FOR PUBLICATION

  UNITED STATES COURT OF APPEALS
       FOR THE NINTH CIRCUIT

C.R. BARD, INC.,                          No. 23-16020

              Plaintiff-Appellant,       D.C. No. 2:21-cv-
                                           00284-DGC
 v.

ATRIUM MEDICAL                              OPINION
CORPORATION,

              Defendant-Appellee.

      Appeal from the United States District Court
               for the District of Arizona
      David G. Campbell, District Judge, Presiding

           Argued and Submitted July 9, 2024
               San Francisco, California

                 Filed August 23, 2024

Before: Michelle T. Friedland, Salvador Mendoza, Jr., and
           Roopali H. Desai, Circuit Judges.

                   Per Curiam Opinion
2              C.R. BARD, INC. V. ATRIUM MED. CORP.


                          SUMMARY *


                           Patent Law

     The panel reversed the district court’s judgment
following a bench trial in favor of Atrium Medical
Corporation on C.R. Bard, Inc.’s claim that Atrium breached
its contract with Bard by failing to make certain minimum
royalty payments due under a licensing agreement.
    In Brulotte v. Thys Co., 

 (1964), the Supreme
Court held that patent holders may not contract for royalties
on any use of a patented invention that occurs after the patent
has expired. Clarifying the proper application of Brulotte,
the panel held that a court must first use state law tools of
contract interpretation to determine the parties’ contractual
obligations. Then, the court must separately ask whether
those contractual obligations are permissible under
Brulotte. To do so, the court asks only whether the contract
provides for royalties on the use of a patented invention that
occurs after the expiration of the patent.
    Applying Brulotte to the parties’ agreement, the panel
held that the district court erred in concluding that a portion
of the parties’ agreement violated Brulotte in light of the
subjective motivations of the parties during the course of
their negotiations. The parties’ agreement provides for U.S.
royalties only through the expiration of the U.S. patent, so it
does      not      constitute     patent     misuse      under
Brulotte. Accordingly, the panel reversed the district court’s


*
 This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
             C.R. BARD, INC. V. ATRIUM MED. CORP.            3


entry of judgment for Atrium on Bard’s breach of contract
claim.
   The panel addressed the remaining issues in a
concurrently filed memorandum disposition.


                         COUNSEL

Brian R. Matsui (argued), Seth W. Lloyd, and Deanne E.
Maynard, Morrison & Foerster LLP, Washington, D.C.;
Diana L. Kim, Morrison & Foerster LLP, Palo Alto,
California; Andrew Federhar and Jessica Gale, Spencer Fane
LLP, Phoenix, Arizona; Steven C. Cherny, Quinn Emanuel
Urquhart & Sullivan LLP, Boston, Massachusetts; Matthew
A. Traupman, Quinn Emanuel Urquhart & Sullivan LLP,
New York, New York; for Plaintiff-Appellant.
Christopher McArdle (argued), Wade G. Perrin, and Paul
Tanck, Alston & Bird LLP, New York, New York; Charles
W. Cox II, Alston & Bird LLP, Los Angeles, California; for
Defendant-Appellee.

OPINION

PER CURIAM:

    Under the Supreme Court’s decision in Brulotte v. Thys
Co., 

 (1964), patent holders may not contract for
royalties on any use of a patented invention that occurs after
the patent has expired. The Court has declined to overrule
Brulotte, explaining that the “decision is simplicity itself to
apply” and that parties may “find ways around” its
4              C.R. BARD, INC. V. ATRIUM MED. CORP.


prohibition. Kimble v. Marvel Ent., LLC, 

 (2015).
    We now clarify the proper application of Brulotte. A
court must first use the familiar state law tools of contract
interpretation to determine the parties’ contractual
obligations. Factfinding may be required to determine the
meaning of any ambiguous terms. Then, the court must
separately ask whether those contractual obligations are
permissible under Brulotte. To do so, the court asks only
whether the contract provides for royalties on the use of a
patented invention that occurs after the expiration of that
patent. That question of law is a formal inquiry that does not
depend on the parties’ motivations, the course of their
negotiations, or the consideration received by either party in
exchange for the inclusion of a particular contractual term.
    Here, the district court concluded that a portion of a
licensing agreement violated Brulotte in light of the
subjective motivations of the parties during the course of
their negotiations. We conclude that the agreement at issue
does not provide for royalties on post-expiration use of a
patented invention, so we reverse. 1
                                   I.
    C.R. Bard, Inc. (“Bard”), is a medical device company.
Through a subsidiary, it held two patents on a type of
vascular graft: one U.S. patent and one Canadian patent.
Bard sued Atrium Medical Corporation (“Atrium”) for
patent infringement, and the two companies settled the suit
in 2011 by entering into a licensing agreement. The terms
of the agreement provided that Atrium would pay Bard a

1
  We address the other issues presented by this appeal in a concurrently
filed memorandum disposition.
                C.R. BARD, INC. V. ATRIUM MED. CORP.                   5


15% per-unit royalty on covered U.S. sales until the U.S.
patent expired in 2019 and a 15% per-unit royalty on covered
Canadian sales until the Canadian patent expired in 2024.
The agreement also provided that “in no event will royalties
for any calendar quarter of the Term 2 be less than” $3.75
million (equivalent to $15 million per year).
    Sales of Atrium’s “iCast” stent, which occurred only in
the United States, were not initially subject to the per-unit
royalties. The Food and Drug Administration (“FDA”) had
approved the iCast stent only for use in a patient’s airway.
But nearly all iCast sales were for off-label vascular uses.
When the parties entered the license agreement, Atrium was
preparing to seek FDA approval for vascular iCast uses,
which it predicted would dramatically increase sales. The
parties’ agreement provided that, once such FDA approval
was granted, the iCast stent would become subject to the
15% per-unit royalty, and the minimum royalty payments
would terminate. The agreement also provided that the
minimum royalty payments would terminate if the FDA
were to “rescind[] its approval to market or sell” the iCast
stent “for any and all indications previously approved.”
    Contrary to the parties’ expectations, the FDA did not
grant approval for vascular iCast uses until 2023, well after
the U.S. patent expired in 2019. Because the per-unit
royalties never exceeded the quarterly minimum royalty
payments, Atrium only ever paid the minimum due under the
agreement. Atrium stopped making the minimum royalty
payments to Bard when the U.S. patent expired. Atrium

2
  The definition of “Term” stated: “This Agreement shall be effective as
of the Effective Date and shall remain in full force and effect until the
last to expire of all the patents included within the Licensed Patents,
unless earlier terminated in accordance with its terms.”
6            C.R. BARD, INC. V. ATRIUM MED. CORP.


then paid only the per-unit royalties on Canadian sales,
which were substantially smaller than the minimum
royalties, for about two years. As the parties’ dispute over
the payments unfolded, Atrium ceased paying those per-unit
royalties as well.
    Bard sued Atrium in 2021. It alleged, as relevant here,
that Atrium’s failure to make the minimum royalty payments
between the expiration of the U.S. patent in 2019 and the
FDA’s approval of iCast for vascular use in 2023 was a
breach of contract. After discovery, the parties filed cross-
motions for summary judgment. Atrium asserted that the
minimum royalty provision was unenforceable after the
expiration of the U.S. patent because it constituted patent
misuse under Brulotte. The district court concluded that
there was a factual dispute as to “the extent to which
minimum royalties after August 2019 include[d] payments
for use of the [U.S.] patent,” precluding summary judgment
on Bard’s breach-of-contract claim.
    The district court held a two-day bench trial. Five
witnesses testified, largely about the negotiations between
Bard and Atrium that led to their licensing agreement. The
district court then issued findings of fact and conclusions of
law. The district court found that the “clear and primary
purpose of the minimum royalty provision was to
compensate Bard for iCast sales” in the United States. In
light of that purpose, the district court held that the minimum
royalty provision constituted patent misuse after the
expiration of the U.S. patent.
    Bard timely appealed.
                C.R. BARD, INC. V. ATRIUM MED. CORP.                      7


                                    II.
   The district court exercised jurisdiction under 

. We have appellate jurisdiction under 

. 3
   We review de novo a district court’s legal conclusions.
O’Bannon v. Nat’l Collegiate Athletic Ass’n, 

 (9th Cir. 2015).
                                   III.
    We conclude that the minimum royalty provision does
not constitute patent misuse under Brulotte. We first explain
the controlling precedents. We then explain why application
of the Brulotte rule is a question of law that we review de
novo. Finally, we apply Brulotte to the parties’ agreement.
                                    A.
     The Constitution empowers Congress to “promote the
Progress of Science and useful Arts, by securing for limited
Times to Authors and Inventors the exclusive Right to their
respective Writings and Discoveries.” U.S. Const. art. I, § 8,
cl. 8. The Patent Act specifies the period after which a patent
expires. 

(a)(2).
    In Brulotte, the Supreme Court held that patent holders
may not contract for royalties on the use of a patented
invention that occurs after the patent has expired. 

  The claims at issue in this case arise under state law, not federal patent
law, so appellate jurisdiction does not lie with the Federal Circuit. See

(a)(1) (providing for exclusive Federal Circuit
jurisdiction over appeals in “any civil action arising under . . . any Act
of Congress relating to patents”). Atrium’s patent-misuse defense does
not affect the jurisdictional analysis. See Caterpillar Inc. v. Williams,

 (1987) (describing the well-pleaded complaint rule).
8            C.R. BARD, INC. V. ATRIUM MED. CORP.


at 32. There, purchasers had each acquired a hop-picking
machine in exchange for both a “flat sum” and a seasonal
“license for its use.” Id. at 29. The seasonal license payment
was calculated as the greater of either “a minimum royalty
of $500 for each hop-picking season or $3.33 1/3 per 200
pounds of dried hops harvested by the machine.” Id. The
licenses referred to twelve patents, seven of which “were
incorporated into the machines.” Id. at 30. “Of those seven
all expired on or before 1957. But the licenses . . . continued
for terms beyond that date.” Id. The purchasers “refused to
make royalty payments accruing . . . after the expiration of
the patents.” Id.
    The Supreme Court held that “any attempted reservation
or continuation in the patentee . . . after the patent expires,
whatever the legal device employed, runs counter to the
policy and purpose of the patent laws.” Id. at 31 (quoting
Scott Paper Co. v. Marcalus Mfg. Co., 

(1945)). The agreement was therefore invalid “insofar as it
allow[ed] royalties to be collected which accrued after the
last of the patents incorporated into the machines had
expired.” 

 The Court reasoned that “there is intrinsic
evidence that the agreements were not designed” merely to
“spread the payments for the use of the patent” over “a
reasonable amount of time.” Id. at 31 (quotation marks
omitted). The Court explained that, because the licenses
drew “no line between the term of the patent and the post-
expiration period,” the “contracts [were] . . . on their face a
bald attempt to exact the same terms and conditions for the
period after the patents have expired” as for the period before
the patents expired. Id. at 32.
   The Court revisited the Brulotte rule in Kimble v. Marvel
Entertainment, LLC, 

 (2015). Acknowledging
a “broad scholarly consensus” against the economic
               C.R. BARD, INC. V. ATRIUM MED. CORP.                  9


assumptions made in Brulotte, 

 at 461 (citing judicial and
academic criticism), the Court nevertheless concluded that
overruling Brulotte was not justified as a matter of stare
decisis, 

. The Court in Kimble explained in part
that Brulotte “is simplicity itself to apply”: “A court need
only ask whether a licensing agreement provides royalties
for post-expiration use of a patent. If not, no problem; if so,
no dice.” 

.
     The Court in Kimble also emphasized the limits of the
Brulotte rule, noting that “parties can often find ways around
Brulotte.” 

. Parties may, for example, “defer
payments for pre-expiration use of a patent into the post-
expiration period,” because “all the decision bars are
royalties for using an invention after it has moved into the
public domain.” 

 at 453–54. For instance, parties may
agree to royalties “equal to 10% of sales during the 20-year
patent term,” paid over 40 years. 

. “[P]arties have
still more options when a licensing agreement covers either
multiple patents or additional non-patent rights. Under
Brulotte, royalties may run until the latest-running patent
covered in the parties’ agreement expires.” 

 And parties
may agree to continuing royalties on non-patent rights that
are “closely related to a patent,” such as “a license involving
both a patent and a trade secret” that sets “a 5% royalty
during the patent period (as compensation for the two
combined) and a 4% royalty afterward (as payment for the
trade secret alone).” 

    We have applied Brulotte in two published opinions. 4

4
 We cited Brulotte in an additional opinion, issued mere weeks after
Brulotte was decided, but we simply noted that it was not applicable.
Atlas-Pac. Eng’g Co. v. Geo. W. Ashlock Co., 

, 289 n.1 (9th
Cir. 1964).
10              C.R. BARD, INC. V. ATRIUM MED. CORP.


    The first decision, Zila, Inc. v. Tinnell, 

(9th Cir. 2007), concerned a licensing agreement for a herpes
treatment. After applying for a patent, an inventor
transferred his intellectual property to Zila in exchange for
stock and a 5% perpetual royalty. 

. Zila then
secured several U.S. patents and one Canadian patent. 

Zila ultimately stopped paying royalties to the inventor,
invoking the Brulotte rule. 

.
    We noted the “unconvincing” economic basis of Brulotte
and stated that “our task is not to expand Brulotte’s holding.”

 at 1019–20. We first held that Brulotte had no effect on
Zila’s obligation to pay royalties for use of the Canadian
patent because Brulotte does not “extend its royalty-
canceling powers to contracts for foreign patents.” 

. We then held that Brulotte prohibited U.S. royalties
after the expiration of the final U.S. patent, and we remanded
for the district court to resolve a factual dispute related to
whether the final U.S. patent had already expired. 

 at
1025–27.
    We again applied Brulotte in Kimble v. Marvel
Enterprises Inc., 

 (9th Cir. 2013), aff’d sub
nom. Kimble, 

. 5 We considered a licensing
agreement for a toy that allowed a user to “mimic[] Spider-
Man’s web-shooting abilities with foam string.” 

 at 857–

5
   In reviewing our court’s judgment in Kimble, the Supreme Court
considered only whether to overrule Brulotte. 

. The
Supreme Court declined to do so and therefore affirmed our court’s
judgment. 

. Our opinion in Kimble remains binding circuit
precedent because the judgment was left undisturbed and because the
Supreme Court’s decision was in no way irreconcilable with our
analysis. See Miller v. Gammie, 

 (9th Cir. 2003) (en
banc) (holding that circuit precedent remains binding unless it is “clearly
irreconcilable” with an intervening Supreme Court decision).
             C.R. BARD, INC. V. ATRIUM MED. CORP.           11


58. Kimble, the patent-holder, settled an infringement and
breach of contract lawsuit with Marvel, which had been
selling a “Web Blaster.” Id. at 858. The terms of the
settlement agreement provided that Marvel would purchase
the patent from Kimble in exchange for a lump sum and an
ongoing royalty of 3% on both “product sales that would
infringe the Patent . . . as well as sales of the Web Blaster
product.” Id. at 858–59.
    We stated that, under Brulotte, royalties on sales of a
product that embodies both a patented invention and a non-
patent right (such as a trade secret) must “provide[] a
discount for the non-patent rights from the patent-protected
rate” after the patent expires. Id. at 863. “This is because—
in the absence of a discount or other clear indication that the
license was in no way subject to patent leverage—we
presume that the post-expiration royalty payments are for the
then-current patent use, which is an improper extension of
the patent monopoly under Brulotte.” Id. at 863–64.
    We concluded that the agreement’s post-expiration
royalties were barred by Brulotte. We noted that the 3%
royalty did not decrease upon expiration of the patent and
applied to “both patent and Web Blaster rights, with no
discount or other clear indication that the Web Blaster
royalties were not subject to patent leverage.” Id. at 864.
We rejected the idea that there were two separate royalties,
one for patent rights and one for the Web Blaster product,
explaining that the parties’ agreement referred both to patent
rights and to the Web Blaster product only because litigation
over whether the product actually infringed the patent was
ongoing at the time of the settlement. Id. We concluded that
“the rights were intertwined and [could not] be separated in
any principled manner.” Id. We therefore rejected the
argument that the case fell outside Brulotte because it
12            C.R. BARD, INC. V. ATRIUM MED. CORP.


concerned a “‘hybrid’ agreement, that coincidentally
included both patent and non-patent rights, as opposed to a
‘hybrid’ product, consisting of both patented and non-
patented ideas.” Id. at 865. We noted that “a discounted
[post-expiration] rate may not be necessary to avoid Brulotte
in every case,” but we held that “in the absence of a
discounted rate, there must be some other clear indication”
that the royalty was not for use of the patent after its
expiration. Id.
                              B.
    In this case, the district court made factual findings about
why the parties included the minimum royalty provision in
their licensing agreement. Those factual findings do not
control our review, however, because the application of the
Brulotte rule is a question of law that depends on the terms
of the contract at issue. The Brulotte inquiry does not turn
on the parties’ motivations, the course of their negotiations,
or the consideration received by either party in exchange for
the inclusion of a particular contractual term. Of course,
what the parties’ obligations are when a contractual
provision is ambiguous can be a factual question that turns
on what the parties intended the contract to require. But once
a factfinder has answered that question, whether the
contract’s requirements constitute patent misuse under
Brulotte is a question of law. Here, there is no dispute about
what the parties’ licensing agreement requires. There is only
a dispute about whether those requirements constitute patent
misuse under Brulotte. We review that question of law de
novo.
   Our conclusion that the Brulotte inquiry is a question of
law is consistent with every controlling precedent. In
Brulotte itself, the Supreme Court analyzed the “provisions
             C.R. BARD, INC. V. ATRIUM MED. CORP.          13


of the license agreements” at issue and held that the terms
were improper “on their face.” 379 U.S. at 31–32. The
Court did not inquire into the parties’ negotiations.
Consistent with that analysis, the Court later explained that
“[a] court need only ask whether a licensing agreement
provides royalties for post-expiration use of a patent.”
Kimble, 

.
    We have likewise treated the application of Brulotte as a
question of law turning on the terms of a licensing
agreement. In Zila, we applied Brulotte based on the terms
of the contract at issue. 502 F.3d at 1022–27. We did so
again in the Kimble decision that was reviewed by the
Supreme Court. See 727 F.3d at 864–66. To be sure, in
Kimble we noted a few extrinsic facts to provide context for
our analysis. For example, we noted that “[a]t the time the
parties negotiated the agreement, the patent infringement
claim was not definitively resolved.” Id. at 864. We used
that fact to determine that the parties’ agreement was not
referring to two distinct rights when it referred to patent
rights and rights to the “Web Blaster” product. Id. But our
Brulotte analysis turned on the requirements actually
imposed by the agreement, not the back-and-forth of the
negotiations through which the parties agreed to those terms.
See id. at 864–66 (observing that the parties’ agreement
provided for post-expiration royalties and lacked “any clear
indication that the Web Blaster royalties were not subject to
patent leverage”).
    Other circuits likewise apply the Brulotte rule by looking
at the terms of the agreement at issue. See, e.g., Meehan v.
PPG Indus., Inc., 

 (7th Cir. 1986) (“The
terms of the contract must be examined.”); Boggild v.
Kenner Prods., 

 (6th Cir. 1988) (declining
to remand for an inquiry into the parties’ bargaining
14              C.R. BARD, INC. V. ATRIUM MED. CORP.


history); 6 Pitney Bowes, Inc. v. Mestre, 

(11th Cir. 1983) (concluding that an agreement violated
Brulotte because of “two provisions in the agreement”). We
know of no published decision by any Court of Appeals that
treats the application of Brulotte as a factual question turning
on the parties’ motivations during negotiations.
    Treating the application of Brulotte as a factual inquiry
into the parties’ motivations would run afoul of the Supreme
Court’s statement that parties may “find ways around
Brulotte.” Kimble, 

. Parties seeking to find
a way around Brulotte may evince motivations that are in
some sense contrary to Brulotte, even if the unambiguous
terms of the agreement themselves are permissible. Indeed,
as this case illustrates, the parties themselves often cannot
cleanly or consistently identify their motivations for entering
into an agreement, and each party may value a given
provision differently. By contrast, looking only at the terms
of the agreement is consistent with both the Supreme Court’s
statement that Brulotte is “simplicity itself to apply,” 

, and our statement that “our task is not to expand
Brulotte’s holding beyond its terms,” Zila, 

.
                                  C.
    Having concluded that the Brulotte rule is a question of
law that we review de novo, we now turn to its application
in this case. We “need only ask whether a licensing
agreement provides royalties for post-expiration use of a
patent. If not, no problem; if so, no dice.” Kimble, 

. We emphasize that the parties do not dispute what

6
 One concurring judge explained Boggild as holding that the application
of Brulotte depends on “the terms of the license and that other evidence
of the motivation of the parties with respect to leverage is irrelevant.”
Boggild, 

 (Brown, J., concurring).
              C.R. BARD, INC. V. ATRIUM MED. CORP.              15


the terms of their contract require—only whether those
requirements are permissible under Brulotte.
    The licensing agreement terms unambiguously require a
15% per-unit royalty on U.S. sales until the expiration of the
U.S. patent and a 15% per-unit royalty on Canadian sales
until the expiration of the Canadian patent, which does not
violate Brulotte. The agreement states that Atrium will pay
“a royalty of fifteen percent (15%) of the Net Sales of all
Licensed Products sold during the Term.” “Licensed
Products” refers to covered products “that are made, used,
offered for sale and/or imported or sold in a country where
one or more claims of the Licensed Patents are issued and
outstanding.” And “Licensed Patents” refers to Bard’s U.S.
patent, as well as “all other patents . . . issued anywhere in
the world that rely on the [U.S.] patent for priority.” The
“Licensed Patents,” then, encompass the U.S. and Canadian
patents. The per-unit royalty provision plainly complies
with Brulotte because it simply provides royalties on each
respective patent only until that patent expires.
    Next, the minimum royalty provision establishes a
minimum amount due for the use of all unexpired patents in
their respective countries. The minimum royalty provision
states “in no event will royalties for any calendar quarter of
the Term be less than” $3.75 million ($15 million per year).
The agreement provides that the minimum royalty provision
would terminate only if the FDA approved iCast for vascular
use or rescinded approval for any use. Otherwise, the
agreement—and thus the minimum royalty provision—was
to remain in effect “until the last to expire of all of the patents
included within the Licensed Patents.” The last “Licensed
Patent” to expire was the Canadian patent in 2024. Thus,
absent another condition triggering the end of the minimum
payment provision, Atrium was required to pay Bard at least
16             C.R. BARD, INC. V. ATRIUM MED. CORP.


$3.75 million per quarter until the expiration of the Canadian
patent.
    We conclude that the minimum royalty provision also
complies with Brulotte. After the expiration of the U.S.
patent, the agreement provides for minimum royalties only
on Canadian sales, not U.S. sales. The provision therefore
does not provide for royalties on “post-expiration use” of the
U.S. patent. From 2011 to August 2019, the minimum
royalty provision applied to use of both the U.S. patent in the
United States and the Canadian patent in Canada. Beginning
in August 2019, when the U.S. patent expired, the minimum
royalties applied only to use of the Canadian patent in
Canada. Atrium was obligated to pay a 15% royalty, and no
less than $3.75 million per quarter, on its covered Canadian
sales. Atrium’s post-expiration U.S. sales were completely
irrelevant. Even if they had increased a thousand-fold, it
would not have affected the payments Atrium owed to Bard.
The agreement therefore does not “provide[] royalties for
post-expiration use” of the U.S. patent. Kimble, 

. Brulotte concerns only whether royalties are “by their
terms for use during” the post-expiration period. 

. It does not prohibit royalties that are, by their terms,
royalties for something other than use of the expired U.S.
patent. 7
    Atrium argues that the presence of U.S.-focused
conditions in the licensing agreement demonstrates that the
minimum royalties are royalties on U.S. sales. The
agreement contains two termination triggers for the
minimum royalties, providing that they shall cease if the

7
  We note that, even absent ongoing post-expiration sales in another
country, parties may contract for flat post-expiration payments that are
not a royalty for ongoing use. See Kimble, 576 U.S. at 453–54.
             C.R. BARD, INC. V. ATRIUM MED. CORP.          17


FDA grants approval for vascular use of the iCast stent or if
the FDA rescinds all previously approved iCast uses.
    Although those provisions certainly concern the U.S.
market, they do not affect the character of the royalties
provided for in the agreement. The fact that Atrium sells the
iCast stent only in the United States is wholly within
Atrium’s control. Had Atrium started selling it in Canada,
Atrium would have had to pay per-unit royalties for those
sales under the Canadian patent once the FDA approved it
for vascular use. And although the FDA is a U.S. regulator,
conditioning payments on possible FDA actions simply
serves to allocate risk between the parties. The minimum
royalty payments incentivized Atrium to seek prompt FDA
approval of vascular iCast uses, from which Bard stood to
benefit. On the other hand, had the FDA rescinded “its
approval to market or sell” iCast for “any and all” uses, such
an unexpected and drastic event would no doubt have had
significant consequences for Atrium’s finances, so that
provision guarded against a disastrous outcome for Atrium.
Neither of those provisions dictates whether the minimum
royalties are royalties on U.S. sales.
    Atrium also implies that the minimum royalty payments
at issue are not Canadian royalties—and are therefore
prohibited U.S. royalties—because they are far greater than
the 15% per-unit royalty on Atrium’s Canadian sales. We
reject that argument. A minimum royalty provision has
effect only if it may require payments greater than the per-
unit royalty. And Brulotte establishes a per se rule, so we
have no occasion to decide whether the size of a royalty is
reasonable. See Kimble, 

 (declining to
replace Brulotte’s per se rule with a reasonableness
analysis). Whether $3.75 million per quarter is a reasonable
18           C.R. BARD, INC. V. ATRIUM MED. CORP.


royalty for Atrium’s Canadian sales does not affect whether
such payments are Canadian royalties.
    Finally, Atrium suggests that the minimum royalty
provision violates Brulotte because the amount of the
minimum royalties is not discounted upon expiration of the
U.S. patent. We disagree. That argument stems from the
rule concerning post-expiration royalties on U.S. sales of
products that implicate both a patent and a non-patent right.
If such post-expiration royalties reflect a discount compared
to the pre-expiration royalties, that discount indicates that
the portion of the royalty attributable to the patent right has
properly ended upon the patent’s expiration. That rule is not
applicable here because the royalties at issue are not
royalties on sales reflecting “inseparable patent and non-
patent rights.” Kimble, 

.
    The parties’ agreement provides for U.S. royalties only
through the expiration of the U.S. patent, so it does not
constitute patent misuse under Brulotte.
                             IV.
    For the foregoing reasons, we reverse the district court’s
entry of judgment for Atrium on Bard’s breach of contract
claim.