The opinion of the court was delivered by: DAVID COAR, District Judge
MEMORANDUM OPINION AND ORDER
Before this court is the motion by Defendant Plastican, Inc.
("Plastican") to dismiss Ropak Corporation ("Ropak") and
Plas-Tool Co. ("Plas-Tool") as plaintiffs for lack of standing.
Defendant does not challenge the standing of Plaintiffs John W.
von Holdt, Jr. and Janice Anderson. For the reasons set forth
below, Defendant's motion to dismiss Ropak as plaintiff is
DENIED. Defendant's motion to dismiss Plas-Tool as plaintiff is
For the purposes of this motion, the following facts alleged in
Plaintiffs' complaint are taken as true. John W. von Holdt, Jr.
and Janice Anderson own United States Letters Patent No.
4,735,337 (the "`337 patent"), a valid and enforceable patent.
(Am. Compl. ¶ 9, 11). Plas-Tool is a licensee of the `337 patent by virtue of a license that
includes the right to join as plaintiff in any action for
infringement of the `337 patent by others. (Am. Compl. ¶ 10).
Plas-Tool and the original patent owner, John W. von Holdt,
Sr., successfully enforced the `337 patent against Ropak
Corporation in 1995. The dispute yielded a Settlement and License
Agreement entered into on June 15, 1995 ("the 1995 Agreement").
(Am. Compl. ¶ 11). By virtue of that Agreement, Ropak is now a
sublicensee of claims 9-12 of the `337 patent. The Agreement
affords Ropak the right to join as plaintiff in any action for
infringement of the `337 patent by others. (Am. Compl. ¶ 10).
At all times since issuance of the `337 patent, Plas-Tool,
under its license, has been engaged in the business of
marketing, selling, and distributing molds used to make the
plastic lids protected by the `337 patent. Since entering into
its sublicense, Ropak has been engaged in the business of making,
selling and distributing molded plastic lids covered by the `337
patent. (Am. Compl. ¶ 12).
Plaintiffs Ropak, von Holdt, Jr., Anderson, and Plas-Tool have
filed suit against Defendant for making, advertising, selling
and/or offering for sale molded plastic lids that infringe the
`337 patent. (Am. Compl. ¶¶ 14-20).
In ruling on motion to dismiss for lack of standing, the court
must accept as true all material allegations of the complaint and
draw all reasonable inferences in the plaintiff's favor. Reid L.
v. Illinois State Board of Education, 358 F.3d 511, 515 (7th
Cir. 2004). Whether a licensee of a patent has co-plaintiff
standing depends upon the rights the licensee holds: To have co-plaintiff standing in an infringement
suit, a licensee must hold some of the proprietary
sticks from the bundle of patent rights, albeit a
lesser share of rights in the patent than for an
assignment and standing to sue alone. The proprietary
rights granted by any patent are the rights to
exclude others from making, using or selling the
invention in the United States.
Ortho Pharmaceutical Corp. v. Genetics Institute, Inc.,
52 F.3d 1026, 1031-32 (Fed Cir. 1995) (internal citation omitted). The
standard, stated alternatively, requires a party to "have
received, not only the right to practice the invention within a
given territory, but also the patentee's express or implied
promise that others shall be excluded from practicing the
invention within that territory as well. Rite-Hite Corp. v.
Kelley Co., Inc. 56 F.3d 1538, 1552 (Fed. Cir. 1995). A
licensee with such proprietary rights is generally called an
"exclusive" licensee. Ortho Pharmaceutical, 52 F.3d at 1032.
Thus, exclusive licensees have standing to sue, whereas bare
licensees those who hold nothing more than the patent owner's
covenant not to sue the licensee for infringement do not. Id.
"But it is the licensee's beneficial ownership of a right to
prevent others from making, using or selling the patented
technology that provides the foundation for co-plaintiff
standing, not simply that the word `exclusive' may or may not
appear in the license. Id.
Defendant argues that neither Ropak nor Plas-Tool is an
exclusive licensee of the `337 patent; therefore, they have no
standing to sue. Plaintiffs argue that Ropak and Plas-Tool have
exclusive rights under the `337 patent that no other licensee has
been granted, and it is these exclusive rights that Defendant has
infringed. A. ROPAK'S STANDING
To determine whether Ropak has standing as a co-plaintiff, the
Court looks to Ropak's agreement with the patentee. See Ortho
Pharmaceutical, 52 F.3d at 1032 (stating that "co-plaintiff
standing is determined by whether or not the licensee acquired
proprietary rights in the patent under the contract with the
patentee"). The 1995 Agreement between Von Holdt, Sr., Plas-Tool,
and Ropak grants Ropak the right to make, use, and sell plastic
lids covered by claims 9-12 of the `337 patent.*fn1 The
Agreement states that this license "shall be exclusive with
respect to plastic lids . . . within the following size and
thickness parameters," which the Agreement then lists. (Von Holdt
Decl. Ex. G § 3B) (emphasis added). The Agreement also states
that, "[w]ith respect to the plastic lids for round containers
which do not fall within the [specified] size and thickness
parameters, ROPAK shall have a non-exclusive license." (Von Holdt
Decl. Ex. G § 3C). Thus, the Agreement's terms grant Ropak an
exclusive license to lids of a certain size under claims 9-12 of
the `337 patent. Still, the presence of the word "exclusive" in
the license, without more, does not mean that Ropak is an
exclusive licensee. Ortho Pharmaceutical, 52 F.3d at 1032.
Nor is the right to sue clause in the Agreement dispositive.
The Agreement states that, with respect to infringement claims,
the "parties agree to cooperate and assist each other . . . at no
cost to the other party, regardless of the party which prosecutes
the proceedings." (Von Holdt Decl. Ex. G § 11B). The Agreement
provides an example: "[I]n the event of prosecution by ROPAK and
if necessary in order for such prosecution to occur, VON HOLDT
and PLAS-TOOL will agree to be joined in the prosecution as nominal parties
and/or to assign ROPAK their rights to prosecute the matter."
Id. (emphasis added). This provision, however, does not
automatically grant Ropak co-plaintiff standing. As explained in
Ortho Pharmaceutical, 52 F.3d at 1034, "a right to sue clause
cannot negate the requirement that, for ...