Monday, September 14, 2009

NDA or Preinvention Assignment?

Dear Rich: I currently am working at a company that makes a product that I have no intrest in trying to make better. But they package this product with something that I have found a better way to do. I want to invent this product prototype but was informed that because I signed an NDA, if I take this idea out of the idea stage it would then belong to them!!! Is this true? My company is going out of business next year but the corporation is staying open under a different name out of the country. Does this make a difference? And they are keeping our company name as a brand. Is a nondisclosure agreement iron-clad or does an aspiring inventor have a chance to shine? I didn't realize that by signing an NDA, they could own innovations concepts and inventions. The thought of someone else owning my creative process is very scary to me. We're guessing that what you actually signed was a combo-agreement that had nondisclosure provisions and also gave your employer the rights to any inventions or copyrights created in the course of your employment (known as a preinvention assignment). Eight states have limitations on these agreements and in those states the employee will usually own non-work related innovations created without employer resources and on the employee's time. In general, if you signed a typical preinvention assignment your employer will own your work-related innovations. 
All that other stuff ...We're not sure what's going on with your company but assuming the assets are transferred to another entity, that new entity will step into the shoes of your employer and own everything you created. Practically, the new owners may not police the old agreements, or may not be aware of what you're doing, but under contract law, they could claim rights to it. The Dear RIch Staff reports that your predicament is standard, (and often a business necessity) for many innovative companies. And in these days of disappearing job opportunities, it's not likely to go away.
Even without the paperwork ... Regardless of whether you signed any paperwork, if you were employed for your innovation skills (or hired to create inventions), the employer would likely own what you create under the "employed to invent" doctrine. Alternatively, even if you weren't hired to invent, if you use the employer's resource (materials, supplies or time), the employer may obtain a royalty-free right to own your innovations under "shop-right" rules. In addition, whether or not you signed a nondisclosure agreement, you're bound under state laws to maintain an employer's trade secrets. (Sometimes, the rules expressed above are different for government and university employees.
Plunk Your Magic Twanger! What about this picture of a rare poisonous tree frog? Okay, it's not actually poisonous or a tree frog. In fact the only reason we're posting it is that was offering it as a free download and we like the way the little guy looked.