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Judge Kearney grants motion to dismiss declaratory judgment action due to failure to join patent owners

Judge Kearney, sitting by designation from the Eastern District of Pennsylvania, recently considered declaratory judgment-defendant Nuseed Americas Inc.’s motion to dismiss for lack of subject matter jurisdiction.  BASF Plant Science LP v. Nuseed Americas Inc., No. 17-421 (D. Del. Aug. 17, 2017).  The motion presented the issue of the scope of authority given to agents authorized by a patent owner to negotiate terms of a license agreement with a potential infringer.  Id. at 1.  In other words:

When, as here, we address an apparent impetuous impasse in patent license negotiations between a potential infringer and a company negotiating on the patent owner’s behalf, we must scrutinize whether there is a real and immediate threat of a patent infringement action by the named defendant against the potential infringer.  If not, we lack subject matter jurisdiction and must enter the accompanying Order dismissing the declaratory judgment action against the agent defendant mindful the potential infringer may seek a declaration from a court with personal jurisdiction over the patent owner or another party with the legal right to sue it for infringement.

Id.  Judge Kearney determined that dismissal was warranted because BASF sued the agent with whom it was negotiating, but did not join the patent owners.  Id. at 8-10.  “We appreciate BASF’s immediate attempt to seek declaratory relief against the agent with whom it negotiated. But the agent presented no real and imminent threat of suing BASF for patent infringement.”  Id. at 10.

BASF Plant Science, LP v. Nuseed Americas Inc., No. 17-421 (D. Del. Aug. 17, 2017)

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