Invention disclosures from the USA – challenges for German companies

German companies that operate research and development sites in the USA regularly face a particular question: How should invention disclosures from US employees be handled? While the Employee Inventions Act (ArbEG) provides a detailed framework in Germany, the situation in the US is quite different. This article highlights the differences and explains why they are of central importance for international patent strategies.

1. Employee invention law in Germany

The ArbEG is unique. It comprehensively regulates:

• Reporting obligation: Employees must report every work-related invention in writing.
• Claiming: The employer must claim the invention within a certain period of time.
• Remuneration: Employees are entitled to reasonable remuneration for their inventions.

This makes it clear that the transfer of inventions to the employer is heavily regulated by law in Germany.

2. Contract law in the USA

There is no comparable law in the USA. Rights to inventions are only transferred to the employer if this is contractually regulated usually via the employment contract or separate IP assignment agreements. In concrete terms, this means

• No automatic transfer of rights:Without an assignment agreement, the employee retains the rights.
• No legal obligation to pay compensation:Compensation for inventors is exclusively a matter of contract.
• Court rulings regularly emphasize that the contractual situation is decisive.

3. Risks for German companies

This poses risks for German companies that want to include US inventions in their global patent strategy:

• Incomplete chain of rights:If a US employee has not assigned their rights properly, patents cannot be effectively registered.
• Patent attacks by third parties:Weaknesses in the transfer of rights can be attacked later.
• Different compensation logic:While mandatory in Germany, there are often no provisions in the US—an area of tension for global teams.

4. Recommendations for action

To avoid these pitfalls, companies should:

1. Review contracts:Regularly review and update employment and IP assignment agreements at the US location.
2. Harmonize processes:Establish uniform reporting and documentation procedures for inventions worldwide.
3. Create interfaces:Close coordination between US HR, German IP department, and external consultants.
4. Audit risks:Regular review of rights chains, especially before international patent applications.

5. Conclusion

Invention disclosures from the US are more than a formality for German companies. While the ArbEG in Germany specifies clear obligations, in the US it is the contract alone that decides. Those who do not take these differences into account risk gaps in protection and disputes. 

The key lies in clear contracts, coordinated processes, and an awareness of the legal differences.