Establishing the correct ownership and inventorship of a patent right is an important foundation of IP basics which tends to be overlooked by many inventors and patent owners. The consequences of taking a casual approach and failing to set out a good and proper chain of entitlement could be severe (e.g. leading to potential loss of rights) in an ownership or inventorship dispute.
We have compiled a list of questions that inventors and patent owners should always ask themselves even before filing a patent application to mitigate the risk of a messy dispute arising further down the pipeline.
1. What is the ‘inventive concept’ of the invention?
In other words, what is the ‘heart’ of the invention? This should be clear from an understanding of the problems that the invention is seeking to address, and how the invention was conceived as a result of those problems.
In an already-filed patent application, the ‘inventive concept’ should be apparent from a reading of the patent specification, including the claims, as a whole.[1] Whilst the claims should assist in understanding the invention and the inventive concept that gave rise to it,[2] it is not sufficient to rely solely on the claims to establish the ‘inventive concept’. It is possible, of course, for an invention to have more than one ‘inventive concept’, even though a patent application may only be claiming a single invention.
2. Who contributed to the ‘inventive concept’?
The true inventor(s) of an invention should be objectively assessed as a question of fact, not based on conjecture. This is particularly relevant in scenarios involving multiple or joint inventors.
One of the key considerations in determining the true inventorship of an invention is whether the individual (or individuals) ‘materially contributed’ to the invention. Importantly, it is not sufficient to rely on the quantity of that individual’s contribution to the invention, rather, it is the quality of that individual’s contribution that holds greater weight.[3] Additionally, if the final embodiment of the inventive concept of the invention would not have come about without that individual’s involvement, then that individual should have entitlement to the invention.[4]
For avoidance of any doubt, if an individual had material input to the inventive concept(s) of the invention, then that individual should be named as an inventor.
3. How did the patent applicant gain entitlement to the invention?
As a general principle, an invention is owned by the true inventor(s) of that invention, unless there are circumstances which dictate otherwise.
If the true inventor of the invention is not the patent applicant, then it is crucial to establish that the rights to the invention were, in fact, properly transferred from the inventor to that patent applicant.
A patent applicant may not be entitled to an invention if their rights were derived from an individual who is not a true inventor of the invention, i.e. one that did not contribute to the inventive concept.
4. What agreements are in place to establish the transfer of ownership from the inventor to the patent applicant?
Such agreements (e.g. in the form of a Deed of Assignment) must be in writing, and should clearly set out the following information:
- The name(s) and address(es) of each party involved in the transfer of ownership (e.g. the inventor(s) as the assignor(s), and an authorised representative of the assignee);
- The date that the transfer of ownership is to take effect;
- Details of the invention that is to be the subject of the ownership transfer, including the title of the invention and, if available, the patent application number and the filing date of the patent application;
- The rights that are to be assigned (e.g. the entire right, title and interest to the invention, including the right to make applications for patent or other protection in relation to the invention, the right to claim priority from a patent application, and the right to sue for damages and all other remedies in respect of infringement); and
- The name(s) and signatures(s) of each party involved in the transfer of ownership. The date and location of the signing should also be clearly indicated.
For employees of a company, it is important for both parties to be aware of whether any contractual or fiduciary relationships give rise to proprietary rights in an invention.[5] In Australia, an employer is generally entitled to the rights of an invention created by an employee, provided that the invention was created as part of the employee’s duties during the course of their employment, the invention is related to the employer’s business, and the employment contract does not stipulate otherwise. For contractors, on the other hand, the general rule is that an invention created by a contractor is owned by that contractor (not the hirer) unless the contract dictates otherwise.
In some circumstances, an individual may also have contractual or fiduciary relationships with more than one company, or an invention may have been created as part of a collaboration between multiple companies. To avoid any doubt as to which party is entitled to the invention, each company should have clear written agreements in place which clearly set out the division of rights to the invention.
For collaborative researchers, such as university employees employed to conduct research as part of their duties, the general rule is that the university (i.e. employer) owns the invention, unless there are specific agreements in place which dictate otherwise.
5. Is there more than one patent applicant?
Dividing the rights to a patent application by naming multiple applicants can be problematic, and is a contentious issue that has left many inventors wishing that they had invented a time machine instead. Business relationships, like any other, may be well and good at the outset, but could eventually break down. A good rule of thumb for patent applicants to follow is to think twice before agreeing to joint ownership of a patent application (i.e. by naming multiple patent applicants).
If there are multiple or joint inventors in respect of an invention, it may be prudent to consider setting up a company and have all the inventors assign their rights to the company. By having the company as the sole patent applicant, patent rights are less likely to be adversely affected in the event of a dispute between the joint inventors.
In circumstances where an invention was part of a collaborative effort by multiple inventors residing in different countries, it is important to ensure that the appropriate foreign filing authorisations are obtained prior to filing a patent application.
The above provides a general guide to some of the issues in respect of patent inventorship and ownership that inventors and patent owners should be mindful of prior to filing a patent application. Please contact us for further advice or assistance in relation to any patent inventorship or ownership issues that you may be experiencing.
[1] Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9.
[2] Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9, [60].
[3] Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9, [50].
[4] University of Western Australia v Gray [2009] FCAFC 116; JMVB Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474 [132].
[5] University of Western Australia v Gray [2009] FCAFC 116.