Co-Ownership Of Patent

  • All Co-Owners Must Consent To Join Suit For Any Co-Owner To Have Standing: Must join all legal-title co-owners of the patent as plaintiffs. Waterman (U.S. 02/02/1891); Advanced Video II (Fed. Cir. 01/11/18) (2-1) (aff’g dismissal of complaint for lack of standing because co-owner not a party); Israel Bio-Engineering (Fed. Cir. 01/29/07) (aff’g Summ. J. of no statutory standing; “a co-owner acting alone will lack [prudential] standing”). Typically co-owner can resist such joinder notwithstanding FRCP 19(a), unless has granted exclusive license to the plaintiff or has waived right not to join. UNM (Fed. Cir. 06/06/14) (2-1) (“the right of a patent co-owner to impede an infringement suit brought by another co-owner is a substantive right that trumps the procedural rule for involuntary joinder under Rule 19(a)”; aff’g lack of standing), rehearing en banc denied (6-4) (Fed. Cir. 09/17/14). Each co-owner (legal title) of a patent must consent to join a suit enforcing the patent. DDB Tech. (Fed. Cir. 02/13/08) (exceptions to rule that a co-owner cannot be involuntarily joined are (1) an exclusive licensee may join the patent owner as an involuntary plaintiff in an infringement suit, and (2) a co-owner who, by agreement, waives his right to refuse to join suit, may be forced to join an infringement suit); Ethicon (Fed. Cir. 02/03/98) (dismissing suit where co-owner refused to join); Schering (Fed. Cir. 01/08/97) (“‘one co-owner has the right to impede the other co-owner’s ability to sue infringers by refusing to voluntarily join in such a suit.’”)
    • Note: Rule that co-owners cannot be joined by Rule 19(a) may be susceptible to challenge as patent exceptionalism. See Advanced Video II (Fed. Cir. 01/11/18) (2-1) (O’Malley, J., concurring op.) (long discussion of why court’s precedents are wrong).
    • Note: While some decisions refer to this as prudential (statutory) standing, if the absent co-owner had the right to license the accused infringer, then this is a matter of Constitutional Standing. Cf. WiAV Solutions (Fed. Cir. 12/22/10) (rev’g dismissal for lack of Art. III standing; exclusive licensee has “constitutional standing” where accused party cannot obtain a license from the absent licenseor. The touchstone of constitutional standing in a patent infringement suit is whether a party can establish that it has an exclusionary right in a patent that, if violated by another, would cause the party holding the exclusionary right to suffer legal injury…. “An exclusive licensee lacks standing to sue a party who has the ability to obtain such a license from another party with the right to grant it. In both of these scenarios, the exclusive licensee does not have an exclusionary right with respect to the alleged infringer and thus is not injured by that alleged infringer.”)
  • Co-Owner Can Grant License Under Patent Without Consent Of Or Recourse By Other Owner: “Each co-owner of a United States patent is ordinarily free to make, use, offer to sell, and sell the patented invention without regard to the wishes of any other co-owner. Each co-owner’s ownership rights carry with them the right to license others, a right that also does not require the consent of any other co-owner.” Schering (Fed. Cir. 01/08/97) (but, absent agreement to the contrary, a co-owner cannot grant a release of another co-owner’s right to accrued damages). Look for possible co-owners and try to bargain with them for a covenant not to sue.

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