Board of Trustees of the Leland Stanford Junior University v. Roche Molecular Systems, Inc. , 131 S. Ct. 2188 ( 2011 )

(Slip Opinion) OCTOBER TERM, 2010 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
BOARD OF TRUSTEES OF THE LELAND STANFORD
JUNIOR UNIVERSITY v. ROCHE MOLECULAR
SYSTEMS, INC., ET AL.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FEDERAL CIRCUIT
No. 09–1159. Argued February 28, 2011—Decided June 6, 2011
In 1985, a small California research company called Cetus began to
develop methods for quantifying blood-borne levels of human immu
nodeficiency virus (HIV), the virus that causes AIDS. A Nobel Prize
winning technique developed at Cetus known as PCR was an integral
part of these efforts.
In 1988, Cetus began to collaborate with scientists at Stanford
University’s Department of Infectious Diseases to test the efficacy of
new AIDS drugs. Dr. Holodniy joined Stanford as a research fellow
in the department around that time. When he did so, he signed an
agreement stating that he “agree[d] to assign” to Stanford his “right,
title and interest in” inventions resulting from his employment there.
Holodniy’s supervisor arranged for him to conduct research at Cetus
to learn about PCR. As a condition of gaining access to Cetus,
Holodniy was required to sign an agreement stating that he “will as
sign and do[es] hereby assign” to Cetus his “right, title and interest
in . . . the ideas, inventions, and improvements” made “as a conse
quence of [his] access” to Cetus. Working with Cetus employees,
Holodniy devised a PCR-based procedure for measuring the amount
of HIV in a patient’s blood. Upon returning to Stanford, he and other
Stanford employees tested the procedure. Stanford secured three
patents to the measurement process.
Roche Molecular Systems acquired Cetus’s PCR-related assets.
After conducting clinical trials on the HIV quantification method de
veloped at Cetus, Roche commercialized the procedure. Today, its
HIV test kits are used worldwide.
The University and Small Business Patent Procedures Act of 1980
2 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Syllabus
(Bayh-Dole Act or Act) allocates rights in federally funded “subject
invention[s]” between the Federal Government and federal contrac
tors. 35 U. S. C. §§201(e), (c), 202(a). The Act defines “subject inven
tion” as “any invention of the contractor conceived or first actually
reduced to practice in the performance of work under a funding
agreement,” §201(e), and provides that contractors may “elect to re
tain title to any subject invention,” §202(a). Because some of Stan
ford’s research on the HIV measurement technique was funded by
the National Institutes of Health (NIH), the Bayh-Dole Act applied.
In accordance with the Act’s requirements, Stanford notified NIH
that it was electing to retain title to the invention and conferred on
the Government a license to use the patented procedure.
Petitioner, the Board of Trustees of Stanford University, filed suit
against respondents (Roche), claiming that their HIV test kits in
fringed Stanford’s patents. Roche responded that Holodniy’s agree
ment with Cetus gave it co-ownership of the procedure, and thus
Stanford lacked standing to sue it for patent infringement. Stanford
countered that Holodniy had no rights to assign because the Univer
sity had superior rights under the Bayh-Dole Act. The District Court
agreed with Stanford and held that under the Bayh-Dole Act, Holod
niy had no rights to assign to Cetus. The Court of Appeals for the
Federal Circuit disagreed, concluding that Holodniy’s agreement with
Cetus assigned his rights to Cetus, and thus to Roche. It also found
that the Bayh-Dole Act did not automatically void an inventor’s
rights in federally funded inventions. Thus, the Act did not extin
guish Roche’s ownership interest in the invention, and Stanford was
deprived of standing.
Held: The Bayh-Dole Act does not automatically vest title to federally
funded inventions in federal contractors or authorize contractors to
unilaterally take title to such inventions. Pp. 6–15.
(a) Since 1790, patent law has operated on the premise that rights
in an invention belong to the inventor. See, e.g., Gayler v. Wilder, 10
How. 477, 493. In most cases, a patent may be issued only to an ap
plying inventor, or—because an inventor’s interest in his invention is
assignable in law by an instrument in writing—an inventor’s as
signee. See United States v. Dubilier Condenser Corp., 289 U. S. 178,
187. Absent an agreement to the contrary, an employer does not
have rights in an invention “which is the original conception of the
employee alone,” id., at 189; an inventor must expressly grant those
rights to his employer, see id., at 187. Pp. 6–8.
(b) Stanford and amicus United States contend that, when an in
vention is conceived or first reduced to practice with the support of
federal funds, the Bayh-Dole Act vests title to those inventions in the
inventor’s employer—the federal contractor. Congress has in the
Cite as: 563 U. S. ____ (2011) 3
Syllabus
past divested inventors of their rights in inventions by providing un
ambiguously that inventions created pursuant to certain specified
federal contracts become the Government’s property. Such unambi
guous language is notably absent from the Bayh-Dole Act. Instead,
the Act provides that contractors may “elect to retain title to any sub
ject invention,” §202(a), defining a “subject invention” as “any inven
tion of the contractor conceived or first actually reduced to practice in
the performance of work under a funding agreement,” §201(e).
Stanford contends that “invention of the contractor” means all in
ventions that a contractor’s employees make with the aid of federal
funds. That reading assumes that Congress subtly set aside two cen
turies of patent law in a statutory definition. This Court has rejected
the idea that mere employment is sufficient to vest title to an em
ployee’s invention in the employer. Stanford’s reading also renders
the phrase “of the contractor” superfluous since the definition already
covers inventions made under a funding agreement. Construing the
phrase to refer instead to a particular category of inventions con
ceived or reduced to practice under a funding agreement—inventions
“of the contractor,” that is, those owned by or belonging to the con
tractor—makes the phrase meaningful in the statutory definition.
And “invention owned by the contractor” or “invention belonging to
the contractor” are natural readings of the phrase “invention of the
contractor.”
Section 202(a), which states that contractors may “elect to retain
title,” confirms that the Act does not vest title. Stanford reaches the
opposite conclusion, but only because it reads “retain” to mean “ac
quire” and “receive.” That is certainly not the common meaning of
“retain,” which is “to hold or continue to hold in possession or use.”
You cannot retain something unless you already have it. And
§210(a)—which provides that the Act “take[s] precedence over any
other Act which would require a disposition of rights in subject inven
tions . . . that is inconsistent with” the Act—does not displace the ba
sic principle that an inventor owns the rights to his invention. Only
when an invention belongs to the contractor does the Bayh-Dole Act
come into play. The Act’s disposition of rights does nothing more
than clarify the order of priority of rights between the Federal Gov
ernment and a federal contractor in a federally funded invention that
already belongs to the contractor.
The Act’s isolated provisions dealing with inventors’ rights in sub
ject inventions are consistent with the Court’s construction of the Act.
See §202(d). That construction is also bolstered by the Act’s limited
procedural protections, which expressly give contractors the right to
challenge a Government-imposed impediment to retaining title to a
subject invention, §202(b)(4), but do not provide similar protection for
4 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Syllabus
inventor and third-party rights.
Stanford’s contrary construction would permit title to an em
ployee’s inventions to vest in the University even if the invention was
conceived before the inventor became an employee, so long as the in
vention’s reduction to practice was supported by federal funding. It
also suggests that the school would obtain title were even one dollar
of federal funding applied toward an invention’s conception or reduc
tion to practice. It would be noteworthy enough for Congress to sup
plant one of the fundamental precepts of patent law and deprive in
ventors of rights in their own inventions. To do so under such
unusual terms would be truly surprising. Had Congress intended
such a sea change in intellectual property rights it would have said so
clearly—not obliquely through an ambiguous definition of “subject
invention” and an idiosyncratic use of the word “retain.”
The Court’s construction of the Act is also reflected in the common
practice of contractors, who generally obtain assignments from their
employees, and of agencies that fund federal contractors, who typi
cally expect those contractors to obtain assignments. With effective
assignments, federally funded inventions become “subject inventions”
and the Act as a practical matter works pretty much the way Stan
ford says it should. The only significant difference is that it does so
without violence to the basic patent law principle that inventors own
their inventions. Pp. 8–15.
583 F. 3d 832, affirmed.
ROBERTS, C. J., delivered the opinion of the Court, in which SCALIA,
KENNEDY, THOMAS, ALITO, SOTOMAYOR, and KAGAN, JJ., joined. SO-
TOMAYOR, J., filed a concurring opinion. BREYER, J., filed a dissenting
opinion, in which GINSBURG, J., joined.
Cite as: 563 U. S. ____ (2011) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 09–1159
_________________
BOARD OF TRUSTEES OF THE LELAND STANFORD
JUNIOR UNIVERSITY, PETITIONER v. ROCHE
MOLECULAR SYSTEMS, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT
[June 6, 2011]
CHIEF JUSTICE ROBERTS delivered the opinion of the
Court.
Since 1790, the patent law has operated on the premise
that rights in an invention belong to the inventor. The
question here is whether the University and Small Busi
ness Patent Procedures Act of 1980—commonly referred to
as the Bayh-Dole Act—displaces that norm and automati
cally vests title to federally funded inventions in federal
contractors. We hold that it does not.
I
A
In 1985, a small California research company called
Cetus began to develop methods for quantifying blood
borne levels of human immunodeficiency virus (HIV), the
virus that causes AIDS. A Nobel Prize winning technique
developed at Cetus—polymerase chain reaction, or PCR—
was an integral part of these efforts. PCR allows billions
of copies of DNA sequences to be made from a small initial
blood sample.
In 1988, Cetus began to collaborate with scientists at
2 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
Stanford University’s Department of Infectious Diseases
to test the efficacy of new AIDS drugs. Dr. Mark Holodniy
joined Stanford as a research fellow in the department
around that time. When he did so, he signed a Copyright
and Patent Agreement (CPA) stating that he “agree[d] to
assign” to Stanford his “right, title and interest in” inven
tions resulting from his employment at the University.
App. to Pet. for Cert. 118a–119a.
At Stanford Holodniy undertook to develop an improved
method for quantifying HIV levels in patient blood sam
ples, using PCR. Because Holodniy was largely unfamiliar
with PCR, his supervisor arranged for him to conduct
research at Cetus. As a condition of gaining access to
Cetus, Holodniy signed a Visitor’s Confidentiality Agree
ment (VCA). That agreement stated that Holodniy “will
assign and do[es] hereby assign” to Cetus his “right, title
and interest in each of the ideas, inventions and improve
ments” made “as a consequence of [his] access” to Cetus.
Id., at 122a–124a.
For the next nine months, Holodniy conducted research
at Cetus. Working with Cetus employees, Holodniy de
vised a PCR-based procedure for calculating the amount of
HIV in a patient’s blood. That technique allowed doctors
to determine whether a patient was benefiting from HIV
therapy.
Holodniy then returned to Stanford where he and other
University employees tested the HIV measurement tech
nique. Over the next few years, Stanford obtained written
assignments of rights from the Stanford employees in
volved in refinement of the technique, including Holodniy,
and filed several patent applications related to the proce
dure. Stanford secured three patents to the HIV meas
urement process.
In 1991, Roche Molecular Systems, a company that
specializes in diagnostic blood screening, acquired Cetus’s
PCR-related assets, including all rights Cetus had ob
Cite as: 563 U. S. ____ (2011) 3
Opinion of the Court
tained through agreements like the VCA signed by Holod
niy. After conducting clinical trials on the HIV quantifica
tion method developed at Cetus, Roche commercialized the
procedure. Today, Roche’s HIV test “kits are used in
hospitals and AIDS clinics worldwide.” Brief for Respon
dents 10–11.
B
In 1980, Congress passed the Bayh-Dole Act to “promote
the utilization of inventions arising from federally sup
ported research,” “promote collaboration between commer
cial concerns and nonprofit organizations,” and “ensure
that the Government obtains sufficient rights in federally
supported inventions.” 35 U. S. C. §200. To achieve these
aims, the Act allocates rights in federally funded “subject
invention[s]” between the Federal Government and federal
contractors (“any person, small business firm, or nonprofit
organization that is a party to a funding agreement”).
§§201(e), (c), 202(a). The Act defines “subject invention”
as “any invention of the contractor conceived or first actu
ally reduced to practice in the performance of work under
a funding agreement.” §201(e).
The Bayh-Dole Act provides that contractors may “elect
to retain title to any subject invention.” §202(a). To be
able to retain title, a contractor must fulfill a number of
obligations imposed by the statute. The contractor must
“disclose each subject invention to the [relevant] Federal
agency within a reasonable time”; it must “make a written
election within two years after disclosure” stating that
the contractor opts to retain title to the invention; and the
contractor must “file a patent application prior to any
statutory bar date.” §§202(c)(1)–(3). The “Federal Gov
ernment may receive title” to a subject invention if a
contractor fails to comply with any of these obligations.
Ibid.
The Government has several rights in federally funded
4 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
subject inventions under the Bayh-Dole Act. The agency
that granted the federal funds receives from the contractor
“a nonexclusive, nontransferrable, irrevocable, paid-up
license to practice . . . [the] subject invention.” §202(c)(4).
The agency also possesses “[m]arch-in rights,” which
permit the agency to grant a license to a responsible third
party under certain circumstances, such as when the con
tractor fails to take “effective steps to achieve practical
application” of the invention. §203. The Act further pro
vides that when the contractor does not elect to retain title
to a subject invention, the Government “may consider and
after consultation with the contractor grant requests for
retention of rights by the inventor.” §202(d).
Some of Stanford’s research related to the HIV meas
urement technique was funded by the National Institutes
of Health (NIH), thereby subjecting the invention to the
Bayh-Dole Act. Accordingly, Stanford disclosed the in
vention, conferred on the Government a nonexclusive,
nontransferable, paid-up license to use the patented proce
dure, and formally notified NIH that it elected to retain
title to the invention.
C
In 2005, the Board of Trustees of Stanford University
filed suit against Roche Molecular Systems, Inc., Roche
Diagnostics Corporation, and Roche Diagnostics Opera
tions, Inc. (collectively Roche), contending that Roche’s
HIV test kits infringed Stanford’s patents. As relevant
here, Roche responded by asserting that it was a co-owner
of the HIV quantification procedure, based on Holodniy’s
assignment of his rights in the Visitor’s Confidentiality
Agreement. As a result, Roche argued, Stanford lacked
standing to sue it for patent infringement. 487 F. Supp.
2d 1099, 1111, 1115 (ND Cal. 2007). Stanford claimed
that Holodniy had no rights to assign because the Univer
sity’s HIV research was federally funded, giving the school
Cite as: 563 U. S. ____ (2011) 5
Opinion of the Court
superior rights in the invention under the Bayh-Dole Act.
Ibid.1
The District Court held that the “VCA effectively as
signed any rights that Holodniy had in the patented in
vention to Cetus,” and thus to Roche. Id., at 1117. But
because of the operation of the Bayh-Dole Act, “Holodniy
had no interest to assign.” Id., at 1117, 1119. The court
concluded that the Bayh-Dole Act “provides that the indi
vidual inventor may obtain title” to a federally funded
invention “only after the government and the contracting
party have declined to do so.” Id., at 1118.
The Court of Appeals for the Federal Circuit disagreed.
First, the court concluded that Holodniy’s initial agree
ment with Stanford in the Copyright and Patent Agree
ment constituted a mere promise to assign rights in the
future, unlike Holodniy’s agreement with Cetus in the
Visitor’s Confidentiality Agreement, which itself assigned
Holodniy’s rights in the invention to Cetus. See 583 F. 3d
832, 841–842 (2009). Therefore, as a matter of contract
law, Cetus obtained Holodniy’s rights in the HIV quantifi
cation technique through the VCA.2 Next, the court ex
plained that the Bayh-Dole Act “does not automatically
void ab initio the inventors’ rights in government-funded
inventions” and that the “statutory scheme did not auto
matically void the patent rights that Cetus received from
Holodniy.” Id., at 844–845. The court held that “Roche
possesse[d] an ownership interest in the patents-in-suit”
——————
1 Roche submitted a host of other claims to the District Court, includ
ing that it had “shop rights” to the patents and was entitled to a license
to use the patents. See 583 F. 3d 832, 838 (CA Fed. 2009). None of
those claims is now before us; we deal only with Roche’s claim to co
ownership to rebut Stanford’s standing to bring an infringement action.
2 Because the Federal Circuit’s interpretation of the relevant assign
ment agreements is not an issue on which we granted certiorari, we
have no occasion to pass on the validity of the lower court’s construction
of those agreements.
6 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
that was not extinguished by the Bayh-Dole Act, “de
priv[ing] Stanford of standing.” Id., at 836–837. The
Court of Appeals then remanded the case with instruc
tions to dismiss Stanford’s infringement claim. Id., at 849.
We granted certiorari. 562 U. S. ___ (2010).
II
A
Congress has the authority “[t]o promote the Progress of
Science and useful Arts, by securing . . . to Authors and
Inventors the exclusive Right to their respective Writings
and Discoveries.” U. S. Const. Art. I, §8, cl. 8. The first
Congress put that power to use by enacting the Patent Act
of 1790. That Act provided “[t]hat upon the petition of any
person or persons . . . setting forth, that he, she, or they,
hath or have invented or discovered” an invention, a pat
ent could be granted to “such petitioner or petitioners” or
“their heirs, administrators or assigns.” Act of Apr. 10,
1790, §1, 1 Stat. 109–110. Under that law, the first patent
was granted in 1790 to Samuel Hopkins, who had devised
an improved method for making potash, America’s first
industrial chemical. U. S. Patent No. 1 (issued July 31,
1790).3
Although much in intellectual property law has changed
in the 220 years since the first Patent Act, the basic idea
that inventors have the right to patent their inventions
has not. Under the law in its current form, “[w]hoever
invents or discovers any new and useful process, machine,
manufacture, or composition of matter . . . may obtain a
patent therefor.” 35 U. S. C. §101. The inventor must
attest that “he believes himself to be the original and first
inventor of the [invention] for which he solicits a patent.”
——————
3 The
patent was signed by President George Washington, Secretary
of State Thomas Jefferson, and Attorney General Edmund Randolph.
See Maxey, Samuel Hopkins, The Holder of the First U. S. Patent: A
Study of Failure, 122 Pa. Magazine of Hist. and Biography 6 (1998).
Cite as: 563 U. S. ____ (2011) 7
Opinion of the Court
§115. In most cases, a patent may be issued only to an
applying inventor, or—because an inventor’s interest in
his invention is “assignable in law by an instrument in
writing”—an inventor’s assignee. §§151, 152, 261.
Our precedents confirm the general rule that rights in
an invention belong to the inventor. See, e.g., Gayler v.
Wilder, 10 How. 477, 493 (1851) (“the discoverer of a new
and useful improvement is vested by law with an inchoate
right to its exclusive use, which he may perfect and make
absolute by proceeding in the manner which the law re
quires”); Solomons v. United States, 137 U. S. 342, 346
(1890) (“whatever invention [an inventor] may thus con
ceive and perfect is his individual property”); United
States v. Dubilier Condenser Corp., 289 U. S. 178, 188
(1933) (an inventor owns “the product of [his] original
thought”). The treatises are to the same effect. See, e.g., 8
Chisum on Patents §22.01, p. 22–2 (2011) (“The presump
tive owner of the property right in a patentable invention
is the single human inventor”).
It is equally well established that an inventor can assign
his rights in an invention to a third party. See Dubilier
Condenser Corp., supra, at 187 (“A patent is property and
title to it can pass only by assignment”); 8 Chisum on
Patents, supra, §22.01, at 22–2 (“The inventor . . . [may]
transfer ownership interests by written assignment to
anyone”). Thus, although others may acquire an interest
in an invention, any such interest—as a general rule—
must trace back to the inventor.
In accordance with these principles, we have recognized
that unless there is an agreement to the contrary, an
employer does not have rights in an invention “which is
the original conception of the employee alone.” Dubilier
Condenser Corp., 289 U. S., at 189. Such an invention
“remains the property of him who conceived it.” Ibid. In
most circumstances, an inventor must expressly grant his
rights in an invention to his employer if the employer is to
8 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
obtain those rights. See id., at 187 (“The respective rights
and obligations of employer and employee, touching an
invention conceived by the latter, spring from the contract
of employment”).
B
Stanford and the United States as amicus curiae con
tend that the Bayh-Dole Act reorders the normal priority
of rights in an invention when the invention is conceived
or first reduced to practice with the support of federal
funds. In their view, the Act moves inventors from the
front of the line to the back by vesting title to federally
funded inventions in the inventor’s employer—the federal
contractor. See Brief for Petitioner 26–27; Brief for United
States as Amicus Curiae 6.
Congress has in the past divested inventors of their
rights in inventions by providing unambiguously that
inventions created pursuant to specified federal contracts
become the property of the United States. For example,
with respect to certain contracts dealing with nuclear
material and atomic energy, Congress provided that title
to such inventions “shall be vested in, and be the property
of, the [Atomic Energy] Commission.” 42 U. S. C. §2182.
Congress has also enacted laws requiring that title to
certain inventions made pursuant to contracts with the
National Aeronautics and Space Administration “shall be
the exclusive property of the United States,” Pub. L. 111–
314, §3, 124 Stat. 3339, 51 U. S. C. §20135(b)(1), and that
title to certain inventions under contracts with the De
partment of Energy “shall vest in the United States.” 42
U. S. C. §5908.
Such language is notably absent from the Bayh-Dole
Act. Nowhere in the Act is title expressly vested in con
tractors or anyone else; nowhere in the Act are inventors
expressly deprived of their interest in federally funded
inventions. Instead, the Act provides that contractors may
Cite as: 563 U. S. ____ (2011) 9
Opinion of the Court
“elect to retain title to any subject invention.” 35 U. S. C.
§202(a). A “subject invention” is defined as “any invention
of the contractor conceived or first actually reduced to
practice in the performance of work under a funding
agreement.” §201(e).
Stanford asserts that the phrase “invention of the con
tractor” in this provision “is naturally read to include all
inventions made by the contractor’s employees with the
aid of federal funding.” Brief for Petitioner 32 (footnote
omitted). That reading assumes that Congress subtly set
aside two centuries of patent law in a statutory definition.
It also renders the phrase “of the contractor” superfluous.
If the phrase “of the contractor” were deleted from the
definition of “subject invention,” the definition would cover
“any invention . . . conceived or first actually reduced to
practice in the performance of work under a funding
agreement.” Reading “of the contractor” to mean “all
inventions made by the contractor’s employees with the
aid of federal funding,” as Stanford would, adds nothing
that is not already in the definition, since the definition
already covers inventions made under the funding agree
ment. That is contrary to our general “reluctan[ce] to
treat statutory terms as surplusage.” Duncan v. Walker,
533 U. S. 167, 174 (2001) (internal quotation marks
omitted).
Construing the phrase to refer instead to a particular
category of inventions conceived or reduced to practice
under a funding agreement—inventions “of the contrac
tor,” that is, those owned by or belonging to the con
tractor—makes the phrase meaningful in the statutory
definition. And “invention owned by the contractor” or
“invention belonging to the contractor” are natural read
ings of the phrase “invention of the contractor.” As we
have explained, “[t]he use of the word ‘of’ denotes owner
ship.” Poe v. Seaborn, 282 U. S. 101, 109 (1930); see Flores-
Figueroa v. United States, 556 U. S. ___, ___, ___
10 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
(2009) (slip op., at 2, 11) (treating the phrase “identifica
tion [papers] of another person” as meaning such items
belonging to another person (internal quotation marks
omitted)); Ellis v. United States, 206 U. S. 246, 259 (1907)
(interpreting the phrase “works of the United States” to
mean “works belonging to the United States” (internal
quotation marks omitted)).
That reading follows from a common definition of the
word “of.” See Webster’s Third New International Dic
tionary 1565 (2002) (“of” can be “used as a function word
indicating a possessive relationship”); New Oxford Ameri
can Dictionary 1180 (2d ed. 2005) (defining “of” as “indi
cating an association between two entities, typically one of
belonging”); Webster’s New Twentieth Century Dictionary
1241 (2d ed. 1979) (defining “of” as “belonging to”).
Stanford’s reading of the phrase “invention of the con
tractor” to mean “all inventions made by the contractor’s
employees” is plausible enough in the abstract; it is often
the case that whatever an employee produces in the course
of his employment belongs to his employer. No one would
claim that an autoworker who builds a car while working
in a factory owns that car. But, as noted, patent law has
always been different: We have rejected the idea that mere
employment is sufficient to vest title to an employee’s
invention in the employer. Against this background, a
contractor’s invention—an “invention of the contractor”—
does not automatically include inventions made by the
contractor’s employees.4
——————
4 The dissent suggests that “we could interpret the Bayh-Dole Act as
ordinarily assuming, and thereby ordinarily requiring, an assignment
of patent rights by the federally funded employee to the federally
funded employer.” Post, at 8. That suggestion is based in large part on
Executive Order 10096, which “governs Federal Government employee
to-employer patent right assignments.” Post, at 9. Lest there be any
doubt, employees of nonfederal entities that have federal funding
contracts—like Holodniy—are not federal employees. And there is no
Cite as: 563 U. S. ____ (2011) 11
Opinion of the Court
The Bayh-Dole Act’s provision stating that contractors
may “elect to retain title” confirms that the Act does not
vest title. 35 U. S. C. §202(a) (emphasis added). Stanford
reaches the opposite conclusion, but only because it reads
“retain” to mean “acquire” and “receive.” Brief for Peti
tioner 36 (internal quotation marks omitted). That is
certainly not the common meaning of “retain.” “[R]etain”
means “to hold or continue to hold in possession or use.”
Webster’s Third, supra, at 1938; see Webster’s New Colle
giate Dictionary 980 (1980) (“to keep in possession or
use”); American Heritage Dictionary 1109 (1969) (“[t]o
keep or hold in one’s possession”). You cannot retain
something unless you already have it. See Alaska v.
United States, 545 U. S. 75, 104 (2005) (interpreting the
phrase “the United States shall retain title to all property”
to mean that “[t]he United States . . . retained title to its
property located within Alaska’s borders”) (emphasis
added). The Bayh-Dole Act does not confer title to feder
ally funded inventions on contractors or authorize contrac
tors to unilaterally take title to those inventions; it simply
assures contractors that they may keep title to whatever it
is they already have. Such a provision makes sense in a
statute specifying the respective rights and responsibili
ties of federal contractors and the Government.
The Bayh-Dole Act states that it “take[s] precedence
over any other Act which would require a disposition of
rights in subject inventions . . . that is inconsistent with”
the Act. 35 U. S. C. §210(a). The United States as amicus
curiae argues that this provision operates to displace the
basic principle, codified in the Patent Act, that an inventor
owns the rights to his invention. See Brief for United
States 21. But because the Bayh-Dole Act, including
——————
equivalent executive order governing invention rights with respect to
federally funded research; that issue is of course addressed by the
Bayh-Dole Act.
12 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
§210(a), applies only to “subject inventions”—“inventions
of the contractor”—it does not displace an inventor’s ante
cedent title to his invention. Only when an invention
belongs to the contractor does the Bayh-Dole Act come into
play. The Act’s disposition of rights—like much of the
rest of the Bayh-Dole Act—serves to clarify the order of
priority of rights between the Federal Government and a
federal contractor in a federally funded invention that
already belongs to the contractor. Nothing more.5
The isolated provisions of the Bayh-Dole Act dealing
with inventors’ rights in subject inventions are consistent
with our construction of the Act. Under the Act, a federal
agency may “grant requests for retention of rights by the
inventor . . . [i]f a contractor does not elect to retain title to
a subject invention.” §202(d). If an employee inventor
never had title to his invention because title vested in the
contractor by operation of law—as Stanford submits—it
would be odd to allow the Government to grant “requests
for retention of rights by the inventor.” By using the word
“retention,” §202(d) assumes that the inventor had rights
in the subject invention at some point, undermining the
notion that the Act automatically vests title to federally
funded inventions in federal contractors.6
——————
5 Far from superseding the Patent Act in such a backhanded way, it is
clear that §210(a)’s concern is far narrower. That provision specifies 21
different statutory provisions that the Bayh-Dole Act “take[s] prece
dence over,” the vast majority of which deal with the division of owner
ship in certain inventions between a contractor and the Government.
35 U. S. C. §§210(a)(1)–(21); see, e.g., §§210(a)(19)–(20) (the Bayh-Dole
Act takes precedence over “section 6(b) of the Solar Photovoltaic Energy
Research Development and Demonstration Act” and “section 12 of the
Native Latex Commercialization and Economic Development Act”).
6 Stanford contends that it cannot be the case “that the contractor can
only ‘retain title’ to an invention that it already owns, while an inventor
may be considered for ‘retention’ of title only when he has assigned title
away.” Reply Brief for Petitioner 8. That argument has some force.
But there may be situations where an inventor, by the terms of an
Cite as: 563 U. S. ____ (2011) 13
Opinion of the Court
The limited scope of the Act’s procedural protections
also bolsters our conclusion. The Bayh-Dole Act expressly
confers on contractors the right to challenge a Govern
ment-imposed impediment to retaining title to a subject
invention. §202(b)(4). As Roche correctly notes, however,
“the Act contains not a single procedural protection for
third parties that have neither sought nor received federal
funds,” such as cooperating private research institutions.
Brief for Respondents 29. Nor does the Bayh-Dole Act
allow inventors employed by federal contractors to contest
their employer’s claim to a subject invention. The Act, for
example, does not expressly permit an interested third
party or an inventor to challenge a claim that a particular
invention was supported by federal funding. In a world in
which there is frequent collaboration between private
entities, inventors, and federal contractors, see Brief for
Pharmaceutical Research and Manufacturers of America
as Amicus Curiae 22–23, that absence would be deeply
troubling. But the lack of procedures protecting inventor
and third-party rights makes perfect sense if the Act
applies only when a federal contractor has already ac
quired title to an inventor’s interest. In that case, there is
no need to protect inventor or third-party rights, because
the only rights at issue are those of the contractor and the
Government.
The Bayh-Dole Act applies to subject inventions “con
ceived or first actually reduced to practice in the perform
ance of work” “funded in whole or in part by the Federal
Government.” 35 U. S. C. §§201(e), 201(b) (emphasis
added). Under Stanford’s construction of the Act, title to
——————
assignment, has subsidiary rights in an invention to which a contractor
has title, as §202(d) suggests. Compare §202(d) (“retention of rights”)
with §202(a) (“retain title”) (emphasis added). And at the end of the
day, it is Stanford’s contention that “retain” must be “read as a syno
nym for ‘acquire’ or ‘receive’ ” that dooms its argument on this point.
Brief for Petitioner 37.
14 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
Opinion of the Court
one of its employee’s inventions could vest in the Univer
sity even if the invention was conceived before the inven
tor became a University employee, so long as the inven
tion’s reduction to practice was supported by federal
funding. What is more, Stanford’s reading suggests that
the school would obtain title to one of its employee’s inven
tions even if only one dollar of federal funding was applied
toward the invention’s conception or reduction to practice.
It would be noteworthy enough for Congress to supplant
one of the fundamental precepts of patent law and deprive
inventors of rights in their own inventions. To do so under
such unusual terms would be truly surprising. We are
confident that if Congress had intended such a sea change
in intellectual property rights it would have said so
clearly—not obliquely through an ambiguous definition of
“subject invention” and an idiosyncratic use of the word
“retain.” Cf. Whitman v. American Trucking Assns., Inc.,
531 U. S. 457, 468 (2001) (“Congress . . . does not alter
the fundamental details of a regulatory scheme in vague
terms or ancillary provisions”).
Though unnecessary to our conclusion, it is worth noting
that our construction of the Bayh-Dole Act is reflected in
the common practice among parties operating under the
Act. Contractors generally institute policies to obtain
assignments from their employees. See Brief for Respon
dents 34; Brief for Pharmaceutical Research and Manufac
turers of America as Amicus Curiae 13–18. Agencies that
grant funds to federal contractors typically expect those
contractors to obtain assignments. So it is with NIH, the
agency that granted the federal funds at issue in this case.
In guidance documents made available to contractors, NIH
has made clear that “[b]y law, an inventor has initial
ownership of an invention ” and that contractors should
therefore “have in place employee agreements requiring
an inventor to ‘assign’ or give ownership of an invention to
the organization upon acceptance of Federal funds.” NIH
Cite as: 563 U. S. ____ (2011) 15
Opinion of the Court
Policies, Procedures, and Forms, A “20–20” View of Inven
tion Reporting to the National Institutes of Health (Sept.
22, 1995). Such guidance would be unnecessary if Stan
ford’s reading of the statute were correct.
Stanford contends that reading the Bayh-Dole Act as
not vesting title to federally funded inventions in federal
contractors “fundamentally undermin[es]” the Act’s frame
work and severely threatens its continued “successful
application.” Brief for Petitioner 45. We do not agree. As
just noted, universities typically enter into agreements
with their employees requiring the assignment to the
university of rights in inventions. With an effective as
signment, those inventions—if federally funded—become
“subject inventions” under the Act, and the statute as a
practical matter works pretty much the way Stanford says
it should. The only significant difference is that it does so
without violence to the basic principle of patent law that
inventors own their inventions.
The judgment of the Court of Appeals for the Federal
Circuit is affirmed.
It is so ordered.
Cite as: 563 U. S. ____ (2011) 1
SOTOMAYOR, J., concurring
SUPREME COURT OF THE UNITED STATES
_________________
No. 09–1159
_________________
BOARD OF TRUSTEES OF THE LELAND STANFORD
JUNIOR UNIVERSITY, PETITIONER v. ROCHE
MOLECULAR SYSTEMS, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT
[June 6, 2011]
JUSTICE SOTOMAYOR, concurring.
I agree with the Court’s resolution of this case and with
its reasoning. I write separately to note that I share
JUSTICE BREYER’s concerns as to the principles adopted by
the Court of Appeals for the Federal Circuit in FilmTec
Corp. v. Allied-Signal, Inc., 939 F. 2d 1568 (1991), and the
application of those principles to agreements that impli
cate the Bayh-Dole Act. See post, at 6–10 (dissenting
opinion). Because Stanford failed to challenge the decision
below on these grounds, I agree that the appropriate
disposition is to affirm. Like the dissent, however, I un
derstand the majority opinion to permit consideration of
these arguments in a future case. See ante, at 5, n. 2.
Cite as: 563 U. S. ____ (2011) 1
BREYER, J., dissenting
SUPREME COURT OF THE UNITED STATES
_________________
No. 09–1159
_________________
BOARD OF TRUSTEES OF THE LELAND STANFORD
JUNIOR UNIVERSITY, PETITIONER v. ROCHE
MOLECULAR SYSTEMS, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FEDERAL CIRCUIT
[June 6, 2011]
JUSTICE BREYER, with whom JUSTICE GINSBURG joins,
dissenting.
The question presented in this case is:
“Whether a federal contractor university’s statutory
right under the Bayh-Dole Act, 35 U. S. C. §§200–212,
in inventions arising from federally funded research
can be terminated unilaterally by an individual in
ventor through a separate agreement purporting to as
sign the inventor’s rights to a third party.” Brief for
Petitioner i.
In my view, the answer to this question is likely no. But
because that answer turns on matters that have not been
fully briefed (and are not resolved by the opinion of the
Court), I would return this case to the Federal Circuit for
further argument.
I
The Bayh-Dole Act creates a three-tier system for patent
rights ownership applicable to federally funded research
conducted by nonprofit organizations, such as universities,
and small businesses. It sets forth conditions that mean
(1) the funded firm; (2) failing that, the United States
Government; and (3) failing that, the employee who made
2 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
BREYER, J., dissenting
the invention, will likely obtain (or retain) any result-
ing patent rights (normally in that just-listed order). 35
U. S. C. §§202–203. The statute applies to “subject in
vention[s]” defined as “any invention of the contractor
conceived or first actually reduced to practice in the per
formance of work under a funding agreement.” §201(e)
(emphasis added). Since the “contractor” (e.g., a univer
sity or small business) is unlikely to “conceiv[e]” of an idea
or “reduc[e]” it “to practice” other than through its employ
ees, the term “invention of the contractor” must refer
to the work and ideas of those employees. We all agree
that the term covers those employee inventions that the
employee properly assigns to the contractor, i.e., his or
her employer. But does the term “subject invention”
also include inventions that the employee fails to assign
properly?
II
Congress enacted this statute against a background
norm that often, but not always, denies individual inven
tors patent rights growing out of research for which the
public has already paid. This legal norm reflects the fact
that patents themselves have both benefits and costs.
Patents, for example, help to elicit useful inventions and
research and to assure public disclosure of technological
advances. See, e.g., Mazer v. Stein, 347 U. S. 201, 219
(1954); Bilski v. Kappos, 561 U. S. ___, ___ (2010) (slip op.,
at 4); id., at ___ (slip op., at 10) (Stevens, J., concurring in
judgment). But patents sometimes mean unnecessarily
high prices or restricted dissemination; and they some
times discourage further innovation and competition by re
quiring costly searches for earlier, related patents or by
tying up ideas, which, were they free, would more effec
tively spur research and development. See, e.g., Labora
tory Corp. of America Holdings v. Metabolite Laboratories,
Inc., 548 U. S. 124, 128 (2006) (BREYER, J., dissenting
Cite as: 563 U. S. ____ (2011) 3
BREYER, J., dissenting
from dismissal of certiorari as improvidently granted);
Heller & Eisenberg, Can Patents Deter Innovation? The
Anticommons in Biomedical Research, 280 Science 698
(1998).
Thus, Thomas Jefferson wrote of “the difficulty of draw
ing a line between the things which are worth to the pub
lic the embarrassment of an exclusive patent, and those
which are not.” Letter to Isaac McPherson (Aug. 13,
1813), in 6 Writings of Thomas Jefferson 181 (H. Washing
ton ed. 1854). And James Madison favored the patent
monopoly because it amounted to “compensation for” a
community “benefit.” Monopolies. Perpetuities. Corpora
tions. Ecclesiastical Endowments., in J. Madison, Writings
756 (J. Rakove ed. 1999).
The importance of assuring this community “benefit” is
reflected in legal rules that may deny or limit the award of
patent rights where the public has already paid to produce
an invention, lest the public bear the potential costs of
patent protection where there is no offsetting need for
such protection to elicit that invention. Why should the
public have to pay twice for the same invention?
Legal rules of this kind include an Executive Order that
ordinarily gives to the Government “the entire right, title
and interest” to inventions made by Government employ
ees who “conduct or perform research, development work,
or both.” 37 CFR §501.6 (2010) (codifying, as amended,
Exec. Order 10096, 3 CFR 292 (1949–1953 Comp.)). See
also Heinemann v. United States, 796 F. 2d 451, 455–456
(CA Fed. 1986) (holding Executive Order constitutional
and finding “no ‘taking’ because the invention was not the
property of Heinemann”). They also include statutes,
which, in specific research areas, give the Government
title to inventions made pursuant to Government con
tracts. See Atomic Energy Act of 1954, §152, 68 Stat. 944(codified as amended at 42 U. S. C. §2182); National Aero
nautics and Space Act of 1958, §305, 72 Stat. 435 (codified
4 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
BREYER, J., dissenting
at 42 U. S. C. §2457), repealed by §6, 124 Stat. 3444;
Federal Nonnuclear Energy Research and Development
Act of 1974, §9, 88 Stat. 1887 (codified as amended at 42
U. S. C. §5908(a)). And they have included Government
regulations, established prior to the Bayh-Dole Act’s en
actment, that work in roughly similar ways. See, e.g., 45
CFR §650.4(b) (1977) (National Science Foundation regu
lations providing that Foundation would “determine the
disposition of the invention [made under the grant] and
title to and rights under any patent application”); §§8.1(a),
8.2(d) (Department of Health, Education, and Welfare
regulations providing that inventions made under de
partment grants “shall be subject to determination” by the
agency and that the department may “require that all
domestic rights in the invention shall be assigned to the
United States”).
These legal rules provide the basic background against
which Congress passed the Bayh-Dole Act. And the Act’s
provisions reflect a related effort to assure that rights to
inventions arising out of research for which the public has
paid are distributed and used in ways that further specific
important public interests. I agree with the majority that
the Act does not simply take the individual inventors’
rights and grant them to the Government. Rather, it
assumes that the federal funds’ recipient, say a university
or small business, will possess those rights. The Act
leaves those rights in the hands of that recipient, not
because it seeks to make the public pay twice for the same
invention, but for a special public policy reason. In doing
so, it seeks to encourage those institutions to commercial
ize inventions that otherwise might not realize their po
tentially beneficial public use. 35 U. S. C. §200. The Act
helps assure that commercialization (while “promot[ing]
free competition” and “protect[ing] the public,” ibid.) by
imposing a set of conditions upon the federal funds recipi
ent, by providing that sometimes the Government will
Cite as: 563 U. S. ____ (2011) 5
BREYER, J., dissenting
take direct control of the patent rights, and by adding that
on occasion the Government will permit the individual
inventor to retain those rights. §§202–203.
Given this basic statutory objective, I cannot so easily
accept the majority’s conclusion—that the individual in
ventor can lawfully assign an invention (produced by
public funds) to a third party, thereby taking that inven
tion out from under the Bayh-Dole Act’s restrictions,
conditions, and allocation rules. That conclusion, in my
view, is inconsistent with the Act’s basic purposes. It may
significantly undercut the Act’s ability to achieve its objec
tives. It allows individual inventors, for whose invention
the public has paid, to avoid the Act’s corresponding re
strictions and conditions. And it makes the commerciali
zation and marketing of such an invention more difficult:
A potential purchaser of rights from the contractor, say a
university, will not know if the university itself possesses
the patent right in question or whether, as here, the indi
vidual, inadvertently or deliberately, has previously as
signed the title to a third party.
Moreover, I do not agree that the language to which the
majority points—the words “invention of the contractor”
and “retain”—requires its result. As the majority con
cedes, Stanford’s alternative reading of the phrase “ ‘in
vention of the contractor’ ” is “plausible enough in the
abstract.” Ante, at 10. Nor do I agree that the Act’s lack
of an explicit provision for “an interested third party” to
claim that an invention was not the result of federal fund
ing “bolsters” the majority’s interpretation. Ante, at 13.
In any event, universities and businesses have worked out
ways to protect the various participants to research. See
Brief for Association of American Universities et al. as
Amici Curiae 22–24 (hereinafter AAU Brief); App. 118–
124 (Materials Transfer Agreement between Cetus and
Stanford University).
Ultimately, the majority rejects Stanford’s reading (and
6 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
BREYER, J., dissenting
the Government’s reading) of the Act because it believes
that it is inconsistent with certain background norms of
patent law, norms that ordinarily provide an individual
inventor with full patent rights. Ante, at 10. But in my
view, the competing norms governing rights in inventions
for which the public has already paid, along with the
Bayh-Dole Act’s objectives, suggest a different result.
III
There are two different legal routes to what I consider
an interpretation more consistent with the statute’s objec
tives. First, we could set aside the Federal Circuit’s inter
pretation of the licensing agreements and its related
licensing doctrine. That doctrine governs interpretation of
licensing agreements made before an invention is con
ceived or reduced to practice. Here, there are two such
agreements. In the earlier agreement—that between Dr.
Holodniy and Stanford University—Dr. Holodniy said, “I
agree to assign . . . to Stanford . . . that right, title and
interest in and to . . . such inventions as required by Con
tracts and Grants.” App. to Pet. for Cert. 119a (emphasis
added). In the later agreement—that between Dr. Holod
niy and the private research firm Cetus—Dr. Holodniy
said, “I will assign and do hereby assign to Cetus, my
right, title, and interest in” here relevant “ideas” and
“inventions.” Id., at 123a (emphasis added; capitalization
omitted).
The Federal Circuit held that the earlier Stanford agree
ment’s use of the words “agree to assign,” when compared
with the later Cetus agreement’s use of the words “do
hereby assign,” made all the difference. It concluded that,
once the invention came into existence, the latter words
meant that the Cetus agreement trumped the earlier,
Stanford agreement. 583 F. 3d 832, 841–842 (CA Fed.
2009). That, in the Circuit’s view, is because the latter
words operated upon the invention automatically, while
Cite as: 563 U. S. ____ (2011) 7
BREYER, J., dissenting
the former did not. Quoting its 1991 opinion in FilmTec
Corp. v. Allied-Signal, Inc., 939 F. 2d 1568, 1572, the
Circuit declared that “ ‘[o]nce the invention is made and
[the] application for [a] patent is filed, . . . legal title to the
rights accruing thereunder would be in the assignee [i.e.,
Cetus] . . . , and the assignor-inventor would have nothing
remaining to assign.’ ” 583 F. 3d, at 842.
Given what seem only slight linguistic differences in the
contractual language, this reasoning seems to make too
much of too little. Dr. Holodniy executed his agreement
with Stanford in 1988. At that time, patent law appears
to have long specified that a present assignment of future
inventions (as in both contracts here) conveyed equitable,
but not legal, title. See, e.g., G. Curtis, A Treatise on the
Law of Patents for Useful Inventions §170, p. 155 (3d ed.
1867) (“A contract to convey a future invention . . . cannot
alone authorize a patent to be taken by the party in whose
favor such a contract was intended to operate”); Comment,
Contract Rights as Commercial Security: Present and
Future Intangibles, 67 Yale L. J. 847, 854, n. 27 (1958)
(“The rule generally applicable grants equitable enforce
ment to an assignment of an expectancy but demands a
further act, either reduction to possession or further as
signment of the right when it comes into existence”).
Under this rule, both the initial Stanford and later
Cetus agreements would have given rise only to equitable
interests in Dr. Holodniy’s invention. And as between
these two claims in equity, the facts that Stanford’s con
tract came first and that Stanford subsequently obtained a
postinvention assignment as well should have meant that
Stanford, not Cetus, would receive the rights its contract
conveyed.
In 1991, however, the Federal Circuit, in FilmTec,
adopted the new rule quoted above—a rule that distin
guishes between these equitable claims and, in effect, says
that Cetus must win. The Federal Circuit provided no
8 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
BREYER, J., dissenting
explanation for what seems a significant change in the
law. See 939 F. 2d, at 1572. Nor did it give any explana
tion for that change in its opinion in this case. See 583
F. 3d, at 841–842. The Federal Circuit’s FilmTec rule
undercuts the objectives of the Bayh-Dole Act. While the
cognoscenti may be able to meet the FilmTec rule in future
contracts simply by copying the precise words blessed by
the Federal Circuit, the rule nonetheless remains a tech
nical drafting trap for the unwary. See AAU Brief 35–36.
But cf. ante, at 15 (assuming ease of obtaining effective
assignments). It is unclear to me why, where the Bayh-
Dole Act is at issue, we should prefer the Federal Circuit’s
FilmTec rule to the rule, of apparently much longer vin
tage, that would treat both agreements in this case as
creating merely equitable rights.
At the same time, the Federal Circuit’s reasoning brings
about an interpretation contrary to the intention of the
parties to the earlier, Stanford, contract. See App. to Pet.
for Cert. 120a (provision in Stanford contract promising
that Dr. Holodniy “will not enter into any agreement
creating copyright or patent obligations in conflict with
this agreement”). And it runs counter to what may well
have been the drafters’ reasonable expectations of how
courts would interpret the relevant language.
Second, we could interpret the Bayh-Dole Act as ordi
narily assuming, and thereby ordinarily requiring, an
assignment of patent rights by the federally funded em
ployee to the federally funded employer. I concede that
this interpretation would treat federally funded employees
of contractors (subject to the Act) differently than the law
ordinarily treats private sector employees. The Court long
ago described the latter, private sector principles. In
United States v. Dubilier Condenser Corp., 289 U. S. 178(1933), the Court explained that a “patent is property, and
title to it can pass only by assignment.” Id., at 187. It
then described two categories of private sector employee
Cite as: 563 U. S. ____ (2011) 9
BREYER, J., dissenting
to-employer assignments as follows: First, a person who is
“employed to make an invention, who succeeds, dur
ing his term of service, in accomplishing that task, is
bound to assign to his employer any patent obtained.”
Ibid.But, second,
“if the employment be general, albeit it cover a field of
labor and effort in the performance of which the em
ployee conceived the invention for which he obtained a
patent, the contract is not so broadly construed as to
require an assignment of the patent.” Ibid.The Court added that, because of “the peculiar nature of
the act of invention,” courts are “reluctan[t] . . . to imply or
infer an agreement by the employee to assign his patent.”
Id., at 188. And it applied these same principles govern
ing assignment to inventions made by employees of the
United States. Id., at 189–190.
Subsequently, however, the President promulgated
Executive Order 10096. Courts have since found that this
Executive Order, not Dubilier, governs Federal Govern
ment employee-to-employer patent right assignments.
See, e.g., Kaplan v. Corcoran, 545 F. 2d 1073, 1076–1077
(CA7 1976); Heinemann, 796 F. 2d, at 455–456; Wright v.
United States, 164 F. 3d 267, 269 (CA5 1999); Halas v.
United States, 28 Fed. Cl. 354, 364 (1993). The Bayh-Dole
Act seeks objectives roughly analogous to the objectives of
the Executive Order. At least one agency has promulgated
regulations that require Bayh-Dole contractors to insist
upon similar assignments. See NIH Policies, Procedures,
and Forms, A “20–20” View of Invention Reporting to the
National Institutes of Health (Sept. 22, 1995) (available in
the Clerk of Court’s case file) (requiring a Government
contractor, such as Stanford University, to “have in place
employee agreements requiring an inventor to ‘assign’ or
10 BOARD OF TRUSTEES OF LELAND STANFORD JUNIOR
UNIV. v. ROCHE MOLECULAR SYSTEMS, INC.
BREYER, J., dissenting
give ownership of an invention to the organization upon
acceptance of Federal funds,” as the Bayh-Dole Act “re
quire[s]”). And an amicus brief, filed by major associa
tions of universities, scientists, medical researchers, and
others, argues that we should interpret the rules govern
ing assignments of the employees at issue here (and
consequently the Act’s reference to “inventions of the con
tractor”) in a similar way. AAU Brief 5–14.
The District Court in this case adopted roughly this
approach. 487 F. Supp. 2d 1099, 1118 (ND Cal. 2007)
(“[A]lthough title still vests in the named inventor, the
inventor remains under a legal obligation to assign his
interest either to the government or the nonprofit contrac
tor unless the inventor acts within the statutory frame
work to retain title”). And since a university often enters
into a grant agreement with the Government for a re
searcher’s benefit and at his request, see J. Hall, Grant
Management 205 (2010), implying such a presumption in
favor of compliance with the grant agreement, and thus
with the Bayh-Dole Act, would ordinarily be equitable.
IV
As I have suggested, these views are tentative. That is
because the parties have not fully argued these matters
(though one amicus brief raises the license interpretation
question, see Brief for Alexander M. Shukh as Amicus
Curiae 18–24, and at least one other can be read as sup
porting something like the equitable presumption I have
described, see AAU Brief 5–14). Cf. ante, at 5, n. 2. While
I do not understand the majority to have foreclosed a
similarly situated party from raising these matters in a
future case, see ibid., I believe them relevant to our efforts
to answer the question presented here. Consequently, I
would vacate the judgment of the Federal Circuit and
remand this case to provide the parties with an opportu
nity to argue these, or related, matters more fully.
Cite as: 563 U. S. ____ (2011) 11
BREYER, J., dissenting
Because the Court decides otherwise, with respect, I
dissent.