Bottom line: On September 14, 2026, the Federal Circuit held in TexasLDPC Inc. v. Broadcom Inc., No. 2025‑1074, that an exclusive licensee of Texas A&M patents held “all substantial rights” and could sue Broadcom in its own name under 35 U.S.C. § 281 — without joining the university. The court reversed a Delaware district court's dismissal.
What happened?
Texas A&M granted TexasLDPC an exclusive license — including rights to make, use, sell and sublicense, and the exclusive right to sue and collect damages — under five patents on error‑correction (LDPC) technology. Texas A&M kept a share of royalties and recoveries, a non‑commercial research right, the sole right to sue one prior non‑exclusive licensee, a right to join certain suits, consent over assignment (not to be unreasonably withheld) and termination for missed milestones.
The district court dismissed, finding (1) the license had terminated when TexasLDPC became an enforcement‑only business and, alternatively, (2) Texas A&M was a necessary party that could not be joined. The Federal Circuit (Chief Judge Moore, Judge Chen and Chief District Judge Bissoon; opinion by Judge Chen) reversed on both points:
- No termination. “Business operations” in the agreement included enforcement activity.
- All substantial rights. Calling it “a close call,” the court found the exclusive make/use/sell right and the right to sue decisive, and the licensor's retained rights did not change the result.
- No Rule 19 joinder needed. The university was not a necessary party.
Why does it matter for licensors and licensees?
Whether a licensee can sue alone often depends on a handful of clauses. Universities, chemical companies and pharma licensors who want to stay out of litigation — or licensees who want control of enforcement — should draft deliberately.
Key takeaways
- Grant clause: An exclusive make/use/sell grant plus the right to sue is the core of “all substantial rights.”
- Retained rights: Research rights, revenue sharing and reasonable assignment consent may not defeat standing — but litigation vetoes or pre‑approved defendant lists can.
- Termination triggers: Vague “ceases business operations” clauses invite disputes; define them.
Frequently Asked Questions
Q: Can an exclusive patent licensee sue for infringement without the patent owner?
A: Yes, if the license transfers “all substantial rights.” In TexasLDPC v. Broadcom (Fed. Cir. Sept. 14, 2026) the court found that standard met even though the university licensor kept several rights.
Q: Which license terms matter most?
A: The court treated the exclusive right to make, use and sell and the right to sue as the most important factors; retained research rights and assignment‑consent rights did not defeat standing there.
Negotiating or enforcing a patent license?
Contact Green, Griffith & Associates LLP for strategic licensing, enforcement, and appellate counsel.