Ownership vs. Inventorship of a Patent

By David Carnes

A patent grants the owner of the patent a temporary legal monopoly on a bundle of rights related to an invention, including the right to profit from it. The inventor, however, is not always the owner of a patent. Patent law provides a number of ways in which someone can obtain patent rights over technology invented by another.

A patent grants the owner of the patent a temporary legal monopoly on a bundle of rights related to an invention, including the right to profit from it. The inventor, however, is not always the owner of a patent. Patent law provides a number of ways in which someone can obtain patent rights over technology invented by another.

The "First-to-File" versus "First-to-Invent" Systems

Sometimes, two people working independently of each other invent the same invention. U.S. patent law applies a "first-to-invent" standard, meaning that the original inventor may invalidate a patent granted to a later inventor, even if the later inventor filed his patent application first. When two inventors file patent applications on the same invention, the Board of Appeals and Interferences at the U.S. Patent Office may have an interference hearing to determine who conceived of the invention first, and whether the inventors were diligent in reducing their inventions to practice. Most of the rest of the world applies a "first-to-file" system, meaning that a subsequent inventor is entitled to patent protection as long as he files a patent application before the original inventor does. In such a case, the original inventor will not own the patent.

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Patent Licensing

Once an inventor files a patent application, he is free to market his invention to potential manufacturers and distributors. If the patent is eventually granted, patent protection will be extended retroactively to the application filing date. Once a patent license is granted, the licensee may manufacture or sell the patented technology. A patent license, however, does not transfer full ownership rights -- for example, the licensee's right to sue third parties for infringement is limited by law.

Works for Hire

An employee may enter into an employment contract that contains a work-for-hire clause. A work-for-hire clause provides that patent rights to any technology invented by the employee in the line of duty belong to the employer as soon as the technology is created. If a work-for-hire clause applies, only the employer is entitled to apply for a patent on the technology, and any patent granted for the technology will belong exclusively to the employer. Many technology companies have their employees sign employment agreements that contain work for hire clauses.

Patent Assignment

Instead of licensing the patented technology, an inventor may simply assign the patent to another. A patent assignment transfers all right and title to the patent to someone else. This means that even the inventor must obtain a license from the assignee to continue manufacturing or selling the technology. Once the assignment agreement has been signed, the assignee is required to register the assignment with the U.S. Patent and Trademark Office by filing USPTO Form 1595. An inventor may assign a patent to receive a large lump sum payment rather than wait years for royalties to trickle in. Assignment is especially likely if the inventor is more skeptical of the invention's marketability than the assignee is.

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Reasons for a Patent

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Patent Assignment Agreement

Patents are valuable because they give the inventor the right to exclude others from making or using the patented invention. This right can be transferred to others through an assignment. Agreements to assign patents are common in industries that engage in research and development.

Differences Between a License and a Patent

In the U.S., a patent for an invention can be granted only by the United States Patent and Trademark Office in Washington, D.C. Once granted, the patent gives an inventor the exclusive right to manufacture, use and sell his invention, as well as legally prevent others from doing so. The patent holder also has the right to license others to use his invention, typically for payment of a royalty fee. A patent license is a private agreement between the inventor and a licensee, and does not involve the USPTO.

How a Patent Protects

A patent is the grant of a property right to an inventor for a set term, usually 20 years. When an inventor applies for a patent, the U.S. Patent and Trademark Office determines whether the invention is useful., not substantially similar to a prior invention and not an obvious extension of a prior invention. If the invention satisfies these requirements, the PTO issues a patent certificate. A patent provides specific protections for an invention.

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