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Federal Circuit Says Patentee Keeps Standing Despite Broad License

Published
Score
12

Why it matters

The Federal Circuit reversed a district court dismissal and held that a patent owner retains Article III constitutional standing to sue for infringement even after granting a broad license, provided it keeps some exclusionary rights and has not transferred all substantial rights in the patent. In A.L.M. Holding Company v. Zydex Industries Private Ltd., No. 25-1317 (Fed. Cir. May 18, 2026), the court found that A.L.M. and related patent owners had standing despite the scope of their licensing arrangement because they retained royalty rights and veto power over sublicensing.

The Federal Circuit applied the same standing framework it recently used in Intellectual Tech LLC v. Zebra Technologies Corp. and similar cases. The court's reasoning turns on whether a patentee has transferred away all exclusionary interests. Where some meaningful control remains—here, the ability to collect royalties and block sublicenses—the patentee suffers concrete injury from alleged infringement sufficient to satisfy constitutional requirements.

Attorneys should note the distinction the decision sharpens between constitutional standing and the statutory "all substantial rights" analysis. The ruling continues a Federal Circuit trend of finding standing where patentees retain control even under broad licensing or security arrangements. This affects how patent owners structure licenses, when they can bring infringement suits, and what ownership analysis should precede litigation.

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