Recording a Patent Assignment

Under 35 U.S.C. § 261, patent assignments are void as against subsequent purchasers for valuable consideration without notice, unless the assignment is recorded in the USPTO within three months of the date of the assignment or prior to the subsequent purchaser's acquisition. This creates a notice system: when Company A assigns a patent to Company B, and Company B fails to record the assignment, a later purchaser (Company C) who buys the patent from Company A without knowledge of the prior assignment to Company B can potentially take priority over Company B. Recording with the USPTO makes the assignment part of the public record — subsequent purchasers are charged with constructive notice of recorded assignments. The recording requirement protects the chain of title and ensures that anyone searching USPTO records can determine the current owner of a patent.

Under 35 U.S.C. § 261, an assignment must be recorded either: (1) Within 3 months of the date of execution (the date the assignment document was signed); OR (2) Prior to the date a subsequent purchaser acquires the patent for valuable consideration without notice. The three-month window provides an absolute safe harbor: if an assignment is recorded within three months of execution, it will have priority over any subsequent assignment even if the subsequent assignee acquired the patent before the recording. If the assignment is recorded after three months, it is still valid between the assignor and assignee — but it may be void against a bona fide purchaser for value without notice who acquired the patent before the recording. PRACTICE: to protect your rights, record the assignment as soon as possible after execution, and in any event within three months. Major companies routinely record all assignments within days of execution to close any window for competing claims.

To record a patent assignment with the USPTO: (1) PREPARE THE ASSIGNMENT DOCUMENT — the assignment must be in writing (35 U.S.C. § 261); it should identify the assignor, the assignee, the patent(s) or application(s) being assigned (by number), the consideration, and be signed by the assignor; (2) SUBMIT TO USPTO ASSIGNMENT DIVISION — submit the assignment document (or a copy certified by a notary) through the USPTO's Assignment Center (online) or by mail to the USPTO Assignment Division; (3) PAY THE RECORDING FEE — the USPTO charges a per-property recording fee (currently $40 per application or patent for the first 6 properties in a recordation; $25 each thereafter); (4) RECEIVE REEL/FRAME NUMBER — the USPTO assigns a reel and frame number confirming the recording; this appears in the USPTO's Assignment Database. WHAT CAN BE RECORDED: assignments of patents and applications; licenses (in some circumstances, for notice purposes); security interests (for lenders taking a patent as collateral); changes of name (corporate name changes); court orders affecting title.

An unrecorded assignment is generally valid between the assignor and assignee (it is enforceable in contract), but it is subject to being voided as against a bona fide purchaser for value without notice under § 261. Specific consequences: (1) STANDING TO SUE — a party must hold legal title to sue for patent infringement; if a patent was assigned but the assignment is not recorded, the assignee may need to add the recorded owner as a party in an infringement suit; (2) SUBSEQUENT BONA FIDE PURCHASER — a later purchaser who acquires the patent without notice of the prior unrecorded assignment and records their own assignment first may take priority over the earlier unrecorded assignee; (3) LENDER RIGHTS — a lender who takes a security interest in the patent must record its security interest with both the USPTO (for the patent) and potentially the state UCC system (for the underlying IP rights contract) to perfect its security interest against bankruptcy trustees and judgment creditors; (4) DUE DILIGENCE — in M&A transactions, acquirers verify recorded assignment chains; gaps in the chain can indicate title defects requiring correction before closing.

The chain of title for a patent is the complete sequence of recorded assignments from the original inventor(s) to the current owner. A clean chain of title shows an unbroken sequence: Inventor A → (assignment recorded) → Company X → (assignment recorded) → Current Owner. Chain of title matters because: (1) STANDING — to sue for patent infringement, the plaintiff must hold all substantial rights in the patent; a broken chain of title may mean the plaintiff does not have the right to sue; (2) LICENSING — licensees require the licensor to prove it has the authority to grant licenses; a title defect undermines the licensor's authority; (3) ENFORCEMENT — courts examine chain of title to determine who is the proper plaintiff; improper plaintiff can lead to dismissal; (4) M&A TRANSACTIONS — buyers perform IP due diligence to verify that the seller actually owns the patents being acquired; title defects discovered post-closing can lead to disputes or indemnification claims; (5) SECURITY INTERESTS — lenders require clean title to accept a patent as collateral. COMMON TITLE DEFECTS: missing employee assignments (inventor was an employee but never signed an assignment); corporate name changes not recorded; multi-step assignments with gaps; foreign inventor assignments from non-U.S. jurisdictions not properly executed.