Employment Law Update - August 2011 Supplemental


On June 6, 2011, the U.S. Supreme Court issued its decision in the case of Stanford Univ. v. Roche Molecular Sys., Inc., No. 09-1159. While the primary issue in the case involved patent rights for inventions developed by federal funding, the decision, written by Chief Justice John G. Roberts, sends a message to employers who want to make sure they have rights in the inventions created by their employees.

The case involved a researcher, Dr. Mark Holodniy, who joined Stanford University in 1988 and signed an agreement stating that he agreed to assign to the university his rights, title and interest in any inventions resulting from his employment with the school. Stanford collaborated with a small California research company called Cetus to develop methods for quantifying blood-borne levels of HIV. In connection with his employment at Stanford, Holodniy conducted research with Cetus and, as a condition to gain access to the company, signed an agreement with it stating that he “will assign and do[es] hereby assign” to Cetus his right, title and interest in the inventions made as a consequence of his access.

Working with Cetus employees, Holodniy devised a procedure for measuring the amount of HIV in a patient’s blood. At Stanford, he and other university employees tested the procedure. Stanford obtained three patents based on the procedure. Thereafter, Roche Molecular Systems acquired Cetus and commercialized Holodniy’s procedure, which is used today in HIV test kits worldwide. Stanford filed suit against Roche, claiming that Roche’s HIV test kits infringed Stanford’s patents.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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