Lead Opinion
Concurring opinion filed by Circuit. Judge O’Malley.
Dissenting opinion filed by Circuit Judge Newman.
Advanced Video Technologies LLC appeals an order from the United States District Court for the Southern District of New York that dismissed its complaints for lack of standing. The district court based its decision on the ground that a co-owner of the patent was not a party to the actions, and the co-owner’s ownership interests in the patent were not transferred to Advanced Video. We affirm.
Background
This appeal involves U.S. Patent No. 5,781,788 (“’788 patent”), entitled “Full Duplex Single Clip- Video Codec.” The technology of the patent is not at issue. The single issue involved in this- appeal is whether a co-inventor of the patent transferred her co-ownership interests in the patent under the terras of an employment agreement.
The ’788 patent lists three co-inventors: Beng-Yu “Benny” Woo, Xiaoming Li, and Vivian Hsiun. The invention was created while the co-inventors were employed with Infochips Systems Inc. (“Infochips”). Two of the inventors, Mr. Woo and Ms. Li assigned their co-ownership interests in the patent to Advanced Video. The only co-ownership interests involved in this appeal are those of Ms. Hsiun.
Advanced Video maintains that it obtained Ms. Hsiun’s co-ownership interests in the invention through a series of transfers. According to Advanced Video, the first transfer was made before the ’788 patent application was filed, pursuant to a January 1992 Employment Agreement (“Employment Agreement”) between Ms. Hsiun and Infochips. The second transfer occurred when Infochips’ “receivables,” which had been pledged as security in a financing agreement between Infochips and an entity called Lease Management Services, were seized by Lease Management when Infochips went out of business in 1993. The third transfer occurred in 1995 when Lease Management sold the Infochips assets to Mr. Woo, one of the three co-inventors. A fourth transfer occurred when Mr. Woo assigned his ownership interest in the ’788 patent to an entity called AVC Technology Inc. (“AVC”).
In 1995, AVC filed the parent application of the ’788 patent.
In 2011, Advanced Video filed three patent infringement lawsuits against Appel-lees in the United States District Court for the Southern District of New York. The district court found, however, that AVC had failed to comply with Delaware statutory law governing the distribution of assets for dissolved corporations, and that no patent rights had transferred from AVC to Advanced Video. Because Advanced Video had no ownership interest in the patent, the cases were dismissed for lack of standing. Advanced Video Techs., LLC v. HTC Corp.,
In 2015, the Delaware Court of Chancery appointed a Receiver to transfer to Advanced Video any patent rights held by AVC. Advanced Video Techs. LLC v. HTC Corp., No. 15 Civ. 4626 (CM),
I agree that I will promptly make full written disclosure to the Company, will hold in trust for the sole right and benefit of the Company, and will assign to the Company all my right, title, and interest in and to any and all inventions, original works of authorship, developments, improvements or trade secrets which I may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of time I am in the employ of the Company.
J.A. 258 (emphasis added).
The quitclaim provision provides as follows:
I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have infringement [sic] of any patents, copyrights, or mask work rights resulting from any such application assigned hereunder to the Company.
J.A. 260. (emphasis added).
The district court concluded that these provisions did not effect a transfer of Ms. Hsiun’s ownership rights to Advanced Video. As such, because Ms. Hsiun was not a party to' the suit, the district court dismissed the case for lack of standing. Advanced Video appeals.
Discussion
1. Standard of Review
This court reviews de novo a district court’s dismissal for lack of standing. 1sr. Bio-Eng’g Project v. Amgen Inc.,
2. “Will Assign”
Advanced Video argues that Ms. Hsiun’s ownership rights transferred immediately upon execution of the Employment Agreement. In support, Advanced Video points to “will assign” language contained in the agreement.
Section 2.b of the Infochips Employment Agreement provides that Ms. Hsiun “will assign to the Company” all her right, title, and interest in any inventions. The district court found that “will” invoked a promise to do something in the future and did not effect a present assignment. Advanced Video Techs.,
3. Trust Assignment
Advanced Video argues that “will hold in trust” created an immediate trust under California law in favor of Infochips. Even were we to determine that Ms. Hsi-uris interests in the invention were immediately placed in trust, it does not follow that those interests were automatically, or ever, actually transferred out of trust in favor of Infochips. Absent a transfer, Ms. Hsiun would continue to hold the invention rights as a trustee. While Advanced Video could potentially seek to enforce its alleged ownership rights, or allege a breach of Ms. Hsiuris duties as a trustee by her .failure to transfer those rights, by bringing an action against Ms. Hsiun, no party brought such an action. See, e.g., Jim Arnold Corp. v. Hydrotech Sys.,
Under California trust law a trust beneficiary “generally is not the real party in interest,” “may not sue in the nathe of the trust,” and “has no legal title or ownership interest in the trust assets.” Saks v. Damon Raike & Co.,
4. Quitclaim Assignment .
Advanced Video maintains that it has standing because it eventually acquired Ms. Hsiuris ownership interest in the invention when she quitclaimed her interest to Infochips under the terms of the Employment Agreement.
Section 2.e of the Employment Agreement provides: ■ • ■
I hereby waive and quitclaim to the Company any and all claims, of any -nature whatsoever, which I now or may hereafter have infringement [sic] of any patents; copyrights, or, mask work rights resulting from any such application assigned hereunder to the Company.
J.A. 260.
Advanced Video argues that “assigned hereunder”' should essentially be read to mean all claims “assignable hereunder,” and that rights that Ms. Hsiun promised she “will assign” were immediately quit-claimed under the Employment Agreement. The Employment Agreement, however, does not . provide “assignable hereunder” language. Advanced Video cites no authority showing that, “assigned hereunder” covers patent rights that could have been assigned under a contract, but were never .actually assigned.
The quitclaim provision waives Ms. Hsi-un’s rights to interests in any patent rights that she assigned under the agreement. But, as no patent rights were ever assigned to Infochips, the quitclaim provision has no application. Accordingly, we find that the quitclaim provision in the Employment Agreement did not effect an assignment of the 788 patent from Ms. Hsiun to Infochips, AVC, or Advanced Video.
The dissent argues that it may be discerned from the Employment Agreement that the parties intended any ownership interest in inventions developed during Ms. Hsiun’s employment with In-fochips were the property of Infochips. Dissent at 7-10. But, the terms of the Employment Agreement provide otherwise. Generally, courts should not deviate from unambiguous provisions unless they lead to “absurd -results.” Shaw v. Regents of Univ. of Cal.
Conclusion
Advanced Video does not have full ownership of the, 788 patent. Ms. Hsiun is neither a party to the suits, nor has she consented to these suits. Advanced Video, therefore, has no standing to maintain its suit. Accordingly, we affirm the district court’s dismissal of the cases.
AFFIRMED
Costs
No costs.
Notes
. We only address the validity of the purported transfer under the Employment Agreement.
. A continuation of that patent application, filed in 1997, ultimately issued as the '788 patent in 1998.
.The district court also awarded attorneys’ fees, finding the case “exceptional” under 35 U.S.C. § 285. The fee award was affirmed by this court. Advanced Video Techs., LLC v. HTC Corp.,
. See Fed. R. Civ. P. 19; STC.UNM v. Intel Corp.,
Concurrence Opinion
concurring.
I agree that we are bound to apply the law of this Circuit that compels the result we reach today. I, thus, must concur in that result. I write separately, however, to explain why I continue to believe that the binding precedent which serves as the predicate for today’s majority opinion is wrong. In particular, I address why the conclusion that a non-consenting co-owner or co-inventor can never be involuntarily joined in an infringement action pursuant to Rule 19 of the Federal Rules of Civil Procedure is incorrect. In the absence of that errant conclusion, the various questions we address in this case would be irrelevant.
As I explained in my opinion dissenting from the denial of the petition for rehearing en banc in STC.UNM v. Intel Corp.,
And, as Judge Newman wrote in her opinion dissenting from the denial of rehearing en banc in STC.UNM, “Rule 19 is not permissive” despite this court’s precedent that “Rule 19 uniquely does not apply in patent cases.”
Despite our precedent, Rule 19(a) provides for the involuntary joinder of a necessary party. The rule states, in relevant part, that:
(a) Persons Required to be Joined if Feasible.
(1) Required Party. A person who is subject to service of process and whose joinder will not deprive the court of subject-matter jurisdiction must be joined as a party if:
(A) in that person’s absence, the court cannot accord complete relief among existing parties; or
(B) that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person’s absence may:
(i) as a practical matter impair or impede the person’s ability to protect the interest; or
(ii) leave an existing party subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations because of the interest.
(2) Joinder by Court Order. If a person has not been joined as required, the court must order that the person be made a party. A person who refuses to join as a plaintiff may be made either a defendant or, in a proper case, an involuntary plaintiff.
Fed. R. Civ. P. 19(a)(1)—(2). By its terms, therefore, when a person satisfies the requirements of Rule 19(a), joinder of that person is required.
If joinder of a required party is not feasible, Rule 19(b) provides that “the court must determine whether, in equity and good conscience, the action should proceed among the existing parties or should be dismissed.” Fed. R. Civ. P. 19(b). That analysis involves consideration of several factors specified in Rule 19(b), including: (1) “the extent to which a judgment rendered in the person’s absence might prejudice that person or the existing parties”; (2) “the extent to which any prejudice could be lessened or avoided”; (3) “whether a judgment rendered in the person’s absence would be adequate”; and (4) “whether the plaintiff would have an adequate remedy if the action were dismissed for nonjoinder.” Fed. R. Civ. P. 19(b)(1)— (4).
Recognizing the mandatory nature of Rule 19, one panel of this court has noted, albeit in dictum, that “all entities with an independent right to enforce the patent are indispensable or necessary parties to an infringement suit. When such an entity declines to join in the suit it may be join¿d involuntarily, either as a party plaintiff or party defendant! ] ....” IpVenture, Inc. v. ProStar Comput., Inc.,
For its part, the Supreme Court has indicated in a non-patent case that Rule 19—not substantive law—applies when determining who must participate in a lawsuit. See Provident Tradesmens,
the right of a person who ‘may be affected’ by the judgment to be joined is a ‘substantive’ right, unaffected by the federal rules; that a trial court ‘may not proceed’ in the absence of such a person; and that since [one party] could not be joined as a defendant without destroying diversity jurisdiction the action had to be dismissed.
Id. at 107,
There is no dispute over whether co-owners are necessary parties to infringement actions; the question we must address is whether a co-owner’s mere recalcitrance can prevent enforcement of another co-owner’s rights. Rule 19(a) is designed to address circumstances just like those at issue here. See 7 Charles Alan Wright et al., Federal Practice and Procedure § 1606 (3d ed. 2013) (“The joinder of an absent person who should be a plaintiff as an involuntary plaintiff is authorized by the second half of the third sentence of Rule 19(a).... The purpose of this procedure is to mitigate some of the harshness that occasionally results when the joinder of a nonparty is found to be desirable but the nonparty refuses to join in the action.”). Involuntary joinder assumes recalcitrance by the joined party (or, as here, a preference not to participate), but authorizes joinder nonetheless. Rule 19(a) makes no exception for recalcitrant patent owners and we, to date, have not explained from where such an exception derives. See id. (noting that the “most typical application” of Rule 19(a) “has been to allow exclusive licensees of patents and copyrights to make the owner of the monopoly an involuntary plaintiff in infringement suits”).
The original cases on which our Rule 19 joinder precedent relies do not proscribe the use of involuntary joinder of co-owners • or co-inventors in patent cases, as our precedent does. Neither Ethicon, Inc. v. U.S. Surgical Corp.,
In Ethicon, we quoted an earlier Federal Circuit decision for the proposition that “one co-owner has the light .to impede the other co-owner’s ability to sue infringers by refusing to voluntarily join in such, a suit.”
First, the “crux of the problem” in Will-ingham was “whether a co-owner could authorize by contract another co-owner to file suit for patent infringement without the permission of the first co-owner, in an action- in which the unwilling co-owner is joined as an involuntary plaintiff under Rule 19.”
The Sixth Circuit in Willingham recognized’ the “general rule that all co-owners of a patent must be joined as plaintiffs before an infringement suit can be initiated.” Id. at 1343 (citing Waterman v. Mackenzie,
Schering involved a dispute between two co-owners of a pharmaceutical patent: Schering and Roussel. Schering sued Zeneca for infringement, and two weeks later, Roussel granted a license to Zeneca. Schering argued that the terms of its co-ownership agreement with Roussel—which provided that, “if one of the corowners files an infringement suit, it can call on the non-suing co-owner to provide ‘reasonable assistance’ in connection with the litiga; tion”—meant that the non-suing party could not grunt a license to a defendant or prospective defendant. Schering,
Involuntary joinder was not at issue on appeal in Schering because,'at the district court level, “Schering joined Roussel as'an involuntary plaintiff pursuant to1 Rule 19(a).” Schering Corp. v. Zeneca Inc.,
In Ethicon, the co-owner of the patent— Dr. Choi—granted a “retroactive license” to the accused infringer—U.S. Surgical— and thus could not consent to an infringement suit against it. Ethicon,
In the context of its retroactive licensure discussion, the court explained that, “as a matter of substantive patent law, all co-owners must ordinarily consent to join as plaintiffs in an infringement suit.” Id. at 1468.
The majority in Ethicon did not discuss joinder under Rule 19, did not purport to harmonize the requirements of Rule 19 with preexisting substantive patent law, and—because the decision was focused on licensing issues—did not create any new principles of law applicable to future cases involving the involuntary joinder of patent co-owners. Importantly, the Ethicon majority’s silence cannot be evidence of its position with respect to Rule 19, even though the dissenting opinion discussed the rule. Id. at 1472 (Newman, J., dissenting) (“There is no barrier to the involuntary joinder of a joint inventor and/or co-owner under Rule 19, if such is needed to bring before the court all persons deemed necessary to the suit.”); see United Haulers Ass’n v. Oneida-Herkimer Solid Waste Mgmt. Auth.,
Although our Ethicon decision was not based on Rule 19, we subsequently stated that it “explicitly held that Rule 19 does not permit the involuntary joinder of a patent co-owner in an infringement suit brought by another co-owner.” DDB Techs,, L.L.C. v. MLB Advanced Media, L.P.,
Tracing the origin of our so-called rule of substantive patent law makes clear that, prior to our decision in STC.UNM v. Intel Corp.,
Moreover, it is well established that, absent any agreement to the contrary, “each of the joint owners of a patent may make, use, offer to sell, or sell the patented invention within the United States, or import the patented invention into the United States, without the consent of and without accounting to the other owners.” 35 U.S.C. § 262. Given these rights, the Ethicon court declared that “the congressional policy expressed by section 262 is that patent co-owners are ‘at the mercy of each other.’” Ethicon,
Finally, the Patent Act provides that “[a] patentee shall have remedy by civil action- for infringement of his patent.” 35 U.S.C. § 281 (emphasis added). In other words, each co-owner has a right to file a civil action to enforce the patent. But the effect of our current precedent is that, if a patent co-owner refuses to join the infringement suit voluntarily as a plaintiff, it can prevent the other owner from obtaining judicial relief for accrued damages. If that were the cáse, then § 281’s statutorily-mandated right to a civil action would have, little, meaning. Accordingly, while there may be some other support for our precedent’s 'so-called overriding “substantive right” against involuntary joinder in patent infringement cases, our decisions have provided no statutory basis for this rule,' which actually appears inconsistent with several provisions of the Patent Act.
Rather than once again exempting patent, law from the rules that govern all federal litigation, we should either: (1) clarify the basis for our so-called substantive right against involuntary joinder in patent infringement cases and explain why it can overcome the dictates of Rule 19; or (2) hold that Rule 19, including the provisions for involuntary joinder set forth therein, applies to cases such as this one. For these reasons, I respectfully suggest that our Rule 19 precedent should be reconsidered en banc by this court. Because I must abide by that precedent in deciding this case, however, I concur in the judgment.
. At the outset, the Court noted that the absent party fell within the category of persons who should be "joined if feasible" under Rule 19(a), but “could not be made a defendant without destroying diversity.” Provident Tradesmens,
. In Waterman, the Supreme Court explained that a patentee or his assignee may grant and convey to another: (1) the whole patent; (2) an undivided part or share of that exclusive right; or (3) “the exclusive right under the patent within and throughout a specified part of the United States.”
. The court recognized two exceptions: (1) "when any patent owner has granted an exclusive license, he stands in a relationship of trust to his licensee and must permit the licensee to sue in his name”; and (2) "[i]f, by agreement, a co-owner waives his right to refuse to join suit, his co-owners may subsequently force him to join in a suit against infringers.” Ethicon,
. Other decisions from this court have perpetuated the idea that all co-owners must ordinarily join as plaintiffs in' an infringement suit, but, again, Rule 19(a) was neither raised nor addressed in those cases. See Isr. Bio-Eng’g Project v. Amgen, Inc.,
Dissenting Opinion
dissenting.
I respectfully dissent. Joint inventor Vivian Hsiun never had co-ownership of the ’788 Patent, contrary to the majority opinion. By her Employment Agreement, her invention was the property of her employer; she was not the owner, and she could not acquire ownership simply by refusing to sign a separate “assignment” document.
Vivian Hsiun was employed on the basis of a detailed and thorough Employment Agreement, whereby all of her inventions and other product of her employment are owned by the employer. After the ’788 Patent application was filed, of which she is listed as one of three joint inventors, Ms. Hsiun declined to sign the PTO’s form of assignment document. This lapse was discovered by the defendants during this litigation, and the defendants moved to dismiss for lack of standing to enforce the patent. The district court granted the motion and the panel majority agrees, finding sua sponte that Ms. Hsiun owns one-third of the ’788 Patent.
However, the .Employment Agreement placed ownership of the employee’s inventions with the employer. In view of the Employment Agreement, a separate assignment document is not necessary to confirm that the employee has no ownership of the ’788 Patent. Nor has the employee asserted any such ownership.
Discussion
The Employment Agreement contains several provisions concerning ownership of inventions made by Ms. Hsiun during her employment, as follows:
1.
Section 2.b provides that all inventions made during employment will be disclosed and held in trust and assigned to the Company
Agreement Section 2.b obligates Ms. Hsiun to disclose and to assign all her right, title, and interest in all inventions that she makes while employed by the Company:
2.b. Inventions and Original Works Assigned to the Company. I agree that I ■will- promptly-make'full written disclosure to the Company, will hold in trust for the sole right and benefit of the Company, and will assign to the Company all my right, title, and interest in and to any and all inventions, original works of authorship, developments, improvements or trade secrets which I may solely or jointly conceive or develop or reduce to practice, or cause to be conceived or developed or reduced to practice, during the period of time I am in the employ of the Company. ...
Empl. Agmt., J.A. 258. On Ms. Hsiun’s refusal to sign the PTO’s standard assignment form, the PTO accepted the Employment Agreement as showing ownership by the employer. Ms. Hsiun .did not object to the procedures in the PTO, and the face of the patent lists AVC Technology, Inc. as “Assignee.” Ms. Hsiun did not object, and has never asserted any ownership interest in the ’788 Patent.
2.
Section 2.c states that invention records are the property of the Company
In conformity with the other provisions on ownership of inventions made by Ms. Hsiun during her employment, the Employment Agreement provides that all invention records are the property of the employer:
2.c. Maintenance of Records. I agree to keep and maintain adequate and current written records of all inventions and original works of. authorship made by me (solely or jointly with others) during the term of my employment with the Company. The records, will .be in the form of notes, sketches, drawings, and any other' format that may be specified by the. Company. The records will be available to and remain the sole property of the Company at all times.
Empl. Agmt., J.A. 259. It is not disputed that the ’788 invention was made during Ms. Hsiun’s employment. She has asserted no ownership or any other rights to her invention records. . .
3.
Section 2.e states the employee’s obligation to assist in obtaining patents
This clause of the Employment Agreement refers to patents on inventions “assigned hereunder” to the employer:
2.e. Obtaining Letters Patent, Copyrights, and Mask Work Rights. I agree that my obligation.to assist the Company to obtain United States or foreign letters patent, copyrights, or mask work rights covering inventions, works of authorship, and mask works, respectively, assigned hereunder to the Company shall continue beyond the termination of my employment, but the Company shall compensate me at a reasonable rate for time actually spent by me at the Company’s request on such assistance, ...
Empl. Agmt., J.A. 259. The words “assigned hereunder” and the continuing obligations after termination of employment conform to the mutual intent and understanding, of employer and employee, with respect to the Company’s ownership of inventions made during her employment.
Ms. Hsiun did not object to the Company’s filing of this patent applications naming her as a joint inventor; such filing was authorized by the agreed right of ownership of her inventions.
4.
Section 2.e provides for action by the employer in absence of the employee’s signature on patent documents
Ms. Hsiun agreed that if her signature is unobtainable for “inventions or other rights assigned to the Company,” the Company may act in her stead:
2.e. [continued]. ... If the Company is unable because of my mental or physical incapacity or for any other reason to secure my signature to apply for or to pursue any application for any United States or foreign letters patent, copyrights, or mask work rights covering inventions or other rights assigned to the Company as above, then I hereby irrevocably designate and appoint the Company and its duly authorized officers and agents as my agent and attorney in fact, to act for and in my behalf and stead to execute and file any such applications and to do all other lawfully permitted acts to further the prosecution and issuance of letters patent, copyrights, and mask work rights with the same legal force and effect as if executed by me. ...
Empl. Agmt., J.A. 259-60. This provision was a basis of the Company’s prosecution of the ’788 application, and issuance of the ’788 Patent naming Ms. Hsiun as a joint inventor and AVC Technology as as-signee.
5.
Section 2.b requires the employee to hold all inventions in trust for the Company
2.b. I agree that I ... will hold in trust for the sole right and benefit of the Company, and will assign to the Company all my right, title, and interest in and to any and all inventions, ... during the period of time I am in the employ of the Company.
Empl. Agmt., J.A. 258. My colleagues on this panel concede that the trust provision of the Employment Agreement may apply, Maj. Op. at 1322, but nonetheless hold that the trust provision is ineffective to establish that Ms. Hsiun held her inventions in trust “for the sole right and benefit of the Company.” My colleagues state that it is necessary for the beneficiary to sue the trustee in order to obtain the benefit of the trust. No supporting authority is cited, or relates to these facts.
The parties’ briefs discuss a California case in which the court held that a trust was not created on a dying man’s oral instruction to pay his hospital bill and dispose of his funds, the court stating in Monell v. College of Physicians & Surgeons of San Francisco,
The panel majority also states that under California law the beneficiary of the trust is not the real party in interest. However, California law accords with the general law of trusts, as represented by Kadota Fig Ass’n of Producers v. Case-Sivayne Co.,
At a minimum, the trust provision further demonstrates the mutual intent and understanding that Ms. Hsiun’s inventions made during her employment are for tíie sole benefit of the employer.
6.
Section 2.e provides a “waiver and quitclaim” of infringement claims of patents “assigned hereunder”
The Employment Agreement contains the following waiver and quitclaim provision:
2.e. [continued] ... I hereby waive and quitclaim to the Company any and all claims, of any nature whatsoever, which I now or may hereafter have infringement of any patents, copyrights, or mask work rights resulting from any such application assigned hereunder to the Company.
Empl. Agmt., J.A. 260.
The waiver and quitclaim provisions comport with the mutual intent and understanding that Ms. Hsiun retained no ownership of patents on her inventions “assigned hereunder to the Company.” The quitclaim assures that any rights the grantor had, are transferred to the grantee of the property. California precedent is clear. E.g., City of Manhattan Beach v. Superior Court,
The panel majority states that since the ’788 Patent was not assigned to the Company, “the quitclaim provision has no application.” Maj. Op. at 1319. To the contrary: if indeed the patent was not individually assigned in a special document, the “quitclaim to the Company” assures transfer of the property to the Company.
A quitclaim does not require that the property was already assigned, for in such case no quitclaim would be needed. However, the quitclaim does require that “any and all claims” that may “now or hereafter” exist, are “assigned hereunder to the Company.”
This provision further renders impossible that Ms. Hsiun now owns one-third of the ’788 Patent, for any such ownership was quitclaimed to the employer.
7.
Section 5 requires the employee to execute all documents needed to carry out the Agreement
The record before us does not explain why Ms. Hsiun refused to sign the provided PTO assignment form, for the Employment Agreement is explicit as to the employee’s obligations to execute any required documents:
5. Representations. I agree to execute any proper oath or verify any proper document required to carry out the terms of this Agreement. I represent that my performance of all the terms of this Agreement will not breach any agreement to keep in confidence proprietary information acquired by me in confidence or in trust prior to my employment by the Company. I have not entered into, and I agree I will not enter into, any oral or written agreement in conflict herewith.
Empl. Agmt., J.A. 260-61.
Throughout this litigation, there is no assertion-by Ms. Hsiun of any ownership interest in the '788 Patent, or any negation of her obligations set forth in the Employment Agreement.
' 8.
Other provisions of the Employment Agreement compoH with the mutual understanding of employer ownership of employee inventions
Several other provisions of the Employment Agreement relate to inventions, and further implement the understanding of employer ownership of the employee’s work product:
Section 3 prohibits conflicting future employment,
Section 4 provides for ownership by the Company of all documents and property created by the employee.
Section 6,b states that this is the entire agreement and cannot be changed except “in writing signed by the party. to be charged.”
Section 6.c provides for severability.
Section 6.d binds the employee’s heirs and executors for the benefit of thé Company, its successors, and its assigns.
Section 6.e provides that the Agreement survives the termination of employment, and benefits the Company’s successors and assigns.
. Section 7 requires the employee to identify all pre-employment inventions—there were none.
It is inconceivable that the parties intended that unless a separate assignment document was signed as to each and every aspect of the employee’s work product, the provisions of the Employment Agreement would not apply. .
9.
Section 6.a of the Agreement states that California law applies
California contract law. provides:
Cal. Civ, Code § 1643: A, contract must receive such an interpretation as' will make it lawful, operative, definite, reasonable, and capable of being carried into effect, if it can be done without violating the intention of the parties.
The record contains no challenge to the mutual intent and understanding of the parties to the Employment Agreement. The provisions of the Employment Agreement demonstrate, over and over, the intent and understanding that Ms. Hsiun’s inventions made as an employee are the property of the employer. There aré no contrary provisions, and no contrary evidence was presented in this action.
Every contract provision, and the entirety of the Employment contract, show this mutuality of intent. The intention of the parties must be respected and “intent is to be inferred, if possible, solely from the written provisions of the contract.” People ex. rel. Lockyer v. R.J. Reynolds Tobacco Co.,
It is not reasonable now to hold that the Employment Agreement fails in its intended purpose, for every provision of the Agreement accords with and implements the intent that the employee’s inventions are the property of the employer.
10.
The Delaware Chancery Court quit-claimed. and assigned the 788 Patent to the plaintiff
The record further demonstrates that ownership of the ’788 Patent, by Ms. Hsi-un’s employer and its successors, was recognized in corporate proceedings in Delaware.
After a challenge to the. transfer of the ’788 Patent, a.Receiver was appointed by the Chancery Court, who held.as follows:
I, Joseph Cicero, ... have quit-claimed, assigned, transferred, set over and conveyed and do hereby quitclaim, assign, transfer, set over and convey unto Advanced Video Technologies LLC, a New York limited liability company (“Assignee”), its successors, and assigns, any and all right, title, and interest to United States Patent No. 5,781,788 (the “Patent”) held,and enjoyed, by Assignor, for the entire term of the Patent, including any reissues, reexaminations, and extensions thereof, including the right to sue for and recover damages in respect of past acts of infringement. This assignment includes, but is not limited to, all Assignor’s right to all income, royalties, damages and payments now or hereafter due and payable, and in and to all causes of action, either in law or in equity, and the right to sue and counterclaim for and collect past and continuing damages for infringement. The right, title and interest conveyed in this Assignment is to be held and enjoyed by Assignee and Assignee’s successors and assigns as fully and exclusively as it would have been held and enjoyed by Assignor had this assignment not been made.
[signed] Joseph B. Cicero, Esq., Date: 6/5/15
Receiver for AVC Technology, Inc.
J.A. 130. The record does not show any appeal by any person or other entity from the Delaware Court’s determination, or any challenge to or dispute with this establishment of ownership of the ’788 Patent by Advanced Video Technologies.
11.
Federal Circuit precedent does not contravene the Employment Agreement
Ethicon Inc. v. U.S. Surgical Corp.,
Nor does the ruling in Arachnid, Inc. v. Merit Industries, Inc.,
Ms. Hsiun’s Employment Agreement is directly controlled by contract law. The Employment Agreement that she signed established ownership by the employer of the ’788 Patent by way of clear contract provisions implementing the intent and understanding and agreement of employer and employee, as a condition of the employment. There is no ambiguity, and Ms. Hsiun asserts no ownership in the ’788 Patent.
Conclusion
The Employment Agreement established the terms and conditions of Ms. Hsiun’s employment. These terms and conditions include ownership by the employer of all inventions made by the employee during her employment. My colleagues’ award to Ms. Hsiun of one-third of the ’788 Patent cannot be supported, under any view of any law. I respectfully dissent.
. The panel majority states that “the terms of the Employment Agreement provide otherwise," the “otherwise” being “unambiguous provisions" in the Employment Agreement purportedly negating assignment to the employer. Maj. Op. at 1323. No citation is offered, and I-have searched in vain for any such unambiguous provision.