Employee Inventions Flashcards
Under s39(1) when will an invention (NB not ‘patentable invention’) made by an employee belong to the employer?
Different criteria for two levels of employee:
- If it was made in the course of normal duties of the employee, or in the course of additional duties specifically assigned to him, where an invention might reasonably be expected to arise from them
- If it was made in the course of the employee’s duties and implicit in these duties there is a special obligation (e.g. a fiduciary relationship) to further the interests of the employer.
s39(2) - any other invention will belong to the employee
NB there is no arrangement under s39 where joint ownership between an employee and employer could arise
Scenerio:
Employee owns the invention but the employer has related rights under design/copyright
S39(3)
If an invention belongs to an employee then they can apply for a patent and work the invention without infringing any copyright or design right that may belong to the employer
NB this doesn’t appear to cover registered designs - but their is a technical function limitation for RDR
applies to employees normally residing in the UK and mainly employed there
When is someone an ‘employee’?
Someone who has a contract of service or apprenticeship with an employer.
In the case of PhD student - consider any agreements they might have with the university or a third party funding them, particularly any IPR clauses
A director or shareholder is not necessarily an employee - even if they have a fiduciary relationship they might not fall under s39(1) - request confirmation
What should be considered when determining an employee’s ‘normal duties’?
Normal duties are usually those that relate to the employee’s contracted role.
Normal duties doesn’t necessarily preclude working from home or outside of normal hours, or using one’s own equipment.
Who does s39 apply to?
Right to employee inventions
i.e., who is an employee?
- Employees normally resident in the UK and mainly employed here (don’t need to be citizens), or
- if unclear where mainly employed, then if they are attached to a UK place of business
(see s43(2))
Who has the burden of proof in employer-employee entitlement disputes?
Burden of proof is on the employer to show that one of the situations set out in s39(1) applies
How to tell if someone is an employee or a contractor?
If they pay their own national insurance, they are a contractor.
If someone is a contractor in an FD1 question - ask to see copies of any contract and check if it deals with ownership
With contractors consider:
- Do they work full time for that person or just when needed?
- Would the invention be expected to arise from their duties under the contract?
What limitations on employment contracts are found in Section 42?
Any contractual term* diminishing the employee’s right (e.g. right to the invention or right to compensation) is unenforceable
but this does not extend to duties of confidentialiy, which are enforceable
*won’t void the whole contract if the term is severable (i.e. does not go to the heart of the contract)
What types of contract do the limitations of section 42 apply to?
- between employee and employer
- with someone else at the behest of their employer
What is the deadline for an employee to make a compensation claim?
Make claim while the patent is in force or within 1 year of lapse
(NB this windos can be extended under R108(1) at the Comptroller’s discretion)
while patent is in force
What are the conditions for an employee to receive compensation for an invention owned by their employer?
Patent is in force, or within a year of lapse, makes an application for compensation:
- a granted patent for an invention made by the employee is owned by the employer; and
- invention/patent is of outstanding benefit to the employer; and
- it is just that the employer compensates the employee
then the court may award compensation
(Remember - if employer is actually true owner then thay can bring entitlement proceedings up to two years post-grant)
What are the conditions for an employee to receive compensation for an invention owned by themselves?
While patent in force or within a year of lapse, makes a claim for compensation:
- a granted patent for an invention made by the employee is owned by the employee; and
- it is assigned/exclusively licensed to the employer; and
- the benefit to the employee is inadequate in relation to the benefit to the employer; and
- it is just that the employer (further) compensates the employee
then court/Comptroller may award compensation
NB s40(4) - this overrides any contract or agreement relating to the invention
In what circumstance stipulated by section 40 will subsections (1) and (2) not apply?
If the employee is in a trade union that has negotiated a pay settlement regarding such inventions
How should ‘outstanding benefit’ be interpreted?
- Not merely substantial, but out of the ordinary
- Future benefit is not included (so may want to make claim later on)
- Foreign rights can also be taken into account (s43(4))
- Factor out contributions of adverts/marketing
- Benefit is actual, not theoretical - what was the actual benefit?
- Need to consider size of employer - outstanding benefit to a large employer may be harder to demonstrate
Who bares the burden of proof for showing ‘outstanding benefit’?
The employee making the claim (this is hard to prove - there have only been a couple of successful applications)
