EDVA Court Dismisses Patent Infringement Claims For Lack of Standing
In a December 18 decision, the U.S. District Court in Richmond dismissed seven claims of patent infringement for lack of standing because the plaintiff did not have the exclusive right to license the patent.
In WiAV Solutions LLC v. Motorola, Inc., et al., Case No. 3:09CV447 (E.D. Va. Dec. 18, 2009), WiAV brought claims of infringement of nine patents involving wireless communication technology against multiple defendants. Seven of the patents (the “Mindspeed Patents”) had been assigned to Mindspeed Technologies, which was named in the case as defendant patent owner.
The defendants moved to dismiss the claims related to the Mindspeed patents for lack of standing. In a December 18, 2009 decision, Judge Robert E. Payne ruled that WiAV lacked constitutional standing because it was not an exclusive licensee of the patent. The key points from Judge Payne’s opinion:
- To show that a case or controversy exists, a plaintiff must meet both constitutional and prudential standing requirements.
- To have constitutional standing, a plaintiff in a patent suit must have both the contractual right to bring suit and the right to exclude others from making, using, selling or offering to sell the patented invention.
- A party with “all substantial rights” under a patent or an exclusive licensee of a patent in a field of use has standing to sue but a “bare licensee” has no standing.
- A licensee which is granted an exclusive license subject to prior, nonexclusive licenses has standing as an exclusive licensee.
- A licensee is not an exclusive licensee, however, if others retain the right to grant additional licenses, even when the right to sublicense is limited to subsidiaries and affiliates.
The Mindspeed Patents had been transferred and licensed through a complicated series of agreements. At least four other parties retained the right to grant new licenses in the field of wireless handsets, defeating WiAV’s claim of exclusivity.
Judge Payne rejected WiAV’s request to adopt a new legal principle that, if a grantor retains a limited right to sublicense, it does not defeat exclusivity because WiAV could have alleviated the standing issue at the time it contracted for its rights and because WiAV’s request ran against well-accepted legal principles.
