Abstract

     It has been well ingrained in all of us that what is fair is generally right, and what is unfair is wrong. We are all familiar with the notion that we cannot have our cake and eat it, too. How far does that sense of fairness extend? Should it take precedence over other public policy concerns which have  helped to shape our laws and justice system? These questions have plagued the courts in the context of patent law and assignment agreements. The following hypothetical situations help illustrate the dilemma.
     Consider an inventor who acts fraudulently in obtaining a patent, which he then assigns to Company A. Can that inventor assert an inequitable conduct defense to render the patent unenforceable when he is later charged with infringement by Company A?
     What about an inventor who assigns her patent to Company A, knowing that a prior art reference exists which will likely invalidate the patent? Can she defeat Company A’s infringement allegations by invalidating the patent with that same prior art reference?
     What about the case of an inventor who assigns his patent and subsequently discovers a previously unknown prior art reference which he believes invalidates the patent? Should the inventor be allowed to allege invalidity based on that prior art reference in defense of an infringement action?
     Alternatively, what if Company A, who was assigned the patent by Inventor, subsequently assigns the patent to Company B? Should Company A be prohibited from attempting to invalidate the patent by using a prior art reference discovered after it had assigned the patent to Company B?
     Finally, issues arise when corporate employees are part of a team of inventors. For example, an employee-inventor assigns his invention to Company A as required by his employment agreement, signs the inventor’s oath to accompany a patent application which he did not prepare, and then leaves Company A while the patent is being prosecuted. Is he prevented from challenging the validity of any patent which ultimately issues from the initial application? What about his subsequent employer, Company B, who thought enough of the employee-inventor to place him in charge of its infringing product line?
     It is easy to review the first scenario and determine that the inventor should not be able to avoid infringement by claiming that the patent he assigned is unenforceable as a result of his own conduct. Similarly, it seems reasonable that the employee inventor in the final hypothetical should not be prevented from arguing that a patent prosecuted and obtained by his former employer is invalid, nor should his subsequent employer. But where should the line be drawn in the other scenarios? Should a non-inventor assignor be held to the same standards as an inventor assignor?
     The courts have used the doctrine of assignor estoppel to help answer these questions, but its interpretation has not been consistent. The doctrine of assignor estoppel is a reflection of our fundamental sense of fair play, the notion that one cannot undermine the value of that which she conveyed by later challenging its worth. More specifically, assignor estoppel precludes an assignor of a patent from attacking the novelty, utility, or validity of the patent as a defense to a charge of infringement. The doctrine was originally adopted from the British common law, but has not always found favor with the courts. In fact, the United States Supreme Court spent the better part of the twentieth century slowly eroding the doctrine until it was effectively rendered nonviable. The Court of Appeals for the Federal Circuit, on the other hand, took up the gauntlet and has revived the doctrine. However, the broad application of the doctrine advocated by the Federal Circuit raises concerns about, among other things, patent law policies and employer-employee relationships and rights.