HBA-RBT H.B. 22 76(R)    BILL ANALYSIS


Office of House Bill AnalysisH.B. 22
By: Goolsby
Business & Industry
2/8/1999
Introduced



BACKGROUND AND PURPOSE

Many employers require employees to sign a pre-invention assignment
agreement as a condition of employment.  A pre-invention assignment
agreement is an employment contract that obligates the employee to assign
to the employer all interests in any future inventions conceived during the
employment term.  These agreements may also include the assignment of
rights to inventions made before and after the term of employment.  No
Texas law currently addresses this subject. H.B.  22 sets out the rights
and obligations of employees and employers regarding pre-invention
assignment agreements. 

RULEMAKING AUTHORITY

It is the opinion of the Office of House Bill Analysis that this bill does
not expressly delegate any additional rulemaking authority to a state
officer, department, agency, or institution. 

SECTION BY SECTION ANALYSIS

SECTION 1.  Amends Title 132, V.T.C.S., by adding Article 9021, as follows:

ARTICLE 9021. ASSIGNMENT OF RIGHTS IN AN INVENTION

Sec. 1.  DEFINITION.  Defines "invention."

Sec. 2.  ENFORCEABILITY OF ASSIGNMENT OF RIGHTS:  REQUIREMENTS. Provides
that an employment agreement that assigns an employee's rights in an
invention to an employer is void unless the employee receives consideration
in addition to the employment compensation in exchange for the assignment,
the assignment is not a condition of employment or continued employment,
and the employer provides the employee with a printed notice of the
employee's rights.  Establishes the form and content of the notice.   

Sec. 3.  EXCEPTION:  CERTAIN AGREEMENTS VALID.  Provides that an employment
agreement that assigns any right of an employee in an invention is valid if
the agreement expressly states that it applies only to an invention that
results from work performed by the employee for the employer, that at the
time of conception or reduction to practice the invention relates to the
employer's business, or is an actual or anticipated research or development
project of the employer. 

Sec. 4.  DISCLOSURE OF INVENTION.  Authorizes an employer to require in an
employment agreement that an employee disclose in confidence any invention
that was developed or is being developed by the employee.  Prohibits an
employer from using the information disclosed for any purpose except
determining the rights of the employer and the employee in the invention.
Requires the employer to maintain a record of disclosed inventions for five
years. 

Sec. 5.  ACTION FOR DAMAGES.  Provides that the terms "economic damages"
and "exemplary damages" have the meanings set forth in Section 41.001,
Civil Practice and Remedies Code.  "Exemplary damages" means any damages
awarded as a penalty or by way  of punishment. "Exemplary damages" includes
punitive damages.  "Economic damages" means compensatory damages for
pecuniary loss; the term does not include exemplary damages or damages for
physical pain and mental anguish, loss of consortium, disfigurement,
physical impairment, or loss of companionship and society.  Authorizes an
employee to file suit against the employer for the unauthorized use of
disclosed information about an invention.  Provides that an employee who
files suit under this section can recover  
$1,000 or the employee's economic damages, whichever is greater, as well as
exemplary damages, court costs, and attorney's fees. 

SECTION 2.  Makes application of this Act prospective.

SECTION 3.  Emergency clause.
            Effective date:  upon passage