Federal Circuit Reverses EDVA Dismissal of Patent Infringement Claims For Lack of Standing
As reported previously here, in WiAV Solutions LLC v. Motorola, Inc., et al., Case No. 3:09CV447, Judge Robert E. Payne dismissed seven claims of patent infringement for lack of standing because the plaintiff did not have the exclusive right to license the patent. Plaintiff WiAV had licensed seven of the nine patents at issue from Mindspeed Technologies (which was also named in the case as defendant patent owner). In a December 18, 2009 decision, Judge Payne ruled that WiAV lacked constitutional standing because it was not an exclusive licensee of the patents. Judge Payne later certified WiAV’s appeal of that decision to the Federal Circuit, as reported here.
On December 22, 2010, the Federal Circuit (Judge Linn, joined by Chief Judge Rader and Judge Dyk) reversed Judge Payne. After reciting the history of the patents at issue, which included a complicated series of license agreements with six other entities, the Court framed the issue thusly:
Because an exclusive licensee derives its standing from the exclusionary rights it holds, it follows that its standing will ordinarily be coterminous wit those rights. Depending on the scope of its exclusionary rights, an exclusive licensee may have standing to sue some parties and not others…. [I]f an exclusive licensee has the right to exclude others from practicing the patent, and a party accused of infringement does not possess, and is incapable of obtaining, a license of those rights from any other party, the exclusive licensee’s exclusionary right is violated.
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The question is whether WiAV has shown that it has the right under the patents to exclude the Defendants from engaging in the alleged infringing activity and therefore is injured by the Defendants' conduct.
Id.at 17-18 (emphasis in original) (a copy of the opinion can be found here). The Federal Circuit answered this question in the affirmative, finding that WiAV, while not the exclusive licensee of the patents at issue, had exclusionary rights vis-à-vis the Defendants. The fact that the six other licensees of the patents retained rights to grant additional licenses did not defeat WiAV’s standing because those six other licensees had limited licensing rights and could not grant a license to the particularly Defendants sued by WiAV.
Accordingly, the Federal Circuit reversed Judge Payne’s decision and remanded the case for further proceedings.
