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Recordal Of Patent Assignment Document

A patent assignment is an irrevocable agreement for a patent owner to sell, give away, or transfer interest to an assignee, who can enforce the patent.6 min read

Patent Assignment: What Is It?

A patent assignment is a part of how to patent and idea and is an irrevocable agreement for a patent owner to sell, give away, or transfer his or her interest to an assignee, who can benefit from and enforce the patent. The assignee receives the original owner's interest and gains the exclusive rights to the intellectual property. He or she can sue others for making or selling the invention or design.

There are four types of patent assignments:

  • Assignment of Rights - Patent Issued: This is for patents that have already been issued.

  • Assignment of Rights - Patent Application: This is for patents still in the application process. After filing this form, the assignee can be listed as the patent applicant.

  • Assignment of Intellectual Property Rights - No Patent Issued or Application Filed: This is for unregistered inventions with no patent.

  • Exclusive Rights

Advantages of a Patent Assignment

Assignees don't create a unique invention or design. They also don't go through the lengthy patent process. They simply assume exclusive rights to intellectual property.

Many patents cover intellectual property that can earn the owner money. A patent owner can charge a lump sum sale price for a patent assignment. After the transfer, the assignee can start to earn profits from the patent. Both original owners and assignees can benefit from this business arrangement.

Disadvantages of a Patent Assignment

  • Too Many or Not Enough Inventors

Patents can have multiple owners who invented the product or design. Sometimes patents list too many or not enough inventors. When this happens, owners can argue about an incorrect filing. This kind of dispute can make a patent assignment impossible.

Older patents may already have many infringements. Not all patent assignments include the right to sue for past infringements. This is known as the right to causes of action. This can cost the assignee a lot of potential profit.

Examples of What Happens When You File a Patent Assignment vs. When You File a Patent License

  • When You File a Patent Assignment

The patent owner changes permanently. You file the paperwork with the United States Patent and Trademark Office (USPTO). Information about the new owner is available to the public.

Many owners charge a one-time fee for a patent assignment. The original owner doesn't receive additional payments or profits in the future. The new owner receives future profits.

  • When You File a Patent License

The patent owner doesn't change permanently. Most licenses have a time limit. At the end of the period, the original owner takes control again. Licensing information isn't always available through an online USPTO search. Contact the recordation office directly to get information about patent licenses.

The licensee can assign the rights to another person or company. This adds another layer of ownership over the intellectual property.

Many owners charge royalties for a patent license. The licensee pays royalty fees throughout the license period. If the royalty fees are high and the license period is long, a patent assignment may be a better choice for earning the new owner more money.

Common Mistakes

  • Not Filing an Assignment Document

A verbal agreement is not official. File a patent assignment to change patent ownership.

  • Taking Action Before Filing

The assignee shouldn't make or sell the invention before the patent assignment is official. If an error or another problem happens, this could be patent infringement.

Patent assignments are official documents. The assignee name must be legal and correct. Before filing, check the spelling of the assignee name. If the assignee is a business, confirm the legal name. Many patents have more than one owner. List all names on the assignment.

  • Misidentifying the Patent

Include as much information about the patent as you can. List the patent number and title. Describe the intellectual property completely.

  • Not Searching for Security Interests

Patents can be collateral. A bank or another party can file a security interest in a patent, and this can limit how much an assignee can earn from a patent. Check for security interests before filing a patent assignment.

  • Not Filing a Proprietary Information Agreement

Many businesses file patents, as this is part of a business plan, and it's especially common for startup businesses. Inventorship problems can happen if employees file patents instead of the business.

Often, employees have an obligation to assign inventions to a company. This is true if they developed the invention on the job.

To avoid confusion, require employees to sign a proprietary information agreement. This automatically assigns inventions and designs to the business. Other options include signing an automatic assignment or an explicit assignment. These all clarify patent ownership.

Make sure all official documents concerning your patent are notarized. There is a huge legal advantage to being notarized. It makes it so that your documents will be accepted as correct until it is proven otherwise. If you can't get your documents notarized, gather two witnesses. Have them attest to the signatures.

Deadline

You have to file a patent assignment within three months of signing the form. If you don't, the assignee could lose ownership rights.

Frequently Asked Questions

  • Where Do I Record a Patent Assignment?

If you have a U.S. patent, record your patent assignment with the USPTO. If you have a foreign patent, file with the correct national patent offices.

  • I Can't Get a Signature from the Inventor. What Happens Now?

First, it needs to be officially established that:

  • Whoever is pursuing the application has the right to do so.
  • The inventor cannot be reached.

In order to establish this, the patent office will need a copy of the following:

  • the employee agreement
  • the assignment
  • other evidence of the rights

After that, the patent office will continue as if the signature has been obtained, even though it hasn't.

If the inventor has died, the patent office will try to contact the person in charge of managing the deceased's estate or the heir. If the invented refuses to sign or is missing, the patent office will ask for a declaration from the person who is trying to contact them. They will also look at the following items that have been sent to the inventor:

  • Do I Have to File a Patent Assignment if the Owner's Name Changed?

No, you don't need a patent assignment if only the person's or company's name changed. If the company merged with another, you may need a patent assignment.

  • What if I Make a Mistake on My Patent Assignment?

You can't correct a patent assignment. You have to assign it back to the original owner. Then you have to reassign with the correct information.

  • How Much Does a Patent Assignment Cost?

The patent assignment fee is $25. Filing electronically doesn't cost extra. You do have to pay an additional $40 fee if you file on paper.

Yes, you should get a lawyer to help with a patent assignment. A lawyer will make sure there are no filing errors. A lawyer knows how to describe the patent correctly. Errors and bad descriptions can limit the power of a patent assignment. This could cost the assignee a lot of money in future profits and legal fees.

Steps to File a Patent Assignment

1. Fill Out a Recordation Form Cover Sheet

The Recordation Form Cover Sheet is an official USPTO document. This includes the names of the assignor(s) and the assignee(s). It also includes the patent title and number.

2. Complete a Patent Assignment Agreement

The patent assignment agreement should list the assignor(s) and the assignee(s). It should state that the assignor has the right to assign the patent. It should also describe the intellectual property clearly and completely. It should also explain any financial or other transactions that have to take place. This includes a description of the lump sum payment.

3. Sign the Patent Assignment Agreement

All patent owners and assignees must sign the patent assignment agreement.

4. Submit the Patent Assignment

Finally, submit the patent assignment with the USPTO. You have to pay the assignment fee at this time.

If you need help with patent assignments, you can post your question or concern on UpCounsel's marketplace. UpCounsel accepts only the top 5 percent of lawyers to its site. Lawyers on UpCounsel come from law schools such as Harvard Law and Yale Law and average 14 years of legal experience, including work with or on behalf of companies like Google, Stripe, and Twilio.

What are assignments of issued European Patents?

An assignment of a European Patent is the act of transferring ownership of the issued European Patent from the assignor to the assignee. Often, the assignment document is simply referred to as the “assignment”. The two parties can be individuals or legal entities. Issued European Patents always need to be assigned on a country by country basis complying with the various national assignment requirements where the European Patent takes effect (is validated) in the respective contracting countries of the European Patent Convention (EPC). In addition, while the European Patent is still within the 9-month opposition term or an opposition is pending, the European Patent Office records assignments for the purpose of the opposition upon request, payment of the fee, and submission of a validly executed assignment document.

What are assignments of pending European Patent Applications?

In contrast to assignments of issued European Patents requiring recordation of the assignment on a country by country basis, the assignment of pending European Patent Applications is recorded centrally at the European Patent Office (EPO) upon request, payment of the fee, and submission of a validly executed assignment document.

Is the recordation of assignment of a partial ownership interests possible at the EPO?

Yes, it is for instance possible to add or remove a co-owner or co-applicant. Unless expressly specified otherwise in the assignment document, equal shares are assumed between the co-owner and co-applicant, often also called joint owners or joint applicants. Although not recordable at the EPO, certain partial rights can be assignable separately and independently from the underlying IP right, for instance the priority right that if properly claimed can determine the time rank of a later filed patent application.

What is required for valid assignments of issued European Patents?

National laws, rules and formalities apply for recordation of country by country assignments by a variety of national recording authorities such as national Patent Offices. When looking at a bigger patent family in what EPC countries the European Patent is validated and takes effect, a one fits all assignment fulfilling this wide variety of requirements is virtually impossible. Typically, national representatives should be retained for complying with this variety of requirements. If possible, European Patent Applications should be assigned at the EPO while still pending for avoiding the hassle of dealing with such wide variety of national requirements.

What are typical national form requirements for assignments of issued European Patents?

Assignments typically need to be made in writing and typically require the signatures of both the assignor and the assignee. In case of a legal entity, the signatory needs to be entitled to sign on behalf of that legal entity, typically an officer of the legal entity, or needs to have received the signatory authorization from such officer. Although in some countries the signature of the assignor only may suffice, more commonly, the signatures of both parties are required. It is good practice to assume that both signatures are required everywhere. The signatures are typically required in ink. As an alternative to filing the original with the signatures in ink, an increasing number of authorities have waived the requirement to file the original but accept copies, or when filed electronically, scans of the assignment document signed in ink. If not filed, the original should be kept in a safe place. Some countries may require notarization and maybe even require some form of legalization, e.g. “Apostille”, for effectively recording an assignment.

What assignment document content is typically required for assignments of issued European Patents?

In most countries, the assignment document just identifies the right that is assigned and the parties, but some countries require a specific text using specific language. From a practical standpoint, a good way of looking at assignments from a formal point of view is to treat these like a contract, although the assignment may have comparatively little content in comparison to other types of contracts. A few authorities may require the use of a specific form.

What are the form requirements for assignments of pending European Patent Applications?

Article 72 EPC in conjunction with Rule 22 EPC governs assignments at the EPO, see http://www.epo.org/law-practice/legal-texts/html/epc/2016/e/ar72.html in conjunction with http://www.epo.org/law-practice/legal-texts/html/epc/2016/e/r22.html. Further details fleshing out the meaning of Article 72 EPC and Rule 22 EPC can be found in the Guidelines for Examination in the EPO, Part E, Chapter XIII, downloadable as PDF documents at: http://www.epo.org/law-practice/legal-texts/guidelines.html. As of November 1, 2016, the Guidelines expressly clarify that “Article 72 requires that the signatures of the parties appear on the document submitted as evidence of the transfer”.As an alternative to filing the original assignment document with the signatures in ink, submitting copies or when filed electronically scans of the signed assignment form is admissible. If not filed, the original should be kept in a safe place. No specific assignment form is required. The assignment is just a very short document identifying the right that is assigned and the parties, the signatories and if applicable their job titles or other sources of signatory authorization. If only a specific percentage of ownership is assigned, this percentage also needs to be identified in the assignment.

Why are assignments important?

For pending European Patent Applications or for issued European Patents for the purpose of opposition proceedings, under Article 60 (3) EPC only the recorded assignee = applicant can exercise the right to a European Patent, see http://www.epo.org/law-practice/legal-texts/html/epc/2016/e/ar60.html, ruling that “(3) In proceedings before the European Patent Office, the applicant shall be deemed to be entitled to exercise the right to a European patent.”For issued European Patents, on a country by country basis, the failure to properly assign and record may also result in enforceability delays of the assigned IP right by the assignee until recordation has been finalized. Also, a proper assignment is required for validly claiming priority rights.

What are the most common assignment deficiencies?

Although the assignment document has only limited content a variety of deficiencies may occur. Just to mention a few: The assignor may not be the owner of the assigned IP right at the date of assignment; the incorrect IP right is assigned; at least one of the signatories lacks signatory authorization; a required language or form is not used; certain assignment document form requirements are missed, formalities such as signatures in ink, notarization or legalization are missed; some recordation form requirements such as request and recordation fee payment are missed; the signature by one party such as the assignee is missed; the parties are not properly defined to be clearly identifiable, for instance due to incorrect name and/or address; or the date of the assignment is too late for taking certain legal effects.

What are the legal consequences of a deficient assignment?

Although it may be possible to overcome some consequences by correcting deficiencies without losing the initial assignment date, or time permitting simply by executing and recording a new assignment, in some cases these remedial measures may come too late. For example, for validly claiming priority rights, the priority right needs to be actually owned by the applicant of the later application within the priority time period. The risk with assignments is that some deficiencies may not be noticed until it is too late to fix the problem. For this reason, assignment formalities should be observed scrupulously.

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