Judge Andrews Denies Motion to Dismiss for Lack of Standing
March 17, 2016
Publication| Intellectual Property
In EMC Corporation, et al. v. Pure Storage, Inc., C.A. No. 13-1985-RGA (D. Del. Feb. 29, 2016), Judge Andrews denied Pure Storage, Inc.’s challenge to EMC Corporation’s (“EMC”) standing to sue for infringement. Originally, the patents in suit were assigned by the co-inventors to Data Domain, Inc. EMC acquired Data Domain, Inc. in 2009 (which later became New Data Domain) and engaged in a number of transfers and transactions through which the patents-in-suit were first licensed and assigned to EMC International Company (“EIC”) and subsequently, “all right, title and interest” in New Data Domain’s intellectual property was transferred to plaintiff EMC.
The threshold question in deciding the standing inquiry was the nature and scope of the parties’ right to sue for infringement. The plaintiffs argued that the license agreement to EIC granted only a limited exclusive license to EIC but that New Data Domain expressly retained the primary right to sue and control litigation for infringement, which it subsequently assigned to EMC. Conversely, the defendant contended that the license agreement “granted an exclusive license to EIC of ‘all substantial rights’ in New Data Domain’s intellectual property, including the right to sue.” Thus, New Data Domain’s later assignment of intellectual property to EMC did not include the authority to control and direct litigation.
Applying Massachusetts law, the Court found the agreements unambiguous and agreed with the plaintiffs: “New Data Domain retained the primary right to sue for infringement in the EIC License Agreement and subsequently assigned that right to EMC Corporation.”
Analysis: Although other rights possessed by a licensee support standing (i.e., possession of the right to make and use the embodiments and to license the patents in suit), the licensee’s “non-illusory right to institute and control infringement litigation is the most important consideration in support of its standing to sue for infringement of the  patents.”