In previous posts here and here I discussed a companion lawsuit to the major GE-Mitsubishi wind patent litigation in which GE and a former employee are fighting over the rights to certain wind turbine technology.
In that suit, filed in the Eastern District of California, GE accused Thomas Wilkins, an electrical engineer who worked at Enron Wind and GE after it acquired Enron, of breaching his employment agreements with both companies by asserting an ownership interest and trying to license U.S. Patents Nos. 6,924,565 (‘565 Patent) and 6,921,985.
Although the court granted GE’s motion for a preliminary injunction last year and ordered Wilkins to temporarily cease his licensing activities, the case has seen some twists and turns resulting in an apparent victory for Wilkins.
In an Order decided earlier this month, the court “tentatively” granted partial summary judgment for Wilkins, holding that he owns the ‘565 Patent and therefore has the right to license it. The court also granted Wilkins’ request that the preliminary injunction be dissolved with respect to the ‘565 Patent.
Over the course of this case, GE had put forth two arguments as to why it, and not Wilkins, owned the rights to the ‘565 Patent. The first was that Wilkins was hired by Enron and GE to invent, and as such, he was obligated to assign the rights to the ‘565 Patent to GE.
However, in a prior order the court held the statute of limitations had passed for GE to enforce this obligation:
the Court concluded in its summary judgment order that even if Mr. Wilkins was hired to invent, GE’s ability to enforce Mr. Wilkins’ obligation to assign his rights to the ‘565 patent is time-barred. The statute of limitations period on that claim expired in 2007 at the latest. Accordingly, GE cannot establish sole legal title to the ‘565 patent under a “hired to invent” theory and cannot preclude Mr. Wilkins from licensing the patent on that basis.
In the most recent decision, the court rejected GE’s alternative legal theory that under California law an employee hired to invent not only has a duty to assign his rights, but also has an independent duty not to use the invention to the detriment of his employer.
The court found nothing in the case law to support the application of this principle to patents or to licensing. Accordingly, the court held that Wilkins owns the ‘565 Patent and has the right to license it:
Absent assignment, Mr. Wilkins retained his ownership interest in the ‘565 patent and enjoys an unfettered right to license the patent.
The court did, however, make the grant of summary judgment for Wilkins “tentative” and gave GE the opportunity to raise other issues before it enters judgment:
Because GE’s legal basis for precluding Mr. Wilkins from licensing the ‘565 patent appears to lack merit, the Court will tentatively grant Mr. Wilkins summary judgment on this matter. GE will be given a final opportunity to raise any other issues not already addressed by the Court before summary judgment is entered.
The court also granted summary judgment for Wilkins with respect to his duty to assign the ‘985 Patent after GE conceded that the statute of limitations period on that claim expired in 2004. This was because GE was aware back in 2002 that Wilkins breached his duty to assign the rights to the patent, and there is a two-year statute of limitations on the claim.
Not only is this a win for Wilkins, but it’s also a victory for Mitsubishi, who had intervened in the case. The suit aroused Mitsubishi’s interest because the ‘985 Patent is one of several asserted by GE against Mitsubishi in at least two lawsuits, including a patent infringement case in Texas and an investigation in the U.S. International Trade Commission (ITC). Among other things, Wilkins’ inventive contributions to the ‘985 Patent were at issue in the ITC case.
The ‘985 Patent is also one of the patents-at-issue in Mitsubishi’s antitrust suit against GE, in which it has accused its rival of engaging in an anticompetitive scheme to monopolize the U.S. market for variable speed wind turbines. The antitrust suit was stayed pending resolution of the patent infringement suits.