SECTIONS 22372-22378 - California Statutes

BUSINESS AND PROFESSIONS CODE

SECTION 22372-22378

22372. (a) Every contract for invention development services shall
be in writing and shall be subject to the provisions of this chapter.
A copy of the written contract shall be given to the customer at the
time he signs the contract.
(b) If one or more subsequent contracts are contemplated by the
invention developer in connection with an invention, or if the
invention developer contemplates performance of services in
connection with an invention in more than one phase with the
performance of each phase covered in one or more subsequent
contracts, the invention developer shall so state in a writing and
shall supply to the customer such writing together with a copy of
such contract or a written summary of the general terms of each and
every such subsequent contract, including the amount of any fees or
other consideration required from the customer, at the time the
customer signs the first contract.

22373. (a) Notwithstanding any contractual provision to the
contrary, the invention developer and the customer shall each have
the right to cancel a contract for invention development services for
any reason at any time within seven days of the date the invention
developer and the customer sign the contract. Cancellation shall be
effected by written notice mailed or delivered to the invention
developer or the customer. If said notice is mailed, it must be
postmarked by midnight of the last day of the cancellation period. If
the notice is delivered, it must be delivered by the end of the
invention developer's normal business day. Within five business days
after receipt of such notice of cancellation by the customer, the
invention developer shall return to the customer, by mail, all moneys
paid and all materials provided by the customer.
(b) The provisions of subdivision (a) shall apply to every
contract executed between an invention developer and a customer. Each
such contract shall contain the following statement in 10-point
boldface type immediately above the place at which the customer signs
the contract:

"The seven-day period during which you may cancel this contract
for any reason by mailing or delivering written notice to the
invention developer will expire on

.
(Last date to mail or deliver notice)

If you choose to mail your notice, it must be placed in the United
States mail properly addressed first-class postage prepaid and
postmarked before midnight of this date. If you choose to deliver
your notice to the invention developer directly, it must be delivered
to him by the end of his normal business day on this date. The
invention developer also has the right to cancel this contract by
notice similarly mailed or delivered."

22374. Each and every contract for invention development services
shall carry a distinctive and conspicuous cover sheet with the
following notice (and no other) imprinted thereon in boldface type of
not less than 10-point size:
"The following disclosures are required by law:
"You have the right to cancel this contract for any reason at any
time within seven days from the date you and the invention developer
sign the contract and you receive a fully executed copy of it. To
exercise this option you need only mail or deliver to this invention
developer written notice of your cancellation. The method and time
for notification is set forth in this contract immediately above the
place for your signature. Upon cancellation, the invention developer
must return by mail, within five business days, all money paid and
all materials provided by you.
"Your potential patent rights may be adversely affected by any
attempt to commercialize your idea or invention before a patent
application covering it is filed. Nonconfidential disclosures of your
idea or invention may also trigger certain statutory deadlines for
filing a patent application in the United States and would prevent
you from obtaining valid patent rights in countries whose law
provides that patent applications must be filed before there is a
public disclosure.
"This contract between you and the invention developer is
regulated by law. The invention developer is not qualified or
permitted to advise you whether protection of your idea or invention
is available under the patent, copyright or trademark laws of the
United States or any other law. This contract does not provide any
patent, copyright or trademark protection for your idea or invention.
If your idea or invention is patentable, copyrightable or subject to
trademark protection, or infringes an existing valid patent,
copyright or trademark or a patent, copyright or trademark for which
application has been made, your failure to inquire into these matters
may affect your rights to your idea or invention."

22375. No invention developer shall acquire any interest, partial
or whole, in the title to the customer's invention, unless the
invention developer contracts to manufacture the invention and
acquires such interest for such purpose at or about the time the
contract for manufacture is executed. Nothing in this section shall
be construed to prohibit an invention developer from contracting with
a customer to receive a portion of any proceeds accruing to the
customer as a result of performance of invention development services
by the invention developer.

22376. No contract for invention development services shall require
or entail the execution of any note or series of notes by the
customer which, when separately negotiated, will cut off as to third
parties any right of action or defense which the customer may have
against the invention developer.

22377. Any assignee of the invention developer's rights is subject
to all equities and defenses of the customer against the invention
developer existing in favor of the customer at the time of the
assignment.

22378. With respect to each and every contract for invention
development services, the invention developer shall deliver to the
customer, at the address specified in the contract at quarterly
intervals throughout the term of the contract, a written statement of
the services performed to date; provided, however, the first such
statement need not be delivered until 180 days after the contract is
executed.