Patent Assignment Requirements

A patent assignment transfers ownership of patent rights from the assignor to the assignee: STATUTORY BASIS: 35 U.S.C. § 261 — 'applications for patent, patents, or any interest therein, shall be assignable in law by an instrument in writing'; WRITING REQUIREMENT: an assignment of patent rights MUST be in writing to be valid; an oral assignment is unenforceable; the writing must identify the patent or application being assigned and the parties; WHAT CAN BE ASSIGNED: (a) an entire patent or application; (b) an undivided fractional interest (e.g., 50% of all rights); (c) rights limited to a geographic area; (d) a field-of-use license is NOT an assignment — it does not transfer ownership; WHO MUST SIGN: the assignor (the person transferring rights) must sign; the assignee's signature is not legally required for validity but is typically included; ASSIGNMENT vs. LICENSE: an assignment transfers ownership of patent rights — the assignee becomes the owner; a license grants permission to do something that would otherwise be infringement — the licensor retains ownership; COMPULSORY ASSIGNMENT (Employment Agreements): employment invention assignment agreements (IAAs) in employment contracts create a present obligation to assign future inventions; Filmtec Corp. v. Allied-Signal Inc. (Fed. Cir. 1991): a clause that 'employee hereby assigns' all future inventions operates as a present automatic assignment — the invention vests in the employer at the moment of conception without any further action; 'employee agrees to assign' clauses require a future act to effectuate the assignment and do not automatically vest; PARTIAL ASSIGNMENTS: co-owners each have independent rights to practice the patent and license others without accounting to co-owners (35 U.S.C. § 262); partial assignments create complex co-ownership situations.

Recording an assignment with the USPTO provides constructive notice to subsequent transferees: RECORDING OFFICE: USPTO's Assignment Division (Assignment Branch of the Office of Patent Legal Administration); ONLINE RECORDING: Electronic Patent Assignment System (EPAS) at assignment.uspto.gov; paper recording also available; TIMING — 3-MONTH RULE: 35 U.S.C. § 261: if an assignment is recorded within 3 months of the assignment date, it establishes priority over a subsequent conflicting conveyance; if recorded AFTER 3 months, a subsequent bona fide purchaser for value WITHOUT NOTICE who records first has priority; EFFECT OF RECORDING: recording gives CONSTRUCTIVE NOTICE of the assignment to the world; anyone searching USPTO records is deemed to know of recorded assignments; PRIORITY RULE: Assignment A (earlier in time but unrecorded) vs. Assignment B (later but recorded first): if Assignment B is a bona fide purchaser for value without actual notice of Assignment A, and Assignment A is not recorded within 3 months, Assignment B WINS; PRACTICE: always record assignments promptly — ideally simultaneously with the assignment; do not rely on the 3-month grace period; EMPLOYER ASSIGNMENT RECORDING: employers with IAAs typically record assignments at/after issuance; during prosecution, the assignee can prosecute the application but must record the assignment or submit a statement signed by the assignee; USPTO RECORDS: assignment records are public; anyone can search by patent number, application number, or assignee name; INTERNATIONAL CONSIDERATIONS: recording with the USPTO only affects US patent rights; international patent rights require separate assignments/recordings in each country.

Most technology employees have contractual assignment obligations that transfer patent rights to their employer: STANDARD IAA (INVENTION ASSIGNMENT AGREEMENT): employees sign IAAs at the start of employment; the IAA typically requires: (a) assignment of all inventions made during employment; (b) assignment of inventions related to the employer's business or resulting from the employee's work; (c) disclosure of all inventions to the employer; (d) cooperation in prosecuting patent applications; THE FILMTEC RULE: the language in the IAA matters critically: 'HEREBY ASSIGNS' — automatic present assignment; the invention vests in the employer at the moment of conception; the employee has no title to assign later; the employer can sue for infringement in its own name without further assignment action; 'AGREES TO ASSIGN' — contractual obligation to assign in the future; inventor retains legal title until a subsequent assignment is executed; employer must obtain actual assignment before suing for infringement; Stanford v. Roche (S.Ct. 2011): Bayh-Dole Act does not automatically vest title in a university for inventions made with federal funding; the employee's IAA governs — an 'agree to assign' clause in an employment agreement does not defeat a subsequent 'hereby assign' clause in a consulting agreement; STATE LIMITS ON IAA SCOPE: California Labor Code § 2870: IAA cannot require assignment of inventions made entirely on employee's own time without employer's resources UNLESS the invention relates to the employer's business or results from the employee's work; similar protections in Delaware, Minnesota, North Carolina, Washington; SPONSORED RESEARCH: inventions made with federal funding may have Bayh-Dole obligations even if IAA covers them; employer takes title but subject to government license and march-in rights.

Assignments of patent applications are common and have different procedural requirements: APPLICATIONS ARE ASSIGNABLE: § 261 covers both issued patents and applications; an assignee can prosecute a pending application and is entitled to receive the issued patent; ASSIGNMENT BEFORE FILING: an inventor can assign rights before the application is filed; the IAA typically assigns all future inventions, so the assignment pre-dates the application; the assignee must record the assignment at the USPTO to establish rights during prosecution; ASSIGNMENT DURING PROSECUTION: inventors frequently assign applications to their employers immediately after filing or during prosecution; the assignee can prosecute the application (file responses, request examiner interviews) once the assignment is recorded or an appropriate statement is submitted; INVENTOR DECLARATION vs. ASSIGNMENT: in AIA applications, either the inventor OR the assignee can file the application; if the assignee files, the assignee must submit a substitute statement explaining why the inventor is not available (if inventor is obligated to assign under an IAA); CIP AND CONTINUATION ASSIGNMENTS: an assignment of a parent application does not automatically assign continuation applications unless the assignment specifically covers continuations and divisionals; best practice: use an omnibus assignment covering the parent and all related continuations/divisionals/CIPs; POST-ISSUANCE ASSIGNMENT: after issuance, the assignment must be recorded at the USPTO; if the assignment is NOT recorded before issuance, the patent issues in the inventor's name even if the inventor had a prior obligation to assign; USPTO will not check for assignment obligations before issuing the patent; EFFECT ON STANDING TO SUE: to sue for infringement, plaintiff must have been assignee at the time of infringement (or must sue with the patentee); a bare license cannot bring an infringement suit.

Assignment errors can result in loss of ownership rights, inability to sue for infringement, and costly disputes: PITFALL 1 — MISSING LANGUAGE: an assignment that only says 'I assign my interest in US Patent No. X' may not cover continuation applications, foreign counterparts, or reissue patents; BEST PRACTICE: use comprehensive omnibus language covering 'all continuations, divisionals, continuations-in-part, reissue applications, and foreign counterparts'; PITFALL 2 — INVENTOR SIGNATURES: all co-inventors must assign; a partial assignment from only some co-inventors leaves the unassigning inventor as co-owner with independent licensing rights; BEST PRACTICE: ensure all inventors sign the assignment; track down all inventors at the time of assignment; PITFALL 3 — DELAYED RECORDING: delay in recording after assignment creates risk of priority dispute with a subsequent bona fide purchaser; BEST PRACTICE: record immediately after execution; do not rely on the 3-month safe harbor; PITFALL 4 — AGREE TO ASSIGN vs. HEREBY ASSIGN: 'agree to assign' clauses require a subsequent execution act; if the inventor then assigns to a third party first and the third party records, the employer may lose rights (under Filmtec); BEST PRACTICE: use 'hereby assigns' language in all IAAs; PITFALL 5 — CHAIN OF TITLE GAPS: if an inventor assigned to a company A, and company A was then acquired, there may be gaps in the chain of title if the acquisition did not specifically cover the patent; BEST PRACTICE: in acquisition due diligence, trace the chain of title for each patent from inventor to current owner; record new assignments if needed; PITFALL 6 — STATE LAW VARIATIONS: California § 2870 and similar statutes can void assignment provisions for inventions made outside of employment duties; conduct a state-law analysis for employees in restricted states.