Propat International Corp. v. RPost, Inc.

Authenticational Technologies Ltd. (Authentix) was assigned Patent No. 6,182,219 (the 219 patent) and became the legal titleholder of the patent. A May 2002 agreement between Propat International Corp. (Propat) (plaintiff) and Authentix gave Propat rights and duties regarding the 219 patent that focused on patent-licensing and infringement-litigation services. The agreement named Authentix as the patent owner and stated that Authentix retained responsibility to maintain the 219 patent. Under the agreement, Authentix retained an economic interest in any proceeds from patent licensing and lawsuits, had the right to be notified of any licensing and litigation decisions and could veto such decisions if the veto was reasonable, and had unlimited power to prevent Propat from transferring its interest in the 219 patent to any third parties. The agreement included a provision explicitly granting Propat the right to sue. Propat sued RPost, Inc.; RPost U.S., Inc.; RPost International Limited; and three related individuals (collectively, RPost) (defendants) in federal court for infringement of the 219 patent. Propat and RPost filed cross-motions that sought to address whether Propat had standing to file suit in relation to the 219 patent. The district court held that Propat did not have standing to file an infringement action. Propat appealed.