Employee Inventors, Client Identity, and Assignments

By David Hricik, Mercer Law School

Over the years (sigh, decades) of being involved with ethical issues in patent practice, one set of problems that recurs involves assignments from employee-inventors.  I was reminded of some of them by a recent article in Landslide Magazine by Fred Carbone (of my old firm, Baker Botts), entitled “Employee Inventors and Patent Ownership: Whose Rights are They Anyway?” (available, I hope not behind a paywall, here).

The article does a good job of laying out some of the thorns in the bramble bush of choice of law in interpreting contracts of assignment (which, of course, arises only when the assignor was an inventor, and inventorship can be its own thorny issue).  The article points out some common law gap filling obligations that may require an assignment where no written agreement, or an ineffective one, is in place.  Apparently, Mr. Carbone is going to give a talk on April 20, 2021 on other ways to obtain assignment (as explained on page 23 of the magazine).

One related issue that I’ve discussed more than a few times and seen arise repeatedly over the years is when, after a dispute arises between a former employee and former employer, the former employee asserts that he had believed that the lawyer who had represented the employer also represented the employee and that the employee had been an inventor and either was left off or was included as an inventor but did not owe an obligation of assignment.  Sometimes that implicates Model Rule 4.3, which can require a lawyer to correct a non-client’s misunderstanding as to who the lawyer represents.

As a best practice, even if not required, including a written statement that the lawyer does not (or does) represent the inventor, or advising the inventor to obtain her own counsel, or both, may often be a good idea to avoid either misunderstanding or strategic behavior.

About David

Professor of Law, Mercer University School of Law. Formerly Of Counsel, Taylor English Duma, LLP and in 2012-13, judicial clerk to Chief Judge Rader.

4 thoughts on “Employee Inventors, Client Identity, and Assignments

  1. 2

    I have long advocated for independent counsel to advise employees about their limited rights from signing patent assignment clauses. I often fielded questions about the meaning of an assignment clause. Most inventors are completely unaware of their invention as an asset that can be bought and sold. I still believe in royalty rate schedules that reward inventors and creators over time for their continued development and allow for assignors to continue to receive limited assignments to recoup their development costs plus profit so that improvement patents and creative secondary markets prove lucrative for both the inventor and investor.

  2. 1

    Over the… decades…, one set of problems that recurs involves assignments from employee-inventors.

    Boy howdy, does this issue ever re-occur. Congress could (and should) solve 98% of the troubles that arise in this issue by amending Title 35 to make the employer in an invent-for-hire situation the “inventor” for statutory purposes, much like Title 17 makes the employer of a work-for-hire the “author” for copyright purposes.

    1. 1.1

      I would push back against that.

      The disparate bargaining power combined with such a move would all but eliminate innovation on a personal level.

      We need MORE of that sense of personal initiative – not less.

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