Structuring Present Assignment Clauses and Power of Attorney in Hardware PIIA Agreements
Present assignment clauses and irrevocable powers of attorney in hardware PIIAs secure immediate IP ownership and enable unilateral patent filings.
FilmTec Precedent
Meaning
Legal doctrine established by the Federal Circuit regarding the automatic transfer of legal title to future inventions. The filmtec precedent clarifies that using the phrase hereby assigns in a contract effects an immediate transfer of rights the moment an invention is conceived. This differs from a promise to assign, which only creates an equitable interest.
This distinction is vital for determining who has the standing to sue for patent infringement.
Automatic Assignment
Under the filmtec precedent, no further action is required from the inventor once the invention is created if the original contract used the correct operative words. The legal title moves to the employer by operation of law. This mechanism provides companies with a high level of certainty regarding their intellectual property portfolios.
It prevents situations where a disgruntled employee refuses to sign assignment papers after a product is launched.
Equitable Title
An agreement that falls outside the filmtec precedent only grants the employer an equitable title. This means the company has a right to ask a court to transfer the patent, but it does not yet own the patent. The lack of legal title can prevent a company from filing a lawsuit against a competitor.
A clear chain of title is necessary for most licensing and sale transactions.
Notice Provision
Third parties are generally bound by the transfer of title that occurs under the filmtec precedent if they have notice of the agreement. Filing the original employment contract with the patent office can serve as constructive notice. This protects the company against subsequent buyers who might try to purchase the same rights from the inventor.
Clear documentation ensures that the company remains the sole owner of the technology.