Property, intangible

a blog about ownership of intellectual property rights and its licensing

Patent Ownership in Germany

Here’s an interesting little patent case involving the ownership of patents under foreign law, in this case German law. The plaintiff’s principal, Werner Schnaebele, worked in Germany for a predecessor of the defendant. He signed one employment agreement that didn’t have any provision for ownership of inventions conceived of by employees, meaning local law would apply; then a second agreement he signed stated expressly that the German Employees Inventions Act (Gesetz über Arbeitnehmererfindungen, in case you were wondering) would govern.

The German Employees Inventions Act says that an employee retains the right to his or her invention but an employer can take ownership if, within four months of the existence of the invention, the employer serves the employee with a written declaration claiming the right to invention and it pays the employee a fee above and beyond the employee’s regular compensation. This didn’t happen for the patents-in-suit. Schaebele’s company later sued for a declaration of ownership of the patents.

The defendant moved to dismiss under Fed. R. Civ. P. 12(b)(6), claiming that the claim didn’t sound in patent but was one under contract instead. It was really kind of a lame theory:

[Defendant] Rockwell argues that [plaintiff] Auvesy’s claim for declaratory judgment sounds in contract. This is wrong. Auvesy does not, for example, seek affirmative relief for Rockwell’s failure to pay for Schnaebele’s invention. Indeed, such a claim would make little sense as it appears that Rockwell did not have a duty — under contract or under German law — to buy Schnaebele’s invention. Instead, Auvesy seeks a declaration that it owns the patents because Rockwell didn’t pay for the invention.

(emphasis in original). A theory that Wisconsin law controlled ownership also didn’t fly either:

State law, not federal law, typically governs patent ownership, but a contractual agreement to apply foreign law as to ownership is “just as valid as an agreement to apply the law of a particular state. [There is] no conflict between United States patent law and enforcing the intentions of the parties that the contract be interpreted under the laws of a foreign country.” Azakawa v. Link New Technology Int’l, Inc., 520 F.3d 1354, 1357-58 (Fed. Cir. 2008) (citing Int’l Nutrition Co. v. Horphag Research Ltd., 257 F.3d 1324 (Fed. Cir. 2001)).

Framed as such, Rockwell’s motion largely falls apart. First, Rockwell argues that Auvesy’s claim for declaratory judgment is barred by Wis. Stat. § 893.43, which provides that breach of contract claims must be brought within six years of accrual. Auvesy’s claim is not for breach of contract, and it is not governed by Wisconsin law. Rockwell argues that Auvesy’s remaining claims are premised upon Auvesy’s alleged ownership interest in the patents. So they are, and for the reasons already stated, Auvesy states an actionable claim to ownership.

Motion to dismiss denied.

Auvesy GmbH & Co. KG v. Rockwell Automation, Inc., Case No. 14-C-1258 (E.D. Wisc. June 30, 2015).

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