Co-Plaintiff Tri-County Dismissed for Lack of Standing Where It Effectively Assigned All Substantial Rights Back To Co-Plaintiff Azure

Azure Networks, LLC v. CSR PLC, ___ F.3d ___ (Fed. Cir. Nov. 6, 2014) (Reyna, Mayer (dissenting in part), CHEN) (E.D. Tex., Schneider) (3 of 5 stars)

Federal Circuit affirms dismissal of co-plaintiff for lack of standing, vacates judgment of noninfringement and remands.

STANDING: Azure assigned the patent to a local Texas non-profit, which then licensed back essentially all rights to Azure, including the rights to practice the patent, to sublicense, and to pursue infringement without any control by the non-profit—e.g., "Azure is holding all the string." The Federal Circuit agreed with the district court that the non-profit should be dismissed because the agreement "constituted an effective assignment for purposes of standing." Slip Op. at 3. The non-profit's right to practice (though it is a legal aid society and the patent covers computer networking components), economic interests, limited termination rights, and unfixed reversionary interest did not demonstrate its ownership. As an effective nonexclusive licensee, the non-profit could not sue or join the suit. Id. at 19.

CLAIM CONSTRUCTION: The Federal Circuit construed the terms "Media Access Control"/"Medium Access Control" address (a/k/a "MAC address") pursuant to its well-established meaning, as "an address that uniquely identifies a device or group of devices on a shared communication medium." The patentee did not act as his own lexicographer to redefine the term, despite examples in the specification that were cited as support for the narrower meaning. This included a single, cursory use of the term "Media Access (MAC) address" (without the term "Control"), where dropping the word "Control" was not unknown to skilled artisans at the time. Judgment of noninfringement was thus vacated and remanded based on the district court's improper claim construction, which had limited the term to an address assigned during operation, and not at the factory.

DISSENT-IN-PART: Judge Mayer disagreed on claim construction, noting that the specification repeatedly and unambiguously indicates that "MAC address" (which is not the industry term "Media Access Control address") refers to "an address that is assign to a peripheral device by a hub device." In his view, the patent did not describe or enable any other method of network communication and thus would be invalid under the majority's construction.