Quantum Corp. v. Riverbed Tech. Inc. (PDF) 2008 U.S. Dist. LEXIS 11348 Decided February 4, 2008 Judge Alsup In this case Judge Alsup granted the defendantââ?¬â?¢s motion to dismiss whereas Judge Wilken denied a similar motion in a case with similar facts. Here, Plaintiff Quantum sued Defendant Riverbed for patent infringement. Riverbed contends that Quantum had an insufficient interest in the patent at the time the complaint was filed. The chain of ownership is as follows. The named inventor on the patent assigned his rights to the patent to Trustus Pty. Trustus Pty. then assigned its rights in the patent to Rocksoft. All the shares of Rocksoft where acquired by ACN 120, a proprietary company of ADIC, thereby making Rocksoft a wholly-owned subsidiary of ACN 120. Quantum acquired ADIC as a wholly-owned subsidiary. Before this litigation, ACN 120 ââ?¬Å?and its subsidiariesââ?¬Â? granted an exclusive license to Quantum for all the patents owned by ACN 120 and its subsidiaries. Rocksoft did not sign this agreement. Not until after the complaint was filed in this case did Rocksoft execute an assignment to Quantum for the patent at issue. Judge Alsup found that Quantum did not have any rights in the patent when this complaint was filed because no assignment linked Rocksoft to ACN 120. Thus, ACN 120 had not authority to assign the patent to Quantum. ââ?¬Å?While Rocksoft and ACN 120 were affiliates, each was created as separate corporate entities, and must accordingly be treated as such.ââ?¬Â?

[T]he mere fact that Rocksoft was ACN 120�s wholly-owned subsidiary does not automatically mean that ACN 120 and Rocksoft had an agency relationship.

Quantum cited Atmel Corp. v. Authentec, Inc., decided by Judge Wilken and covered earlier by me here, in support of allowing a parent company to assert a patent owned by a subsidiary without an express licensing agreement between the corporations. Judge Alsup had this to say of Atmel

:

[Atmel] did not come to grips with the law cited above, perhaps because it was not adequately presented.

I will admit that the facts were murky and quite confusing, as you can see if you read my previous post on the Atmel decision and also read the actual Atmel decision. Further, Judge Alsup supposes, if the assignments in Atmel were in writing, a key fact in this case, was perhaps not in contention in Atmel. After this case, Atmel becomes questionable precedent.

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