Exclusive patent license deemed non-assignable
In a non-bankruptcy case, Proteotech, Inc. v. Unicity International, Inc., 542 F. Supp. 2d 1216; 87 U.S.P.Q. 2d 1317
(W.D. Wash.), a Federal District Court has held that an exclusive patent license is not freely assignable absent the licensor's consent. In reaching this decision, the Court reached out to the bankruptcy court decisions in In re Hernandez
, 285 B.R. 435 (Bankr. D. Ariz. 2002) and In re Aerobox Composite Structures
, 373 B.R. 135 (Bankr. D.N.M. 2007).
The plaintiff, Proteotech, had granted an exclusive patent license to Rexall Sundown, Inc. The license did not contain any relevant provisions regarding sublicensing of the patent rights. Rexall then granted a non-exclusive license of the technology to the defendant, Unicity. In 2006, Proteotech sued Unicity alleging patent infringement, among other things. Proteotech claimed that because Rexall had no authority to sublicense the patent rights, Unicity had not received any right to practice the patent and thus was violating the patent.
The Court noted the controlling precedent of In re CFLC, Inc. (Everex)
with respect to non-exclusive patent licenses, but still was faced with the question of whether an exclusive patent license was non-assignable. Following Hernandez
, the District Court held that exclusive patent licenses are, by default, non-assignable.
Labels: assignment, patent license, patents