Akira and the Choice of Law

Akazawa v. Link New Technology Int'l, Inc. (2007-1184)

I sometimes wonder whether attorneys and academics truly appreciate how patent law presents some of the most fascinating conflict of laws issues. Consider the fact that the CAFC must often decide whether to apply its own law (for substantive patent issues), regional circuit law (for procedural issues), and, of course, state law (typically for ownership issues and assignment).

Akira Akazawa holds US Patent 5,615,716 by an assignment from the inventor's wife, who, in turn, received rights to the patent under Japanese law of intestacy. When Akira brought suit on the patent in the Central District of California, he (she?) set up an interesting conflict of laws issue between the Japanese laws of intestacy, and the Patent Act's provision of a written assignment to effect transfer of title.

Akira's assignor never obtained a written assignment from an executor and adminstrator of the inventor's estate. The district court held that 35 USC 261 provided that an assignment was the exclusive means of transferring title to a patent, and therefore Akira lacked standing.

The CAFC vacated, and instructed the lower court to first consider the proper body of law before ruling on the issue, noting that "there is nothing that limits assignment as the only means for transferring ownership."

Quite true. In fact, the CAFC previously noted that title to a patent can pass by operation of law if the laws of relevant jurisdiction provide for such immediate vesting. H.M. Stickle v. Heublein, Inc., 716 F.2d 1550 (Fed. Cir. 1983). Further, choice of law rules typically apply the law of domicile at the time of death in issues of succession, such as interpretation of a will. The fact that the present situation deals with intestacy, and not a written will is immaterial. If Japanese law provides for immediate vesting of the patent in the inventor's heirs, then Akira's title is good.

Therefore, the district court is now tasked with determining "[w]hether an administrator is required under Japanese law ...." The lesson to take away from all of this is to never assume that federal Patent Law will necessarily trump foreign and state laws, particularly on issues of ownership. In fact, it may be an obligation of the courts to apply foreign law (in accordance with doctrines such as comity) on certain issues. In this case, it was improper for the district court to impose a requirement of a written assignment if none was needed under Japanese law.