Your own time, your own laptop — and why that still may not be enough

Most employment agreements at technology companies contain a present-tense assignment of inventions. That clause is normal, and on its own it is not a problem — it is the same instrument the IP assignment agreement does on the contractor side. What differs on the employee side is that a handful of states impose a statutory floor the clause cannot cut through, and that floor has a shape which surprises people.

The carve-out has two limbs, and only one of them is about your laptop

California Labor Code § 2870 is the model the other statutes were drafted from. It says an assignment provision "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" — and then takes it straight back for inventions that either "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 "result from any work performed by the employee for the employer".

Read the sentence twice. Own time and own equipment is a threshold you must clear before the carve-out is even in play. Clearing it wins you nothing by itself. The exceptions then run independently, and either of them alone puts the invention back inside the assignment. Where a clause does purport to reach an invention that subdivision (a) excludes, § 2870(b) says "the provision is against the public policy of this state and is unenforceable" — but that only rescues an invention which survives both limbs.

Why the relatedness limb swallows more than people expect

The statute does not say "competes with". It says relates to the employer's business, or to its actual or demonstrably anticipated research and development. A payments engineer who builds a personal budgeting app is inside the employer's business in the ordinary sense of the word, whether or not the two products would ever appear in the same market. And "demonstrably anticipated" reaches the roadmap slide shown at an all-hands: a direction the company had evidenced an intention to go, even if it never got there.

The timing is fixed, and it cuts the employee's way more often than people assume. Relatedness is assessed at conception or reduction to practice, so a project that was unrelated when you began, and became related only when your employer moved into the space, is judged on the earlier date.

One word varies between the statutes, and it is worth finding in yours. Washington and Minnesota each frame the limb as an invention relating directly to the business of the employer. California, Kansas and Delaware drop the adverb, although the notice Kansas obliges an employer to hand over puts it back in. That is a real difference in reach.

"Entirely on your own time" is not as obvious as it sounds

It has been litigated, at length. In Core Optical Technologies v Nokia, decided by the Federal Circuit in May 2024, the question was whether a PhD student's research counted as his "own time" under a clause tracking the statutory wording. Mark Core did the work on a TRW fellowship: reduced hours on company tasks, a monthly stipend, tuition and fees paid, and an obligation to return to TRW for a year afterwards.

The district court held that this was at least partly TRW's time and granted summary judgment that the patent had automatically assigned. The Federal Circuit vacated: the phrase "developed entirely on my own time" did not unambiguously express a mutual intent either way, and the case had to go back for a factual inquiry into what the parties meant. An entire patent infringement action turned on one phrase in a form signed at induction.

The notice they were supposed to hand you

Section 2872 requires that where an agreement entered into after 1 January 1980 contains an assignment provision, "the employer must also, at the time the agreement is made, provide a written notification to the employee that the agreement does not apply to an invention which qualifies fully under the provisions of Section 2870". Washington imposes the same duty for agreements after 1 September 1979, Minnesota after 1 August 1977, and Kansas at the time the agreement is made. Go and find yours: it is usually an appendix at the back of the onboarding pack.

Be careful what you expect the missing notice to do. In Whitewater West Industries v Alleshouse the Federal Circuit expressly declined to decide whether the absence of a § 2872 notification invalidated anything, because the clause failed on another ground. The notice requirement is a real obligation; it is not a reliable route to voiding an assignment on its own.

Five statutes, five slightly different floors

The list is short on purpose: these are the five whose text was read for this article, not a national survey. Only a minority of states have legislated here at all. Everywhere else the agreement's own words are the entire answer, which is the honest reason two engineers doing identical work in different offices get different results.

The prior inventions schedule, and the cost of leaving it blank

Almost every invention assignment agreement has a schedule at the back headed "prior inventions" or "excluded inventions". Most people leave it empty because filling it in feels like volunteering information. That instinct is exactly backwards.

Section 2871 confirms that an employer may lawfully require disclosure of all of an employee's inventions, received in confidence, together with a review process to resolve what belongs to whom. Kansas goes further and makes disclosure mandatory even for an employee who satisfies the carve-out. So the disclosure is not optional in the way people treat it — and an empty schedule is not a neutral act. It is a signed, dated statement to your employer that on the day you joined you had nothing.

A dated list, however thin, is the cheapest evidence you will ever create. One line naming the project and the stage it had reached, attached to the employment contract before you sign, does more work than anything assembled afterwards. Where the project is already commercial, a written carve-out negotiated at offer stage is better still: that is the one moment when you have leverage and the company has none.

Trailing assignment clauses reach past your last day

The clause people miss entirely is the holdover, or trailing assignment: an obligation to assign inventions conceived for some period after the employment ends. Whitewater West Industries v Alleshouse, decided by the Federal Circuit in November 2020, is what happens when one is drafted without limit.

Richard Alleshouse's agreement required him to assign any invention "resulting from or suggested by" his work, or "in any way connected to any subject matter within the existing or contemplated business" of his employer. The inventions at issue were conceived after he left, and he used none of the employer's confidential information. The court found the obligation "unlimited in time and geography", held that its restraining effect on his ability to work in his own field was of substantial character, and struck it down under California Business and Professions Code § 16600 — the same provision that governs non-compete enforceability. Section 2870 did not save it.

Two warnings sit behind that result. Whitewater is a California outcome resting on an unusually broad statute; in most states a holdover clause is judged on whether its duration and scope are reasonable, and a twelve-month clause limited to the employer's actual field will often survive. And striking down an assignment clause does nothing to a confidentiality obligation: an employer that cannot claim ownership can still say you built the thing out of its trade secrets.

What to actually do about a project you care about

If the project is going to have customers, revenue or investors, the sequence is worth doing properly rather than defensively. A dated disclosure, a specific carve-out, then a clean IP assignment agreement into whatever entity you form, and the same instrument for anyone else who touches the code — the independent contractor agreement is where that clause belongs for a freelancer.

The honest answer to the midnight question

Nobody can tell you from the outside whether your employer owns your side project. The answer needs three things a stranger does not have: the wording of your agreement, the state whose law governs it, and what your employer's roadmap said at the moment you had the idea.

What you can settle tonight is the part you control. Own time and own equipment is a threshold, not a defence, and it is lost by a single careless act. Relatedness is the limb that decides, and the burden of proving both sits on you. A project built on your own machine, disclosed on a dated schedule, in a field your employer has never been in, is about as safe as this gets. The cheapest hour you will ever spend on anything short of that is the one before you sign, not the one after somebody notices the project.