HRFM Today

Assignments: Best Practice Tips

Written by: Stephen P. Scuderi for the Daily Record

The timing and sufficiency of an assignment document can become critical for protecting the rights of the assignee. These rights include the assignee’s right to sue for infringement, ownership right and right to claim priority.

Right to Sue for Infringement

In the recent case of Diamond Coating v. Hyundai, 823 F. 3d 615 (Fed. Cir. 2016), the court made it clear that anything less than a transfer of the “entire exclusive patent right” runs the risk of the assignee not obtaining “patentee status” and therefore not having standing to sue for infringement under 35 U.S. Code § 281. If less than the entire exclusive right is transferred, than the courts must analyze the agreement to determine if the assignee has obtained all “substantial” rights. If significant restrictions are placed on those rights, than the agreement will be deemed a license and the assignee will not have standing to sue for infringement.

Right of Ownership

Under U.S. law, a patent or patent application “shall be assignable in law by an instrument in writing” (35 U.S. Code § 261). In the U.S., an assignment that is signed by only the assignor is considered a valid assignment.

This is in contrast to Europe, wherein an assignment of a patent must be in writing and “shall require the signature of the parties to the contract” (Article 72 European Patent Convention (EPC)). “Parties” in this case means the assignor and the assignee. Therefore an assignment signed only by the inventor may not be considered valid in some European countries.

Fortunately, validity of an assignment is governed by the laws of the country where the assignment is executed. Therefore, if an assignment is executed and valid in the U.S., it will also be accepted by the European Patent Office. However, for companies with inventors in multiple countries, care must be taken as to the legal requirements for a valid transfer of ownership in the country where the assignment is executed.

State of Computer-Related Patents Under §101 After Alice

Written by: Wayne F. Reinke for the Daily Record

35 U.S.C. §101 states that:  “Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent therefor, subject to the conditions and requirements of this title.”

In the first part of the two-part test set out by the Supreme Court in Alice Corp. v. CLS Bank International, 573 U.S. __, 134 S. Ct. 2347, the claims are reviewed to determine if they are directed to a judicial exception, i.e., a law of nature, natural phenomena or abstract idea.

With regard to an abstract idea, the cases seem to be more conclusory, lacking a thorough explanation.  Many times, it seems as if the test was whether the claims are computer-related and, if so, there must be an abstract idea.  Nonetheless, in the second part of the test, an inquiry is made as to whether the claim includes additional inventive elements that transform the claim into patentable subject matter.  Although there is no definition of what those additional elements need to be, it is clear that it needs to be more than merely applying the abstract idea to a particular technological environment (e.g., a general-purpose computer).  Related inquiries include whether a particular claim preempts a field of activity, i.e., does it usurp all other ways to achieve the same outcome.