Can I transfer or assign the patent license agreement to my LLC?
Full Question:
Answer:
A nonexclusive license typically allows the licensee to practice the invention or authorize others to do so on behalf of the licensee. It is normally not transferable by assignment to any other party. A person may not assign a nonexclusive patent license to a third party, absent consent of the licensor, because federal patent law precludes the holder of a nonexclusive license from assigning it. CFLC, 89 F.3d, at 679; see also Commissioner v. Sunnen, 333 U.S. 591, 609, 68 S. Ct. 715, 724-35 (1948).
In CFLC, the licensee tried to assign a nonexclusive patent license to a buyer unrelated to the debtor. The patent licensor objected on the basis that Section 365(c) of the Bankruptcy Code prevented the assignment, because applicable federal common law precludes the assignment of nonexclusive patent licenses. The Ninth Circuit agreed with the licensor that federal patent law was "applicable law" under Section 365(c) and that under federal patent law, nonexclusive licensees may not assign patent licenses without the licensor's consent. CFLC, 89 F.3d at 679.
