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Ownership Issue Requires Deeper Inquiry into University Patent Policy on Assignments

September 03, 2003
Ma, Gary C.

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Last Month at the Federal Circuit - October 2003

Judges: Clevenger (author), Lourie, and Prost

In University of West Virginia, Board of Trustees v. VanVoorhies, No. 02-1522 (Fed. Cir. Sept. 3, 2003), the Federal Circuit reversed the district court’s denial of Kurt L. VanVoorhies’s motion for relief from an order requiring assignment of certain patents to the University of West Virginia (“UWV”). Despite the fact that the subject matter of the patents at issue relate to other applications and patents determined by the district court to be the property of UWV, the Federal Circuit held that the district court had erred in ordering the assignment of these “second generation” patents to UWV.

During his graduate studies at UWV, VanVoorhies coinvented a contrawound toroidal helical antenna. This invention was embodied in an application that ultimately issued as U.S. Patent No. 5,442,369 (“the ‘369 patent”). VanVoorhies and his coinventors assigned their rights to this patent to UWV, as required under UWV’s patent policy. Two years later, around the time VanVoorhies received his doctorate, he invented a half-wave bifilar contrawound toroidal helical antenna. However, VanVoorhies refused to assign his rights to this invention to UWV, even though he initially notified UWV about the invention and suggested that they file a patent application for the invention.

Nevertheless, UWV filed and prosecuted an application for this second invention, which issued as U.S. Patent No. 6,028,558 (“the ‘558 patent”). At around the same time, VanVoorhies filed three applications directed to the same invention.

UWV filed suit against VanVoorhies alleging that he breached his duty to assign the second invention to UWV. On May 25, 2000, the district court ordered VanVoorhies to assign his rights to the application filed by UWV and his own applications and any patents issuing thereafter. VanVoorhies appealed this decision, but the Federal Circuit affirmed the district court’s order.

In light of the May 25 Order, UWV presented a set of proposed assignments for VanVoorhies to execute. These assignments not only encompassed the applications adjudicated and the corresponding issued patents, but also covered any additional applications filed or intended to be filed by VanVoorhies. In fact, three additional applications existed (collectively referred to as the “second generation patents”).

VanVoorhies refused to sign the proposed assignments, but instead proposed his own set of assignments that mirrored the language of the May 25 Order.

UWV then filed a motion under Fed. R. Civ. P. 70 to compel VanVoorhies to sign its proposed assignments, which the district court granted. The district court denied VanVoorhies’s motion for relief, finding that all the patents in UWV’s proposed assignments, including the second-generation patents, were within the scope of the original litigation and the May 25 Order. VanVoorhies appealed this decision.

On appeal, the Federal Circuit looked to three potential sources to determine whether VanVoorhies was required to assign the second-generation patents to UWV. First, it looked at the assignment for the ‘369 patent application. The Court found that the language of that assignment only covered the exact invention of the application, its reissues or extensions, and its immediate descendant applications. Since UWV conceded during oral arguments that the second-generation patents did not fall within any of these categories, the Federal Circuit found that the assignment did not provide a basis for UWV’s ownership of those patents.

Second, the Court found that UWV’s patent policy did not require VanVoorhies to assign his rights to the second-generation patents, because that policy only applied to inventions conceived or reduced to practice under the terms of contracts, grants, or other agreements involving UWV, or if the invention was made with substantial use of UWV’s resources. Because the issue of whether the second-generation patents fall within the scope of UWV’s patent policy was not litigated in this case, however, the Court ruled that UWV’s patent policy could not be the basis for assignment of the second-generation patents.

Finally, the Federal Circuit analyzed the language of the district court’s May 25 Order to determine whether it gave UWV rights to the second-generation patents. In particular, the Federal Circuit found the language “any other patent issuing from the application,” as used in the Order, to only contemplate immediate lineal descendants. The Court also noted that the phrase “the invention and technology embodied or disclosed [in the patent]” would have required the district court to construe the claims of the second-generation patents and then compare those construed claims with the patent, which the district court did not do. Accordingly, the Federal Circuit found that the May 25 Order did not require VanVoorhies to assign the second-generation patents to UWV.

The Federal Circuit held that VanVoorhies was not required to assign the second-generation patents to UWV and ordered the district court to restore the status quo to as it was before the grant of the Rule 70 Order. Accordingly, the Federal Circuit reversed the Rule 70 Order, remanded for further consideration of the record, and instructed the district court to restore the status quo on the ownership issue to as it was before the grant of the Rule 70 Order until the issue is fully considered.