MHL TEK v. Nissan, Hyundai, KIA, Porsche, Subaru, Audi, Volkswagen and BMW (Fed. Cir. 2011)
MHL purported to obtain its patents from Animatronics and the inventors who themselves own MHL. However, Animatronics had already assigned a number of patent rights to a third-party, McLaughlin Electronics. The basic standing question for the case is whether the McLaughlin assignment encompassed the patents-in-suit. If so, then the later assignment to MHL was ineffective and the plaintiff had no standing to sue.
The McLaughlin assignment purported to assign “the inventions and discoveries set forth in [a different patent] application.” The parties all admitted that the assignment language was broad enough to encompass more than just the single application listed in the assignment. In considering the language of the assignment, the appellate court broadly held that the assignment was also not limited to “family member” applications linked by a priority claim. Rather, the test given by the assignment is simply whether the patent “claims inventions and discoveries set forth in the [original] application.” Here, the court focused on the claims of the patent-in-suit (the ’516 patent) because “the claims of the patent define the invention” and basically conducted a written-description analysis to determine whether at least one of those claims were described in the specification of the original application. The court considered claim 1 of the ’516 patent and found that its subject matter was fully disclosed by the originally assigned patent. Without explanation, the court then held that this single claim relationship was sufficient to render the entire patent within the assignment agreement. Thus, the functional interpretation of the assignment language was that the assignment encompassed any patent that included at least one claim that was reasonably described by the original specification.
The court also held that two continuations of the originally assigned application had also been transferred to McLaughlin through the assignment.
Finally, the court walked through a “carve-out” in the assignment that retained ownership for Animatronics for patents that “concern” certain identified “proprietary inventions.” Taking a technical view of the carve-out provision, the Federal Circuit looked at each patent claim of the asserted patents to determine whether any patent claims covered a proprietary invention as defined in the assignment. Although the court identified some similarity, the court could not find any claims whose scope could be said to cover one of the defined proprietary inventions. And therefore, the appellate panel affirmed that rights to those patents had been previously assigned by Animatronics and that MHL had no standing to sue on those patents.