By James L. Kwak, Partner, Standley Law Group LLP

The inventor of an invention is the person or persons who intellectually contributed to the conception of the claimed invention. Those persons who merely helped assemble the invention (such as work done on a prototype), but did not conceive any portion of it, are not considered inventors. Those people are merely persons who helped reduce the invention to practice.

For example, let’s assume that Bob invented a new design for a gas grill. Bob makes sketches of his idea and prepares a written description. Bob takes his drawings to a grill manufacturer who takes his drawings and builds him a prototype. In this situation, Bob is the only inventor and the manufacturer is merely the outfit who helped Bob reduce his invention to practice.

So then, who is the owner of an invention? This is important because the owner of the invention is the entity who can legally apply for a patent on the invention and is the one who can reap the benefits of the invention. In the simple situation where the inventor is not employed by a company, or is employed but comes up with an invention separate from his employment, the inventor is typically also the owner of the invention. He/she is the owner of the invention until he/she assigns (sells) his/her rights in the invention to another entity.

If the inventor is employed at a company at the time of the invention, the employer may own the invention if:

  1. The employee has signed an employment agreement agreeing to assign rights to his/her inventions to the employer; or
  2. The employee was specifically hired for the purpose of making inventions or for their invention-making skills (even in the situation where there is no written agreement).

These are just two common examples of employer invention ownership scenarios. Each State has their own laws related to employer/employee invention ownership, so when in doubt an attorney should be consulted to determine the rights of each party. In some situations, even if the law determines that the employee owns the invention, the employer may have some limited rights to use the invention if the employee created the invention using employer resources (e.g., the employer’s tools or materials). If the employee used the employer’s resources to create the invention, the employer may have a “shop right” to the invention. If a shop right exists, the employer can have a royalty free, non-exclusive, non-assignable right to use the invention. Even if the employer may have a shop right to the invention, the employee in such situations still owns the invention. As the owner, the employee has the right to file a patent application to the invention, to license or assign the invention to others.

These rules regarding employee/employers do not apply to independent contractors that are not employed by the company. The general rule for independent contractors is that the independent contractor will own the invention unless there is an agreement between the independent contractor and the company where the independent contractor agrees to assign his or her rights to the invention to the company. Shop rights may also apply in situations where the independent contractor uses company resources to create the invention. For companies interested in owning inventions of employees or independent contractors it hires, it is best to have signed, written agreements in place with the employees and independent contractors prior to work being done. Human Resource departments of companies should consider addressing this issue in the employee handbook or other employee rules and regulations of the company, and making their acceptance a condition of employment.

As a final note, if a patent application is filed with the U.S. Patent Office on the invention, and the invention is assigned to you or an entity you own, make sure the assignment is recorded (filed) at the U.S. Patent Office for the patent application or issued patent. Recording the assignment includes sending the Patent Office a signed copy of the assignment. Recording the assignment is crucial as it provides notice to other potential buyers that you own rights in the patent. If your assignment is not recorded at the Patent Office, a subsequent bona fide purchaser of the invention, who does not have notice of your rights, may take superior rights to the patent over you.

f you have any questions about inventorship and/or ownership of an invention, contact your patent attorney to seek advice.