Problems may arise when a patent is invented by two or more parties without addressing the issues of control or ownership of the patent. The issue is that each of the inventors can exploit the patent without sharing any profits with the other inventors. Also, any one of the inventors can dedicate the patent to the public destroying the value of the patent. Accordingly, ownership issues of a patent should be clarified sooner than later since the relationship between the parties might sour over time complicating amicable resolution. To do so, the co-inventors or co-owners can enter into an agreement to jointly exploit the invention or assign the invention to a corporation in which ownership, control and profits are resolved through distribution of the corporate shares.
The following case illustrates a different type of co-ownership issue other than between co-inventors, specifically, ownership issues arising out of marriage and divorce. Under California law, any personal property including patent rights acquired during marriage is community property. In Envosys v. Nextel (Fed. Cir. Aug. 3, 2010), one of two co-inventors was married at the time the invention was conceived. Accordingly, the invention belonged to (1) the husband and wife as community property and (2) the other co-inventor. The husband and wife divorced. After the divorce, the husband and the other co-inventor assigned the patent to Envosys which sued Nextel for patent infringement.
Nextel contended that the ex-wife still owned part of the patent and that the lawsuit should be dismissed since the wife was not a party to the lawsuit. The logic is that since all of the owners of the patent were not part of the lawsuit, specifically, the wife, the lawsuit should be dismissed.
The Court disagreed with Nextel. According to the divorce papers, the husband and wife filed documents stating that “We have no community assets or liabilities.” Hence, the ex-wife had no ownership interest in the patents at issue.
Although there was a “happy” ending to this case, it still illustrates the importance of allocating ownership interest in a patent as early as possible because other situations might arise downstream that could complicate amicable resolution of the matter.
I invite you to contact me with your patent questions at (949) 433-0900 or [email protected]. Please feel free to forward this article to your friends. As an Orange County Patent Attorney, I serve Orange County, Irvine, Los Angeles, San Diego and surrounding cities.