Licensing Flashcards
(137 cards)
1
Q
What is an assignment?
A
The transfer of all rights to another party.
2
Q
What is a license?
A
A transfer of some rights to another but not title.
3
Q
What is ambiguity?
A
When a word or phrase has two or more possible meanings
4
Q
What is vagueness?
A
When the meaning of the word or phrase is unclear.
5
Q
What is an “exclusive license”?
A
When a licensor has “all substantial rights” under the patent.
6
Q
Can an exclusive license holder sue for past infringement before obtaining a license?
A
No, only infringement that occurs from the effective date of the license.
7
Q
Who has standing to sue for patent infringement?
A
- Patent holders
- Original
- Assignees
- Exclusive Licensees
8
Q
Can the right to sue for past infringement be granted?
A
Yes,
Express grant to allow a successor in title to sue for past infringement is allowed.
Abraxis
9
Q
Can an “exclusive licensee” sue someone for infringement on their own?
A
Yes,
but only if they possess “all substantial rights” to the patent.
10
Q
What is a non-exclusive license?
A
A promise by the licensor not to sue the licensee for using the Patent (other IP).
11
Q
What is rule 19(b) of Federal Civil Procedure?
A
Persons Required to be joined if feasible
(1) Required Party. A person who is subject to service of process and whose joinder will not depreive the court of subject-matter jurisdiction must be joined as a party if:
(b) that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person’s absence may:
(i) as a practical matter impair or impede the person’s ability to protect the interest: or
(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.
12
Q
Is infringement considered a case or controversy to have constitutional standing?
A
Yes when,
“The patent owner asserts their rights based on certain identified ongoing or planned activity of another party and that party did not have a license”
MedImmune
13
Q
Is the offer of a license to a third party a trigger for a declaratory judgment action (DJ)?
A
Possibly,
If the offer places the third party in “reasonable apprehension” of being sued for infringement by identifying infringing activities.
14
Q
Is an offer to license a possible infringer the same as a settlement negotiation?
A
No,
Any license discussions prior to a charge of infringement is not a settlement and is admissable in court.
15
Q
What are the two characteristics of a royalty base?
A
- directly related to the licensee’s use of the licensed rights
- should be amendable to reliable accounting and auditing.
16
Q
What are the two main issues in litigation of royalty bases?
A
- Vagueness in defining the subject matter that bears royalties
- Uncertainty of the metes and bounds of the defined royalty subject matter
17
Q
Can royalties extend beyond the end of the patent term?
A
No but,
- accurals and payment plans that extend beyond the patent term are allowed.
- Brulotte*
18
Q
What is contra preferentum?
A
Any ambiguities and vagueness will be interpreted against the drafter.
19
Q
What is infringement?
A
When someone without authority makes, uses, offers to sell, or sells, induces others to do the same, any patented invention in the US or imports to the US during the term of the patent.
20
Q
What is a Trade Secret?
A
Any formula, pattern, device, compilation of information, program, method technique or process used in one’s business which gives an advantage over competitors and is not generally known.
21
Q
What is the legal action for trade secrets?
A
- Common law
- Texas - Criminal Offense of Misappropriation
- Federal Law
- 18 USC 1831-39
22
Q
How does one protect a trade secret?
A
Makes reasonable efforts to maintain its secrecy.
23
Q
What is a Trademark?
A
Words, names, symbols, or device used to identify and distinguish goods
24
Q
How are trademarks protected?
A
State Repositories
- Intrastate commerce triggers rights
Federal Law (15 USC, 18 USC 2320)
- Interstate commerce triggers rights
25
What is the basis for determining if a Trademark has been violated?
If the offending mark creates a liklihood of confusion in the marketplace
26
How does one infringe on a copyright?
The infringer is substanially similar to the copyrighted work
* 5th Cir - Finder of Fact must compare the two (expert opinion doesn't count)
27
What is a copyright?
An original work (Artistic Expression) reduced to tangible medium
28
How are copyrights protected
* Federal Law (17 USC, 18 USC 2318-2319)
29
What is a non-assertion clause?
A covenant not to sue, on the basis of whatever rights they have
* Does not run with the patent (private convenant)
* Can offset a DJ action
30
What is the burden of proof difference between DJ and Infringement Action?
* DJ
* Potential infringer files
* IP Owner must prove infringement
* Infringement Action
* IP owner files
* Potential infringer must prove no infringement
31
Can an exclusive license be limiting?
* Term
* Geographic Scope
* Field of Uuse
32
What is the analysis for standing in an infringement action?
* Is the license granted an "exclusive license"
* Constitutional Rights
* Was the grant of all "substantial rights"
* Prudential Rights
33
What is the key question regarding Constitutional Standing?
Whether the granted licensee have the right to exclude the defendents from engaging in the infringing activity?
34
How does one determine "substantially all rights"?
* Has the licensee been granted the right to sue for infringment?
* Exclusive right to make, use, sell products or services
* licensee's right to sublicense
* reversionary rights to licensor
* licensor's right to money from sublicensing or infringment
* duration
* licensor right of control of the licensee
* limits on right to assign
35
Can an exclusive licensee compel the patent owner to join an infringement suit.
Yes,
Infringement actions require all indespensible parties including patent owners and exclusive licensors
36
Why would one want to join the patent owner and exclusive licensee?
To avoid multiple infringment actions
37
How long can a license last for a trademark or trade secret?
Indefinately
38
What is the general purpose for granting a license?
The creation of a business relationship that is mutually beneficial to both parties.
39
What are some long term issues with licenses
* intentions of the parties may change
* identity of the parties may change
* the rememberance of what the terms and intentions were may disappear
40
what roles do drafters have in the licensing process?
* memorializing the intentions of the parties
* offering advice on how to accomplish the intentions
* directly negotiating between the parties
41
How does one determine if "all substantial rights" have been granted.
Look at the **terms** of the agreement
42
Can an exclusive licensor have standing to sue?
If the have substantially all of the rights, otherwise they must join the patent owner to the suit.
43
What types of terms indicate substantially all rights have been conveyed?
* right to sue
* generally dispositive
* no need to specifically designate if an assignment
* right to make, use, and sell products or services under the patent
* the scope of the licensee's right to sublicense
* the reversionary rights to licensor following termination or expiration of the license
* the right of the licensor to receive a portion of the proceeds from litigating or licensing the patent
* the duration of the license rights
* the ability of the licensor to supervise and control the licensee's activities
* the obligation of the licensor to continue paying patent maintenance fees
* any limits on the licensee's right to assign its interests in the patent.
44
How are continuation-in-part or continuation patents issued after the effective date of the license?
Automatically assigned after issuance
45
How does a future invention get conveyed?
A clause for "a present assignment of expectant interest"
46
Will the courts enforce a "expectant interest" clause
The current court precedent is to enforce written clauses.
47
Can "substantially all" of the rights be granted orally
No, the Federal circuit has held that a grant of "substantially all" rights and a right to sue must be in writing and coincide with the infringment.
48
Whay is a Grantback license?
A license that requires the licensee to license back any improvements or modifications IP back to the licensor.
49
What is "rule of reason"?
an agreement or business arrangement that on its face appears to conflict with competition law may be treated **as legal** if its actual effect is to promote competition or the public welfare and the gains thereby outweigh any anti-competitive impact.
50
What is the three part "Rule of Reason" Analysis?
1. does the agreement under examination, prima facie, reduce or restrain some aspect of competition?
2. does the agreement have “pro-competitive” (or other) benefits outweighing the harm?
3. is the agreement the least restrictive or anticompetitive way to achieve the benefits or it there a “less restrictive alternative”?
51
Is it possible to avoid patent exhaustion in vertically fragmented markets?
Yes, by a field of use license
52
Can a right to sublicense by implied?
No, the right to sublicense must be expressly granted.
53
Does the right to "make, use, or sell" include any other rights?
Includes the inherent **right to** have other **make** the product on their behalf.
54
What is a compulsory license?
One that is compelled by law.
* Clean Air Act
* Intervenor's Rights
* Failure to grant an injunction in an infringement suit
55
Who is an intervenor?
A person that was not an infringing prior to a re-issue, or re-examination
56
What is a shop right license?
An employee, not hired to invent
* implied
* an employee uses employers facilities, materials, time, money and invents something, and
* employer gets a nonexclusive, royalty-free, irrevocable, nontransferable license to the invention and any patent on the inventions
57
What are some types of licenses that could be anti-competitive?
* Exclusive License
* Cross License
* Patent Pools
* Refusal and Exclusive Dealing
* Grantback
* Tying
* Reverse Settlements
* Standards Setting
58
How is legal title to IP transferred
by Assignment
59
Does the right to sub-license grant standing?
No, the right to practice must be granted
60
What is the key question for standing (assignee or exclusive license)?
1. whether the licensee has the **right to exclude** the defendants from engaging in infringing activity
2. Right to sublicense
3. Right to assign
* *Ortho*
61
How does the UCC characterize Intellectual Property?
General Intangible
62
What is an "Implied" license?
some action or inaction by the patent owner that "signifies a patentee's waiver of the statutory right to exclude others."
63
What types of actions by the IP owner would trigger an Implied License?
1. acquiescence or consent
2. conduct
3. equitable estoppel
4. legal estoppel
5. participation in industry standard setting
64
Can royalties lead to a conclusion of consent in an Implied License?
Yes,
the payment of royalties by an entity and the acceptance of those royalties by the patent holder can infer consent by the patent owner, assuming the patent owner knew the reason for the payments.
65
What is the Clayton Act?
where the transaction "may substantially lessen competition or tend to create a monopoly."
66
Can failure to take action by the IP holder lead to consent of an Implied License?
Yes,
theory of laches
67
What is the theory of laches?
Failure to bring suit in a timely manner can prohibit future legal actions
68
What is Patent Exhaustion?
the first authorized sale of a patented product by the patent owner or a licensee,
1. exhausts the patent rights covering the product, and
2. permits the purchaser to use/resale, and
3. the product free of patent infringement claims.
69
Can a patent holder avoid Patent Exhaustion from direct sales?
Yes and No,
* Prior to *Quanta*, the courts allowed patent owners to sell without exhaustion if the purchasor agreed to a condition of purchase
* After *Quanta*, the court held that exhaustion is triggered by the **authorized** sale of product by the patent holder, including samples.
70
What is a negotiation agreement
An agreement between parties protecting the confidentiality of the negotiation.
71
What is the Sherman Act?
The statute renders illegal acts that monopolize or attempt to monopolize a relevant market. Having a monopoly, however, is not illegal if it is lawfully acquired.
72
Does a patent license violate the Sherman Act?
A patent license transaction, however, is conduct by the patent owner that must be considered in terms of its effect on a relevant market. If it has an anticompetitive effect and results in acquisition of monopoly power in a relevant market, it may be actionable under Section 2 of the Sherman Act.
73
What is a relevant market?
is that group of products or services in a geographic area which consumers would find interchangeable if the price of one product or service increased. In other words, a relevant market is defined in terms of products or services that consumers would consider to be substitutes for each other.
74
What is patent misuse?
An affirmative defense to patent infringement where the patent holder has broadened the 'physical or temporal scope' of the patent grant with anticompetitive effect."
75
Does patent misuse invalidate the patent?
No, the patent can be enforced once the misuse is purged (stopped)
76
How is patent misuse proven?
proof of competitive harm under the antitrust rule of reason.
77
What are some key factors for indicating the grant of a non-exclusive license?
1. grantor retains rights to have made
2. royalties from infringement payable to grantor
3. grantor informed of sub-license activities
78
What are some issues that might arise for failing to join a required party?
* judge can dismiss without prejudice
* refile if within SOL, if not out of luck
79
Are co-exclusive licenses allowed?
Yes,
the grantor and grantee can be co-exclusive licensors. The licensee can have against everyone but the licensor.
80
Can an attorney engage in fraud?
No,
Rule 8.4(c) states an attorney cannot "engage in conduct invlolving dishonesty, fraud, deceit, or misrepresentation.
81
Can a lawyer make knowingly false statements?
No,
Rule 4.1(a)
82
Can an attorney use any means to obtain evidence?
No,
Rule 4.4(a) prohibits "methods of obtaining evidence that violate the legal rights of third parties".
83
Can a lawyer no disclose they are involved in an action?
No,
Rule 4.3(a) "lawyer must make sure that the person is aware that the lawyer is an interested party"
84
Are private investigators required to identify the party they work for?
No
85
Do the rules of ethics apply to employees of the attorney?
Yes,
a lawyer having direct supervisory authority over a non-lawyer shall make reasonable efforts to ensure that the person's conduct is compatible with the professional obligations of the lawyer. Rule 5.3(b)
86
Can the lawyer be held accountable for orders given to non-lawyers?
Yes,
Rule 5.3(c)(1) a lawyer is responsible for the conduct of a nonlawyer if the lawyer "orders or with knowledge of the specific conduct, ratifies the conduct involved"
87
Can a lawyer knowingly assist or induce another to violate the rules?
No,
The lawyer would be subject to misconduct review, Rule 8.4(a)
88
If a judge asks an attorney about their investigative techniques, how must they answer?
Truthfully
89
What is pretexting?
pretending to be someone else for the purposes of illiciting information.
90
What information cannot be obtained by pretexting?
legally protected info, like
* financial info
* personal info
91
Is it an ethics violation to pretext?
* Yes, if a witness or party was tricked/intimidated into providing statements or admissions that they would not normally make
* No, if the information was generally available to the public or objective
92
Can pretexting be used in licensing situations?
Yes
* to determine if violations of court orders, trademarks, patents, are occuring
* Apple*
93
If evidence is obtained unethically, is it admissable?
* Criminal - no, too prejudicial
* Civil - yes, probative for fact finder
## Footnote
*Park v. El Paso Bd. of Realtors*
94
Can you audio record a person?
Texas is a one party state (only one party required to consent to recording)
95
The unethical information rules apply to everyone?
No mostly to **Parties** (opposing side or represented) or **Witnesses**
96
Is the negotiation of a license considered adversarial?
No,
that would require either a suit or reasonable apprehension of being sued.
97
Can a lawyer represent someone against a former client?
Maybe,
Rule 1.9 a lawyer may not represent another against a former client is the **same** or **substantially related** matter.
98
What is the exception to the former client rule?
If the former client provides their written consent
99
Can a firm represent a client against a former client?
No unless,
* it is not the same or substantially related
* client gives consent
100
What is the holding in *Adams*?
Patent Exhaustion
Coffin lids in Boston
101
What is the holding in *Aronson*?
Royalty agreements are enforceable if royalty rates reflect, patents (granted or not granted).
Keyholder
102
What is the holding in *Brulotte*?
Royalties cannot exend beyond the term of the patent.
Hops picking machine
103
What is a tie-in?
The requirement to
* purchase unpatented goods in order to use a patented process or apparatus,
* prohibition on the sale of competing goods,
* conditioning the grant of license on the accpetance of another license
104
What is the legal objection to a tie-in?
Extending the patent monopoly to create another monopoly or restraint of competition
105
What is the holding in *Automatic Radio*?
1. Royalties based on percentage of sales are not misuse *per se*.
2. Licensing a portfolio of patents is not a tie-in.
3. A licensee is not allowed to contest the validity of the patents it has licensed.
106
What effect does filing the agreement with the pleadings have?
A judge may render a judgment on the pleadings without converting the defendant's motion to one for summary judgment.
107
What is the holding in *Beanstalk*?
108
Can a trademark be sold "in gross"?
No, a trademark cannot be sold without the underlying assets which create the product that it identifies.
109
What are the two principles of contract interpretation?
1. a contract will not interpretated so literally if doing so would produce absurd results.
2. a contract must be interpretated as a whole
110
What is the holding in *Corebrace*?
The right to "have made" is an inherent right when a licensee is granted the right to "make, use, or sell".
Earthquake braces
111
Are patent owners *per se* indispensible parties to infringment actions?
No
112
What is the holding in *E-Z Bowz*?
A patent owner is not an indispensible party, and a patnet owner that assigns their interest is not a relevant party
113
What is the holding in *Frolow*?
* product patent mismarking is governed by statute not estopple
* extrajudicial statements can be used as evidence of fact, to be rebutted by the party making the statement
* circumstantial evidence is allowed to prove a an issue of fact
114
What is the holding in *Fujimoto*?
* The offeror can establish whatever means of acceptance they wish
* Failure to specify means no limitation
* Net revenues can be enforced by the court in line with the nature of the business (carry forward losses, etc.)
* Course of conduct by one party and acceptance by the other can alter the terms of the agreement.
Pickles
115
What is the holding in *Helferich*?
116
What is the holding in *Helfreich*?
The sale of one patented product does not exhaust the rights of a complimentary patented product that are intended or work better together.
Handsets
117
What is the holding in *Lexmark*?
An authorized sale of a patented good exhausts a patent holders right to sue the purchasor or any subsequent purchasor for infringement.
* a conditional sale doesn't work
118
What is the holding in *Kimble*?
*Brulotte* is good law, patent royalties (described as such) cannot extend beyond the life of the patent.
119
What was the holding in *Lear*?
Licensee's might be only ones in the best position to challenge the validity of an inventors patents. **Overruled** *Automatic Radio*
120
What was the holding in *Wang*?
Course of conduct can render an implied license, equitable estoppel can render an implied license by misleading conduct that the patent will not be enforced.
121
What is the holding in *Waterman*?
An assignment transfers all rights and terminates the ability of the assignor to pursue infringement actions.
122
What is the holding in *Endo*?
Attorney's engaged in infringment actions are not barred from participating in *Inter-parties* review of the same issues at the PTO. Must abstain from claim amendments.
Pharma - Opioids
123
Whata was the holding in *Zenith*?
* Jurisdiction cannot be granted via stipulation, but by *in personam* and service of process
* Patent pools can restrict free trade and be anticompetitive. Damages can occur to those outside the pool.
TV's
124
How is an Exclusive License anti-competitive?
The right to exclude combined with other assets could enhance a licensee's position in a relevant market
125
How is a patent pool anti-competitive?
If patent owners do not retain the right to license outside the pool, the pool can bcome dominant in a relevant market.
126
How is a cross license anti-competitive?
cross licensing can allocate fields of use and keep prices high
127
How is grantback anti-competitive?
The licensor can bottle up all of the improvements made by licensors and not allow the market to benefit from them.
128
How are standards setting anti-competitive?
When a patent holder fails to declare the existence of patents upon which the standard is based, and then forces a license. Standards by definition restrict the market to technology choice, which limits competition.
129
How do you analyze for tie-in?
1. Does the patent owner have market power?
2. Patent misuse
* Are they separably two or just one item?
* Is the tied thing a staple or non-staple article of commerce?
* Has tying (coercion or conditioning occurred)
130
What is a staple product?
a product that is commonly available and has many non-infringing uses.
131
What is a non-staple product
A product that has very few uses. No non-infringing uses.
132
What is packaging?
Licensing a group of patents together as a package
133
How is packaging anti-competitive?
If the package creates market power and harm to competition
134
What is the exception to packing anti-trust?
If the package contains relevant patents that are necessary to use any of the patents, it is the blocking patent exception.
135
Can a patent holder use a patent to force a licensee to buy materials to practice the patent?
* Staple items - no
* Non-staple items - yes
136
How might a supplier satisfy the anti-competitive issues of staple materials.
* By offering a royalty fee for anyone wishing to practice the technology
* Not restricting from whom the staple is purchased from.
* offering a royalty inclusive price for purchase from the supplier for the target market
* offering a royalty free price for uses outside the targeted market.
137
What other types of patent misuse are there?
* total sales royalty (based on sales outside patnet scope)
* post expiration (brulotte)
* Patent/Know-How Hybrid license (no change in royalty over time)
* Double Royalties
