TBJ NOVEMBER 2021
Inventors Challenging Their Own Patents
What patent owners should know.
Written by and Photo by Victor H. Segura
Your key inventor has gone to work for a competitor and is helping
them produce the same product covered by a patent he previously assigned
to your company. You sue the competitor for patent infringement. Your
former inventor now claims the patent he assigned is invalid and
unenforceable. Not fair, you say? A recent U.S. Supreme Court decision
has set the standard to determine when an inventor can challenge the
validity of his or her own assigned patent.
Assignor estoppel is a doctrine in U.S. patent law that prevents an
inventor who assigns (assignor) a patent to another (assignee) from
later contending that the patent is invalid. As an equitable doctrine,
assignor estoppel is grounded in the principle of fairness. “If one
lawfully conveys to another a patented right … fair dealing should
prevent him from derogating from the title he has
assigned.”1
Assignor estoppel (hereinafter “AE”) has effectively served as an
enforceable noncompete canon. Not only does AE prevent the assignor from
doing an about face regarding the validity of the assigned patent, but
it also reaches those in privity with the assignor. What constitutes
“privity” in an AE assessment? Privity depends on the nature and extent
of the relationship between the assignor and the other party. The
Federal Circuit considers privity as determined upon a balance of the
equities. “If an inventor assigns his invention to his employer company
A and leaves to join company B, whether company B is in privity and thus
bound by the doctrine will depend on the equities dictated by the
relationship between the inventor and company B in light of the act of
infringement. The closer that relationship, the more the equities will
favor applying the doctrine to company B.”2 Companies should
take note of the broad encompassing scope of AE when considering new
hires or performing acquisition studies, as its restrictions affect not
only the inventor but also those in privity with the inventor and even
affiliated companies.
In Minerva Surgical, Inc. v. Hologic Inc., the U.S. Supreme
Court recently affirmed the vitality of the AE doctrine.3 The
court clarified that AE is not a blanket rule, noting situations where
the prohibition imposed on assignors and their privies does not apply.
The court noted that AE should apply only when the principle of fair
dealing is involved. The decision established a new standard for
determining when AE applies: “The doctrine applies when, but only when,
the assignor’s claim of invalidity contradicts explicit or implicit
representations he made in assigning the patent.”4 The court
provided three examples where the majority concluded AE does not
apply:
1. The assignment of patent rights occurs before invention (e.g., an employment agreement requiring assignment of future inventions not yet conceived);
2. A post-assignment change in the law that renders the patent invalid; or
3. A post-assignment change altering the scope of the patent claims.
The common element in the cited examples is that something changed
subsequent to the assignor’s “representations.” In Minerva, the
petitioner argued that the assignee (the company that acquired the
inventor’s patent) allegedly broadened the claims in the patent
application after the inventor assigned the application. The court
stated that “assuming that the new claims are materially broader than
the old ones, the assignor did not warrant to the new claims’ validity.
And if he made no such representation, then he can challenge the new
claims in litigation: Because there is no inconsistency in his
positions, there is no estoppel.”5 The court remanded the
case to the U.S. Court of Appeals for the Federal Circuit to determine
whether the assignee’s new patent claim is materially broader than the
claims that were assigned.
The Minerva decision should not be taken lightly by patent
owners and companies with active patent portfolios if they seek to
maintain full enforceability of their patents. Patent owners,
particularly employers, must now remain cognizant that they may not be
able to prevent a validity challenge to their patents under AE if they
have materially broadened the claims of the patent applications or
patents after receiving the assignment from the inventor. This situation
is common as inventors often assign their patent rights to an invention
at the initial stage when a patent application is prepared and filed by
the assignee. If at a later point, the assignee (e.g., the employer)
broadens the claims during prosecution of the patent application before
the patent office and is subsequently issued a patent with the broadened
claims, the inventor (assignor) could then challenge the validity of the
patent claims that were changed after assignment. Under
Minerva, the employer-assignee could no longer rely on AE to
prevent the invalidity challenge from a competitor who hires the former
employee-inventor.
What can companies do to protect themselves in the wake of the
Minerva decision? As discussed above, the most likely situation
to arise would be an inventor raising a validity challenge after an
assignee broadens the patent claims. To help prevent this issue from
arising, employers should consider keeping their inventors engaged
during the entire prosecution of patent applications to preserve any AE
defense. The intellectual property assignment document signed by the
inventors should seek to cover all permutations of claims to any subject
matter disclosed in the particular patent application and/or patent.
Keeping in mind that the inventor’s representations made in assigning
the patent rights are key to an AE assessment, employers may also
consider drafting employment contracts with employee cooperation clauses
requiring cooperation with execution of supplemental assignments and
oaths or declarations after any amendment (particularly if broadening
claims) is made to the assigned patent application or patent. Employers
may also want to have inventors execute confirmatory assignments when a
patent issues. By having employees/inventors review and sign off on
claim amendments and execute confirmatory assignments, it could mean the
difference between being able to raise AE and expensive litigation to
defend a patent’s validity.
Another option for employers to consider is filing the initial patent
application with broad claims, which can be narrowed during prosecution
of the patent application if necessary. This could preserve an AE
defense by blocking a subsequent assertion by the inventor that the
claims were broadened by a later amendment. Such filings would serve to
confirm that the inventor explicitly assigned narrower claims as well.
In cases where an employer wishes to defer filing and prosecuting a
regular patent application, yet desires to preserve its AE defenses, the
employer can file a U.S. provisional patent application with a set of
broad claims. Such a provisional application filing would establish a
priority filing date while providing the employer additional time to
decide whether or not to proceed with the patent application. Care would
need to be taken to ensure that the broad claims are supported by the
disclosure in the patent application to avoid other validity
issues.6
The correct naming of inventors on patent applications is also not to
be overlooked. Under U.S. patent law, a person should only be listed as
an inventor on a patent application if he or she meets the legal
standard as associated with at least one claim in the application. If
amendments are made to the claims during prosecution of a patent
application, it may be necessary to revise the named inventors depending
on the respective inventive contribution to the claims. Recalling that
under Minerva, AE should apply only when the principle of fair
dealing is involved, employers may also consider educating their
inventors regarding the various options available to a patent applicant
at the U.S. Patent & Trade Office for prosecuting patent
applications, including the option to broaden the claims of issued
patents.7 Such measures may help curtail an inventor’s
allegation of “unfairness” in an AE dispute.
Although the Minerva decision established limiting
parameters, the doctrine of AE continues to provide a means by which
patent owners and employers can defend the validity of their patents
when an inventor-assignor breaches norms of equitable dealing. AE
litigation will now entail determination whether an inventor truly gave
up the ability to challenge the validity of the patent in question at
the time of assignment. By taking measures to ensure that explicit
representations are and have been made by inventors when assigning past,
current, and future patent rights, patent holders can preserve their
right to defend against validity challenges under the AE doctrine.
Inventors, on the other hand, should be mindful of what is being
assigned and when. Anyone acquiring a patent should also consider
conducting a review of the file history for issues that could bar an AE
defense against later validity challenges.
The lower courts are now tasked with refining the legal contours of the
AE standard set by Minerva. Decisions will be addressing issues
such as what constitutes a “material” patent claim amendment and when an
assignor’s claim of invalidity contradicts representations made in
assigning patent rights. Nonetheless, patent owners and employers can
take proactive measures to better preserve their ability to invoke the
AE doctrine in defending their patents against validity
challenges.TBJ
VICTOR H. SEGURA
is an IP attorney with a private practice, focusing on patents and
intellectual property transactional issues. He holds a B.S. in
electrical engineering, a J.D., and an LL.M. from the University of
Houston. Prior to practicing law, Segura served as a helicopter crew
chief in the U.S. Marine Corps. For more information, go to segurapatentlaw.com.