The US Patent System and the Employed Inventor
From LabAutopedia
Authored by Bart J. Zoltan, Principal Research Engineer with Wyeth Research in Pearl River, NY.
Originally presented in March 2006 at the Mid Atlantic Chapter meeting of the Laboratory Robotics Interest Group. This entry is meant as general background and not as legal advice.
As a scientist, engineer or technician who is employed by a company to perform job functions that you were trained to do, it is important to understand who owns what is in your head. In the United States, your employment agreement specifies that, in fact, your employer owns all your inventions. There is no "use it, or lose it" provision, meaning that the company is not required to practice the invention that you have conceived in order for them to have a claim over it, provided it is related to your work.
The case is different if you are employed by an academic institution or the United States government. In academia the usual division of income or royalties is a three way split between the inventor(s), the university, and the inventor's department or laboratory. In the government, inventions that are directly funded and inventions conceived by government employees are administered under Executive Order 10096.
These facts may be a surprise to many. In any case, it is important to understand their ramifications.
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What is a patent?
A patent is a grant from the Federal Government to an inventor of an exclusive right to make, use, or sell an invention for a prespecified number of years. The Federal Government grants patents in return for public disclosure of the details of how to practice the invention. In turn, upon expiration of the patent term, the public will be permitted to practice the invention. The invention is described in the patent in very precise terms, called claims. In the United States, the Federal Government issues patents with authority from Article 1, Section 8, Clause 8 of the U.S. Constitution, which states:
"The congress shall have the power ... to promote the progress of science and the useful arts, by securing for limited times to ... inventors the exclusive right to their ... discoveries."
A patent permits the owner to exclude others from making, selling, using or importing into the USA, the invention as defined in the claims of the patent, for the term of the patent. It does not confer a right for the owner to practice the invention. That right may be precluded by other prior valid patents whose terms have not expired.
What can be patented?
In the language of the statute, any person who "invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent..." Before a patent can be issued, it must satisfy certain well defined criteria. More on this later.
Reasons for Patenting
There are many reasons why an employer would want to go to the effort and expense of patenting an invention made by an employee. One reason is to protect the employer's proprietary intellectual property. Even though an employee's employment agreement specifies that all inventions produced by the employee are the property of the employer, a patent solidifies this fact and spells out the invention in detail.
Another reason for patenting an invention is to bar the competition from using that invention. While fulfilling the terms of your employment you may invent a new process for achieving a goal, or you may invent a novel device that dramatically shortens the time to carry out a existing process. If your unpatented invention falls into the hands of your employer's competitors, the competitors may benefit substantially without the need to invest similar time, effort, resources, and creativity. A patent bars the competition from using your inventions and encourages you to continue to invent new things, while being assured that your employer will gain a competitive advantage throughout the term of the patent.
Due to the public nature of a patent, once it is granted anyone can become informed about the invention. One result may be the establishment of a company's pre-eminence in a given field. By virtue of the patents granted to a company, others will recognize the company as a prolific and creative inventor in a given technology or area. This can translate into intangible benefits, such as the ability to attract leaders in the field.
Less concrete benefits may also be gained by obtaining patents. For example, patents may advance the goals of a department, or highlight the personal accomplishments and advance the career goals of an individual.
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Patent Requirements
Before an invention can be patented, it must satisfy the following requirements.
- Utility: Is the invention useful for a given purpose?
- Novelty: Is the invention new?
- Non-Obviousness: Is there a significant difference between the invention and the existing art?
- Enablement: Does the patent include sufficient information such that one skilled in the art can make and use the invention?
Each one of these requirements must be addressed in the patent application to the satisfaction of the U.S. Patent and Trademark Office in order for a patent to be awarded to its inventor.
Utility
The Federal Government permits patents to be granted for "any new and useful process, machine, manufacture or composition of matter, or any new and useful improvement thereof." The invention must be useful and have real world value. The applicant must provide at least one credible assertion of a specific and substantial utility for the invention. If it covers a machine, your invention must be able to operate successfully, as specified in the claims of the patent.
The Utility requirement is described in the Manual of Patent Examining Procedure, 35 U.S.C. § 101.
Novelty
An invention must be absolutely novel for it to be awarded a patent. The invention must not have been claimed previously in the United States or the rest of the world. Furthermore, a patent cannot be obtained if:
- the subject matter is known or used by others in the United States
- patented or described in a publication anywhere, by you or another party
- on sale in the United States
For the purpose of fulfilling these requirements, publications include the following. If an invention has been previously published in any one of these forms, by you or another party, it is not eligible for a patent.
- Scientific papers
- Abstracts (distributed or presented)
- Posters
- Published U.S. Patent Applications
- Granted U.S. Patents
- Published Foreign Patent Applications
- Granted Foreign Patents
Thus, the novelty requirement can be defeated by the actions of others, or by the applicant's own activities.
If another party has carried out the same activities that are required by a patent applicant, the novelty requirement is not considered to be satisfied. This is also the case if the invention was known or used in the U.S. before the invention by the applicant. If an oral presentation is made in the United States before the applicant made the invention, novelty is not satisfied and the patent will be rejected. And, most obviously, if the invention was patented or published anywhere prior to the invention by the applicant, the patent will be rejected.
It is less well known that the applicant's own activities may defeat the novelty requirement for granting a patent. For example, if you publish, publicly use, or sell your invention more than one year prior to filing an application in the United State, your patent application will be rejected. Note that even if the United State has this one year grace period for patent applications, other countries do not. Even an oral presentation describing your invention will invalidate all subsequent foreign patent applications.
The Novelty requirement is described in the Manual of Patent Examining Procedure, 35 U.S.C. § 102.
Non-Obviousness
"A patent may not be obtained ... if the differences between the subject matter sought to be patented and the prior art are such that the subject matter as a whole would have been obvious at the time the invention was made to a Person Having Ordinary Skill In The Art (PHOSITA) to which said subject matter pertains."
An invention must not be obvious to a person having ordinary skill in the field of technology related to the invention. For example, extending a patented device designed to process one type of container, by modifying the size or location of one part of the device to facilitate the processing of other types of containers commonly used in a field, will likely be considered obvious to others skilled in the art. In this case, a patent application for the device modification will be rejected.
The Non-Obviousness requirement is described in the Manual of Patent Examining Procedure, 35 U.S.C. § 103.
Written Description, Enablement, and Best Mode
The specification of a patent application must contain a written description of the invention. The description must convey that the applicant has invented the subject matter claimed and put the public in possession of the subject matter. It must enable a person with skill in the art to such a degree that the person can practice the invention without undue experimentation. The person skilled in the art should need only to reference the written description of the invention in the patent in order to reduce it to practice. The inventor should also indicate the best mode of practicing the invention. Here, "best mode" refers to the preferred means contemplated by the inventor of carrying out the invention.
The Enablement requirement is described in the Manual of Patent Examining Procedure, 35 U.S.C. § 112.
Who is an Inventor?
An inventor is one who contributes to the conception of an invention and to the claims of the patent application. This also includes people who contribute novel ideas to the development process of the patent invention. Individuals who contribute to the generation of a specifically claimed solution to a problem are considered inventors. Only an inventor or their employer is entitled to the rights of the patent.
Contributing labor, supervision, or another routine activity that leads to the invention does not qualify a person for inventorship. This includes people who follow instructions of another in performing experiments (i.e. "skilled hands"), people who suggest an idea rather than the means of accomplishing it, as well as people who supply background data or other information such as literature references. None of these activities qualify a person for inventorship of a patent. Even identifying a desired goal is not considered sufficient for inventorship.
It should be added that incorrectly identifying someone as an inventor is considered fraud on the United States Patent Office.
Inventorship Statutes
In the United States, a patent application must by filed by "the original and first inventor" (35 U.S.C. § 115). Furthermore, "when an invention is made by two or more persons jointly, they shall apply for a patent jointly" (35 U.S.C. § 116).
Inventors may apply for a patent jointly even though their individual contributions to the invention are not comparable. Joint inventorship may be granted even if the inventors did not physically work together at the same time. Joint inventors are not required to make the same type or level of contribution to patent. Also, joint inventors are not required to have contributed to the subject matter of every claim of the patent. Any joint owner of a patent may sell the interest or any part of it or grant licenses to others.
U.S. "First to Invent" Patent System
Certain rules are used to determine who will be awarded a patent when two or more independent inventors seek a patent for the same invention. These rules vary, most notably between the United States and the rest of the world.
The United States follows a "First to Invent" system when awarding patents. In this system the act of invention can be broken down into two steps. The first step is conception of an idea, and the second step is the diligent reduction to practice of that idea by performing such acts as filing for a patent or actively practicing the invention. In this system the person who conceives of the idea first is the one who is awarded the patent. This person does not have to be the first to submit a patent application for a particular invention. Conception can be proved by witnessed documentation of the idea, such as that commonly found in a laboratory notebook.
Most of the rest of the world follows the "First to File" system. In this system the person who is first to file for a patent on a given invention receives the patent regardless of who conceived of the invention first. A "First to File" system is much easier to administer than the "First to Invent" system.
What is Conception?
In the First to Invent system, the idea of "conception" holds great importance. Conception is considered the formation in the mind of an inventor of a definite and permanent idea of the complete invention, as defined by the claims. The conception of an idea must be particularly described along with a way of achieving the invention in practice.
One way to demonstrate the conception of an invention on a given date is to disclose the invention to a non-inventor, and ask that person to read and understand the idea, and be prepared to attest to this fact at a later date. This is why laboratory notebooks are witnessed and signed by a person who understands the invention, but is not directly involved in its creation.
Laboratory Notebooks
(See the LabAutopedia article: Electronic Laboratory Notebook)
A properly kept and witnessed laboratory notebook is a permanent record that can establish firm dates indicating when an invention was conceived as well as activities that support efforts to diligently reduce the invention to practice.
Properly maintained laboratory notebooks are vital to one's ability to successfully apply for and win a patent in the United States. It is often the laboratory notebook that provides the documented proof required in the U.S. First to Conceive system. A dated lab notebook may be the only way to prove date of conception, as well as diligence and actual reduction to practice in an interference proceeding, an infringement case, or antedating a reference cited as prior art.
During a patent application, or even after a patent has been awarded, other parties may initiate what is referred to as an "interference," which contests the claim of first to conceive. All parties may submit depositions and documentary proof of their claim to the patent -- a properly kept laboratory notebook can be an important part of the documentary proof submitted.
An ideal laboratory notebook is written in ink in books with permanently fixed pages or another permanent medium. Descriptions should be complete and all diagrams explained so that another person skilled in the art can replicate the work. All pages should be dated with clear reference to the associated project, and signed by a witness who is a non inventor.
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