Stanford V. Roche: Bayh-Dole Does Not Automatically Vest Title to Federally Funded Inventions in Federal Contractors

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On June 6, 2011, in a 7-2 affirmance, the Supreme Court held that the Bayh-Dole Act does not automatically vest title to federally funded inventions in federal contractors or authorize contractors to unilaterally take title to such inventions. In reaching this holding, the Supreme Court embraces and upholds two core tenants of patent law: (1) ownership vests in the inventor(s) and (2) mere employment is not sufficient to vest title to an employee’s invention in the employer. More particularly, the Bayh-Dole Act does not “set aside two centuries of patent law” which clearly vests patent rights in the inventors; absent an assignment of such patent rights by the inventor(s) to a third party. (slip op. at 9). “We are confident that if Congress intended such a sea change in intellectual property rights it would have said so clearly — not obliquely through an ambiguous definition of ‘subject invention’ and an idiosyncratic use of the word ‘retain.’” (slip op., at 14).

A summary of key facts is set forth below:

- Cetus (private company) collaborates with Stanford scientists.

- Dr. Holodniy joins Stanford and signs a Copyright and Patent Agreement (CPA) where he “agree[d] to assign” to Stanford his “right, title and interest in” inventions resulting from his employment at the University.

- Dr. Holodniy conducts PCR-related research at Cetus after signing Visitor’s Confidentiality Agreement (VCA) which states that Holodniy “will assign and do[es] hereby assign” to Cetus his “right, title and interest in each of the ideas, inventions and improvements” made “as a consequence of [his] access” to Cetus....

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