This sounds incorrect to me, unless I've misunderstood your meaning. My understanding is that if someone finds a way to invent around the claims of the patent, disclosing a device that operates in a similar but novel manner that is not covered by the original patent, there is nothing for the inventor to assert, and no permission is needed.
What I meant to say is that if A holds a patent, then B is allowed to attempt to improve on that patent. Any such improvement can then be patented. However, B may not infringe on A's patent to do so. For instance, a molecule may have certain medicinal effects and has been patented. Another researcher can't start performing trials using that molecule looking for, say, a means to prolong the drug's metabolic lifespan without first licensing the molecule for use in their study. The researcher would need to find a way to conduct their research without infringing on the patent. The same will apply to Mills. Mills may not be able to patent the hydrino (I may be wrong), but he can certainly patent all the methods he's discovered to date for generating the hydrino reaction. Researchers will not be able to use any of those methods for trying to improve upon them. They'll need to either get a license from BrLP to use their IP or start from scratch and develop their own, which seems about right. The exception to this rule, I believe, is for "idle scientific curiosity". A lone tinkerer in his own garage is allowed to explore without infringing. But as soon as the first graduate student is granted onto the project, the exception no longer applies. At least that's how I understand it.
