Sung-Hoon Kim | June 12, 2014

STC.UNM v. Intel Corp.

June 6, 2014

Panel: Rader, Dyk, and Newman. Opinion by Rader. Dissent by Newman


The ‘998 patent was a CIP of the ‘312 patent, which was jointly owned by STC.UNM and Sandia.  Because a terminal disclaimer (which required a common ownership of both patents) was filed during prosecution of the ‘998 patent, STC.UNM and Sandia are co-owners of the ‘998 patent even if Sandia did not make any contribution to the ‘998 patent.  STC.UNM filed an infringement suit concerning the ‘998 patent against Intel, and Sandia refused to join the lawsuit.  The district court dismissed the case for a lack of standing, and the CAFC affirmed by holding that all co-owners must ordinarily consent to join as plaintiffs in an infringement suit.  Furthermore, both the district court and the CAFC refused to involuntarily join Sandia to the case as a necessary party (FRCP Rule 19).

본사건은연방지방법원뉴멕시코지원의판결에불복하여 STC/UNM이연방순회항소법원 (CAFC)에항소한사건이다.  CAFC는연방지방법원과같이‘312 특허를바탕으로일부계속출원된특허 (continuation-in-part)인‘998 특허심사도중원고STC/UNM가존속기간포기서 (terminal disclaimer)를제출함으로써특허심사거절을극복하였으므로, STC/UNM과 Sandia는‘998 특허의공동소유자(co-owners)라고판단하였다 (Sandia는‘998 특허발명에공헌을하지않았다).  또한CAFC는 Sandia의소송참여의사에상관없이 STC/UNM이인텔을상대로‘998 특허침해소송을제기한것에대해STC/UNM은원고적격(standing)이없다고판단하여소송을기각하였다.  왜냐하면특허침해소송에서는특허의모든공동소유자가원고로참여해야하지만Sandia는소송참여를하지않기로결정하였기때문이다.  마지막으로CAFC는연방지방법원과마찬가지로본사건은연방민사소송규칙 19조의involuntary joinder rule이적용되지않아Sandia를원고로강제참여시킬수없다고판단하였다.


U.S. Patent No. 5,705,321 (issued on January 6, 1998) has four inventors: Steven Brueck, Saleem Zaidi, An-Shyang Chu, and Bruce Draper.  At the time of invention, Brueck, Zaidi, and Chu were employed by the University of New Mexico (UNM), and Draper was employed by Sandia.

In mid-1996, four inventors executed a Joint Assignment to UNM, and that assignment erroneously defined all assignors as employee of UNM, when Draper was in fact not employed by UNM.  In October 1996, UNM executed an assignment to Sandia to correct Draper’s prior assignment to UNM, which was made in error.

While the application that led to ‘321 patent was pending, Brueck and Zaidi filed a new application that led to the ‘998 patent.  This application incorporated the ‘321 patent by reference.  Here, Draper was not listed as an inventor of the ‘998 patent.

During prosecution of the ‘998 patent, the U.S. Patent and Trademark Office (PTO) twice rejected its claims for double patenting over the ‘321 patent.  UNM filed a terminal disclaimer to traverse this rejection.  The terminal disclaimer specified that “any patent granted on this application shall be enforceable only for and during such period” that the ‘998 and ‘312 patents “are commonly owned.”  The ‘998 patent was issued on March 28, 2000.

Subsequently, UNM assigned its own interest in the ‘321 and ‘998 patents to STC (a wholly-owned licensing arm of UNM).  In addition, STC successfully petitioned the PTO to correct of the ‘998 patent to include two more inventors and sought a certification of correction from the PTO to indicate that the ‘998 patent is a CIP of the ‘321 patent.

STC filed an infringement suit concerning the ‘998 patent against Intel in 2010.  In January 2012, Intel moved for summary judgment, asserting that the ‘998 patent was unenforceable for failing to comply with the common-ownership requirement of the terminal disclaimer.

District Court

The District Court of New Mexico granted partial summary judgment for Intel.  The district court reasoned that “ownership rights must derive from inventorship and, because Draper did not co-invent any claims of the ‘998 patent, he had no interest in the ‘998 patent to assign.  Thus, the court held that Sandia did not co-own the ‘998 patent with UNM or STC.”

The parties then cross-moved on the issue of standing.  Sandia refused to join the case, and the court granted Intel’s motion to dismiss for lack of standing.  Relying on Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456 (Fed. Cir. 1998), the court “explained that when a patent is co-owned, a co-owner seeking to enforce the patent must join all other co-owners as plaintiffs to establish standing”, and that “without this joinder, the plaintiff cannot pursue an infringement suit.”

While the court acknowledged FRCP Rule 19(a) for involuntary joinder, the court held that neither of the two exceptions is present here.


The CAFC affirmed the holding of the district court.  The CAFC held that the holding of Ethicon is controlling in this case and rejected the STC’s argument that “the holding in Ethicon yields to Rule 19’s involuntary joinder test.”  In other words, the CAFC held that Rule 19 does not  trump the holding that substantive patent law ordinarily requires consent to joinder from all owners, and that “rules of procedure, such as that in Rule 19(a), must give way to substantive patent rights.”

The CAFC acknowledged two scenarios where involuntary joinder may apply:

  • Where a patent owner has granted an exclusive license, it may be joined in its licensee’s infringement suit; and
  • When, by agreement, a co-owner waives its right to refuse to join suit, his co-owners may later force him to join in a suit against infringers.

However, the CAFC found that neither exception applies in this case.  Therefore, the CAFC affirmed the district court’s decision that STC lacked standing to maintain its infringement suit against Intel.

Dissenting Opinion

Judge Newman issued a dissenting opinion, arguing that the majority’s opinion is contrary to law as it prevents a co-owner of the patent from enforcing his/her patent and ignores the language of Rule 19 for an involuntary joinder rule.


For research institutions or corporations which frequently collaborate on an invention, they need to carefully draft their collaboration agreements so that a jointly owned patent can be enforced properly.  They may specify who has the enforcement right explicitly in their agreements.  Also, they may require that co-owners, who do not want to enforce the patent, participate in a lawsuit when necessary.

For a party to maintain its ability for enforce a patent, it should obtain a full ownership of the patent, a co-owner’s waver of its right to refuse enforce the patent, or obtain an exclusive license to a co-owner’s interest.

For a patent that has gone through several ownership changes, a party should be aware of potential co-owners that may not want to proceed with a lawsuit.

A defendant may consider raising a standing issue if the patent at issue has multiple previous owners.

Full Opinion

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