In order for a patent assignee to recover damages for infringement occurring before the assignee obtained ownership of the patent, the assignment must expressly so state. The Supreme Court said “it is a great mistake to suppose that the assignment of a patent carries with it a transfer of the right to damages for an infringement committed before such assignment.” Moore v. Marsh, 74 U.S. (7 Wall.) 515, 522 (1868).
This is illustrated in the case of Messagephone, Inc. v. Svi Sys., Nos. 99-1471, 99-1478, 2000 U.S. App. LEXIS 19976 (Fed. Cir. 2000). Messagephone sued Svi Systems and Holiday Inn Express alleging infringement of U.S. Patent Nos. 5,323,448 and 5,475,740. These patents were directed to a system that enables hotel guests to order certain amenities, such as movies, in their hotel rooms without incurring charges on their hotel bill.
When the patents where granted in 1994 and 1995, they were assigned to Spectradyne, Inc. On November 7, 1996, Spectradyne assigned title in the patents to Messagephone. This assignment granted Messagephone the “entire right, title, and interest” in the patents. But the assignment was silent regarding Messagephone’s right to sue for infringement that occurred before that date. The Court found that since the assignment did not expressly grant Messagephone’s right to sue for infringement occurring before the date of the assignment, Messagephone could not do so.
The court said, “As a general rule, only a party that possessed legal title to a patent at the time the infringement occurred can bring suit to recover damages for such infringement.” It continued, “A narrow exception to the foregoing rule is that a party may sue for infringement transpiring before it acquired legal title if a written assignment expressly grants the party a right to do so; that right, however, must be articulated explicitly in the assignment and will not be inferred by the court.”
Messagephone tried to fix this, after the lawsuit was filed, by executing a nunc pro tunc (retroactive) assignment of the right to sue for past infringement. But the court said executing it after the lawsuit was filed was too late.
The lack of express language assigning the right to sue for past infringement and damages cost Messagephone one or two years worth of damages, which could be substantial.
If the assignee desires to pursue claims for past infringement occurring before the date of the patent assignment, the patent assignment should include expressly the right to sue and recover for past infringements and damages.