Employee Invention Assignment in New York

Can a New York employer require assignment of every invention?

Subdivision 1 frames the carve-out as a limit on what an assignment promise can do. However broadly the contract is written, it does not reach an invention the employee made on their own time and with their own resources unless one of two statutory exceptions applies A.1.

“Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer's equipment, supplies, facilities, or trade secret information except for those inventions that either:”

The two exceptions are joined disjunctively. An own-time invention falls back within the employer's reach if it either relates to the employer's business or anticipated research and development, or results from the employee's work A.3.

“(a) relate at the time of conception or reduction to practice of the invention to the employer's business, or actual or demonstrably anticipated research or development of the employer; or”

“(b) result from any work performed by the employee for the employer.”

Subdivision 2 supplies the teeth. A provision that tries to require assignment of an invention the statute excludes is not merely unenforceable as written but declared against the public policy of the state A.2.

“To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision one of this section, such provision is against the public policy of this state and shall be unenforceable.”

Section 203-f closely tracks California Labor Code § 2870 — the own-time, own-resource carve-out and the same two business-or-work exceptions — but it is a recent enactment rather than a decades-old statute, so there is as yet no developed body of New York case law construing it. New York's operative remedy is to render the offending provision unenforceable to the extent it overreaches. Practitioners generally read § 203-f as supplying no judicial blue-pencil or reformation of a violating clause; the statute speaks only of unenforceability, and a New York drafter should not assume a court will rewrite an overbroad provision into a compliant one rather than simply declining to enforce it.

Must a New York employer notify the employee?

The statute is short and self-contained. Subdivision 1 defines which inventions an assignment clause cannot reach, and subdivision 2 states the one and only remedy — that an overreaching provision is against the public policy of the state and unenforceable. Nowhere does § 203-f condition the carve-out, or the validity of a permissible assignment clause, on the employer giving the employee any notice B.1.

“such provision is against the public policy of this state and shall be unenforceable”

The contrast with the two notice states is deliberate to flag, because a multistate employer that built its form around the California § 2872 or Washington RCW 49.44.140(3) notice may carry that language into New York and assume it is required here. It is not. The absence of a notice requirement cuts the other way too: a New York employer cannot cure an overbroad assignment clause by giving notice of the carve-out, because § 203-f makes the offending provision unenforceable regardless of what the employee was told. The statute's silence on notice means the work is done entirely by the scope of the assignment language itself.

Who owns an invention by default in New York?

Stanford v. Roche anchors the default. The Court held that the Bayh-Dole Act did not displace the long-standing rule that an invention belongs to its inventor, treating that premise as the baseline against which any assignment must be measured C.1.

“Since 1790, the patent law has operated on the premise that rights in an invention belong to the inventor.”

Because ownership starts with the inventor, an employer's title is derivative: it exists only if and to the extent the employee assigned it. Any third-party interest in the invention must trace back to that inventor-grantor C.3.

“Thus, although others may acquire an interest in an invention, any such interest — as a general rule — must trace back to the inventor.”

New York's own law follows the same path. In Cahill v. Regan, the Court of Appeals confirmed that an employee is the owner of their invention unless the employee was hired to invent or was given the task of devoting their efforts to a particular problem; in that narrow case the resulting invention is the employer's and must be assigned C.2.

“If an employee is hired to invent or is given the task of devoting his efforts to a particular problem, the resulting invention is the employer’s, and any patent obtained by the employee must be assigned to the other.”

Even where the employee keeps title — neither hired to invent nor assigned a specific inventive task — the employer is not necessarily empty-handed. Cahill recognizes the equitable shop right: when the employee used the employer's time, facilities, and materials to reach a concrete result, the employer is in equity entitled to use the invention C.4.

“Since the servant uses his master’s time, facilities and materials to attain a concrete result, the latter is in equity entitled to use that which embodies his own property”

But a shop right is only a non-exclusive license to use, not ownership, and the hired-to-invent doctrine is fact-intensive and narrow. Neither is a substitute for a written clause. The dependable path for a New York employer is a written present-assignment (hereby assigns) clause — present-tense language that transfers legal title automatically on conception, rather than a future promise to assign — operating within the boundaries § 203-f imposes.

Are trailing-assignment (holdover) clauses enforceable in New York?

Start with what the statute does not do. Section 203-f governs which inventions an assignment clause may reach, voiding any provision that purports to capture a qualifying own-time invention, but it sets no durational ceiling on post-employment trailing assignments and says nothing about a clause reaching inventions conceived after the employment relationship ends. New York supplies no statutory analogue to California's Business and Professions Code § 16600 ceiling.

The nearest authority is De Long Corp. v. Lucas, where the court refused to read an agreement as silently imposing a post-employment obligation to assign future improvements. Assignment language reaching an inventor's later work, the court held, must be unmistakable D.1.

“the language of the contract must be very plain and evidence unmistakably that such an agreement was in the mind of the inventor”

De Long framed the policy concern in vivid terms, declining to enforce an open-ended claim on an inventor's future output as the equivalent of an encumbrance on the mind itself D.3.

“The law does not look favorably upon covenants which place ‘a mortgage on a man’s brain, to bind all its future products’.”

Where a holdover clause reaches far enough to operate as a restraint on the employee's ability to work, New York's restrictive-covenant law becomes the operative lens. BDO Seidman v. Hirshberg sets the three-part reasonableness test that governs any such restraint, beginning with the requirement that the restraint be no greater than necessary to protect the employer's legitimate interest D.2.

“A restraint is reasonable only if it: (1) is no greater than is required for the protection of the legitimate interest of the employer”

And the BDO Seidman standard is unforgiving of overreach: failing any one prong is fatal to the covenant D.4.

“A violation of any prong renders the covenant invalid.”

So the New York limit on holdover clauses is reasonableness, not a statutory ceiling as in California and not an open void as in Washington. A trailer clause narrowly tied to inventions conceived during employment, or to a short and defined trailing period for inventions derived from the employer's confidential information, stands on far firmer ground than an aggressive provision that sweeps in an ex-employee's independent post-employment inventions and thereby functions as a disguised noncompete.