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Employment Agreement Patent Assignment

The U.S. Court of Appeals for the Federal Circuit recently looked at IP award clauses in employment contracts. In Advanced Video Techs. LLC v. HTC Corp., 16-2309, 16-2310, 16-2311 (Fed. Cir. 11 January 2018), the court upheld a district court ruling that the ambiguous language of an employment contract did not support any “current transfer” of intellectual property rights to the company. While the courts try to avoid a specific formulation of these clauses – and thus potentially increase a form on the substance – clear language that directly and automatically assigns rights through the application of the law will avoid any confusion or perceived disagreement. Since a case may be dismissed at any time because of an immeasurable reputation, the plaintiffs and defendants in issue should judge, regardless of the stage of the dispute, whether the language of the relevant employment contracts raises a potential ongoing problem. In addition, prior to filing the complaint, parties should always check relevant market documents to ensure that all issues are dealt with prior to the initiation of a dispute. Disclosure and cooperation.

The agreement should also require the worker to disclose in a timely manner any inventive activity, to maintain the documentation of the invention and to cooperate and to assist the employer in obtaining patents. Immediate disclosure should prevent a worker from withholding an invention until after separation from the workplace (in an attempt to claim sole ownership of the invention). Similarly, documentation of the design of the invention will (hopefully) link the invention to a specific date that may be important for determining priority over third parties or for proof that the invention was created during the duration of the employment. Finally, the employer will at some point need the support of its employee/inventor, either during the employment or after the separation of the job, to obtain, enforce or defend patent rights. For example, the employee may be required to perform a task in favour of the employer, sign declarations or provide information about patent actions. A co-operation clause will prevent the worker from taking the employer hostage by refusing to assist in the protection and application of the patent. Practical note: Employers should ensure that their employment contracts include a current transfer of intellectual property rights and not a commitment to allocate in the future. However, even in the case of duly developed employment contracts, employers should transfer their manufacturing workers to the company through a formal allocation for each new IP development. In order to assert a patent in a dispute, a party must prove that it was in law at the beginning of the action. Otherwise, a court may be dismissed for disagreement. Employers often rely on employment contracts signed by worker inventors to enforce final rights over the patents invoked.