Patent assignments are common during the patent process. They allow startups to own the ideas, solutions, and work products of the independent contractors that they hire. They also allow companies to own the inventions or solutions that their engineers create. In this article, we’ll explore everything you need to know about patent assignments, from their definition and purpose to how to find the owner of a patent.
What is a patent assignment?
A patent assignment is a legal document that transfers ownership of a patent from one party to another. The invention rights vest with the person that conceives of the invention unless the inventor has assigned the invention rights to another using the patent assignment. Understanding the basics of patent assignments is crucial for anyone that hires engineers, or independent contractors, purchases a patent, or licenses a patent.
What are the requirements of the patent assignment?
Here are the requirements for a valid patent assignment:
- The patent assignment must be in writing. Patent rights cannot be transferred from one party to another verbally. There is no such thing as a verbal patent assignment.
- Confirm that the party assigning the patent rights has the right to transfer the patent to the receiving party. You can do this by looking up all of the previous patent assignments associated with the patent. Below, I provide the link to the patent office where you can find these prior patent assignments. You are looking for a clear chain of title from the inventor (i.e., assignor) to the assignee.
- The patent assignment should clearly identify the patent being transferred. Moreover, it should state that all other related patents are included in the transfer.
- The assignor must sign the document. Notarization is not necessary but it would be helpful in the event of litigation.
- The assignee must record the patent assignment with the records office at the USPTO within 3 months after execution of the patent assignment. Otherwise, the patent assignment may be invalid.
Can a patent assignment be invalid if the requirements are not met?
A patent assignment can be invalid or not effective at transferring the patent rights from the assignor to the assignee. As such, the assignee needs to do their due diligence to make sure the assignment is proper.
Here are a few action items the assignee can check for their due diligence:
- Conduct a background check on the assignor
- Do they own the patent?
- Conduct a search for the patent at the records office of the USPTO
- Is the chain of title clear from the inventors to the assignor?
- Are there any liens on the patent?
- Conduct a search for all of the patents related to the patent being assigned
- A patent can be a part of a larger portfolio. Make sure that all of the patents in the portfolio are included in the assignment.
- Check the terms of the assignment document
- The assignment document should include a catch-all phrase so that the entire patent portfolio is transferred, not just one of the patents.
Who are the assignor and assignee?
The assignor is the person or entity that is transferring away their patent rights. In the example above, the inventor would be the assignor.
The assignee is the person or entity that receives the patent rights.
Who owns the invention?
An invention is initially owned by the inventor. Invention rights initially vest with the person that conceives or came up with the solution to a problem. In contrast to an inventor, a scribe merely follows the instructions of the inventor. For example, an engineer might design a solution and ask a draftsperson to draw up the concepts conceived by the inventor. The engineer would be considered the inventor. The draftsperson would be considered the scribe. The scribe does not have any invention rights. Nevertheless, you should have the draftsperson sign an invention assignment agreement just in case they do contribute to the invention.
What is the purpose of a patent assignment?
A patent assignment is used when the patent rights are sold to another party. For example, when the inventor sells their invention rights to a company, the inventor transfers their patent rights to the company. The transfer of patent rights is done with a patent assignment.
Patent assignments are also used to make sure that all invention rights are owned by one entity. Otherwise, the startup or company wouldn’t own all of the patent rights even if they paid someone to build a product.
For example, you come up with a clever idea but don’t know how to engineer the product. As such, you hire an engineer (i.e., an independent contractor) to design the product for you. Under US patent laws, the independent contractor is considered the inventor, and the invention rights vest with the independent contractor. You don’t own the ideas of the independent contractor even if you paid money to the independent contractor for their work. The patent assignment transfers the invention rights from the independent contractor to you. Now, you can get a patent for their ideas.
In another example, companies hire engineers to design products. Without a patent assignment, these engineers could get patents for their work. Patent assignments transfer the invention rights from the engineers to the company to allow the company to obtain a patent if desired.
Patent assignments arise in many other situations but they all work the same. They transfer the patent rights from one party to another.
How do you determine ownership of a patent?
All patents are recorded at the records office of the United States Patent and Trademark Office. You can find out who owns a patent by looking up the patent number using the following link: Patent Assignment Search.
The documents you find recorded at the records office of the USPTO may not relate to the transfer of patent rights. Sometimes, they relate to leans that are placed on the patents such as when the patent owner took out a loan for the business.
What you are looking for is a clear chain of title from the inventor or inventors to a company. If a sale of the patent rights occurred, a clear chain of tile needs to exist from the company to the buyer. Otherwise, the patent rights have a cloud in their chain of title.
As such, you have to read each of the documents to make sure that there is a clear chain of title from the inventors to the last owner of the patent.
Patent assignments are crucial for businesses and startups. They allow for the transfer of ownership of the patent from one party to another and ensure that the invention rights are not jeopardized.