Assuring All Substantial Rights in Exclusive Patent Licenses

Jeff Newton, Avago Technologies

Abstract

Despite their best of intentions, parties draft license agreements which purport to have the patentee grant sufficient rights for a licensee to assert a patent against third parties, but fail to grant all substantial rights to sue. The surprising number of cases decided against the intended transfer of all substantial rights to empower a licensee to sue on a patentee is a testimony to the complexity of the jurisprudence in this area. This article clarifies the jurisprudence as to all substantial rights in patent licenses by reviewing the primary categories in a licensing transactions, analyzing thirteen key cases on point from the United States Court of Appeals for the Federal Circuit, and suggesting fifteen practice pointers from the various decisions to assist practitioners in drafting exclusive licenses with all substantial rights which licenses will be upheld as originally intended.