Here is a Déjà vu moment for you: You had a research team working on a high
valued research project. Intellectual
property was generated while hundreds thousands of dollars were poured into the
research—all paid by you. The
intellectual property was turned into several patent applications by a patent
attorney whose service you paid for. Then
there was a big fall out among the team members with your star researcher
storming out, cursing and threatening. It
was time to file the patent applications. Your patent attorney sent the
researchers the assignment documents transferring the patent rights from the researchers/employees
to you (the company). The star researcher,
who was freelancing somewhere else, refused to sign. You pulled out the employment contract and
threaten to sue, only realizing that the contract did not contain IP ownership clause.
Well, the good news is that, if you go to court on a
dispute like this, you have a good chance of winning. The bad news is that you
will need to shell out significant financial resource and emotional strain before
that win.
Employers often assume that, because they paid a
salary to an employee and paid for the expense of the R&D work, any IP
generated by the employee would automatically belong to the employers. Wrong
assumption! As a result, I’ve seen the
messy aftermath playing out painfully for all parties. From the experiences, I can tell you that
cleaning up those messes could be costly, time consuming and emotionally
draining.
It is commonly believed
that the US constitution grants the inventors as the original owner of an
invention. This common understanding is
based on
the Copyright Clause (Article I,
Section 8, Clause 8 of the United States Constitution), which grants
Congress the authority "to promote the Progress of Science and useful
Arts, by securing for limited Times to Authors and Inventors the exclusive
Right to their respective Writings and Discoveries." The common understanding was further strengthened by a
string of case laws starting in 1790. Here
are two cases on the subject if you want to learn more: Gayler v. Wilder, 10 How. 477 (1851) and United States v. Dubilier Condenser Corp., 289 U. S. 178
(1933).
For an
employer to own an invention generated by an inventor employee in his employment
capacity, the inventor employee must expressly grant those rights to his employer. As with any other property right, an
inventor’s property right in an invention can be transferred through a
contract. The court in United States v. Dubilier Condenser Corp.
states that, in most case, a patent may be issued only to an applying inventor;
because an inventor’s interest in his invention is assignable in law by an instrument
in writing, a patent can be issued to an inventor’s assignee. However, the case
law is clear that absent an agreement to the contrary, an employer does not have
rights in an invention “which is the original conception of the employee alone.”
Therefore,
to save you from the headache later, you should always include an IP ownership clause
in your employment or consultant contract.
Most contracts I’ve seen state that “the employee thereby agrees to
assign the IP ownership to the employer.”
This is the exact language that cause the Stanford’s loss to Roche in Stanford v. Roche 131 S. Ct. 2188
(2011). I will talk more about this case
in future posts. For now, you might want
to take the lesson learned by Stanford and stick with “hereby assign”
language. The best part of the “hereby
assign” language is that, if your star researcher refuses to sign the
assignment documents, you can simply file the employment contract with the
USPTO. Just please make sure that the
employment contract has researcher’s signature on it.
Thanks for reading.
Connie
