Park B. Smith, Inc. v. Chf Industries Inc., 2011 U.S. Dist. LEXIS 74696

PBS Inc. filed a patent infringement action against CHF alleging the Pole-Top Roman Shade design infringed PBS's '651 and '039 design patents.
The court granted summary judgment of noninfringement in 2008, but the Federal Circuit vacated and remanded in 2009 after Egyptian Goddess clarified the design-patent standards.
PBS moved to substitute PBS Ltd. as plaintiff; CHF challenged standing; PBS also sought to amend the complaint to add Walmart as a defendant and assert new patent and unfair-competition claims.
Discovery and briefing proceeded; it was later revealed that PBS Ltd. is the owner/assignee of the '651 and '039 patents, not PBS Inc., due toface-notation vs. underlying assignments.
The court concluded PBS Inc. lacked constitutional standing at filing but allowed substitution under Rule 17(a)(3) to substitute PBS Ltd., denying CHF's Rule 41(b) dismissal as moot.
CHF then moved for summary judgment on noninfringement or invalidity, and PBS moved to amend, which the court denied in part; PBS Ltd. substitution was granted and the other motions were denied.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether PBS Inc. had standing at filing	PBS Inc. was exclusive licensee with standing.	PBS lacked standing; substitution cannot cure jurisdiction.	PBS Inc. lacked constitutional standing at filing.
Whether PBS Ltd. can be substituted as plaintiff to cure standing	Rule 17(a)(3) permits substitution to cure a jurisdictional defect when the change is formal and non-prejudicial.	Substitution cannot cure standing defects in patent cases.	Substitution of PBS Ltd. as plaintiff pursuant to Rule 17(a)(3) is allowed; dismissal denied as moot.
Whether the case should be dismissed for lack of standing after substitution	Substitution cures jurisdiction; action may proceed.	Remaining standing defects could doom the case.	Dismissal denied; case proceeds with PBS Ltd. as plaintiff.
Whether PBS's design patents are invalid as anticipated by prior art	Prior art does not disclose all claim features; no anticipation.	Blue Toile Shade discloses the claimed features; anticipation established.	Summary judgment of invalidity denied due to genuine issues of material fact.
Whether PBS's proposed amendments to add Walmart and new claims should be granted	Amendments would not unduly delay or prejudice; necessary for substantial justice.	Delay and prejudice; Walmart addition and new claims should be denied.	Amendment requests denied; Walmart addition and new claims not permitted.

Morrow v. Microsoft Corp., 499 F.3d 1332 (Fed. Cir. 2007) (licensee lacks standing without exclusionary rights)
Advanced Magnetics, Inc. v. Bayfront Partners, Inc., 106 F.3d 11 (2d Cir. 1997) (substitution under Rule 17(a)(3) requires mistake and no prejudice)
Hackner v. Guaranty Trust Co. of New York, 117 F.2d 95 (2d Cir. 1941) (illustrates substitution principles in standing context)
National Maritime Union of Am. v. Curran, 87 F. Supp. 423 (S.D.N.Y. 1949) (court discretion to substitute to satisfy jurisdiction)
Tyco Healthcare Group LP v. Ethicon Endo-Surgery, Inc., 587 F.3d 1375 (Fed. Cir. 2009) (dismissal for lack of standing ordinarily without prejudice)
Loral Fairchild Corp. v. Matsushita Elec. Indus. Co., 266 F.3d 1358 (Fed. Cir. 2001) (credibility and corroboration concerns in invalidity determinations)
Wiwa v. Royal Dutch Petroleum Co., 2009 WL 464946 (S.D.N.Y. 2009) (mistake prong requires absence of bad faith; prejudice analyzed)
Park B. Smith, Inc. v. CHF Indus., Inc., 2008 WL 650339 (S.D.N.Y. 2008) (prior summary-judgment framework and point of novelty analysis pre-Egyptian Goddess)
Crocs, Inc. v. Int'l Trade Comm'n, 598 F.3d 1294 (Fed. Cir. 2010) (ordinary observer test interpreted in light of prior art)
Egyptian Goddess, Inc. v. Swisa, Inc., 543 F.3d 665 (Fed. Cir. 2008) (refined ordinary observer test for design-patent validity against prior art)