Patent License Extends To Reissue Patents Unless Contrary To Intent Of Parties

In Intel Corp. v. Negotiated Data Solutions, Inc., No. 11-1448 (Fed. Cir. Dec. 17, 2012), the Federal Circuit affirmed the district court's SJ determinations of license and noninfringement in favor of Intel Corp. ("Intel"), holding that Intel was licensed to practice the patents-in-suit pursuant to a license agreement with Negotiated Data Solutions, Inc.'s ("N-Data") predecessor-in-interest, National Semiconductor Corp. ("National").

Intel entered into a patent cross-licensing agreement with National ("the Agreement") granting Intel nonexclusive royalty-free licenses to all of National's patents and patent applications having an effective filing date prior to the expiration of the Agreement. During the term of the Agreement, National assigned U.S. Patent Nos. 5,361,261; 5,533,018; 5,566,169; and 5,594,734 (collectively "the Original Patents"), licensed under the Agreement, to Vertical Networks, Inc. ("Vertical"). Vertical filed broadening reissue applications, then assigned the Original Patents and the related reissue applications to N-Data. After expiration of the Agreement, the reissue applications were granted to N-Data with additional claims ("the Reissue Patents").

N-Data then sued Dell, Inc. ("Dell"), an Intel customer, alleging patent infringement of several patents, including the Reissue Patents. Intel intervened, seeking a DJ that Intel and its customers were licensed to practice the asserted Reissue Patents owned by N-Data, because they derive from the Original Patents, which were part of the licensing agreement with National. On SJ, the district court held that the Agreement applied to the patents-in-suit, protecting Intel from claims of direct infringement and indirect infringement based upon sales by third parties incorporating Intel products.

On appeal, the Federal Circuit first examined the facts under the reissue provisions set forth in 35 U.S.C. § 252. N-Data argued that under its interpretation of § 252, only substantially identical claims reach back to the date of the original patent and that the Agreement only covered patents owned or controlled by National during the term of the license. Thus, N-Data believed that while the Agreement covered the Original Patents, it did not cover the Reissue Patents, which were each issued directly to N-Data after the Agreement had expired. That is, N-Data argued that a reissue patent is a distinct property right that does not simply replace the original patent. In contrast, Intel...