Source: JD Supra (Alston & Bird)

A.L.M. Holding Co. and Ergon Asphalt & Emulsions jointly own six patents covering warm-mix asphalt paving methods and compositions and licensed substantial rights to an exclusive licensee while expressly retaining other patent rights, including the right to sue third parties. Zydex moved to dismiss the infringement suit for lack of Article III standing, and the district court granted dismissal without prejudice, relying principally on Morrow v. Microsoft, which held that a bare contractual right to sue separated from all other patent rights did not confer a constitutional exclusionary right.

On appeal the Federal Circuit reversed, stating that Article III standing requires injury in fact, causation, and redressability, and that only injury in fact was contested. The court explained that the central injury-in-fact inquiry in patent suits is whether a party retains an exclusionary right and observed that statutory standing cases can inform the constitutional analysis. Applying the facts, the court held the patent owners’ retained right to sue, together with a sublicensing veto and royalty interests, created a “non-illusory exclusionary interest” sufficient for Article III standing, and it distinguished Morrow where the right to sue was illusory. The opinion is No. 2025-1317, dated May 19, 2026, authored by Judge Chen and joined by Judges Cunningham and Stark. The post includes a standard disclaimer that the update is general and may not apply in all situations.