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In another significant set-back for patent plaintiffs, the Supreme Court in Microsoft v. AT&T Corp. held that merely shipping a master disk containing software code to overseas computer manufacturers for copying and installation on new computers is insufficient to create infringement liability for those copies installed on the foreign-manufactured machines.

In a potentially far-reaching decision on patent validity, the Supreme Court held in KSR Int’l Co. v. Teleflex Inc. that the determination of whether the subject matter of a patent claim is obvious is an "expansive and flexible" legal inquiry, and that the Federal Circuit's test requiring a specific "teaching, motivation, or suggestion" to combine prior art references (the so-called "TSM" test) must not be applied rigidly.