879 F.3d 1314
Fed. Cir.2018Background
- The dispute concerns ownership and standing to sue over U.S. Patent No. 5,781,788 (the ’788 patent), a patent naming three co‑inventors: Woo, Li, and Vivian Hsiun.
- Hsiun was employed by Infochips and signed a 1992 Employment Agreement containing "will assign," trust, and quitclaim provisions relating to inventions made during employment; she refused to sign a PTO assignment later.
- Infochips ceased operations; its receivables and assets passed through Lease Management and ultimately to Woo and AVC, which prosecuted the patent application and obtained the issued ’788 patent; AVC later dissolved and assets were transferred to Advanced Video.
- Advanced Video sued alleged infringers but the district court dismissed for lack of standing, finding Hsiun remained a co‑owner and had not transferred her ownership to Advanced Video; Advanced Video appealed.
- The Federal Circuit affirmed, holding the Employment Agreement did not effect an immediate present assignment of Hsiun’s ownership interests (the “will assign” and trust language did not transfer legal title and the quitclaim applied only to rights already assigned).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the Employment Agreement’s "will assign" language effected a present assignment of Hsiun’s patent ownership | "Will assign" created immediate assignment to Infochips (thus eventual transfer to Advanced Video) | "Will" is a promise to assign in the future, not a present transfer | No present assignment; "will assign" did not transfer legal title |
| Whether the trust language created an effective transfer of Hsiun’s ownership to Infochips | Holding rights "in trust for the sole right and benefit of the Company" transferred ownership or at least allowed enforcement by successors | Even if a trust arose, the trustee (Hsiun) retained legal title; beneficiary cannot maintain infringement suit absent trustee or enforcement action | Trust, if any, did not produce transferable title to Infochips; Advanced Video lacks standing absent enforcement against trustee |
| Whether the quitclaim provision effected a present transfer of any ownership Hsiun had | The quitclaim of "any and all claims ... resulting from any such application assigned hereunder" covered rights that were to be assigned and thus operated to transfer Hsiun’s interest | The quitclaim only waived/quitclaimed rights that had actually been assigned under the agreement; where no assignment occurred it had no effect | Quitclaim did not apply because no prior assignment occurred; it did not transfer Hsiun’s ownership |
| Whether Advanced Video had standing to sue without Hsiun as a party | Transfer chain (Employment Agreement → Infochips → Lease Management → Woo → AVC → Advanced Video) vested ownership in Advanced Video | Hsiun retained an ownership interest; she was not joined or consenting, so Advanced Video lacked standing | Advanced Video did not have full ownership and thus lacked standing; dismissal affirmed |
Key Cases Cited
- Arachnid, Inc. v. Merit Indus., Inc., 939 F.2d 1574 (Fed. Cir. 1991) ("will be assigned" language is promise, not present assignment)
- Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456 (Fed. Cir. 1998) (co‑owner licensing and effect on accrual of damages and consent issues)
- Schering Corp. v. Roussel‑UCLAF SA, 104 F.3d 341 (Fed. Cir. 1997) (co‑ownership agreements and licensing implications)
- Willingham v. Lawton, 555 F.2d 1340 (6th Cir. 1977) (discusses involuntary joinder of co‑owners; background on co‑owner rights)
- IpVenture, Inc. v. ProStar Comput., Inc., 503 F.3d 1324 (Fed. Cir. 2007) (discussion of necessary parties and joinder in patent suits)
- Jim Arnold Corp. v. Hydrotech Sys., 109 F.3d 1567 (Fed. Cir. 1997) (party must obtain title via state‑law claim before suing for infringement in some contexts)
- Abrams Bioscience, Inc. v. Navinta LLC, 625 F.3d 1359 (Fed. Cir. 2010) (standing principles for patent plaintiffs)
- DDB Techs., L.L.C. v. MLB Advanced Media, L.P., 517 F.3d 1284 (Fed. Cir. 2008) (procedural references to joinder and prior decisions)
- STC.UNM v. Intel Corp., 754 F.3d 940 (Fed. Cir. 2014) (panel precedent addressing involuntary joinder of patent co‑owners)
- Provident Tradesmens Bank & Tr. Co. v. Patterson, 390 U.S. 102 (U.S. 1968) (Rule 19 governs joinder questions; procedural rule applies broadly)
- Waterman v. Mackenzie, 138 U.S. 252 (U.S. 1891) (principles on transfers and joint ownership of patent rights)