Property, intangible

a blog about ownership of intellectual property rights and its licensing

Standing or Not? Answer Tomorrow

Here are the facts, you decide who owns the patent. Court’s decision this time tomorrow.

The original owner of the patent was Balsam Coffee Solutions, Inc. On June 9, 2005, Balsam assigned the patent to San Marco Roasters, Inc. The two inventors on the patent were co-owners of both companies. More than a year later, on September 30, 2006, Balsam and San Marco executed an agreement that said:

1. [San Marco] intends to purchase U.S. patent number[] 6,861,086 . . . and agrees to pay [Balsam] based on the terms set out on invoice number 001604 dated September 30, 2006.

2. If it appears [San Marco] will have problems paying for the above noted items and at [Balsam’s] sole discretion, this agreement may be terminated and the rights and ownership shall remain with [Balsam] upon giving notice and returning any payments made to them in regards to the above noted invoice.

3. Ownership and all rights in respect of the above noted patent[] . . . shall remain with [Balsam] until paid in full.

San Marco then tried for a couple of years to sell the patent, representing that it had “100% ownership interest in” the patent. On August 27, 2008, Balsam decided that San Marco was incapable of performing under the terms of the 2006 agreement and terminated it.

On February 27, 2009, Balsam filed a patent infringement suit against Folgers Coffee. Folgers filed a motion to dismiss, claiming that there was no subject matter jurisdiction because Balsam was not the owner of the patent. On August 3, 2009, San Marco assigned the patent to Balsam as “belt-and-suspenders,” then filed a second suit.

Did Balsam own the patent at the time of the original suit? Answer this time tomorrow.

© 2009 Pamela Chestek

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