by Dennis Crouch
Krzysztof Sywula’s story has some thematic elements of the Netflix Glass Onion show. As he tells it, Sywula was at the Santorini Island Grill with Alexis DaCosta & Vincent Coletti talking about creating an improved app for ride sharing. During one of the meetings, Sywula apparently sketched-out a diagram on a napkin that he gave to DaCosta and that eventually served as a basis for the patent filings in this case. The parties continued to work together for several more years with Sywula eventually becoming the CTO. Then came the patenting. Sywula was excluded from being listed as an inventor on the patents, including US11087250 and US11087252; and that was upsetting.
Sywula sued for correction of invention, and the District Court initially dismissed the case on standing, but – after an amended complaint – has now agreed that Sywula has met the requirements to survive a pleading-stage demurrer.
Standing to Sue: Federal Courts can only hear “actual cases or controversies.” U.S. Const., Art. III. The Supreme Court has massaged those words in to a three part standing requirement of (1) injury in fact that is actual, concrete and particularized; (2) a causal link between the challenged actions and the stated injury; and (3) identification of a likely mechanism for redressing the injury that is within the court’s power. These are often broken down to (1) injury-in-fact; (2) causation; and (3) redressability.
The First Problem — Assignment of Rights: Sywula signed a Consulting Agreement and an Invention Agreement, both of which promise to assign rights to DaCosta and Coletti or their newly formed company Teleport, including any inventions, trade secrets, discoveries, designs, software, etc., arising from his work on the endeavor. In patent law, inventorship is tied directly to ownership. An inventor is a presumptive owner of any resulting patent rights. However, those inchoate rights are assignable in a way that decouples inventorship and ownership. There result here is that Sywula is not suffering an ownership injury (or any other payment injury flowing from his failure to be named as an inventor). Sywula v. DaCosta, 21-CV-01450, 2022 WL 2959577 (S.D. Cal. July 26, 2022).
The Second Problem — Concrete Reputational Injury: After receiving this first rejection from the district court, Sywula reformed his complaint to claim a reputational injury due to his failure to be listed as an inventor. Here, courts have been somewhat clear that reputational-interest theory cannot be simply tied to a nebulous cloud. The District Court quotes my 2021 article explaining that courts refuse to find Article III standing based simply upon loss of “the dignity of and accompanying self-satisfaction of official inventorship recognition.” Dennis Crouch, Reattribution, The Poison Pill & Inventorship, 5 BUS. ENTREPRENEURSHIP & TAX L. REV. 138 (Fall 2021).
But, the district court concluded that Sywula had done enough to move from nebulous to concrete. In particular, Swyula’s pleading provide a sufficient showing that his career as a software engineer would have been boosted based if he had been properly listed as an inventor. This economic/pucinary tie-in is what the Federal Circuit looked for in its key decision of Shukh v. Seagate Technology LLC, 803 F.3d 659 (Fed. Cir. 2015). The district court explains:
Sywula adequately pleads he sought employment in the field of his claimed invention. That is, Sywula, a software developer who purportedly architected, developed, and wrote the software for Teleport’s ride-sharing application, alleges he aspired to climb the hierarchical ladder for software developers and obtain a Principal Engineer role. Sywula also adequately pleads Teleport’s omission “affect[ed] his employment” by severely diminishing, if not foreclosing entirely, his opportunity for a promotion to Principal Engineer at Intel. Importantly, he alleges the prospects of his promotion from Software Engineer to Principal Engineer at Intel were not merely illusory or wishful thinking. He claims to have met nearly all of Intel’s experience-and skills-based criteria to be eligible for a promotion. However, he is missing one purportedly crucial qualification: he cannot claim to be an inventor of any patented technology. According to Sywula, “[p]ublished patents are usually required for software engineers to attain higher-ranked roles.” And Intel [his current employer], in particular, considers published patents as relevant to at least three qualities and skills it looks for in prospective Principal Engineers.
Simply put, the Second Amended Complaint contains enough factual material for this Court to infer Defendants’ withholding of inventorship credit in the Teleport patents plausibly diminished or even foreclosed his prospects of career-advancement at Intel and, more generally, in whatever software-developer position he holds or will hold. Hence, Defendants’ omission plausibly strips Sywula of the pecuniary benefits attendant to promotion. Accordingly, Sywula has adequately alleged an economic component to one of his reputational injuries.
Sywula v. Teleport Mobility, Inc., 21-CV-1450, 2023 WL 362504, at *16 (S.D. Cal. Jan. 23, 2023). In its analysis here, the court was went somewhat light on the causation element — noting that it is enough that the reputational injury influenced his career trajectory without being the sole cause. The court also accepted a second justification for jurisdiction — Sywula’s failure to obtain a job as a software engineer at Apple could be partially attributed to the fact that he was not listed as an inventor.
Note: I don’t think that the napkin is of record yet in the litigation.