Confusion, Conflict, and Case Law: Analyzing the Language of the United States Patent Act and Conflicting Case Law Regarding the Transfer of Patent Rights in the 21st Century

Marquette Intellectual Property Law Review Volume 24 Issue 2 Article 6 Summer 2020 Confusion, Conflict, and Case Law: Analyzing the Language of the United States Patent Act and Conflicting Case Law Regarding the Transfer of Patent Rights in the 21st Century Lucas C. Logic Follow this and additional works at: https://scholarship.law.marquette.edu/iplr Part of the Estates and Trusts Commons, Intellectual Property Law Commons, and the Legal History Commons Recommended Citation Lucas C. Logic, Confusion, Conflict, and Case Law: Analyzing the Language of the United States Patent Act and Conflicting Case Law Regarding the Transfer of Patent Rights in the 21st Century, 24 Marq. Intellectual Property L. Rev 240 (2020). This Comment is brought to you for free and open access by the Journals at Marquette Law Scholarly Commons. It has been accepted for inclusion in Marquette Intellectual Property Law Review by an authorized editor of Marquette Law Scholarly Commons. For more information, please contact . LOGIC_MACRO.DOCX (DO NOT DELETE) 2/12/21 12:52 PM CONFUSION, CONFLICT, AND CASE LAW: ANALYZING THE LANGUAGE OF THE UNITED STATES PATENT ACT AND CONFLICTING CASE LAW REGARDING THE TRANSFER OF PATENT RIGHTS IN THE 21ST CENTURY LUCAS C. LOGIC I. INTRODUCTION ........................................................................................... 241 II. OVERVIEW OF PATENTS AND THE SIGNIFICANCE A CLEAR AND TIMELY TRANSFER ........................................................................................... 242 III. THE EVOLUTION OF THE LANGUAGE AND PROTECTIONS OF THE PATENT ACT ..................................................................................................... 245 IV. FOCUS ON WISCONSIN PROBATE AND PROPERTY STATUTORY DEFINITIONS ....................................................................................... 248 V. CONFUSION IN CASE LAW OVER VALID AVENUES OF PATENT TRANSFER ............................................................................................................ 249 VI. FEDERAL CASE LAW AFFIRMING PATENT TRANSFER VIA OPERATION OF LAW .................................................................................................... 250 VII. CONCLUSION .......................................................................................... 255 I. INTRODUCTION Intellectual property can be a complicated area of the law as it relates to the right to assign, pass on, or distribute the rights and ownership interests in intellectual property. Patents, in particular, pose unique issues due to their regulation in both state and federal law.1 Unlike copyrights and trademarks, patents are almost exclusively subject to governance by federal law.2 Because patents are largely governed by the United States Patent Act (hereinafter “Patent Act”), the majority of patent litigation takes place in federal courts, however, one key area where federal law does not exclusively control is the transfer of patents as 1. See Louisa M. Ristick, Intellectual Property Issues in Estate Planning and Administration, COLO. LAW., Dec. 2017, at 46, 50. 2. Lawrence M. Sung, MD. B. ASS’N, Patents, in PATENT, COPYRIGHT, TRADE SECRET, RIGHT OF PUBLICITY, TRADEMARK HANDBOOK FOR MARYLAND BUSINESS AND LITIGATION LAWYERS, ch. 1(I)(A) (2013). LOGIC_MACRO.DOCX (DO NOT DELETE) 242 2/12/21 12:52 PM MARQ. INTELL. PROP. L. REV. [Vol. 24:2 personal property.3 Issues of probate and the classification of what makes up personal property is an issue reserved to the states, however, not all states make it abundantly clear whether patents are classified as property, muddying the waters on patent transfer in the event of an intestate decedent.4 This Comment analyzes the language of the Patent Act as it relates to the transfer of ownership interests as they relate to patents, focusing specifically on how interests in a patent would transfer in the event of the owner dying intestate and not otherwise assigning the interest in the patent. Additionally, it will address how Wisconsin classifies property and does not explicitly list patents as property, which creates a potential issue in the probate of patent interests. Section II will introduce patents and some of the issues regarding patent transfer. The development of the Patent Act and its language regarding the transfer of interests in a patent will be discussed in Section III of this Comment. Section IV will introduce a focused example of how patents are treated in Wisconsin specifically and the issues with how states classify personal property for the sake of probate law. This Comment will discuss why the Patent Act can be interpreted to show a thread of treating patents as personal property, even if not explicitly stated in the earlier iterations of the Patent Act. Sections V and VI will look at the reasoning and interpretation used by courts in the 21st century, focusing primarily on three cases from the 2000s that shaped and refined the ways in which the Patent Act is applied. Additionally, the public policy reasoning behind the United States Court of Appeals for the Federal Circuit decisions in Akazawa v. Link New Technology Intern, Inc., and Sky Technologies LLC v. SAP AG will be addressed. The Comment will conclude in Section VII with a brief assessment of the Federal Circuit’s interpretation of the Patent Act and a suggested course of action for states to resolve uncertainty regarding the status of patents as personal property. II. OVERVIEW OF PATENTS AND THE SIGNIFICANCE A CLEAR AND TIMELY TRANSFER A patent is a grant given by the United States Patent and Trademark Office that allows the owner of the patent to maintain a monopoly on the subject of the patent for a set period of time to have exclusive use and development of an invention.5 “To obtain a patent, the new invention must be both (1) novel, meaning the invention is different from the prior art . . . and (2) nonobvious, meaning generally remote or surprising to one skilled in the art.”6 Additionally, 3. 4. 5. 6. Id. Id. Ristick, supra note 1, at 49. Id. LOGIC_MACRO.DOCX (DO NOT DELETE) 2020] TRANSFER OF PATENT RIGHTS 2/12/21 12:52 PM 243 an invention or idea must have utility to be patentable.7 Most patents are nonrenewable, and the subject of the patent enters the public domain once the term of the patent expires.8 The value in a patent largely stems from the exclusive right to produce, use and profit from the invention.9 The time restrictions on the ownership of a patent creates a need for certainty and timeliness in determining how ownership interests in a patent are transferred.10 Time spent deliberating on the transfer may affect the rights of the owner to capitalize on and profit from the patent.11 These issues are further complicated when the rights to such a patent need to be determined when the decedent owner dies without first assigning the interest or creating a testamentary document to devise the interest in the patent. Additional (...truncated)