WHAT IS A PATENT ASSIGNMENT?
A patent granted by the United States Patent & Trademark Office allows the owner—for a limited time—to exclude others from making, using, offering for sale, or selling the invention throughout the United States or importing the invention into the United States. This article is concerned with patent ownership and the transfer of title to a patent from an original patent owner to a third party.
What is a patent assignment?
Shortly after the U.S. Constitution was ratified, the first Congress enacted the Patent Act of 1790. U.S. Patent No. 1 was granted only months later, on July 31, 1790. Since the beginning of U.S. patents, the rights in an invention have always belonged to the inventor.[i] And the inventor has always had a right to convey her rights to a patented invention to a third party. Subsequently, others may acquire an interest in the patent. All transfers of interest in a patent must trace back to the inventor.[ii] These general rules have not changed over the past 231 years. Currently, the patent laws require an application for patent to be accompanied by an executed inventor’s oath that includes a statement by the individual, which declares it is her belief she is the original inventor of the invention claimed in the application.[iii] The laws further state that patents have the attributes of personal property. Taken together, the entire interest in a patent originates with the inventor, and the entire interest is assignable to others.[iv]
A patent assignment is a written agreement that transfers all ownership and control of the defined property (e.g., patent, patent application, patent family) from an assignor to an assignee for a fixed sum. An assignment is distinct from a license, which merely grants a licensee the right to practice the invention claimed in a patent without fear of being sued by the licensor. A license does not transfer title of the patent to the licensee. In view of these distinctions, the nuances of a patent license, such as whether it is exclusive or non-exclusive, are not applicable to an assignment.
Should a patent assignment be recorded with the USPTO?
The U.S. Patent Office is required to maintain a register of interests in patents and patent applications.[v] The patent assignment register is publicly available, and one can search the register for a particular patent assignment by the relevant patent number, patent application number, assignor name, assignee name, or other identifying information.
Once a patent assignment has been properly executed by the parties, it is advisable to promptly record the assignment with the Patent Office. Recording a patent assignment is beneficial to the assignee because the Patent Office will then issue a certificate of acknowledgement, which is evidence of the execution of the assignment, grant, or conveyance of a patent or patent application. The certificate of acknowledgement can by relied on to establish the assignee’s standing to sue a third party for patent infringement, and recording an assignment creates a rebuttable presumption the assignment is valid.[vi] Recording a patent assignment can also prevent a subsequent purchaser or mortgagee—without notice of the assignment—from subordinating the rights of the assignee. The patent laws encourage the recording of an assignment within three months from its date or prior to the date of a subsequent purchase or mortgage to discourage such sequential sales of a patent. Ideally, a party interested in purchasing a patent would be able to discover the assignment, and the true owner, when diligently searching the patent assignment register.
Recording a patent assignment is also beneficial to the public because an up-to-date register improves the clarity of patent rights. The patent assignment register generally includes information about a patent, such as ownership and contact information, that a party interested in purchasing or licensing the patent would like to know. Without this information, the interested party faces additional costs, such as those associated with tracking down the owner of the patent they are interested in purchasing or licensing. The assignment register also informs investors and others who evaluate companies because their patents may be considered valuable company assets. Indeed, patents are relied on in virtually every industry in the U.S. economy. Thus, improving the clarity of patent rights can lead to patent transactions or otherwise stimulate our economy.
[i] Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc., No. 09-1158, slip at 6–7 (U.S.S.C. June 6, 2011).
[iii] 35 U.S.C. § 115.
[iv] 35 U.S.C. § 261.
[v] 35 U.S.C. § 261.
[vi] SIRF Tech. Inc. v. ITC and Broadcom Corp. and Global Locate, Inc., No. 2009-1262, slip at 10 (Fed. Cir. April 12, 2010).
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