Confirmatory assignment

Despite a valid assignment and an unbroken chain of assignments from each of the inventors, it may still be necessary to execute a formal type of assignment when filing a patent application for the invention, and to submit it to the patent office at the time of filing or shortly after. Namely, some of the world’s patent offices require an applicant to provide a signed assignment document(s) from the inventors to prove the entitlement to apply for a patent for the invention. When the actual assignment of the rights has already taken place in a valid manner, in compliance with the relevant statutory requirements or as part of an employment agreement, this document is merely a formality, a “confirmatory assignment”. As such, it can be used to “confirm” an automatic (and unwritten) assignment from the inventor in such countries where the rights to the employees’ inventions automatically belong to the employer, such that has purportedly taken place at some prior point of time, and to convert it to a written form. This could be important for example for due diligence purposes if prior to a planned transaction including a specific patent no written evidence can be found of the assignment of rights to the invention. A confirmation of the assignment may be required as a condition which must be fulfilled before completing the transaction. Confirmatory assignments are also frequently used, even if a written assignment already exists, when the parties do not want to disclose the assignment document in a public file wrapper. For example, an employment agreement also contains sensitive information, such as the inventor’s salary. The confirmatory assignment is also commonly used to record such non-employee assignments where the commercial terms of the assignment are to remain confidential. But it is also in the interest of the patent office to receive a separate, simple assignment document for the purposes of applying patent and documenting title, instead of complex and diverse assignment agreements, addressing also other matters beyond IP rights.

368 _{A broken chain of the rights regarding some of the inventor’s part leads to an invalid assignment} and can be used in invalidating all or some of the claims as in the referred UK court case.

In most jurisdictions there is no clear statutory basis for the confirmatory assignment. It is, however, clear that the confirmatory assignment, when executed in writing, is proof of the transfer of the rights from the assignor to the assignee. However, timewise, does the confirmatory assignment have the effect of ratifying the unwritten transfer of the rights having taken place at some prior point in time, or does it merely serve as a piece of evidence for the transfer of the rights effective as of its execution date? The answer can have a significant impact on the patent rights, as was seen in the UK case concerning the rights at the time of seeking a priority right. Given the uncertainty of the legal effect of the confirmatory assignment, in respect of the effective time, it would be wise to always have a written assignment in place already at the time of the actual rights transfer.

In the U.S. the confirmatory assignment is a statutory matter:

35 U.S.C. § 261

Subject to the provisions of this title, patents shall have the attributes of personal property.

Applications for patent, patents, or any interest therein, shall be assignable in law by an instrument in writing. The applicant, patentee, or his assigns or legal

representatives may in like manner grant and convey an exclusive right under his application for patent, or patents, to the whole or any specified part of the United States.

(--)

An assignment, grant or conveyance shall be void as against any subsequent purchaser or mortgagee for a valuable consideration, without notice, unless it is recorded in the Patent and Trademark Office within three months from its date or

prior to the date of such subsequent purchase or mortgage.369

The provision requires that apart from patent applications, also assignments are to be made in writing. This does not exclude the option to submit a written employment agreement as “an instrument in writing” but as concluded, a separate document might be a more appropriate option. Further, the provision states that an assignment shall be void against any subsequent purchaser or mortgagee, unless the assignment is recorded in the Patent and Trademark Office within three months from its date or prior to the date of the transaction. In the event that the assignment is not recorded within the defined time, then the assignee assumes the risk of having its rights transferred to a subsequent bona fide purchaser or a lender acting without a notice of assignment. That is, the law protects a third party who is in the belief that the assignee in the patent office records is up to date and no subsequent assignment has occurred. It should be noted that a confirmatory assignment, unlike for example a statutory assignment according to the relevant employee invention law, typically needs to be 369 _{35 U.S.C. § 261; Emphasis added.}

signed by the inventor(s).370 _{Thus, unless the employer provides to the patent office} documentation such as employment contracts, the employer needs to have the inventor sign the necessary documents to be able to apply for a patent for the invention made by the employee. The inventor might have a duty to do so based on the clause in their employment contract. In Finland this duty has been set in the Decree on the Right to Employees’ Inventions371_:

Section 1

When the rights to an invention made by an employee have under the Act on the Right to Employees’ Inventions (656/1967) (--) been transferred to the employer and the employer intends to apply for a patent for the invention, the employee shall sign

an assignment concerning the transfer of rights and any other documents that may be required in the patenting process, except where the employee considers that the

rights to his invention have not passed to the employer.372

What if despite such a duty the inventor refuses to sign the assignment, or the inventor has left the company, moved abroad, and is not reached? In the U.S., for example, a diligent effort must be made to locate and have the inventor(s) sign. Nevertheless, if their efforts are unsuccessful then showing “sufficient proprietary interest” can justify filing without a signature, on behalf of such non-signing inventor(s). Further, the oath or declaration in such an application needs to be accompanied by a petition including proof of the pertinent facts, to show that such action is necessary to preserve the rights of the parties or to prevent irreparable damage.373

In general, an assignment document shall contain sufficiently identified parties and the object of an assignment, in order to address who has assigned which invention to whom. The document also typically contains the basis for the assignment, for example such as a reference to “past and continued employment”, which can have the function of also being consideration for an assignment. Namely, a generally recognized principle in the contract law is that in order for any agreement deemed to be legally binding, each party must gain some benefit of entering into it, i.e. “consideration”.

370 _{Signature requirements vary with each country, though. For documenting purposes it is always} better to request signatures from inventors.

371 _{Finnish Decree on the Right to Employees’ inventions (527/1988, amendments up to 1218/2000).} 372 _{Decree on the Right to Employees’ Inventions 1§; Emphasis added.}