Invention Assignment Laws in South Carolina: Who Owns What You Create

Federal patent law (35 U.S.C. § 101 et seq.) does not mandate that employers own employee inventions; ownership is determined by state law, employment contracts, and the circumstances of creation. The Patent Office recognizes that inventions belong to their creator unless assigned by written agreement or if the employee was hired specifically to invent. Federal law does not preempt state contract or common law rules governing invention assignment. However, federal law does establish what qualifies as patentable (utility, novelty, non-obviousness), and the USPTO will issue patents to whoever has legal title, whether employer or employee. The federal standard does not distinguish between inventions created on or off company time—state law determines this allocation. Employers who want to claim ownership must rely on written agreements, state law trade secret protections, or proof that the employee was hired specifically to invent. No federal agency enforces invention assignment claims; disputes are resolved through state courts or patent litigation in federal courts.

Federal trade secret law under the Defend Trade Secrets Act (18 U.S.C. § 1836) allows employers to protect confidential business information and may support ownership claims if an invention qualifies as a protected trade secret. The DTSA provides for civil remedies and criminal penalties for misappropriation but does not determine underlying ownership—it protects against theft of secrets once ownership is established. Employees who disclose employer trade secrets can be sued under the DTSA, but this does not necessarily mean the invention itself belongs to the employer unless the employment contract says so.

South Carolina does not have a specific invention assignment statute comparable to California's Labor Code § 2870 or other states' invention assignment laws. Instead, ownership of employee inventions in South Carolina is governed by three sources: (1) express written employment agreements, (2) the South Carolina Uniform Trade Secrets Act (S.C. Code § 39-8-10 et seq.), and (3) common law principles of employment.

Under South Carolina common law, inventions created by an employee during the course of employment, using employer resources or trade secrets, belong to the employer if the employment contract includes an invention assignment clause. Courts will enforce written invention assignment agreements if they are reasonable in scope, supported by consideration (such as continued employment or a raise), and not unconscionable. However, if an employee was not hired specifically to invent and the invention was made entirely on personal time with personal resources, the employee retains ownership even if the invention relates to the employer's business—unless the contract explicitly claims such inventions.

The South Carolina Uniform Trade Secrets Act (S.C. Code § 39-8-10 et seq.) provides additional protection for employers: if an invention qualifies as a trade secret (information that derives value from not being generally known and is subject to reasonable efforts to maintain its secrecy), the employer can prevent disclosure and seek damages for misappropriation. This is broader than invention ownership and applies regardless of who technically created the invention, but it does not automatically transfer ownership—it protects confidentiality.

South Carolina differs from federal patent law by allowing state courts to enforce non-compete clauses and invention assignment agreements that are reasonable in geographic scope and duration. South Carolina also recognizes the "hired to invent" doctrine: if an employee was hired specifically to develop inventions or improvements in the employer's field, the employer acquires an automatic right to the invention even without a written agreement, though a written agreement is strongly advised. Unlike California, which provides statutory protection limiting invention assignment claims (Labor Code § 2870), South Carolina has no such limitation and will enforce broader invention assignment agreements if reasonable. Remedies under state law include injunctive relief to prevent disclosure, damages for breach of contract or misappropriation of trade secrets, and attorney fees in trade secret cases under S.C. Code § 39-8-10(d).

South Carolina law recognizes several important exceptions to employer ownership of employee inventions, though they are narrower than in other states. First, inventions created entirely on personal time using only personal resources remain the employee's property, even if they relate to the employer's business, unless the employment contract explicitly claims them. However, this exception does not apply if the invention is a trade secret or if the employee was hired specifically to invent.

Second, South Carolina does not recognize a blanket exemption for inventions unrelated to the employer's business, unlike California Labor Code § 2870. Instead, South Carolina courts apply a "reasonableness" test: an invention assignment clause claiming all inventions, regardless of connection to the business, may be unenforceable as unconscionable or as an unreasonable restraint on employment. Courts consider the employer's legitimate business interests, whether the employee was hired to invent, and whether the clause is overbroad.

Third, if an employee was hired for a specific, non-inventive role (such as a software developer hired to maintain existing systems, not develop new features), and creates an invention unrelated to that role during personal time, courts may not enforce a blanket invention assignment clause. The "hired to invent" doctrine is the exception: if hired to develop innovations, the employer owns inventions within the scope of that role even without written agreement.

Fourth, inventions created before employment or after employment ends are not owned by the employer, unless the invention was in development during employment and completed afterward. Pre-employment inventions remain the employee's property. Post-employment inventions are owned by the employee, though trade secret laws may prevent disclosure if they incorporate confidential information.

Fifth, South Carolina will not enforce invention assignment clauses that are unconscionable, lack consideration, or violate public policy. For example, if an invention assignment clause is so broad that it effectively prevents an employee from working in any similar field, a court may refuse to enforce it. Clauses that assign inventions to the employer's competitors without the employee's knowledge may also be unenforceable.

Sixth, union agreements and collective bargaining contracts may override or modify invention assignment claims, as South Carolina recognizes union rights under the National Labor Relations Act. Sixth, employees who report patent infringement or safety concerns to government agencies (whistleblower protection) are not barred from disclosing invention information if necessary to support the report.

Step 1: Document the Invention and Circumstances

Immediately document when, where, and how you created the invention. Create a written record with dates, times, materials used, and descriptions of the work. Identify whether you used company equipment, company time, company resources, or personal resources. Collect evidence showing when the invention was conceived and when it was completed. Preserve email communications, project notes, lab notebooks (with dates), sketches, prototypes, and any communications with colleagues about the invention. Document whether you were hired specifically to invent or whether the invention was created outside your job duties. Take photographs or screenshots of the invention's development. If the invention relates to the employer's business, document your job description and the connection. Keep all original documents in a safe location, including a backup copy outside company premises.

Step 2: Review Your Employment Agreement and Understand the Company Policy

Locate and carefully read your employment contract, offer letter, employee handbook, and any invention assignment agreement you signed. Identify the specific language claiming ownership of inventions. Determine whether the agreement claims all inventions or only those created during work hours using company resources. Note any exceptions for inventions unrelated to the business or created on personal time. Check for any consideration language (e.g., "in exchange for employment" or "as a condition of employment"). If you cannot locate a written agreement, note whether the company has a policy posted on an internal portal or in the handbook. Document the date you received or acknowledged the policy. If you were never asked to sign an invention assignment agreement, this is significant evidence that the company did not intend to claim ownership. Consult a South Carolina employment attorney to interpret the specific language of your agreement.

Step 3: Determine Applicable Law and Prepare for Negotiation

Based on the circumstances (personal time vs. work time, personal resources vs. company resources, job duties, written agreement), assess whether the employer likely has a legal claim under South Carolina common law or trade secret law. If the invention was created entirely on personal time using personal resources and unrelated to your job duties, you have a strong claim to ownership despite any broad invention assignment language. If the invention was created using company resources or time, or if you were hired to invent, the employer likely has a legal claim. Contact the company in writing (email is acceptable) and request clarification on whether they claim ownership of this specific invention. Provide factual details: date created, resources used, how it relates to your job. State your position clearly: "I believe I own this invention because [reason]." Request a written response within 10 business days. Do not provide the invention or detailed information about how it works in this communication. Keep a copy of your email and the response.

Step 4: Attempt Internal Resolution and File a Complaint if Necessary

If the company claims ownership and you disagree, request a meeting with Human Resources or management to discuss the issue. Bring copies of your documentation showing when and how the invention was created. Present your legal argument calmly and factually. Ask whether the company is willing to release its claim, negotiate joint ownership, or agree to license the invention to you. If the company refuses and you believe they have illegally claimed your invention, you have two options: (1) file a patent application in your name and notify the company, or (2) pursue a civil lawsuit in South Carolina state court for breach of contract, conversion, or unjust enrichment.

There is no state agency that handles invention ownership disputes in South Carolina. Unlike wage and hour claims, invention disputes must be resolved through court. However, if the dispute involves trade secret misappropriation (e.g., the company claims you stole a trade secret), you may be able to report this to local law enforcement, though criminal prosecution is rare.

Step 5: Consult an Attorney and Prepare for Litigation

Contact a South Carolina employment attorney or intellectual property attorney if the invention has significant value or if you plan to patent it. Do not patent an invention if the company has a reasonable legal claim to it, as this could trigger a lawsuit and damage your credibility. An attorney can review your employment agreement, assess the strength of your claim, and advise whether to negotiate, release your claim, or pursue litigation. If you pursue litigation, the case will be filed in South Carolina state court (likely in the circuit court of the county where you work or where the company is incorporated). The lawsuit will typically take 1-2 years to resolve. You can seek damages (money) and injunctive relief (a court order giving you ownership). Attorney fees are awarded to the prevailing party only if the contract includes a fee-shifting clause or if you can prove the company acted in bad faith. Consider the invention's value and the cost of litigation before proceeding. If you plan to patent the invention, file the patent application before litigation begins, naming yourself as inventor. The patent office will issue a patent to whoever is the rightful owner; the employment contract dispute can be resolved separately in court.