In a much anticipated decision, the United States Supreme Court confirmed that, absent a valid assignment agreement, inventors own their invention -- even if federal funding was used to support the research efforts. The decision in Leland Stanford Junior Univeristy v. Roche Molecular Systems, Inc. held that under the Patent Act an inventors owns his or her invention in the first instance and only a valid and binding assignment agreement is effective to transfer ownership from the inventor.
The decision let stand the Federal Circuit's ruling that Stanford University did not obtain the patent rights from one of its research scientists when it used an assignment agreement stating that the research scientist "agrees to assign" all of his future inventions. Rather, Roche obtained the rights in a subsequent agreement because it used the language "do hereby assign." The Federal Circuit has now held on a number of occasions that the language "agree to assign" is a mere promise to assign in the future and requires a subsequent act, while the language "do hereby assign" is effective immediately upon the creation of the future invention without any additional act on the part of the assignee.
The Supreme Court held that the Bayh-Dole act for funding did not change this result as it did not contain any language to trump the Patent Act, which makes clear that an inventor owns the invention unless there is a valid assignment to the contrary. The Supreme Court noted that the Federal Circuit's decision on the distinction between "agree to assign" and "do hereby assign" was not before it as Stanford University did not file its cert petition on that basis. Accordingly, the Supreme Court did not address this issue and let stand the Federal Circuit's decision, although it did leave open the possibility of addressing this issue in the future.
As a result, the Federal Circuit's decision on "agree to assign" stands and companies should immediately review their assignment agreements to determine if they have used the "agree to assign" language. If the "agree to assign" language was used in the past it should be changed immediately to the more favored "do hereby assign" and action should be taken immediately to remedy the problems that may have been created from the "agree to assign" language. Otherwise, the company may lose inventions that it believed it owned.
Please click on the link for a more detailed discussion of the Roche case.