The Legal Trap With Joint Development

Explore the dangers of collaboration.
Zuber Lawler

Although some companies and universities are developing quantum inventions on their own, many others collaborate to share expertise and resources. This creates a pitfall because joint development results in joint ownership of their innovations.

As a result, any owner of a patent can use the jointly owned patent. More importantly, any owner can license others to use the invention, without the consent of the other owners. That means the ability to control the exclusivity of using the invention – which is the only thing a patent provides – is lost. In a similar vein, either owner can permit others to use an innovation that is protected as a trade secret. Indeed, if disclosed without proper protection of secrecy, either owner can destroy the trade secret.

It is therefore essential for joint owners of intellectual property rights to agree precisely on how joint inventors will be identified and how they will own, exploit and limit use and access to their joint intellectual property rights. It is also advisable that their agreement be made as soon as possible. Collaborators are typically best friends while they are working together developing technology, but that friendship can often sour with the passage of time as their commercial interests exploiting their innovations diverge.

A. Joint Inventorship

The exact contours of joint inventorship have always challenged the legal community because joint inventorship is often disputed, particularly where an invention appears to be valuable. Current litigation over joint inventorship focuses on a joint inventor’s degree of collaboration, contribution to the conception of an invention, and corroboration of his or her claim to joint inventorship. The enforcement of the collaboration requirement is alive and well in the Courts, as is the requirement that a joint inventor contribute to the conception of an invention. These requirements can be a significant hurdle, particularly as the evidentiary burden to show corroboration is on the person seeking to change inventorship to add himself or herself as an inventor.

The Federal Circuit has explained the quantum and extent of a joint inventor’s contribution as follows: All that is required of a joint inventor is that he or she (1) contribute in some significant manner to the conception or reduction to practice of the invention, (2) make a contribution to the claimed invention that is not insignificant in quality, when that contribution is measured against the dimension of the full invention, and (3) do more than merely explain to the real inventors well-known concepts and/or the current state of the art.

Determining the correct inventor is a factually intensive inquiry, but resolution of this issue often occurs by motion, before trial.

Recent litigation concerning joint inventorship has focused less on rigorous application of these factors and more on the joint inventorship requirements of collaboration, contribution to the conception of the invention, and finally corroboration of any claims to inventorship.

Changing inventorship to add a missing inventor or to remove an incorrect inventor does not require litigation. It can be done through the Patent Office, either during prosecution of the patent application or after a patent issues. Of course, the sooner any error in naming inventors is corrected, the better, while the inventors still have an amicable relationship and are inclined to correct – not to fight about – the error.

B. Tactics Available To The Omitted Joint Inventor

Each joint inventor presumptively owns an indivisible pro rata, yet indivisible, share of the patent no matter how many claims each individual inventor conceived. Thus, each joint inventor may, without the consent of others, license the rights in the entire patent or refuse to join as a plaintiff in an infringement suit, thus holding tremendous power to destroy the value of a patent.

Ethicon, Inc. v. United States Surgical Corp. is an example of the tremendous power each joint inventor has to destroy the value of a patent. The implication of Ethicon is “one co-owner has the right to impede the other co-owner’s ability to sue infringers by refusing to voluntarily join in such a suit[,]” and thus puts patent co-owners at the mercy of each other. Consent of co-owners and accounting to co-owners is not required under 35 U.S.C. § 262. Also, Schering Corp. v. Roussel-UCLAF SA confirms that a co-owner’s grant of a license to an accused infringer provides a complete defense to an infringement claim brought by the other co-owner.

The question is the extent to which these potentially destructive rights can be addressed and resolved in contracting negotiations among joint inventors, before disputes arise. Fortunately, the patent law allows joint inventors to resolve these issues by contract. How those issues is resolved is a question of the relative leverage of the joint inventors and their organizations, but it is almost always the case that those issues should be resolved from the start.



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