|Heidi M. Brun , patent attorney|
We patent attorneys love to talk about what happens at work. Since we can’t talk about the wonderful inventions that come to us, we usually talk about the situations our clients get into and what we have to do to get them out of it.
For example, one client called me, pleased to tell me that their “exit” had come - they had just finished negotiating with a large company to buy them out. The term sheet was settled and they had turned the matter over to their lawyers to write up the contract. The large company was now doing their due diligence and they had sent my client a long list of requests – a list of all of their patents, their filing dates, issue dates, copies of the patents/applications, etc. Could I help?
Well of course I could and did. Some of the items were straightforward – the portfolio list with all of the bibliographic data and the applications/patents was easy. The tough part was to give copies of the assignments for each file, since my client had handled the filing of their provisional applications themselves and they hadn’t filed assignments on any of their US provisional applications. One of the provisionals had not yet matured to a full application so I told the client – no problem, we’ll prepare an assignment now and you can get all of the inventors to sign it.
Well, there were 8 inventors. 4 of them signed quickly, since they still worked for the client. Of the other 4, some quickly returned the signed document by email. But 2 of them caused the client a huge headache. One was still arguing with the client so he wasn’t keen to sign anything, even though by law, the client already owned the invention (under IL law, an employee’s inventions belong to the client, as long as the invention was made as part of his service to the client, which was the case here). Another one had moved on but couldn’t give us a properly witnessed signature.
The latter is one of those minor issues which cause amazing headaches. A signature on an assignment in the US either has to be notarized or witnessed. Since notaries are not easily available in Israel, we usually have inventors get their signatures witnessed. But the rule is that the witness cannot be a family member. When the inventor is still working for the client, this is not a problem as there always are people around the office who aren’t his/her relatives. But when an inventor is no longer at the client, whether because the inventor is working at home or because the inventor is now working for a different company, it becomes much harder - the inventor cannot easily find people who are comfortable witnessing a signature.
In our situation, the remaining inventor just couldn’t figure out how to get the document witnessed. And the client needed that signature … We finally sent our taxi driver to the inventor’s house. This served us in two ways – we got the inventor to sign the document, we got the original document and we provided a witness – our taxi driver. All in all, a fine solution to the problem.
Ownership troubles also happen when our clients buy granted patents. We had one client who bought a project from another company. When they told me about it, before they finalized the agreement, they asked me to check the patents that were part of the project. So I did. One quick look on “espacenet” and I found all the related patents/applications. And then I checked their title at the USPTO’s assignment branch. This website lists each patent/application and any assignments recorded therein. As expected, there was an assignment from the inventors to the company from whom my client was buying the patents. But, there was also a security lien listed, from the company to a bank. Clearly, the patents had been used as collateral for a loan. So I told this to my client and told them to make sure that the lien is removed before they buy the patents. This, they did.
Afterwards, they transferred the files to me and I made sure to register the assignment from the other company to my client. But the security lien wasn’t yet removed. Worse than that, I couldn’t file the release that the parties had prepared. The security release in the contract between the two parties did not separately list all of the patents involved. This made it impossible for us to register this release for each of the relevant patents/applications.
In the end, we had to have the parties rewrite the security release to separately list all of the patents. After that, we recorded the release at the USPTO.
These are only 2 of many stories involving ownership issues that I have collected over my 25 year career as a patent attorney. I will tell others in another newsletter.