Very few companies realize the significance their in-house invention
submission process may have on the value of a later issued patent. The
early 2000 Federal Circuit decision in In Re Spalding Sports
Worldwide, Inc., 203 F. 3d 800 (Fed. Cir. 2000) clarified several
issues surrounding invention disclosure documents.
Patent litigators have long recognized the potential goldmine of
damaging information that is often contained in invention disclosure
documents. After all, inventors often quickly fill out the documents
with little knowledge of patent law, and often include statements that
may come back to haunt the company in subsequent litigation. Inventors
often point out many of the shortcomings of their inventions, while
downplaying the strengths. Additionally, it is not uncommon to see
potentially damaging statements such as "after reviewing competitor
X's products/processes I realized that a small amount of refinement
would achieve Y" written in an invention disclosure. While such a
statement may appear harmless at the time it is written, it would
appear differently when it is an enlarged courtroom display in a
lawsuit between competitor X and your company.
The first courtroom argument made for the discovery of invention
disclosure documents will be that the documents are not protected by
the attorney-client privilege. Similarly, your company's best method
of keeping invention disclosure documents out of the courtroom is to
have an invention disclosure process that ensures that the documents
do fall under the attorney-client privilege.
Prior to In Re Spalding Sports Worldwide, Inc., most courts were of
the opinion that a company's patent attorneys acted simply as a
"conduit" between the company and the Patent and Trademark Office.
Therefore, even though disclosure forms were ultimately given to an
attorney for legal advice, they were not protected by the
attorney-client privilege and therefore had to be turned over to
The Federal Circuit, in In Re Spalding Sports Worldwide, Inc., found
that disclosure documents may not be discoverable during litigation if
they were prepared and provided to an attorney primarily for the
purpose of obtaining legal advice on patentability, and legal services
in preparing a patent application. The Federal Circuit noted that
attorney-client privilege protects information given to an attorney
that is required for the attorney to give sound and informed advice.
Unfortunately, when an inventor completes an invention disclosure form
it is most often used to inform management of the invention.
To ensure the greatest safeguard against discovery, companies should
implement invention disclosure processes whereby the documents are
transferred as a confidential memo directly from the inventor to the
company's legal department, or patent attorneys, explicitly for legal
advice and services regarding patentability. After this initial
transfer the inventor and the attorneys can discuss distribution of
the documents to other company personnel.