Your corporation employs some highly creative people. You not only encourage them to explore the limits of their creativity but provide significant resources to assist them.

Soon your efforts appear to have paid off when one of your people develops a truly unique process, which is then patented. Months later however, you’re shocked to learn the employee not only has acquired the patent in their own name but has licensed the rights to your chief competitor for a significant sum. Now what?

If you have employment contracts that clearly address to the ownership of such rights, you should be in good position to reassert your rights to the patented process. Employment and non-compete contracts are essential in protecting your rights. The contract should cover such issues as assignment of inventions or patents to the employer, consideration for the employee in return for such assignments, and a clear statement that any such work and its derivatives created by employees using company time and resources is the company’s property.

As with any legally binding agreement, seek the advice of legal counsel. Have your counsel review all your current employment contracts to be certain the terms speak to such situations. If insurance or risk management questions arise, please contact us to align your protection with your needs.