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Invention assignment obligations: First Circuit startup company case

This past week an appellate case out of Massachusetts was decided in which the employment agreement of a company, Covidien, required the employee, one Esch, to disclose and assign certain “Inventions” (a defined term) for one year after leaving Covidien. The jury found, and the appeals court affirmed:

  • that Esch, the former employee, had not breached his obligation to disclose and assign “Inventions” to Covidien — the appeals court held that the jury’s verdict implicitly meant that the jury had found that Esch’s new inventions were not “Inventions” as defined in his Covidien employment agreement; BUT
  • that Esch did breach his confidentiality obligation to Covidien by filing one of his patent applications, which apparently contained Covidien confidential information.

The jury awarded Covidien nearly $795,000 in damages against Esch, but the judge refused Covidien’s request to order Esch to assign his patent application(s) to Covidien.

Citation: Covidien LP v. Esch, No. 20-1515 (1st Cir. Apr. 8, 2021).

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