The Shifting Landscape of Patent Assignments
Within the last year, there have been several cases impacting assignment rights that practitioners need to be aware of. In light of these cases, parties to a patent transaction should carefully negotiate terms addressing potential subsequent validity challenges by an assignor.
October 01, 2021 at 01:00 PM
6 minute read
Intellectual PropertyPatent ownership rights in the U.S. originate with the patent's inventors. For an entity other than the inventors to obtain those rights, it is critical to ensure that inventors have effectively assigned the rights in the invention to the entity. This also applies when a company is acquiring a patent that was previously assigned to another company. Within the last year, there have been several cases impacting assignment rights that practitioners need to be aware of.
On June 29, 2021, in Hologic v. Minerva Surgical, 141 S.Ct. 1068, the Supreme Court ruled on a case addressing assignor estoppel. Assignor estoppel is a doctrine that broadly holds that a party that has assigned a patent cannot later challenge the validity of that patent's claims. In Hologic, an assignee added an allegedly broader claim during prosecution of an acquired patent application. The court held that assignor estoppel would not apply to claims during post-assignment prosecution if such claims are materially broader than those present in the assigned patent application. The court remanded the case to the United States Court of Appeals for the Federal Circuit ("CAFC") to determine whether the added claims were materially broader than those originally assigned. If so assignor estoppel should not apply.
In August of 2021, the CAFC found that several aspects of a university's bylaws did not effectuate a present automatic assignment between a former University of Michigan employee and the university. See CAFC No. 2020-1715, -1716. In a case involving Omni MedSci, Inc. ("Omni"), the former employee acquired several patents and subsequently assigned the patent rights to Omni. Omni later alleged infringement of the assigned patents by a third party. At issue was whether the University of Michigan owned the asserted patents according to the University Bylaws, which stated that patents acquired by university staff and supported by university funds "shall be" the property of the university, instead of Omni, who acquired the patents subsequent to the employment of the inventor. Id. The CAFC held that the use of the phrase "shall be property" reflects only a promise of a potential further assignment. The CAFC also held that the university's requirement that a separate assignment form be executed was not language of confirmation, but rather contained distinct and ambiguous language from the alleged present assignment. Accordingly, in the absence of a present binding agreement that related to the patents at hand, the CAFC agreed with the decision of the district court that there was no assignment.
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