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Supreme Court Upholds but Narrows Assignor Estoppel: What This Means For Your Company and its Employees | Williams Mullen
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In a decision reaching all corners of the technology sector, the U.S. Supreme Court on June 29, 2021 held that, when fairness requires, a patent inventor can contest a patent s validity after assigning it to a third party. Prior to this decision, the doctrine of assignor estoppel prohibited inventors from doing so under Federal Circuit law.
Background of the Decision
Minerva Surgical, Inc. v. Hologic, Inc. involved a life sciences patent application directed to a device for treating abnormal uterine bleeding. The inventor assigned his interest in the application, including any later-filed continuation applications, to a third party (ultimately, Hologic). The inventor s company, Minerva, then developed an allegedly improved medical device for treating the same issue. Hologic, aware of the new device according to the Supreme Court, filed a continuation patent application purporting to cover Minerva s new device. The Pate
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The Supreme Court, speaking through a five-justice majority, has reaffirmed the equitable principle of assignor estoppel while at the same time limiting its application in
Minerva Surgical, Inc. v. Hologic, Inc. Assignor estoppel prohibits an inventor or other owner of rights in a patent from selling that patent to another party, then practicing the invention while attempting to avoid infringement liability by claiming the patent was invalid from the start. The
Minerva majority found that the doctrine was well-established in the law and thus was unwilling to abandon it. However, consistent with the equitable nature of the doctrine, the Court limited the doctrine to those instances where the assignor could be fairly understood to have warranted (either expressly or implicitly) the validity of the claims ultimately issued. Thus, in many circumstances – such as when an inventor assigns rights to a patent applica
Tuesday, July 6, 2021
Contrary to some predictions, assignor estoppel did not suffer the same fate in the hands of the Supreme Court as licensee estoppel in
Lear v. Adkins. In fact, the doctrine, which essentially boils down to limiting an assignor’s ability to assign a patent and then later challenges the validity of it in litigation, was narrowed but certainly not eviscerated as some had hoped. Indeed, in its recent decision in
Minerva Surgical, Inc. v. Hologic, Inc., the Supreme Court maintained that the patent holder’s equities “were far more compelling than those presented in the typical licensing arrangement” and refused to do away with assignor estoppel provided certain contractual obligations exist. In other words, assignor estoppel survives, but it is not the sweeping prohibition on invalidity challenges that it was once thought to be.
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