Wednesday, November 30, 2011

The Time For Mandatory Patent Assignment Recording Is Now

Something strange occurs when the U.S. Patent Office issues a patent monopoly; it does not necessarily know the identity of the monopoly recipient. U.S. patent applications are required to identify the inventors of the invention pursuant to Section 116 of the Patent Act, but they are not required to identify the owner of the application or the resulting issued patent.

The lack of an accurate database of owners of issued patents can be troubling for the public. The absence of readily accessible patent ownership information can inject an unacceptable level of mystery and risk into patent clearances and chain-of-title searches. This is particularly true if the ownership interests in a patent become fragmented among several parties, including lien holders or other creditors.

Further support for an accurate patent ownership database comes from the “bona fide purchaser for value” rule incorporated into Section 261 of the Patent Act. This section confirms that an unrecorded patent assignment or grant is void as to a subsequent purchaser or mortgagee for value and without notice of the unrecorded assignment or grant. A voided assignment can, in turn, create undesirable liability on the part of an assignor to a patent acquirer.

But, good news. The U.S. Patent Office is presently seeking comment on several rules that would mandate the disclosure of any patent assignment. Specifically, the PTO is proposing to require that disclosure of the current assignee be made:
  1. At the time the patent application is filed, 
  2. At the time of payment of the patent issue fee, 
  3. Any time an assignment is made after the application filing date, 
  4. Any time an assignment would cause the loss of entitlement to the small entity fee, 
  5. In order to obtain a discount of maintenance fees. 
Provide your comments regarding the proposed mandatory disclosure of assignments prior to January 23, 2012. Send your e-mail comments to More information regarding mandatory assignment filing is available in the Federal Register.

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