Exclusive License Agreement Limits Licensee’s Rights to Bring Suit
PATENT LICENSEE LACKED STANDING TO BRING SUIT DUE TO FIELD OF USE RESTRICTION
June 8, 2015
Alps South, LLC v. The Ohio Willow Wood Co. 13-1452-- On Friday in an opinion by Judge CHEN, the Federal Circuit overturned a district court’s denial of a motion to dismiss for lack of standing. The patent claimed composites of thermoplastic gels with foam or fabric substrates. Alps obtained an exclusive license to make cushioning liners for prosthetic limbs. Ohio argued the license did not convey sufficient rights in the patent to provide Alps with standing to bring the suit without joining the patentee under Patent Act section 281.
The Federal Circuit agreed with Ohio. The license agreement restricted Alps’s rights in significant ways such as limiting Alps’s right to exclude to the prosthetic liner field of use. The “clear rule for cases involving licenses with field of use restrictions” required naming the patentee as a co-plaintiff before bringing suit. A later “nunc pro tunc” assignment attempting to grant Alps sufficient rights could not confer retroactive standing.