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Alfred E. Mann Found. for Sci. Research v. Cochlear Corp.

United States Court of Appeals for the Federal Circuit

May 14, 2010, Decided

2009-1447

Opinion

 [***1322]  [*1357]   MICHEL, Chief Judge.

The Alfred E. Mann Foundation for Scientific Research ("AMF") is a research organization interested in developing new medical technologies, including cochlear implants. Cochlear Corporation and Cochlear Ltd. (collectively, "Cochlear") are companies that build cochlear implants for use in human patients. AMF sued Cochlear for patent infringement, and the district court dismissed the case for lack of standing to sue. At issue is a 2004 agreement between AMF and Advanced Bionics ("AB"), another company that  [**2] builds cochlear implants, granting AB an exclusive license to the patents that AMF later accused Cochlear of infringing. Cochlear contends, and the district court held, that this agreement was a virtual assignment of the patents-in-suit to AB, giving AB the sole right to sue for infringement of those patents. We find that AMF is the owner of the patents-in-suit because it retained substantial rights in the patents, including the right to sue for infringement if AB declines to do so. Accordingly, we reverse the district court's holding that AMF lacked standing to sue, and we remand for proceedings consistent with this opinion.

I. BACKGROUND

In the mid-1980s, Alfred E. Mann, an inventor of medical devices, founded AMF to develop new medical technologies. AMF conducts research aimed at developing implantable medical devices that can improve health, safety, and quality of life. Among these technologies are cochlear implants, devices that are placed in the inner ear to allow profoundly deaf or severely hard-of-hearing patients to regain their ability to hear. Cochlear implants are sometimes referred to as "bionic ears." The patents-in-suit, U.S. Patent No. 5,609,616 ("the '616 patent") and  [**3] U.S. Patent No. 5,938,691 ("the '691 patent"), disclose and claim cochlear implants and related technologies used to improve hearing. These patents were issued to researchers at AMF, and those researchers assigned the patents to AMF.

As a source of funding for its research work, AMF licenses its patents to for-profit companies that build medical devices. Here, the '616 patent and the '691 patent were licensed to AB under a license agreement entered into in 2004. The license agreement granted AB the following rights:

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604 F.3d 1354 *; 2010 U.S. App. LEXIS 9862 **; 95 U.S.P.Q.2D (BNA) 1321 ***

ALFRED E. MANN FOUNDATION FOR SCIENTIFIC RESEARCH, Plaintiff-Appellant, v. COCHLEAR CORPORATION and COCHLEAR LTD., Defendants-Appellees.

Subsequent History: Motion granted by, in part, Motion denied by, in part, Motion denied by, Motion denied by, As moot Alfred E. Mann Found. for Scientific Research v. Cochlear Corp., 2014 U.S. Dist. LEXIS 197541 (C.D. Cal., Jan. 3, 2014)

Findings of fact/conclusions of law at, Judgment entered by Alfred E. Mann Found. for Scientific Research v. Cochlear Corp., 96 F. Supp. 3d 1028, 2015 U.S. Dist. LEXIS 42277 (C.D. Cal., Mar. 31, 2015)

Motion granted by, in part, Motion denied by, in part, Motion denied by, As moot Alfred E. Mann Found. for Sci. Research v. Cochlear Corp., 2015 U.S. Dist. LEXIS 182400 (C.D. Cal., Mar. 31, 2015)

Motion denied by, Motion granted by, Costs and fees proceeding at Alfred E. Mann Found. For Sci. Research v. Cochlear Corp., 2018 U.S. Dist. LEXIS 223877 (C.D. Cal., Nov. 4, 2018)

Prior History:  [**1] Appeals from the United States District Court for the Central District of California in case no. 07-CV-8108, Judge George H. King.

Disposition: REVERSED AND REMANDED.

CORE TERMS

infringement, patent, licensee, rights, licensor, right to sue, license agreement, sublicense, Cochlear, patents-in-suit, district court, exclusive license, license, bring suit, transferred, substantial rights, standing to sue, decisions, illusory, implants, parties, settle, initiated, suspected, joined, assigned, argues

Civil Procedure, Justiciability, Standing, General Overview, Patent Law, Jurisdiction & Review, Standards of Review, De Novo Review, Business & Corporate Compliance, Ownership, Conveyances, Assignments, Licenses, Appeals, Contracts Law, Contract Interpretation, Questions of Fact & Law, Parol Evidence, Joinder of Parties, Compulsory Joinder, Indispensable Parties, Infringement Actions, Royalties, Standards of Performance