Court Opinion

ID: 4587741
Source: CourtListenerOpinion
Date Created: 2020-11-19 16:00:49.170981+00
Date Added: 2024-06-11T13:50:14.623906
License: Public Domain

Case: 19-1852    Document: 64     Page: 1   Filed: 11/19/2020

   United States Court of Appeals
       for the Federal Circuit
                  ______________________

     WHITEWATER WEST INDUSTRIES, LTD., A
          CANADIAN CORPORATION,
               Plaintiff-Appellee

                             v.

  RICHARD ALLESHOUSE, AN INDIVIDUAL, YONG
  YEH, AN INDIVIDUAL, PACIFIC SURF DESIGNS,
       INC., A DELAWARE CORPORATION,
                Defendants-Appellants
               ______________________

                   2019-1852, 2019-2323
                  ______________________

    Appeals from the United States District Court for the
 Southern District of California in No. 3:17-cv-00501-DMS-
 NLS, Judge Dana M. Sabraw.
                  ______________________

                Decided: November 19, 2020
                  ______________________

     JOSEPH RICK TACHE and ROGER L. SCOTT, Buchalter, A
 Professional Corporation, Irvine, CA, argued for plaintiff-
 appellee. Also represented by KARI BARNES.

     MANUEL FEDERICO DE LA CERRA, The Law Office of Ma-
 nuel de la Cerra, Carlsbad, CA, argued for defendants-ap-
 pellants. Also represented by JEFF RAMBIN, Fairchild,
 Price, Haley & Smith, LLP, Nacogdoches, TX; JOHN
 ROBERTS, Roberts IP Law, Columbus, IN.
Case: 19-1852    Document: 64     Page: 2    Filed: 11/19/2020

 2              WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE

                  ______________________

     Before DYK, MOORE, and TARANTO, Circuit Judges.
 TARANTO, Circuit Judge.
     Richard Alleshouse and Yong Yeh are named as the in-
 ventors on U.S. Patent Nos. 9,044,685 and 9,302,189,
 which claim water-park attractions that individuals may
 ride as if surfing, and on U.S. Patent No. 9,592,433, which
 claims nozzle configurations for regulating water flow in
 such surfing attractions. Pacific Surf Designs Inc., the
 company Messrs. Alleshouse and Yeh formed and operate
 to develop and market such attractions, is the assignee of
 the three patents. Whitewater West Industries, Ltd.
 (Whitewater) is the successor, for present purposes, of
 Wave Loch, Inc., which employed Mr. Alleshouse until just
 before he went into business with Mr. Yeh and the pa-
 tented inventions were conceived.
     Whitewater sued Mr. Alleshouse, Mr. Yeh, and Pacific
 Surf Design in the United States District Court for the
 Southern District of California, asserting claims for breach
 of contract and correction of inventorship. Specifically,
 Whitewater claimed that Mr. Alleshouse had to assign
 each of the ’685, ’189, and ’433 patents to Whitewater, as
 Wave Loch’s successor, under the terms of Mr. Alleshouse’s
 employment contract with Wave Loch. Whitewater also
 claimed that Mr. Yeh—who had not been employed by
 Whitewater or its predecessors and therefore was not un-
 der any alleged assignment duty—was improperly listed as
 an inventor on each of the three patents. The district court
 held that (a) Mr. Alleshouse breached the employment
 agreement, the agreement was valid under state law, and
 Whitewater was therefore entitled to assignment of the de-
 fendants’ patent interests, and (b) Mr. Yeh was improperly
 joined as an inventor. Whitewater West Indus., Inc. v. Al-
 leshouse, No. 17-cv-00501, 2019 WL 4261884 (S.D. Cal.
 Mar. 27, 2019) (March Decision); Whitewater West Indus.,
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 WHITEWATER WEST INDUSTRIES   v. ALLESHOUSE                 3

 Inc. v. Alleshouse, No. 17-cv-00501, 2019 WL 4261883 (S.D.
 Cal. Aug. 1, 2019) (August Decision).
     We reverse. In particular, we reverse the judgment of
 breach of contract because we hold that the assignment
 provision is void under California law. It follows from that
 holding, as Whitewater does not dispute, that Whitewater
 lacks standing to contest inventorship. We therefore also
 reverse the judgment on the inventorship count without
 separately addressing the merits of inventorship. The de-
 fendants are entitled to judgment in their favor in this ac-
 tion.
                              I
                              A
     Two provisions of California law are central on appeal.
 First, California Business and Professions Code § 16600
 states: “Except as provided in this chapter, every contract
 by which anyone is restrained from engaging in a lawful
 profession, trade, or business of any kind is to that extent
 void.” Second, California Labor Code § 2870(a) provides:
    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 ex-
    cept for those inventions that either:
        (1) Relate at the time of conception or reduction
    to practice of the invention to the employer’s busi-
    ness, or actual or demonstrably anticipated re-
    search or development of the employer; or
        (2) Result from any work performed by the em-
    ployee for the employer.
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 4               WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE

 Related to § 2870, California Labor Code § 2872 requires
 that an employer must “provide a written notification” to
 an employee that any assignment provision “does not apply
 to an invention which qualifies fully under the provisions
 of Section 2870.”
                              B
      The ’685 and ’189 patents, which share a specification
 and are both titled “Water Attractions Involving a Flowing
 Body of Water,” describe and claim “water attractions in-
 volving a flowing body of water on a surface” that allows
 riders “to engage in boardriding maneuvers” that differ
 from “naturally occurring ocean wave shapes.” ’685 patent,
 col. 1, lines 52–56. Mr. Alleshouse and Mr. Yeh applied for
 the ’685 patent in October 2013, based on a provisional ap-
 plication filed in October 2012, and it was issued in June
 2015; they filed a continuing application in May 2015 that
 issued as the ’189 patent in April 2016. The ’433 patent,
 which issued in March 2017 and is titled “Nozzle Shapes
 and Configurations for Water Attractions Involving a Flow-
 ing Body of Water,” describes and claims “nozzle shapes
 and configurations which create a flowing body of water
 over a surface in a substantially uniform, radial orientation
 over a substantially changing ride surface.” ’433 patent,
 col. 2, lines 17–20. Mr. Alleshouse and Mr. Yeh filed the
 application that issued as the ’433 patent in October 2013
 based on a provisional application filed in October 2012.
     Mr. Alleshouse had begun working in the field of large-
 scale, sheet-wave attractions when he was hired by Wave
 Loch as a Field Engineer in October 2007. A sheet wave is
 a formation of water in a planar “sheet flow” with sufficient
 depth to replicate characteristics of a naturally occurring
 wave. ’685 patent, col. 1, lines 24–33. Mr. Alleshouse’s re-
 sponsibilities at Wave Loch included, in part, “assessing
 and documenting the physical condition of each ride vis-
 ited, along with its operating parameters,” and “work[ing]
 closely with the WaveLoch engineering staff doing research
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 WHITEWATER WEST INDUSTRIES   v. ALLESHOUSE                 5

 and design work improving existing rides, and developing
 new rides utilizing 3D parametric modeling, numerical
 analysis, and other engineering principles.” J.A. 2257.
     On September 8, 2008, Mr. Alleshouse signed a “Cove-
 nant Against Disclosure and Covenant Not to Compete”
 with Wave Loch (Agreement). J.A. 1021–25. The Agree-
 ment includes the following assignment provision:
    a. Assignment: In consideration of compensation
    paid by Company, Employee agrees that all right,
    title and interest in all inventions, improvements,
    developments, trade-secret, copyrightable or pa-
    tentable material that Employee conceives or here-
    after may make or conceive, whether solely or
    jointly with others:
        (a) with the use of Company’s time, materials,
    or facilities; or
       (b) resulting from or suggested by Employee’s
    work for Company; or
        (c) in any way connected to any subject matter
    within the existing or contemplated business of
    Company
    shall automatically be deemed to become the prop-
    erty of Company as soon as made or conceived, and
    Employee agrees to assign to Company, its succes-
    sors, assigns, or nominees, all of Employee’s rights
    and interests in said inventions, improvements,
    and developments in all countries worldwide. Em-
    ployee’s obligation to assign the rights to such in-
    ventions shall survive the discontinuance or
    termination of this Agreement for any reason.
 J.A. 1022. The Agreement is governed by California law.
 J.A. 1024. It is undisputed on appeal that Whitewater, as
 successor to Wave Loch, is now Mr. Alleshouse’s counter-
 party on this Agreement.
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 6               WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

      Beyond the responsibilities stated in his job description
 at Wave Loch, Mr. Alleshouse was the product manager for
 Wave Loch’s FlowRider attraction—a sheet wave attrac-
 tion that uses a rectangular flow nozzle to direct water up-
 hill within a rectangular footprint—and was responsible
 for design drawings for that product. He also worked on
 Wave Loch’s WaveOz attraction—a 180-degree bowl-
 shaped water riding attraction that uses an array of noz-
 zles directed outward along the bowl radius. In addition,
 Mr. Alleshouse participated in discussions about potential
 attractions the company might produce, including one the
 company decided not to pursue, namely, an attraction that
 might compete with the Stingray attraction released by ri-
 val Murphy Waves in 2010 or 2011—a sheet-wave ride in
 the shape of a halfpipe, traditionally associated with skate-
 boarding, that would allow individuals to ride the water
 along the side walls.
      In early July 2012, Mr. Alleshouse contacted Mr. Yeh,
 a licensed attorney, to discuss Mr. Alleshouse’s obligations
 under the Agreement, and a few days later, the two dis-
 cussed the possibility of starting their own venture, to be-
 come known as Pacific Surf Designs. On July 27, 2012, Mr.
 Alleshouse resigned from Wave Loch, indicating that his
 last day with the company would be August 3, 2012. On
 August 4, 2012, Mr. Alleshouse began keeping a notebook
 of ideas for potential products to be sold by his and Mr.
 Yeh’s new venture. In early September, Mr. Yeh joined Mr.
 Alleshouse to “start testing out models, concepts, [and]
 ideas, in person.”
     On October 13, 2012, Messrs. Alleshouse and Yeh filed
 a provisional application that ultimately culminated in the
 issued ’685 and ’189 patents. On October 24, 2012, Messrs.
 Alleshouse and Yeh filed a provisional application that re-
 sulted in the ’433 patent.
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE                 7

                               C
     On March 13, 2017, Whitewater brought this action
 against Messrs. Alleshouse and Yeh and Pacific Surf De-
 signs. In its amended complaint, Whitewater alleged that
 the Agreement required Mr. Alleshouse to assign his rights
 in the three patents to Whitewater and that Mr. Yeh
 should be removed from inventorship status on all three
 patents. J.A. 78–91. It is undisputed that the result of
 Whitewater’s prevailing on these claims would be that
 Whitewater alone would own the three patents, which it
 could enforce against the defendants. 1
     After a bench trial, the district court ruled for White-
 water. The court first rejected the defendants’ contention
 that the Agreement’s assignment provision is invalid under
 California law—specifically, under California Labor Code
 §§ 2870, 2872, and under California Business and Profes-
 sions Code § 16600. March Decision at *6–9. The court
 then held that Mr. Alleshouse breached the assignment
 provision by failing to assign the patent rights at issue (and
 rejected defenses of equitable estoppel and laches). Id. at
 *9–11. Finally, the court held that Mr. Yeh was not
 properly listed as an inventor on the patents. Id. at *12–
 13.
     As to invalidity of the assignment provision (the dis-
 positive issue on appeal), the district court began by reject-
 ing the defense of invalidity under California Labor Code
 §§ 2870 and 2872. Addressing § 2870, the district court
 stated that Alleshouse “fail[ed] to explain how requiring an
 employee to assign inventions ‘suggested by’ his work for

     1   Whitewater also asserted claims for intentional in-
 terference with contract and violation of California Busi-
 ness and Professions Code § 17200. The district court
 rejected those claims, March Decision at *11, and White-
 water has not sought to revive them on appeal.
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 8               WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

 the employer exceeds the scope of Section 2870, which per-
 mits an employer to require an employee assign inventions
 ‘[r]elate[d] to’ the employer’s business.” Id. at *7–8 (second
 alteration in original). Relying on Cadence Design Sys-
 tems, Inc. v. Bhandari, No. 07-823, 2007 WL 3343085, at *5
 (N.D. Cal. Nov. 8, 2007), the district court stated that
 § 2870 “permits the assignment of inventions conceived af-
 ter employment, so long as the inventive idea relates to the
 employer’s business . . . or results from work performed by
 the employee for the employer.” Id. at *8. As for § 2872’s
 requirement of a notification, the district court concluded
 that the section states no remedy for its violation and that
 absence of a § 2872 notification from Wave Loch was “not
 determinative” because “the subject matter of the patents
 in suit was integral to Mr. Alleshouse’s work at Wave Loch
 and would not have been subject to the notice requirements
 of Section 2872.” Id. at *7. The district court later added
 that it had considered the absence of notification but
 deemed it insufficient for an invalidity conclusion. August
 Decision at *4.
     The district court then briefly rejected the defense of
 invalidity under California Business and Professions Code
 § 16600. Relying on Board of Trustees of Leland Stanford
 Junior University v. Roche Molecular Systems, Inc., 583
F.3d 832, 845 (Fed. Cir. 2009), aff’d on other grounds, 563
U.S. 776 (2011), the district court concluded that “the
 Agreement does not restrain Mr. Alleshouse from engaging
 in the sheet wave profession.” March Decision at *9. The
 district court reasoned that the Agreement “only requires
 him to assign inventions resulting from his work at Wave
 Loch or relating to Wave Loch’s business at the time he was
 there.” Id.
     Having held the Agreement’s assignment provision to
 be valid, the district court went on to find a breach. It ex-
 plained that the “evidence shows Mr. Alleshouse’s half-
 pipe/quarter-pipe invention was related to, and emanated
 from, Wave Loch’s business and research.” Id. at *10.
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 Citing Mr. Alleshouse’s responsibility as the “product man-
 ager for the Flowrider attraction at Wave Loch”; Wave
 Loch’s development of “radial, non-planar nozzles for its
 WaveOz attraction”; and Mr. Alleshouse’s access to “mod-
 els and drawings,” as well as “complete diagrams of similar
 nozzle structures,” the district court stated that “[c]ommon
 sense shows that the inventions at issue resulted from Mr.
 Alleshouse’s work at Wave Loch.” Id. On appeal, the de-
 fendants do not dispute the finding that the inventions
 come under the Agreement’s assignment provision (or the
 rejection of the equitable estoppel and laches defenses).
     The district court next ruled for Whitewater on its
 claim that Mr. Yeh was improperly named as an inventor
 on the three patents at issue. Id. at *12–13. The court
 determined that “Mr. Alleshouse alone conceived of the in-
 ventions” and that “Mr. Yeh’s contributions occurred there-
 after and are insufficient under the law.” Id. at *12. The
 district court later amended—largely supplemented—its
 findings on this issue. August Decision at *2–3.
    The defendants timely appealed. We have jurisdiction
 under 28 U.S.C. § 1295(a)(1).
                              II
      On appeal, the defendants challenge the Agreement’s
 assignment provision as invalid both under § 16600 and
 under §§ 2870 and 2872. On appeal, the parties accept two
 important factual premises: first, the inventions at issue
 were not conceived until after Mr. Alleshouse left his job at
 Wave Loch; second, Mr. Alleshouse did not use any trade-
 secret or other confidential information belonging to Wave
 Loch (now Whitewater) in arriving at the patented inven-
 tions. The defendants, who do not appeal the determina-
 tion of breach, also now accept that the assignment
 provision applies to post-employment inventions. Relying
 on those now-undisputed premises, we conclude that the
 assignment provision is invalid under § 16600, and we re-
 ject Whitewater’s argument that § 2870 saves the provision
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 10               WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

 from invalidity under § 16600. We need not address the
 defendants’ argument for invalidation under § 2872, which
 Whitewater does not contend saves the assignment provi-
 sion from invalidity under § 16600. We therefore reverse
 the district court’s ruling on breach of contract.
                                A
     The parties have not cited any decision of California’s
 Supreme Court or of its intermediate appellate courts that
 directly address how broadly, if at all, employment contract
 provisions may require assignment of inventions conceived
 post-employment and without use of the former employer’s
 confidential information. In this situation, we must try to
 predict, based on precedents that are relevant but not di-
 rectly on point, how the State’s highest court would rule on
 the issue before us. See Comm’r of Internal Revenue v.
 Bosch’s Estate, 387 U.S. 456, 465 (1967); see also Golden v.
 Cal. Emergency Physicians Med. Grp., 782 F.3d 1083, 1089
 (9th Cir. 2015) (Golden I) (same); Johnson v. Riddle, 305
F.3d 1107, 1118 (10th Cir. 2002) (same).
      We review a district court’s interpretation of a State’s
 statutes de novo. Salve Regina Coll. v. Russell, 499 U.S.
225, 239 (1991). In doing so, we give weight to decisions of
 federal courts that are “better schooled in” the law of the
 particular State involved. See Brockett v. Spokane Arcades,
 Inc., 472 U.S. 491, 500 (1985) (“district courts and courts of
 appeals are better schooled in and more able to interpret
 the laws of their respective States”); Propper v. Clark, 337
U.S. 472, 486–87 (1949) (“In dealing with issues of state
 law that enter into judgments of federal courts, we are hes-
 itant to overrule decisions by federal courts skilled in the
 law of particular states unless their conclusions are shown
 to be unreasonable.”); see also, e.g., In re SuperValu, Inc.,
 925 F.3d 955, 963 (8th Cir. 2019) (discussing recent Sev-
 enth Circuit interpretation of Illinois law and “adopt[ing]
 its conclusion”); Factors Etc., Inc. v. Pro Arts, Inc., 652 F.2d
278, 281 (2d Cir. 1981) (“It has frequently been observed
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE                11

 that a court of appeals should give considerable weight to
 state law rulings made by district judges, within the cir-
 cuit, who possess familiarity with the law of the state in
 which their district is located.”). In this case, the most on-
 point California federal-court decisions rendered before the
 ruling under review here support the defendants in their
 challenge to the contrary ruling of the California district
 court in this case.
                               B
     The Agreement’s assignment provision has a broad re-
 straining effect that renders it invalid under § 16600 as
 that statute has been applied to employment contracts in a
 manner highly protective of former employees. We assess
 the provision based on its broad terms. Whitewater did not
 timely make any argument in this court that the provision
 could be upheld if we concluded that § 16600 might permit
 a narrower provision that covered Mr. Alleshouse’s partic-
 ular circumstance. 2
                               1
     The Agreement’s assignment provision is broad. It re-
 quires, among other things, that Mr. Alleshouse, as a

     2   Whitewater made no such argument in its brief in
 this court. See SmithKline Beecham Corp. v. Apotex Corp.,
 439 F.3d 1312, 1319 (Fed. Cir. 2006) (“Our law is well es-
 tablished that arguments not raised in the opening brief
 are waived.”). It has not addressed whether § 16600 allows
 such a judicial approach to overbroad agreements. See
 Kolani v. Gluska, 64 Cal. App. 4th 402, 406–07 (1998); Ap-
 plied Materials, Inc. v. Advanced Micro-Fabrication Equip-
 ment (Shanghai) Co., 630 F. Supp. 2d 1084, 1091 (N.D. Cal.
 2009); cf. Guth v. Minnesota Min. & Mfg. Co., 72 F.2d 385,
 389 (7th Cir. 1934) (discussing question of parsing agree-
 ment having invalid and valid parts).
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 12              WHITEWATER WEST INDUSTRIES      v. ALLESHOUSE

 former employee, assign to Wave Loch (or its successors,
 assignees, or nominees) all of his rights or interests in any
 invention he “may make or conceive,” “whether solely or
 jointly with others,” if the invention is either “resulting
 from or suggested by” his “work for” Wave Loch or “in any
 way connected to any subject matter within the existing or
 contemplated business of” Wave Loch. J.A. 1022. The as-
 signment duty applies to all of Mr. Alleshouse’s “rights and
 interests in said inventions . . . in all countries worldwide.”
Id.
     No trade-secret or other confidential information need
 have been used to conceive the invention or reduce it to
 practice for the assignment provision to apply. The obliga-
 tion is unlimited in time and geography. It applies when
 Mr. Alleshouse’s post-employment invention is merely
 “suggested by” his work for Wave Loch. It applies, too,
 when his post-employment invention is “in any way con-
 nected to any subject matter” that was within Wave Loch’s
 “existing or contemplated” business when Mr. Alleshouse
 worked for Wave Loch.
     The restraining effect of these requirements is evident.
 For a number of years, Mr. Alleshouse worked for Wave
 Loch in a wide variety of capacities involving design and
 implementation of water attractions. Anyone in his posi-
 tion would have developed useful, specialized knowledge of
 the business of water attractions, wholly apart from any
 confidential information. Work in the same line of business
 was necessarily among the best and likeliest prospects for
 such an individual to pursue when leaving the employer.
      Yet under the Agreement’s assignment provision, pur-
 suit of the very prospects for which the individual “is par-
 ticularly fitted,” as the Seventh Circuit noted in 1934,
 carries a heavy price. Guth, 72 F.2d at 389. A wide range
 of inventions made after leaving the employer, for all time,
 would have to be assigned to that (now former) employer.
 The individual, and the individual’s new employer or
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE                13

 enterprise, would lose the likely competitive benefits of the
 exclusivity rights provided by patents on such new inven-
 tions—or, worse, could be subject to being sued by the for-
 mer employer, as assignee, for infringement of those very
 patents. The impairment of the individual’s ability to pur-
 sue his profession, trade, or business would be significant.
     A century ago, the Second Circuit explained that even
 an agreement providing just for an “exclusive license to use
 all other future patents and inventions devised or ac-
 quired” by a former employee—short of an actual assign-
 ment—“would be an extremely harsh one; it might even be
 found unconscionable, for it mortgages his inventive facul-
 ties to complainant for an indefinite period subsequent to
 employment.” Standard Plunger Elevator Co. v. Stokes,
 212 F. 893, 896 (2d Cir. 1914). A requirement of assign-
 ment, like the one at issue here, imposes an even harsher
 penalty on post-employment professional, trade, or busi-
 ness prospects—a penalty that has undoubted restraining
 effect on those prospects and that a number of courts have
 long held to invalidate certain broad agreements with
 those effects. See, e.g., Guth, 72 F.2d at 388–89 (partly in-
 validating, as “conflict[ing] with the public policy of the
 land,” broad agreement that required former employee to
 “turn over the children of his inventive genius” conceived
 after employment); id. at 387–89 (collecting case law); TLS
 Mgmt. & Mktg. Servs., LLC v. Rodriguez-Toledo, 966 F.3d
46, 57–58 (1st Cir. 2020) (applying policy against overbroad
 non-compete clauses to overbroad non-disclosure agree-
 ments and collecting cases).
     Identifying this substantial restraining effect on for-
 mer employees does not suffice to answer the question
 whether a particular law-making authority has chosen to
 invalidate an agreement having such an effect. A law-mak-
 ing authority, in deciding on a policy to govern the issue,
 presumably would consider a variety of facially pertinent
 interests, among them the interests of former employees,
 the interests of employers, the overall societal interest, and
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 14              WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE

 practicalities of implementing any policy chosen. 3 The
 question for us is how California has resolved the issue—
 where there is no use of confidential information and the
 conceptions of the inventions post-date employment.
                              2
     Our best assessment of California law on the subject is
 that California has chosen, in § 16600, to forbid the re-
 straint on former employees imposed by the agreement in
 this case. We begin with the California Supreme Court’s
 relevant pronouncements. That court recently reiterated
 that “[t]he language of section 16600 is broad on its face.”
 Ixchel Pharma, LLC v. Biogen, Inc., 470 P.3d 571, 582 (Cal.
 2020). 4 And in that decision, the court, in adopting a flex-
 ible rule-of-reason approach to assess certain contracts be-
 tween businesses, distinguished and emphasized just how
 “strictly,” id. at 586, 588, § 16600 forbids agreements that
 impair the post-employment liberty of former employees,
 relying on a long line of cases culminating in Edwards v.

      3   For example, Whitewater notes a concern about the
 potential for “dishonest employees to withhold their best
 efforts and ideas from their current employers.” White-
 water Resp. Br. 16. That concern could be a part of the
 balance of relevant considerations, and it also might be ad-
 dressed by means other than assignment provisions, e.g.,
 disclosure requirements, see California Labor Code § 2871,
 or a duty of loyalty, see California Labor Code § 2859. See
 Iconix, Inc. v. Tokuda, 457 F. Supp. 2d 969, 997 (N.D. Cal.
 2006) (acknowledging assignment under duty of loyalty to
 employer); Cubic Corp., 185 Cal. App. 3d at 444, 451 (dis-
 cussing implications of disclosure requirement as part of
 employment contract). Whitewater asserted no such sepa-
 rate basis of liability in this case.
     4    Section 16600 is subject to exceptions “provided in
 this chapter,” i.e., §§ 16601, 16602, and 16602.5. Those ex-
 ceptions have not been invoked here.
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE                15

 Arthur Andersen LLP, 189 P.3d 285 (Cal. 2008). Ixchel, 470
P.3d at 583–88.
      In Edwards, the California Supreme Court invalidated
 contractual provisions barring a former employee from
 working for or soliciting certain clients of his previous em-
 ployer for limited periods following his termination. 189
P.3d at 288. In reaching its conclusion, the court rejected
 the notion that “a mere limitation on an employee’s ability
 to practice his or her vocation would be permissible under
 section 16600, as long as it was reasonably based,” explain-
 ing that the statute’s use of the word “restrain” does not
 “mean simply to ‘prohibit,’” id. at 291, and that the statute
 “evinces a settled legislative policy in favor of open compe-
 tition and employee mobility,” id., and “embodies the orig-
 inal, strict common law antipathy toward restraints of
 trade,” id. at 292–93. The court also rejected a “narrow-
 restraint exception” test for § 16600, articulated by the
 Ninth Circuit, as contravening California’s protection of
 employees. Id. at 293. The court emphasized that “Cali-
 fornia courts have been clear in their expression that sec-
 tion 16600 represents a strong public policy of the state
 which should not be diluted by judicial fiat.” Id. at 293 (in-
 ternal quotation marks omitted).
     In Ixchel, the California Supreme Court reiterated
 § 16600’s special protectiveness of employees. It held that
 courts should apply “a reasonableness standard to contrac-
 tual restraints on business operations and commercial
 dealings,” but explained that its holding “do[es] not disturb
 the holding in Edwards and other decisions strictly inter-
 preting section 16600 to invalidate noncompetition agree-
 ments following the termination of employment or sale of
 interest in a business.” Ixchel, 470 P.3d at 588. Specifi-
 cally, the court explained that “the rationale in Edwards
 focused on policy considerations specific to employment
 mobility and competition: ‘The law protects Californians
 and ensures “that every citizen shall retain the right to
 pursue any lawful employment and enterprise of their
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 16              WHITEWATER WEST INDUSTRIES      v. ALLESHOUSE

 choice.”’” Id. at 587 (quoting Edwards, 189 P.3d at 291).
 This strict approach to § 16600 as applied to contracts re-
 straining former employees condemns the assignment re-
 quirement at issue here given the significant restraining
 effect the requirement has on former employees like Mr.
 Alleshouse.
     Since the California Supreme Court decided Edwards,
 the Ninth Circuit has confirmed the strictness and breadth
 of § 16600’s prohibition on contracts restraining former
 employees, especially but not only as to competition with
 the former employer. In Golden I, the Ninth Circuit con-
 sidered a “no-employment” provision from a settlement
 agreement stating that the former employee “shall not be
 entitled to work or be reinstated at any [former-employer]-
 contracted facility or at any facility owned or managed by”
 the former employer. 782 F.3d at 1085. The court ex-
 plained that § 16600 is not limited to non-competition pro-
 visions, noting that “the legislature adopted categorical
 language: ‘every contract’ that ‘restrain[s]’ anyone ‘from en-
 gaging in lawful profession . . . of any kind’ is ‘void.’”
 Golden I, 782 F.3d at 1090 (brackets and ellipsis in origi-
 nal). Recounting the California Supreme Court’s decision
 in Chamberlain v. Augustine, 156 P. 479 (Cal. 1916), the
 Ninth Circuit highlighted the “canonical statement” that
 “the crux of the inquiry under section 16600 is not whether
 the contract constituted a covenant not to compete, but ra-
 ther whether it imposes ‘a restraint of a substantial char-
 acter’ regardless of ‘the form in which it is cast.’” Golden I,
782 F.3d at 1091. The Ninth Circuit concluded that all con-
 tract provisions that “constitute[] a restraint of a substan-
 tial character” on a former employee’s ability to engage in
 a legal profession are prohibited under § 16600. Id. at
 1092–93.
    The Ninth Circuit elaborated when the Golden I case
 returned to the court. In Golden v. Cal. Emergency Physi-
 cians Med. Grp. (Golden II), the Ninth Circuit explained
 that “a contractual provision imposes a restraint of a
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE               17

 substantial character if it significantly or materially im-
 pedes a person’s lawful profession, trade, or business” and
 that “it will be the rare contractual restraint whose effect
 is so insubstantial that it escapes scrutiny under section
 16600.” 896 F.3d 1018, 1024 (9th Cir. 2018). Ultimately,
 considering the scope of the no-employment provision, the
 Ninth Circuit held that the restraint was “of a substantial
 character” because the former employee “would be ineligi-
 ble for employment in any department of a hospital where
 [the former employer] has a contract” and “easily [rose] to
 the level of a substantial restraint” when considering the
 market presence of the former employer. Id. at 1025–26.
 The assignment provision in the present case has a re-
 straining effect of a substantial character under the Ninth
 Circuit’s approach.
      The California Supreme Court and Ninth Circuit deci-
 sions just discussed address § 16600 in its application to
 restrictions on former employees, but they do not specifi-
 cally address contracts requiring assignments of rights in
 inventions conceived after employment. Three federal dis-
 trict courts in California did address that particular situa-
 tion before the district court decided the present case.
 Those decisions are in line with the principles of the Cali-
 fornia Supreme Court and Ninth Circuit and support our
 rejection of the ruling now before us.
     In Armorlite Lens Co. v. Campbell, the district court
 applied § 16600 to a contractual provision requiring assign-
 ment of “all new ideas and concepts” that an employee de-
 veloped “during the period of [his] employment, or within
 one (1) year after the termination thereof.” 340 F. Supp.
273, 274 (S.D. Cal. 1972). The court explained that an
 agreement “which requires a former employee to turn over
 to his former employer all new ideas and concepts concern-
 ing the field of work or the products of the employer” within
 one year after termination “is unnecessarily broad.” Id. at
 275. Noting that the provision covered “ideas and concepts
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 18              WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

 not based on . . . confidential information,” the court held
 the provision “void and unenforceable” under § 16600. Id.
     Similarly, in Applied Materials, Inc. v. Advanced Mi-
 cro-Fabrication Equipment (Shanghai) Co., the district
 court considered, and held invalid under § 16600, an as-
 signment provision that required assignment of “any in-
 vention . . . described in a patent application or . . .
 disclosed . . . within one (1) year after terminating my em-
 ployment” based on a presumption “that the invention was
 conceived or made during the period of [the] employment.”
 630 F. Supp. 2d 1084, 1086 (N.D. Cal. 2009). The court
 explained that “[a]ssignment clauses function as unlawful
 non-compete provisions where they require an employee to
 assign an invention conceived after departing from an em-
 ployer’s service.” Id. at 1090. Applied to the specific as-
 signment provision at issue, the district court observed
 that it “broadly target[ed] any inventions ‘relate[d] to’ for-
 mer employees’ ‘work’” with the former employer and was
 “in no way limited” to subject matter based on confidential
 material. Id. (second alteration in original). The court also
 noted that the provision covered “any invention disclosed
 by former employees, regardless of when or where they
 were conceived,” so the provision was “overly broad with
 respect to both subject matter and temporal scope.” Id. at
 1090–91.
     Most recently, in Conversion Logic, Inc. v. Measured,
 Inc., the district court addressed, and invalidated under
 § 16600, three consulting agreements that, reflecting the
 language of the agreements, the court treated as employ-
 ment agreements for purposes of § 16600. No. 2:19-cv-
 05546, 2019 WL 6828283, at *6 (C.D. Cal. 2019). The
 agreements required assignment of “all Inventions . . . con-
 ceived or developed by Employee while employed with the
 Company or within one (1) year following termination of
 such employment.” Id. The agreements extended “beyond
 the length of the employment” and “include[d] broad
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE                19

 language sweeping up inventions and discoveries unre-
 lated to” the companies’ proprietary information. Id. at *6–
 7.
     Those decisions, all from federal district courts in Cal-
 ifornia, confirm that invention-assignment provisions that
 go beyond protection of proprietary information and en-
 snare post-employment inventions are to be judged under
 the strict § 16600 standards that protect former employees.
 As far as we have been shown, there is no contrary decision
 of a California federal court except for the district court’s
 decision in this case. As explained, the agreement in this
 case is invalid under § 16600’s strict standards governing
 restraints on former employees.
                               3
      This conclusion is not undermined by the sole authority
 on § 16600 cited by the district court, namely, this court’s
 decision in Board of Trustees of the Leland Stanford Junior
 University v. Roche Molecular Systems, Inc., which rejected
 a § 16600 challenge to an assignment provision. 583 F.3d
832, 837 (Fed. Cir. 2009), aff’d on other grounds, 563 U.S.
776 (2011). A researcher employed by Stanford, Holodniy,
 in the course of that employment, arranged to spend time
 at Cetus, as a visitor, to learn certain laboratory techniques
 as part of a Stanford-Cetus collaboration on efforts to quan-
 tify amounts of Human Immunodeficiency Virus (HIV) in
 human blood samples. Id. The researcher signed a “Visi-
 tor’s Confidentiality Agreement” (VCA) with Cetus that in-
 cluded a patent-assignment provision granting various
 invention rights to Cetus. Id. at 837, 842. Stanford even-
 tually secured certain patents naming the researcher as an
 inventor, and when Stanford sued Cetus’s successor,
 Roche, for infringement by its marketing of certain detec-
 tion kits, Roche defended on the ground, among others,
 that it owned the interest of the Stanford researcher based
 on the assignment provision. Id. at 839. This court agreed,
 in the process rejecting one of Stanford’s responses,
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 20              WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

 namely, that the agreement was invalid under § 16600. Id.
 at 845–46.
     One ground on which we rejected the § 16600 challenge
 was that there was simply no evidence of a restraining ef-
 fect on Holodniy’s ability to engage in his profession.
 “Stanford provides no evidence that the VCA restrained
 Holodniy from engaging in any profession. Indeed, the rec-
 ord shows that Holodniy freely continued his HIV research
 at Stanford, publishing articles and using the knowledge
 he obtained from Cetus to further the science behind the
 patents-in-suit.” Id. at 845. That ground, essentially a
 threshold ground for application of § 16600, readily distin-
 guishes the present case.
      This court also stated that “California courts apply sec-
 tion 16600 to employment restrictions on departing em-
 ployees, not to patent assignments.” Id. at 846 (citing
 Thompson v. Impaxx, Inc., 7 Cal. Rptr. 3d 427 (Ct. App.
 2003), and D’Sa v. Playhut, 102 Cal. Rptr. 2d 495 (Ct. App.
 2000)). Given that the two cited cases did not hold that a
 patent-assignment provision in an employment agreement
 cannot be subject to § 16600, the absence of discussion of
 what were already two decisions by California federal dis-
 trict courts holding otherwise, and the post-Stanford clari-
 fications of § 16600 law, we interpret that sentence to
 reflect the fact that Holodniy’s relationship with Cetus was
 not one of employment. It was a visitor relationship while
 Holodniy was employed at Stanford, and it was part of an
 overall relationship between the two institutions—Stan-
 ford and Cetus. Those are not the employment-agreement
 circumstances for which § 16600 prescribes a strict ap-
 proach, as the California Supreme Court has recently con-
 firmed; indeed, the Stanford circumstances are more akin
 to the business-to-business dealings for which Ixchel holds
 that § 16600 prescribes a much less strict approach. The
 present case, in contrast, falls squarely under the strict em-
 ployment-agreement standard.
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE               21

     Those aspects of Stanford made it unnecessary for this
 court to resolve definitively whether the inventions at issue
 were conceived while Holodniy was learning techniques at
 Cetus or later. The district court in the case had ruled, on
 summary judgment, that they were conceived while Holod-
 niy was visiting Cetus. Bd. of Trustees of Leland Stanford
 Junior Univ. v. Roche Molecular Sys., Inc., 487 F. Supp. 2d
1099, 1107–08, 1116–17 (N.D. Cal. 2007), aff’d, 583 F.3d
832 (Fed. Cir. 2009), aff’d, 563 U.S. 776 (2011). We did not
 set aside that ruling or pronounce it correct or incorrect.
 See Stanford, 583 F.3d at 842. We could decide the § 16600
 issue in Stanford without deciding the timing of the con-
 ception only because the case did not involve the circum-
 stance—an employment agreement with an assignment
 requirement having a significant restraining effect on a for-
 mer employee—in which that issue is critical. For the rea-
 sons already discussed, this case involves just such an
 agreement, and Stanford does not undermine the conclu-
 sion that the agreement here is invalid under § 16600.
                              C
      Whitewater suggests that we should reach a different
 conclusion about § 16600 because of § 2870(a). In particu-
 lar, it says that § 2870(a) clearly approves an agreement
 like the one at issue here and, therefore, the general statu-
 tory prescription, § 16600, should be applied narrowly so
 as not to override that clear approval of such an agreement
 by the more specific statutory prescription, § 2870(a).
 Whitewater Resp. Br. 33–35. This argument relies on the
 duty to harmonize statutes, a well-recognized principle of
 California law. See State Dep’t of Public Health v. Superior
 Court, 342 P.3d 1217, 1225 (Cal. 2015) (“We have recently
 emphasized the importance of harmonizing potentially in-
 consistent statutes. ‘A court must, where reasonably pos-
 sible,    harmonize        statutes,    reconcile    seeming
 inconsistencies in them, and construe them to give force
 and effect to all of their provisions. [Citations.] This rule
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 22              WHITEWATER WEST INDUSTRIES     v. ALLESHOUSE

 applies although one of the statutes involved deals gener-
 ally with a subject and another relates specifically to par-
 ticular aspects of the subject.’ [Citation.]”) (internal
 quotation marks omitted) (citing authorities).
      We part company with Whitewater not over the harmo-
 nization principle but over its application in this case. Spe-
 cifically, we reject Whitewater’s premise that § 2870(a)
 clearly covers, and through its exceptions clearly approves,
 an agreement requiring assignment of post-employment
 inventions. We conclude that § 2870(a) does not clearly
 cover agreements requiring assignments of post-employ-
 ment inventions. From that conclusion it follows that the
 proper way to fulfill the duty to harmonize the two statu-
 tory prescriptions is by reading § 2870(a) not to override
 what we think is a clear application of § 16600 (rather
 than, as Whitewater argues, reading § 16600 narrowly to
 avoid overriding § 2870).
     To begin with, the exceptions in § 2870(a) cannot be
 broader in scope than the restriction to which they are ex-
 ceptions. The subsection states a restriction, followed by
 exceptions. It states that certain provisions of employment
 agreements “shall not apply” to certain inventions, “except
 for” certain inventions that meet any of several criteria.
 The “except for” structure means that the exceptions are
 necessarily a subset of the initial scope of the restriction.
 The key question, then, is whether the restriction reaches
 agreements to assign post-employment inventions.
      Whitewater has not cited, and the district court did not
 cite, any cases that apply § 2870(a) to a post-employment
 invention. 5 We must consider the statute without the aid

      5  The only case cited by the district court, Cadence
 Design, involved an assignment requirement for an inven-
 tion conceived during employment. 2007 WL 3343085,
 at *4. The contractual provision also declared expressly
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE               23

 of any on-point case law. We conclude that § 2870(a) does
 not support Whitewater’s premise. To the contrary, it is at
 least a fair reading of § 2870(a)—and given the duty to har-
 monize it with § 16600, we think it is ultimately a neces-
 sary reading—that it simply does not apply to post-
 employment inventions, much less affirmatively authorize
 all agreements that require assignment of post-employ-
 ment inventions as long as they meet the “except for” crite-
 ria, regardless of other characteristics, such as the absence
 of any temporal limit on the contractual assignment duty.
     The opening clause of § 2870(a) defines the subsection’s
 outer limits—before exceptions are stated that narrow the
 scope within those limits—by confining its scope to a “pro-
 vision 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.” It is only
 such a provision that the subsection restricts—declaring
 that it “shall not apply to an invention that the employee
 developed on his or her own time without using the em-
 ployer’s equipment, supplies, facilities, or trade secret in-
 formation.” It then creates an exception to that restriction
 in two circumstances—namely, for “inventions that either
 “(1) [r]elate at the time of conception or reduction to prac-
 tice of the invention to the employer’s business, or actual
 or demonstrably anticipated research or development of
 the employer” or “(2) [r]esult from any work performed by
 the employee for the employer.” 6

 that it did not reach beyond what § 2870 approved. Id. at
 *5 (relying on that declaration to find the provision con-
 sistent with § 2870).
     6    Subsection (b) then declares unenforceable any
 provision in an employment agreement to the extent the
 provision “purports to require an employee to assign an
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 24              WHITEWATER WEST INDUSTRIES      v. ALLESHOUSE

     Various features of the language of § 2870(a) at least
 suggest that it is referring only to inventions made by a
 person who, at the time of the making of the inventions,
 was an employee of the employer. 7 The subsection refers
 to “employees” and “employers,” and it never refers either
 to “former employees” or “former employers” or to a post-
 employment period. In its wording and structure, it is nat-
 urally understood to be addressing only an employer’s de-
 fault right to insist on assignments from its employees of
 inventions they make while they are employees, and then
 narrowing that right so as to benefit employees. Nothing
 in the statutory language positively indicates, let alone re-
 quires the conclusion, that the California Legislature, in
 § 2870, was addressing requirements to assign post-em-
 ployment inventions—which present what have long been
 recognized as presenting significant additional policy con-
 cerns, over and above those presented by assignment re-
 quirements for inventions made during employment. See
 Guth, 72 F.2d at 387–89 (1934 decision noting case-law
 recognition of distinction). Nor has Whitewater cited any
 legislative history suggesting that the California Legisla-
 ture was doing so.
     The subsection states that its subject is a “provision”
 that requires “an employee” to make certain assignments.
 It then declares that such a provision “shall not apply” to a
 group (to be further limited in the exceptions) of inventions
 which the “employee developed entirely on his or her own
 time without using the employer’s equipment, supplies, fa-
 cilities, or trade secret information.” That initial definition
 of the employee protection suggests a presupposition of

 invention otherwise excluded from being required to be as-
 signed under subdivision (a).”
     7   That reading does not preclude a breach of the duty
 to assign during employment from being remedied post-
 employment.
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 WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE               25

 current employee status because the definition focuses pre-
 cisely on excluding use of employer resources (temporal,
 physical, or informational) to which current employees
 commonly have ready access. Section 2870(a) proceeds to
 further define which among such own-time/own-resources
 inventions of an employee the employer can still claim
 through mandated assignment—those which “relate at the
 time of conception or reduction to practice” to certain cur-
 rent or sufficiently anticipated activities of the employer,
 and those which “result from” any work of the employee for
 the employer. Neither exception contains any pointer to-
 ward post-employment inventions, and such a temporal ex-
 tension (with no further temporal limit) would raise
 obvious issues. If such inventions were covered, the excep-
 tions would, by their terms, seem to expand as the former
 employer’s activities change over time (indefinitely into the
 future) and call for ever-less-certain determinations of the
 causal connection (“result from”) back to work during em-
 ployment. 8
     For such reasons, we think that § 2870(a)’s own terms
 suggest that it is sensibly, perhaps even best, understood
 to be restricted in its reach to inventions conceived during
 employment. That understanding, moreover, fits well with
 neighboring § 2871. That section authorizes employers to
 require employees to disclose “all of the employee’s inven-
 tions made . . . during the term of his or her employment.”
 Cal. Lab. Code § 2871. Although Whitewater contrasts the
 temporal language in § 2871 with the absence of similar
 words in § 2870, the language is just as easily understood

     8Section 2870 is part of California Labor Code Article
 3.5, which is titled “Inventions Made by an Employee.”
 That title tends to reinforce—and does not run counter to—
 what is already suggested by the language of the sections
 within Article 3.5.
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 26              WHITEWATER WEST INDUSTRIES    v. ALLESHOUSE

 as making explicit what is already implicit in § 2870, form-
 ing a coherent whole.
     We conclude that, at a minimum, § 2870(a) is nowhere
 close to clear in applying to post-employment inventions.
 No case law supports such an interpretation. Moreover, to
 read it as applying to such inventions, and authorizing
 temporally unlimited assignment requirements through
 its exceptions, would produce a conflict with what we think
 is otherwise the clear prohibition of § 16600 on agreements
 like the one at issue here. In these circumstances, the duty
 to harmonize statutes requires reading § 2870(a) not to ap-
 ply to post-employment inventions. 9
                             ***
    For the foregoing reasons, the assignment provision is
 invalid under § 16600. Accordingly, we reverse the district
 court’s decision that Mr. Alleshouse breached his contract
 by failing to assign each of the ’685, ’189, and ’433 patents
 to Whitewater.
                              III
     The district court entered judgment in Whitewater’s fa-
 vor not only on the contract claim but also on Whitewater’s
 claim for correction of inventorship on the three patents at
 issue under 35 U.S.C. § 256. Whitewater does not dispute
 that its interest in correcting inventorship under § 256 de-
 pends, in this case, on its acquisition of an ownership in-
 terest in the patents based on the assignment provision on
 which its contract claim rests. Because the assignment
 provision is invalid, Whitewater’s claim under § 256

      9  We need not address the defendants’ argument
 that the Agreement’s assignment provision in this case,
 with its “in any way connected to” and “suggested by” lan-
 guage, extends beyond the exceptions stated in § 2870(a).
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 WHITEWATER WEST INDUSTRIES   v. ALLESHOUSE               27

 necessarily fails. On that basis, we reverse the judgment
 on the inventorship claim.
                            IV
    The judgment of the district court is reversed. Judg-
 ment shall be entered in favor of the defendants.
    Costs are awarded to the defendants.
                      REVERSED