SIM card reader that I buy and integrate into my device, must I pay copyright also?

Answer 1

Under the First Sale doctrine, when intellectual property is imparted to an actual physical thing, the first commercial buyer of that actual physical thing (that is made with proper intellectual property licensing or permission) is entitled to use it without further intellectual property limitations. As Wikipedia explains at the link:

The first-sale doctrine (also sometimes referred to as the "right of first sale" or the "first sale rule") is an American legal concept that limits the rights of an intellectual property owner to control resale of products embodying its intellectual property. The doctrine enables the distribution chain of copyrighted products, library lending, giving, video rentals and secondary markets for copyrighted works (for example, enabling individuals to sell their legally purchased books or CDs to others). In trademark law, this same doctrine enables reselling of trademarked products after the trademark holder puts the products on the market. In the case of patented products, the doctrine allows resale of patented products without any control from the patent holder.

A different analysis applies if the goods when first made were already infringing. But, in practice, the aggrieved IP owner usually sues the primary infringer or an importer of the infringing goods, rather than a retail purchaser, in those case.

Answer 2

As someone who designs electronics for a living, this is my experience.

It's common practice in the electronics industry to buy parts and then use them in designs without paying anything other than the cost of the part itself. This applies to simple parts like resistors, capacitors, LEDs, transistors, diodes, etc. It also applies to things like entire circuit boards or modules that one might connect together.

There are some exceptions. For example, certain pieces of hardware are meant to be used with certain protocols, IP, or address spaces. Technically you are not paying for use of the hardware itself. But for practical purposes its just about the same as if you were, since without paying, can't use the hardware for its intended purpose.

1. For example a CAN bus transceiver is meant to be used with the CAN bus protocol, which is owned by Bosch GmbH. Each implementation using that protocol is obligated to pay a royalty to Bosch. If you use a chip which contains a CAN bus controller the cost of the royalty is included with the controller chip, but if you made your own implementation (say in an FPGA) you would need to pay the royalty.

2. Ethernet and WIFI products require a MAC address. MAC addresses are assigned by the IEEE and a small fee must be paid for each one. If you buy a complete functioning Ethernet or WIFI module that already has a MAC address, then the manufacturer already paid for the MAC address. If you are making your own implementation, out of say a MAC-PHY chip, which doesn't come with a factory programmed MAC address, then you would need to either buy a small MAC address EEPROM (which has the cost of the MAC address included) or else buy MAC addresses directly from IEEE.

If you want to sell electronics in the US then it needs to comply with FCC regulations. This is typically accomplished by testing at a certified lab (which can cost several thousand dollars). Certain product categories are exempt from testing, for example products that run at very low clock frequencies, or are completely passive.

You would also be required to meet any safety standards. In the US this is typically accomplished by testing at certified labs like UL or Intertek.

Answer 3

No, the manufacturer will be paying for any patent licenses, copyright, etc. and it's all included in the price that you are paying.

The exception would be if someone rips off the patent holder and builds say LEDs without paying for a patent license that they should pay for. But in that case, the patent holder would take the manufacturer to court who made a million LEDs, and not you when you bought twenty of them.

Answer 4

Everything you sell needs to meet safety standards for the jurisdiction you are selling it in. Not every product has safety standards, but many do.

The certification will inspect every part of your product including the components. As such, the cheapest way to get a certification is to use components that themselves have been pre-certified. An example of that is the "RU" recognition provided by UL. The certifier will not test those components, because they are already tested, so you will not pay for testing them.

Companies which seek such component certifications want you to use them in products; that was the entire point of certification! So yes, there is no question in that case.

Most of the cheap Amazon crud is straight off Alibaba.com and has no certifications of any kind. If you use it, IP rights will be the least of your problems.

Or maybe not. Maybe the cheapo builder violated somebody else's patent. So out of the blue, this patent holder could come after you. (Simply because you are within their reach). Generally not an issue with white-market goods.

Answer 5

Apart from anything else you don't have to pay for copyright permission on those devices because you're not making copies of them. Copyright is essentially the right to make copies.

Answer 6

Those components are sold to be included in other products, whether those products are created for sale or not is irrelevant.

Or do you think you'd have to pay intellectual property rights to the paper mill over a pack of printer paper you use to print the monthly newsletter of your local sportsclub?

Answer 7

The IP inherent in these is embedded in the process of making them. You've simply bought the items. As a user, no IP has entered the conversation and therefore the question simply doesn't arise.

If you attempted to make more WiFi cards using their circuit board design, this would be infringement of their IP. But you aren't, so it isn't.

Answer 8

Components are generally consumable, your labeling is going to be the issue, and you mention microcontrollers specifically, so the usual Open Source caveats apply, and you could be hounded for that.

So, do not infringe on trademarks. Try not to clone products that are still patent protected, and especially watch copyright as well as it tends to outlive patents.

Beware of licensed product. You cannot necessarily "chip" consoles and call them a derivative work if you are doing it to pirate games. Playing out of region DVD's may be OK though. Don't be deceptive, if it does not save fuel and you claim it does there will be trouble. Likewise do not print 800W PSU labels and use them on 400W units.

But otherwise you should be fine, get over to Tindie and see what they have to say on the matter. At the end of the day everything is made my someone, and unless you are Rolex (tm), my guess is you will never be making everything in-house.

Those LEDs were made to be used in something.