Case is dismissed for lack of standing to sue
Enhanced Security Research, LLC, et al. v. Cisco Systems, Inc., et al., C. A. No. 09-390-JJF, June 25, 2010.
Farnan, J. Defendants’ motion to dismiss for lack of subject matter jurisdiction and failure to join an indispensible party is granted. Plaintiffs’ motion to consolidate cases is denied as moot. Defendant’s motion to stay pending the outcome of reexamination proceedings is denied as moot and the motion to supplement the record on the motion to stay is denied as moot.
The court was called upon to consider whether the plaintiff has standing to sue in its own name alone. Under the terms of a purchase agreement, Enhanced Security Research retained the rights to “use, exploit, enforce” the patents-in-suit. However, Security Research Holdings has “the exclusive right to initiate, maintain, manage, resolve, conclude, and settle” all licensing, litigation and enforcement efforts. Plaintiff is prohibited from contacting potential infringers without prior consent of Security Research Holdings. Plaintiff furthermore relinquished its ability to freely assign, transfer or license the patents-in-suit. The court concludes that plaintiff lacks Article III standing, a defect that joinder can not cure. It therefore dismisses the action. The motion to consolidate with an action subsequently filed by both enhanced Security Research and Security Research Holdings (09-571-JJF) is denied as moot.
