Innovus Prime, LLC v. Panasonic Corp. & Panasonic Corp. of N. Am., Inc.

When a patent is assigned, the assignee takes the patent subject to all prior license agreements whether it has notice of the agreement or not.

Opinion (Whyte): Philips Electronics ("Philips") received a patent for an apparatus that processes television pictures. Later, Philips and Panasonic Corp. & Panasonic Corp. of N. Am., Inc. ("Panasonic") entered into an agreement where each agreed to forbear patent claims against the other for products related to audio or video for the life of patents held by the companies before a specific data. One of the patents covered by the agreement was the subject of three assignments, ultimately ending up in the possession of Innovus Prime, LLC ("Innovus"), which asserted infringement claims against Panasonic shortly before the patent’s term expired. Panasonic defended by pointing to the non-assertion agreement and moved for summary judgment of noninfringement. There is no substantive difference between an agreement not to sue and a non-exclusive license. Accordingly, the court treated the agreement between Philips and Panasonic as a license. When a patent is assigned, the assignee takes the patent subject to all prior license agreements whether it has notice of the license or not. Innovus, as assignee of the patent, could therefore only receive the rights held by the assignor. Because Phillips had foregone the right to sue Panasonic for infringement of the patent, none of the subsequent assignees of the patent had the right to sue Panasonic for infringement. Accordingly, because Innovus did not have the right to sue Panasonic for infringement of the patent the District Court GRANTED Panasonic’s motion for summary judgment.