Property, intangible

a blog about ownership of intellectual property rights and its licensing

Standing or Not? Answer

Here is the answer to yesterday’s post:

The court held that Balsam was the owner of the patent and therefore had standing to bring suit. Although San Marco was the owner of the patent in 2005, the court found that the 2006 agreement evidenced intent that Balsam immediately possess title to the patent and hold it until San Marco had satisfied certain conditions. San Marco did not satisfy them, so the patent remained with Balsam. San Marco’s claim that it had “100% ownership interest” in the patent was consistent with the parties intent; if San Marco found a buyer it could have satisfied the conditions for ownership of the patent, therefore having full ownership to transfer to the buyer.

So the 2006 agreement transferred ownership of the patent from San Marco back to Balsam and was simultaneously a conditional purchase of the patent by San Marco back from Balsam. Although assignments have to be in writing, the court found that the 2006 document satisfied the writing requirement.

Folger’s argument, that the 2006 agreement was void ab initio because it was a mutual mistake between the parties, was sensible, but wrong. At most the agreement was voidable by an adversely affected party, either San Marco or Balsam, but neither had asked to have the agreement set aside. Balsam therefore had standing as September 30, 2006, including for the suit against Folgers filed in 2009.

Balsam Coffee Solutions Inc. v. Folgers Coffee Co., No. 6:09-CV-89, 2009 WL 3297292 (E.D. Tex. Oct. 14, 2009).

© 2009 Pamela Chestek

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