Property, intangible

a blog about ownership of intellectual property rights and its licensing

Neither Fish Nor Fowl

Ah, here’s an interesting one. The plaintiff claims to be an exclusive patent licensee, the defendant is the United States, the case properly filed in the Court of Federal Claims, and the defendant has challenged standing. But rather than the usual situation where the court is examining whether enough rights were transferred for the license to be considered “exclusive,” we have a bit of a different twist:

[T]he Government asserted that the WRF–NG Agreement only granted NG the right to bring infringement actions against a “Third Party.” The Agreement expressly provided a definition of “Third Party”: “any individual, corporation, partnership or other business entity other than WRF, Licensee, Affiliates and Sublicensees.”

What’s missing? The government is neither an individual, corporation, partnership nor other business entity.

The plaintiffs argued that the intent of the paragraph was clear, to simply exclude the patent owner and its licensees as potential defendants. But the court wasn’t having any part of it:

The Court is not persuaded by the Plaintiffs’ attempts to expand the scope of the contract beyond the plain meaning of its language. “The fundamental principle in contract construction is to interpret the contract to carry out the intent of the parties, as that intent is evidenced by the contractual language.” Restatement (Second) of Contracts § 8:12 (1981). The contractual language is quite clear: “Third Party” is limited to a set of entities, and plainly the Government does not fall within any of the classes of entity defined in the contract.

The court reviews other arguments made by the plaintiffs but finds none persuasive enough:

All told, the only pieces of evidence that even arguably support an intention of the parties to transfer to NG the right to sue the United States are the ambiguous Recital provision and this lawsuit–neither of which constitute clear evidence of intent. Nothing else indicates any intent to transfer the rights. Because nothing solidly evidences any intent either way, the Court is left to return to the plain language of the definition adopted by the parties.

Neurografix v. U.S., No. 12-385C (June 7, 2013).

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