These materials are public information and have been prepared for entertainment purposes only to contribute to the fascinating study of intellectual.

Patent Assignments and Other Information that only Attorneys find Useful and Interesting

Justin R. Nifong

Disclaimer These materials are public information and have

been prepared for entertainment purposes only to contribute to the fascinating study of intellectual property law. No rights, warranties, or other guarantees are provided herein. Everyone else’s disclaimers are hereby incorporated by reference in their entirety.

Agenda Let’s make it of record Yo, I own this right, right? Divided ownership is no ownership Let’s vacation in the Cayman Islands

Assignments Must Be In Writing “Applications for patent, patents, or any interests

therein, shall be assignable in law by an instrument in writing . . . .” 35 U.S.C. § 261.

Record That Document! The USPTO follows a

race-notice recording procedure in which a three month notice period is provided for assignment recording, otherwise the first to record is considered the superior party against a subsequent bona-fide purchaser. 35 U.S.C. §§ 261.

Federal Circuit has held that recordation of an assignment creates a rebuttable presumption that the assignment is valid. SIRF Technology v. ITC and Broadcom

No More Fees! The fee for recording

assignments electronically with the USPTO was eliminated in January, 2014

What can be recorded? Just about anything:• Assignments.• Letters disputing ownership.• License Agreements.• Notes and other security interests.• Wills.

What About Security Interests? A recording with the USPTO

is not required for perfecting a security interest in a patent and perfection is instead governed by the Uniform Commercial Code, though the USPTO provides for recording of security interests and it may be best practices to consider doing so.

Searching Assignment Records http://assignments.uspto.gov/assignments/?db=pat

Security Interest Example:

License Agreement Example:

Federal Law Applies, Right? State law governs the application of assignment

obligations***. Minco, Inc. v. Combustion Eng'g, Inc *** Feds have usurped that power in certain

circumstances.

When You Assign A Patent, The Assignee Gets All Rights, Right? The conveyance of a patent does not normally include the

right to recover for injuries occurring before the conveyance. Crown Die & Tool Co. v. Nye Tool & Mach. Works

As the Supreme Court has stated, “it is a great mistake to suppose that the assignment of a patent carries with it the right to sue for past infringement.”

Assignments must include “right to sue for past infringement language” if that right is conveyed (in most states).

Oops We Forgot the Written Agreement Rights that exist when no written agreement:

Shop Rights Hired-to-invent doctrine

Shop Rights Shop right is a common law

doctrine founded in equitable principles that allows an employer to use the employee’s invention without payment to the employee if that invention was made using the employer’s time, materials, facilities, or equipment. Lariscey v. United States

Not assignable. Not licensable. May not survive sale of

company.

Oops Continued- Hired-To-Invent You are on your own here. Google is your friend.

Hired-To-Invent and Work-For-Hire are not one in the same! Hired-to-Invent usually applies to patents, and work-

for-hire usually applies to copyrights.

The Magic Language in Employment Agreements

“I will assign and do hereby assign… my right, title, and interest in each of the ideas, inventions and improvements” effected a present assignment of the inventor’s future inventions and therefore the assignee immediately acquired equitable title to the inventions.

The CAFC has addressed this many times and has endorsed this language each time!

Stanford 1st Assignment:“I agree to assign or confirm in

writing to Stanford and/or Sponsors that right, title and interest in . . . such inventions”

Later Assignment: “I will assign and do hereby assign to CETUS, my right, title, and interest in each of the ideas, inventions and improvements.”

Families of IP assets Courts will try to

construe assignments to generally cover downstream applications unless language clearly excludes those downstream applications.

Same general rule applies to license agreements and downstream applications. General Protecht Group, Inc. v. Leviton Mfg. Co.. *** if you license a parent application, you have probably licensed any downstream applications.

Carve Out Provisions in Agreements Carve Out provisions

exclude certain technologies from either assignments or license agreements.

CAFC has held that carve outs only applied if the particular claim in a patent was only directed to the carved out technology. If other features were included in the claim, then the Carve Out did not apply. MHL Tek.

You Can Assign Individual Claims in a Patent, Right? Example: Patent Application issues

with claims 1-10 directed towards a widget and claims 11-20 directed towards a doodad.

Claims 1-10 assigned to ABC.

Claims 11-20 assigned to XYZ.

An assignment of only certain claims in a patent is, in fact, not an assignment. This logically follows from 37 CFR 3.1, which reads “An assignment of a patent, or patent application, is the transfer to another of a party’s entire ownership interest.”

Let’s hold hands Rights are severely limited when you have co-

owners. No standing to sue individually and either party can grant non-exclusive licenses– creates a race to the bottom for royalty rates.

Let’s put these assets in our Cayman Island company Can limit your ability to collect lost profits since your

Cayman Island company doesn’t have profits associated with the sale of products to lose.

Also brings up standing issues.

Most Favored Nations Clause Grants a first licensee a matching royalty if a later

licensee gets a lower royalty rate. Be careful with paid up royalties to settle litigations

as this can trigger a Most Favored Nations clause.

Questions