## Facts

- Waterjet Technology, Inc. conducted research and development in high-pressure and abrasive waterjet technology and maintained a substantial patent portfolio.
- Flow International Corporation began as Waterjet’s subsidiary, later became independent, and competed in the same field.
- Waterjet required employees to disclose and assign inventions developed during employment that related to Waterjet’s business; Waterjet paid patent prosecution and USPTO fees for covered inventions.
- Steven Craigen was hired by Waterjet in 1983 and signed an employment agreement requiring prompt disclosure and assignment to Waterjet of inventions developed during employment related to Waterjet’s business.
- While employed at Waterjet, Craigen participated in developing an invention at Waterjet’s facilities and expense that became the ’824 patent; all inventors except Craigen assigned their interests to Waterjet.
- Craigen left Waterjet in 1997 and joined Flow International.
- Waterjet sued Flow International and Craigen in federal court for patent infringement and sought to compel Craigen to assign his remaining interest in the ’824 patent.
- The dispute implicated Washington’s employee-invention assignment statute, RCW 49.44.140, including its limits on assignment clauses and its requirement that employers provide “written notification” of those limits.

## Issues

1. Whether the employment agreement provided adequate “written notification” under RCW 49.44.140(3).
2. If notice was inadequate, whether the agreement could still be enforced to the extent consistent with RCW 49.44.140(1) by excising inconsistent portions.
3. If the agreement could not be enforced, whether an implied assignment obligation could be enforced, or whether RCW 49.44.140 displaced any employer common-law rights to employee inventions.

## Decision

- The court answered the first certified question yes: the employment agreement provided adequate notice under RCW 49.44.140(3).
- The court stated that, even if notice had been insufficient, the remedy would be limited to excising provisions inconsistent with RCW 49.44.140(1), leaving compliant portions enforceable.
- The court declined to reach the third certified question regarding implied agreements and statutory displacement of common-law rights.

## Legal Principles

- RCW 49.44.140(3) requires an employer to provide “written notification” to an employee required to sign an invention-assignment provision; the statute does not require a particular format or a separate statutory-summary document if the written agreement effectively notifies the employee of the invention-assignment obligation regulated by the statute.
- Under RCW 49.44.140(1), an invention-assignment provision is inapplicable to inventions developed entirely on the employee’s own time without employer resources, unless the invention relates directly to the employer’s business or anticipated research, or results from work performed for the employer.
- A defect in statutory notice, if established, does not require invalidating an invention-assignment agreement in full; the proper cure is to sever and excise only those portions that exceed RCW 49.44.140(1).

## Conclusion

The Washington Supreme Court held that the employee’s invention-assignment agreement satisfied RCW 49.44.140(3)’s written-notification requirement and indicated that any noncompliance would warrant only severing overbroad provisions, not nullifying otherwise valid assignment obligations.


Waterjet Tech., Inc. v. Flow Int'l Corp., 996 P.2d 598 (Wash. 2000)