In Brief:  Joint inventorship can be based on designs disclosed during an investment pitch.

Here’s What Happened:  

Gary Ragner designed a hose and assigned the invention to his company, Ragner Technology Corp. In 2011, Ragner was looking for investors to bring its MicroHose product to market. Gary met with Michael Berardi, who had a degree in sociology and no experience in designing or building hoses, and some other people to explore the investment opportunity. Gary showed the group his designs and demonstrated a prototype. Michael made some suggestions for changes to the designs. After the meeting, Michael went to Home Depot, bought some supplies and built his own prototype that was, not surprisingly, very similar to Gary’s designs.

Michael filed a patent application naming himself as the sole inventor of utility patents and design patents related to an expandable hose. He assigned the patents to his company, Blue Gentian LLC.

Meanwhile, Gary licensed the manufacture and distribution of his hose to Tristar Products, Inc.

Blue Gentian sued Tristar for patent infringement. Tristar counterclaimed to add Gary as a joint inventor. After testimony from the group who attended the 2011 meeting, the district court found that Gary conveyed three key claim elements to Michael during the investor meeting and therefore should have been named an inventor on Micheal’s patents. Blue Gentian appealed.

On appeal to the Federal Circuit Court of Appeals found that the three elements Gary disclosed to Michael each appear in at least one claim of Michael’s patent. These features distinguished Michael’s patent from prior art. So, the features Michael disclosed to Gary were significant in quality when measured against the full invention. The court further held that Gary’s disclosure of confidential technical details and design alternatives was sufficient to demonstrate a collaboration that would result in joint inventorship.

The judgment was affirmed.

Why You Should Know This: The issue in this case was probably clear after the first two paragraphs. In the rush to find investors, Michael didn’t pay attention to the basics of protecting his Intellectual Property. He had to rely on circumstantial evidence. A signed confidentiality and non-circumvention agreement would have saved a lot of time and money.

Case Information: Blue Gentian, LLC v. Tristar Prod., Inc., 70 F.4th 1351 (Fed. Cir. 2023)

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