Abbott Point of Care v. Epocal (Fed. Cir. 2012)
Abbott and Epocal both sell products used for point-of-care testing of blood samples. In 2009, Abbott sued Epocal in the Northern District of Alabama alleging infringement of its U.S. Patent Nos. 6,845,327 and 6,896,778 and asking the court to determine the legal title holder of the patents.
The patents list Dr. Lauks as the inventor and were filed in 2001 shortly after Lauks founded Epocal. The USPTO assignment database include a 2003 assignment from Lauks to Epocal and another assignment filed in 2009 shows the invention was assigned from Lauks to Abbott's predecessor company (i-STAT) vis-à-vis a 1984 employment contract. (Lauks himself did not sign another assignment). These assignments foreshadow the dispute: both Abbott and Epocal claim title to the patents.
It turns out that Lauks was an i-STAT employee in the 1980's and up through 1999 (apparently in New Jersey). He resigned in 1999 but took a position from 1999-2001 as a consultant to i-STAT. His employment agreement included a statement that he "hereby assign[s]" to i-STAT all rights to any invention that he "may make or conceive during [his] employment by … or which relate to any present or prospective activities of Integrated Ionics."
In reading this provision, the Federal Circuit first determined that the assignment clause ended in 1999 when Lauks resigned and the new consulting agreement signed by Lauks did not require that IP rights be transferred. And, in fact, the consulting contract included a provision that Lauks could also work on his own behalf. The Federal Circuit found such a clause to be in conflict with an automatic assignment. The court then concluded that – absent an agreement with i-STAT to assign his rights – Lauks was under no obligation to assign his patent rights to the company.
Because the 1999 Consultation Agreement is silent with respect to any assignment of Lauks' rights in inventions, improvements, or discoveries made or conceived during the consultation period, Lauks had no obligation to assign inventions from the consulting period to i-STAT. Thus, as the district court correctly concluded, the contract does not convey all substantial interest in the '328 or '772 patents.
These holdings were stated as being based upon New Jersey law (apparently the site of the contract). However, the court did not cite to New Jersey statute or precedent that would lead to these conclusions.
The appellate panel did look to New Jersey precedent in affirming the district court's refusal to allow Abbott additional discovery regarding the circumstances of the consulting contract. The court found the contract's plain language clear and unambiguous and that additional extrinsic evidence could not change that determination.
Chief Judge Rader penned the majority opinion, which was signed by Judge Lourie. Judge Bryson filed a dissent.
In dissent, Judge Bryson identified some ambiguity in the 1999 consulting contract as to whether the assignment provisions in the prior employment agreements were incorporated by reference. Based upon that ambiguity, Judge Bryson would have allowed Abbott additional rights of pre-judgment discovery.
The case did not address whether Abbott may have "shop rights" to practice the invention.