What happens when an inventor is sued for infringing her own patent?

That’s the question students at the Juelsgaard Intellectual Property and Innovation Clinic addressed in an amicus curiae brief submitted this week to the United States Court of Appeals for the Federal Circuit. Clinic students Jason Reinecke ’18 and Nathaniel Rubin ’18 represented nonprofit advocacy group Public Knowledge and sixteen law professors in urging the Federal Circuit to reconsider its doctrine of assignor estoppel.

Assignor estoppel curiously prevents anyone who sells a patent (such as the inventor) from later challenging its validity. The Clinic’s brief emphasized that assignor estoppel makes it harder to weed out bad patents and can keep inventors from changing employers.

In Mentor Graphics Corp. v. EVE-USA, Inc., two inventors employed at Mentor invented computer graphics software and transferred the patent to Mentor as a required condition of employment. Later, the inventors left Mentor to found EVE, which quickly began selling competing software products. Mentor sued EVE, alleging that EVE’s software infringed the patent EVE’s founders transferred to Mentor. The trial court found that assignor estoppel blocked EVE from arguing the patent was invalid. A three-judge Federal Circuit panel agreed.

EVE now seeks to have all twelve active Federal Circuit judges hear the case, in hopes of limiting or abolishing assignor estoppel. A hearing in front of all active judges typically only occurs in cases the Court perceives to be particularly important.

The Clinic’s brief provided the Federal Circuit with the perspectives of Public Knowledge and scholars that this case is important and worthy of rehearing. The Clinic described two ways in which assignor estoppel reduces innovation and competition.

First, assignor estoppel makes it more likely that invalid patents will remain on the books. Invalidating a bad patent benefits the public, since doing so allows everyone in society to use the invention. Assignor estoppel unfortunately limits this benefit. What’s worse, inventors and their future employers are often the people who know the most about a patent and are in the best position to invalidate bad ones—but assignor estoppel prevents them from doing so.

Second, assignor estoppel restricts innovation by locking inventors into their employers. The Federal Circuit applies assignor estoppel to prevent not only inventors, but also their future employers, from challenging the inventor’s patents. As a result, inventors cannot change employers without operating at a significant disadvantage, since their new employer will be prevented from challenging the validity of the inventor’s former patents. In effect, assignor estoppel acts as a partial noncompete agreement, whichharms innovation and competition.

The Clinic’s brief also highlighted that, although the Supreme Court has steadily limited assignor estoppel, the Federal Circuit has repeatedly expanded it. The Clinic’s brief argues that the Federal Circuit should rehear the case because it is contradicted by the Supreme Court’s rulings and is at risk of being reversed.

Mentor Graphics’ response brief opposing a new hearing significantly engaged with the Clinic’s arguments, implicitly acknowledging the significance of the Clinic’s contribution to the debate on this issue.