You've come up with a brilliant new invention and want to obtain a patent to protect this innovation. You talk with a lawyer who drafts and files a patent application on your behalf, go through examination with the United States Patent and Trademark Office (USPTO), and finally get your application allowed. Congratulations, you are now the proud owner of a patent!

Or are you?

In this article we will be discussing everything an aspiring inventor needs to know about assigning patent rights.

What is a Patent Assignment?

A patent assignment is a transfer of all or part of the rights, title, and interest (i.e., ownership) of a patent or patent application from one party (an assignor) to another (an assignee). (37 CFR 3.1).

An assignor is the party that transfers (“assigns”) the patent rights through the assignment.

An assignee is the party that receives the rights as a result of an assignment.

As the assignee you can wield your patent rights as you like (within the limits of the law, of course). For example, you can:

• Offensively take down others who are infringing on your inventions;
• Defensively leverage your rights to gain access to other patents; and
• Monetize by licensing your patent to a third party to generate revenue, such as through royalties.

More than one party may be an assignee, equally sharing rights to the patent. These parties are considered “joint assignees.”

In practice, this means that one joint assignee may license the patent to Party A, while another joint assignee attempts to license the patent to Party B, perhaps a competitor of Party A.

Many licensors want exclusive rights, meaning other parties cannot license the same patent – specifically to prevent competition from having access to the same innovations. In this manner, having joint assignees (or poor assignment recordation practices) may weaken your patent rights.

Additionally, if a patent is jointly owned, all joint owners must participate in any infringement action that is brought against an alleged infringer. For example, if a patent is jointly owned by two parties and one owner wants to initiate an infringement action but the second owner is unwilling to join the action, the action cannot proceed. (STC.UNM v. Intel Corp., No. 2013-1241 (Fed. Cir. June 6, 2014)).

Why Don't I Own My Patent from the Onset?

You might, but there are a number of factors that need to be reviewed.

Are you the only inventor? If not, you may only own a percentage of the patent (see joint assignees above). Depending on agreements between inventors, you may also be obligated to assign your patent to one of the other inventors.

Is an applicant an assignee? Not necessarily - although the applicant may be presumed to be the assignee, without an assignment, the applicant does not own the rights to the patent.

Did you invent something while at work? If so, check your employment agreement, because you may be obligated to assign any patents developed in the scope of your work.

Are you a part of a startup and looking to acquire investors? Many investors may require assignment of all applicable (current, pending, and future) patents as a condition for funding.

Are you the head of your company and de facto owner of the patent, but your company is merging or being acquired by another company? The transfer of assets during mergers and acquisitions often includes a transfer of assignments for patents.

What Does It Mean to Record an Assignment?

The USPTO maintains a public registry of patent assignments. Once an assignment has been executed, the applicant or owner, generally through their attorney, submits the assignment to the USPTO for recordation on the registry. The USPTO does not analyze the assignment, it merely publishes (i.e., records) the assignment in associate with the relevant patent or patent application. (Assignments for unpublished applications or patents sealed under government secrecy orders are the only exceptions, as the assignments for these matters are not made public.)

The public can then use these records to conduct ownership and chain-of-title searches. These records may be viewed in person at specific USPTO locations or online through the USPTO's assignment database on its website. 

How Do (and Why Should) I Record My Assignment?

Executing (and subsequently recording) an assignment grants the patent rights to the person or entity named in the recordation, and provides notice to future purchasers so they understand who actually owns the patent rights. The first recordation is considered the actual assignment. (MPEP §302).

Recording an assignment is also legally mandated in many jurisdictions.

For example, the UPSTO requires a recordation of an assignment within three months from the date of execution of an assignment or transfer of assignment. (35 U.S.C. §261).

Some foreign jurisdictions (e.g., Canada) require an assignment to be recorded before you file an application.

Some other foreign jurisdictions (e.g., Europe) only require assignments when there is a transfer of ownership.

How Can I Transfer My Patent Assignment?

In the case of an inventor (or inventors) being named on an application without obligation to assign their rights to another entity, but wanting to transfer their rights to another entity, each inventor must sign a patent assignment assigning their patent rights to this entity.

In the case where an entity is the assignor, it may transfer their assignment by having an officer (or someone else with apparent authority) sign a document assigning their rights to the patent to another entity.

In either case, full details of the associated parties (assignee and assignor) must be clear, including full names and addresses and clear indications of who is the assignee and assignor. The patent or patent application must also be clearly identified (this would include, at least, the patent or patent application number, inventors, filing date, and title). For foreign jurisdictions, a translation of the assignment must also be entered.

What is a “Chain of Ownership” and Why Does it Matter?

A chain of ownership, or chain of title, is a record of all transfers of ownership of the patent, beginning from the original owner(s) and extending to the current assignee. In the USPTO, this chain of ownership is automatically kept in the assignment database – though it is still good to keep track of the chain of ownership on your end as well.

To assign rights to a new assignee, you must be able to show proof of an unbroken chain in title from the original owner(s) to the current assignor, before recording the assignment to the new assignee.

How Gallium Law Can Help

The practitioners of Gallium Law are experts in the field of patents, and have extensive experience with preparing, recording, and transferring assignments. If you or your team would like help with either this recordation or transfer, please fill out this online form or call us at 651-256-9480 to schedule a consultation.

*The information in this article is not legal advice and should not be relied on. The content of this article is for informational purposes only and is meant as a starting point in your search for answers to your legal questions.