A patent assignment assigning all continuation applications was ambiguous to a previously issued continuation patent not specifically identified in the assignment.
Practice Pointers:
Most patent assignments and licenses include listed patent applications and/or issued patents and a catchall clause to include related patent applications and patents, such as “any and all divisional applications, continuations, and continuations in part…” In Euclid, the court found for an assignment that listed a specific issued patent and several specific patent applications, that the standard clause for all continuation applications is not clear as to whether the assignment covers already issued continuation patents. The court looked at the assignment clause that covered a “issued US patent” (singular) as conflicting with the catchall continuation clause thus making the assignment ambiguous as to whether the unlisted issued continuation patent is assigned. This case shows that practitioners must be careful in drafting even routine clauses, consider the facts and to be clear as to which applications and patents are to be included and excluded.
The patent in issue was the No. 6,217,742 (the "'742 CIP patent") patent that was a "continuation-in-part of application No. 09/236,731, filed on Jan. 25, 1999, now Pat. No. 6,033,553 ....". The '742 CIP patent issued on April 17, 2001—before the date of the December 20, 2001 assignment. Id. at [45].
A simple time line is:
1) Parent 553 patent issues (patent-in-suit)
2) CIP 742 patent issues
3) Assignment executed - assigns parent issued 553 patent and all continuations.. (But did not expressly include theCourt held the assignment of the CIP patent was ambiguous. Under Ohio state law “where a contract is ambiguous, a court may consider extrinsic evidence to ascertain the parties' intent..” The court remanded the case to the district court to determine whether the assignment, interpreted in light of the extrinsic evidence, transferred ownership of the CIP patent.
CIP 742 patent number).
Practice tip: Make sure all issued patent numbers are included in assignments and assignment is clear. Need to carefully check even routine clauses and consider facts. Check for grammatical consistency (e.g., singular vs. plural). If a continuation application or continuation issued patent is not intended to be assigned, then write that in the assignment.
Here is the assignment (Bold added)
| I, JACK BENNETT, [address], in consideration for $25,000.00 and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged do hereby sell and assign to VECTOR CORROSION TECHNOLOGIES LTD. [address] all my interest in the United States, Canada and in all other countries in and to my US, Canadian, and European applications for patents and issued U.S. patent, namely: 1. Issued U.S. Patent 6,033,553. ….. 2. US Application No. 08/839,292 filed on April 17, 1997, 3. US Application No. 08/731,248, filed on October 11, 1996 (now abandoned), 4. EPO Application No. 99122342.1, filed November 9, 1999, and 5. Canadian Application No. 2288630, filed November 8, 1999, any and all divisional applications, continuations, and continuations in part together with the entire right, title and interest in and to said applications, and to all divisional applications, continuations, and continuations in part thereof, the right to claim priority therefrom under the International Convention, and any and all Letters Patent which may issue or be reissued for said invention to the full end of the term for which each said Letters Patent may be granted; and hereby authorize the …. |
Below are relevant excepts from the opinion. (emphasis added)
When confronted with an issue of contractual interpretation, the role of a court is to give effect to the intent of the parties to the agreement. We examine the [contract] as a whole and presume that the intent of the parties is reflected in the language used in the [contract]. We look to the plain and ordinary meaning of the language used in the [contract] unless another meaning is clearly apparent from the contents of the [contract]. When the language of a written contract is clear, a court may look no further than the writing itself to find the intent of the parties. As a matter of law, a contract is unambiguous if it can be given a definite legal meaning.Opinion http://www.cafc.uscourts.gov/opinions/08-1170.pdf
On the other hand, where a contract is ambiguous, a court may consider extrinsic evidence to ascertain the parties' intent....
…. We disagree with the district court that the Assignment unambiguously transferred ownership of the '742 patent to Vector. The district court was correct that the language of the Assignment purports to convey "US Patent 6,033,553" and "any and all divisional applications, continuations, and continuations in part." Euclid, slip op. at 4. The district court was also correct that the '742 patent is a continuation-in-part of the '553 patent, as the Related U.S. Application Data on the face of the '742 patent makes clear. Id. at 6; see also '742 patent at [63].
The Assignment, however, also includes language that suggests that it was not intended to effect an assignment of the '742 patent. In particular, the Assignment specifically assigns all interest in and to the inventor's "US, Canadian, and European applications for patents and issued U.S. patent." Notably, this language refers to "applications"—plural—but "issued U.S. patent"—singular. Had the assignee intended, through the assignment of "continuations in part" to assign other issued U.S. patents, it would be expected that the Assignment would have said that the inventor was assigning his "issued U.S. patents"— plural—and even recited the patent number of the issued '742 patent.
At bottom, we cannot give the Assignment a "definite legal meaning." Westfield, 797 N.E.2d at 1261. Under one reasonable interpretation, the Assignment includes the '742 patent, because it issued from a continuation-in-part of the '553 patent. But under another reasonable interpretation, the Assignment excludes the '742 patent, because it was an already issued patent, not an application, at the time of the assignment. We therefore conclude that the Assignment is susceptible to at least two reasonable interpretations and is therefore ambiguous under Ohio law. See Potti, 938 F.2d at 647. Extrinsic evidence therefore should have been considered to ascertain the parties' intent. See Westfield, 797 N.E.2d at 1261.
In its brief on appeal, Euclid argues that substantial extrinsic evidence supports its view that the Assignment did not include the '742 patent. Specifically, Euclid points to evidence concerning Vector's recording of the assignment of the '553 patent but not the '742 patent, the inventor's payment of maintenance fees and attempted licensing negotiations after the date of the Assignment, and the subsequent execution of a different assignment by the inventor. Vector, however, has not yet had the opportunity or the obligation to challenge Euclid's extrinsic evidence or to bring forward its own evidence of intent. We therefore remand to the district court to allow that court to determine in the first instance—either through a subsequent motion for summary judgment, or at trial— whether the Assignment, interpreted in light of relevant extrinsic evidence, transferred ownership of the '742 patent to Vector.
