Invention assignment agreement

The Supreme Court states that since 1790 the patent law has operated on the premise that rights in an invention belong to the inventor, and that it has rejected the idea that mere employment is sufficient to vest title to an employee's invention in the employer². In most cases a patent may be issued only to an applying inventor or to the inventor's assignee, because an inventor's interest in an invention is assignable in law by an instrument in writing². For applications filed on or after 16 September 2012, a person to whom the inventor has assigned or is under an obligation to assign the invention may make the application (35 U.S.C. 118)¹².

35 U.S.C. 261 provides that applications for patent, patents, or any interest therein shall be assignable in law by an instrument in writing³. An assignment is void as against a subsequent purchaser or mortgagee for valuable consideration, without notice, unless it is recorded in the Patent and Trademark Office within three months from its date or before the date of the subsequent purchase or mortgage³. See Patent assignment for recording and for the difference from a license. Who counts as an inventor is a separate question, covered on Inventorship.

Some US states restrict what an employment agreement may require an employee to assign. California's statute is one example. Under Labor Code 2870(a), a provision requiring the employee to assign, or offer to assign, rights in an invention does not apply to an invention the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities or trade secret information. Two exceptions remain: inventions that relate, at the time of conception or reduction to practice, to the employer's business or actual or demonstrably anticipated research or development, and inventions that result from any work performed by the employee for the employer¹. See Trade secret.

• Unenforceable to that extent. To the extent a provision purports to require assignment of an invention excluded under subdivision (a), it is against the public policy of California and unenforceable (section 2870(b))¹.
• Not a condition of employment. No employer shall require such a provision as a condition of employment or continued employment (section 2871). The same section says the article does not forbid provisions for confidential disclosure of all the employee's inventions made during employment, an employer review process, or full title being in the United States as required by government contracts⁴.
• Notice and burden. If an employment agreement entered into after 1 January 1980 requires assignment, the employer must also give written notification, at the time the agreement is made, that it does not apply to an invention that qualifies fully under section 2870. In any suit, the burden of proof is on the employee claiming the benefit (section 2872)⁵.

Other states have their own texts. The table shows three whose official text is cited on this page. It is not a list of every state, and the wording differs, so the statute of the state concerned has to be read.

In Stanford v. Roche, the researcher had signed two agreements. The one with Stanford stated that he "agree[d] to assign" his right, title and interest in inventions resulting from his employment there. The one with Cetus stated that he "will assign and do[es] hereby assign" his right, title and interest in the ideas, inventions and improvements made as a consequence of his access to Cetus².

The Federal Circuit concluded that the agreement with Stanford was a mere promise to assign rights in the future, unlike the agreement with Cetus, which itself assigned the researcher's rights². The Supreme Court said the Federal Circuit's interpretation of the agreements was not an issue on which it had granted certiorari, so it had no occasion to pass on the validity of that construction². This page therefore states no rule on how particular wording operates. The Court's holding was that the Bayh-Dole Act does not automatically vest title to federally funded inventions in federal contractors². See Technology transfer.

The EPC provides that the right to a European patent belongs to the inventor or his successor in title. Where the inventor is an employee, that right is determined in accordance with the law of the State in which the employee is mainly employed or, if that State cannot be determined, the law of the State in which the employer has the place of business to which the employee is attached (Article 60(1))⁹. An assignment of a European patent application must be made in writing and signed by the parties to the contract (Article 72)¹¹. China's Patent Law treats an invention-creation accomplished in the course of performing the duties of an employee, or mainly by using the employer's material and technical conditions, as a service invention-creation, for which the right to apply for a patent belongs to the employer. For an invention-creation accomplished by using the employer's material and technical conditions, a contract between the employer and the inventor on the ownership of the right to apply and of the patent right prevails (Article 6)¹⁰. The employer granted the patent must also reward the inventor of a service invention-creation and pay reasonable remuneration after exploitation (Article 15)¹⁰. This page does not set out other countries' rules on employee inventions.

The decision below is the Supreme Court's ruling on whether the Bayh-Dole Act vests title in federal contractors. It is an example of how employment, title and assignment wording arose in a real case, and it says nothing about either party beyond the opinion itself.

The Court held that the Bayh-Dole Act does not automatically vest title to federally funded inventions in federal contractors, on the premise that rights in an invention belong to the inventor. It recorded the "agree to assign" and "do hereby assign" wording and said it had no occasion to pass on the Federal Circuit's construction of those agreements2.