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Omni MedSci v. Apple: A Promise to Assign Is Not an Assignment

Federal Circuit, decided 2 August 2021. Read from the opinion; quotations verified against the court's text.

Holding

On August 2, 2021 the Federal Circuit held that a University of Michigan bylaw saying patents "shall be the property of the University" was "at most, a statement of a future intention to assign" rather than a present automatic assignment, so the professor still held title and his later assignment to his own company was effective, over a dissent from Judge Newman.

A University of Michigan professor invented, formed a company, assigned his patents to it, and sued Apple. Apple argued the company had no standing because a university bylaw already gave the patents to Michigan. The bylaw said inventions "shall be the property of the University."

The Federal Circuit held that phrase does not transfer anything. It is "a statement of intended disposition and a promise of a potential future assignment, not as a present automatic transfer." The professor still had title to give.

Judge Newman dissented, saying the patents are the property of the University.

The Distinction the Court Drew

The court contrasted the bylaw's forward-looking language with the kind of wording that does transfer on its own terms: language in which an inventor does hereby grant rights, operating in the present rather than describing a future step.

Two things about how the court got there are worth holding onto. It read the bylaw as a whole rather than resting on any single phrase. And the outcome was contested: a judge on the same panel read the same document the other way.

Why there is no checklist on this page. The tempting thing to publish here is a list of "good" and "bad" assignment phrases drawn from the opinion. That would be legal drafting advice, it would be wrong often enough to matter, and it misreads the decision: the majority read the document as a whole, so no single phrase is the test. A dissent on the same facts is the clearest possible evidence that phrase-matching is not the method.

Why It Cuts Both Ways

The lesson runs in both directions, and which direction matters depends on which side of the language you are on.

If you are relying on an agreement to have captured someone's inventions, whether that agreement actually did so is a question about its specific words, read whole, under the law of a particular state. If you are the inventor, the same is true in reverse. Neither position is settled by knowing this case came out one way.

For a startup the practical exposure is usually not a university bylaw. It is a founder's prior employment agreement, an advisor's terms, a contractor's default IP clause, or a university affiliation nobody flagged. Those are documents that exist already and can be read now, which is cheaper than discovering the question during diligence.

What This Case Is Not

  • It does not tell you whether your agreement transfers your inventions. Contract interpretation is governed by state law that varies, and it belongs to a lawyer reading your actual document.
  • It does not make any particular wording "safe." The court's method was to read the whole instrument.
  • It is not a recommendation to rewrite anything. What it offers is the distinction the court drew, which is a reason to have counsel look at agreements you are relying on.

Educational, not legal advice. Consult a qualified patent attorney about your own agreements and chain of title.

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