June 8, 2015 – The Federal Circuit held Alps South did not have proper standing to bring suit against Ohio Willow Wood for patent infringement. An exclusive licensee to whom “all substantial rights in the patent” are transferred has standing to sue in its own name. But, if a licensee does not hold all substantial rights, it may only sue third parties as a co-plaintiff with the patentee. The Federal Circuit found that “an exclusive licensee with less than all substantial rights, such as a field of use licensee, [must] join the patentee before initiating suit.”
Here, the Federal Circuit agreed that Alps South’s original license agreement was an exclusive license that conferred the rights to exclude and to pursue infringement litigation, but the court found that it did not confer all substantial rights on Alps South. Language in the original license demonstrated that the licensor retained certain rights for itself and restricted Alps South’s rights in significant ways, e.g., by limiting it to practicing and enforcing the patent in the field of prosthetic products. Therefore, because Alps South was merely an exclusive field of use licensee, it did not possess all substantial rights in the patent and lacked standing to sue without naming the licensor as a co-plaintiff.
The patent-at-issue is U.S. Patent No. 6,552,109, which relates to “liners” used as a cushioning and protective layer between the residuum of an amputated limb and a prosthetic limb. The case is captioned Alps South, LLC v. The Ohio Willow Wood Co., 2013-1452, -1488, 2014-1147, -1426.
By: Christopher J. Stankus