Ownership of property rights

Intellectual belongings abbreviated by IP represent intangible belongings however, it is capable to the same protection as touchable belongings like a ownership of a house. IP consist of right of first publications, patents, hallmarks and registered and unregistered design rights.

Ownership of IP rights usually vest on the registered owner. However, there are cases of ownership differences between the discoverer employee and the company employer as to ownership of IP. In peculiar, anterior to 1stof June 1978 an employee’s intercession or find in the class of his employment was usually the good involvement vested on the employer. In consequence, this meant that by virtuousness of an implied term in the employee’s contract of employment he was a legal guardian of the innovation or find, every bit long as it was within the class of employment and employee was obliges to pass on it to the employer as directed inBritish Syphon Co Ltd v. Homewood [ 1956 ]( 1 ).

The current state of affairs is different, despite anything in any regulation of jurisprudence, all innovations created by an employee post-31stMay 1978 and falling within S. 39 ( 1 ) ( a ) or ( B ) is regarded as among the employee and the employer as belong on the footing that one of the undermentioned conditions is met:

( 1 ) Requirements under subdivision 39 ( 1 ) ( a ) Dad 1977 ( 2 ) : — – The innovation was created in the class of the normal responsibilities of the employeeORin the class of responsibilities falling outside employee’s normal responsibilities nevertheless ; the innovation was peculiarly delegated to the employee. Furthermore, in any instance the innovation is moderately expected to hold resulted from the public presentation of the employee’s responsibilities as identified inReiss Engineering Co Ltd V Harris [ 1985 ]( 3 ).OR

( 2 ) Requirement under S. 39 ( 1 ) ( B ) : — – The innovation was created in the class of employee’s responsibilities moreover the clip of the creative activity, the nature of the employee’s responsibilities and the specialness of his duty on the nature of his responsibilities, he is deemed as owing a particular duty to progress the involvement of the employer’s project.

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Under S.39 ( 1 ) ( B ) the instance ofHarris’ Patent [ 1985 ]( 4 )represent that the corresponding regulation at common jurisprudence was that an innovation belonged to the employer if it would be inconsistent with good religion on the portion of the employee that he should keep it against his employer. This regulation still applies today as a agency of S.39 ( 1 ) ( B ) .

Any other innovation non falling with subdivision 39 ( 1 ) ( a ) or ( B ) is to be regarded as belonging to the employee under subdivision 39 ( 2 ) .


Since the patent was invented station 31stMay 1978, Patents Act 1977 is applicable to this state of affairs. Whether Ben is entitled to the ownership of the patent is dependent on whether s.39 ( 1 ) ( a ) OR ( 1 ) ( B ) is applicable. Case of Reiss Engineering Co Ltd have identified that it is non sufficient for a term in the contract to render ownership to the employer. Therefore, the term in the contract may non hold any sufficient application to do in this instance. However, subdivision 39 must be examined in the visible radiation of Ben’s contract of employment. Harmonizing to the fact, Ben is appointed as a coder for the production of computing machine plans, therefore it is likely to be argued under S.39 ( 1 ) ( a ) that the innovation was created in the class of Ben’s normal responsibilities as an employee of Odyssey.

Furthermore, Odyssey may dispute under S.39 ( 1 ) ( B ) that Ben, as an employee of Odyssey owes a particular duty to progress the involvement of his employer. Both challenges are likely to win every bit long as the innovations fall within the class of employment. Nevertheless, Ben may reason that the innovation was non in the class of his employment. Alternatively, he may reason that it was non his creative activity ; he merely assisted Bill with the creative activity. Since, under employment jurisprudence Bill is non classed as an employee but an independent adviser.

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Additionally, if Ben’s contract of employment no longer exist so this may help Ben in reasoning that the employer was merely entitled to innovations created under that employment “…..during the subsistence ofthiscontract of employment…”

With respects to Bill’s entitlement to the ownership of the patent, it is likely that S.39 would non function any usage to Odyssey on the footing that Bill is an independent worker instead than an employee. However, Odyssey may stand for that Bill is an employee of Odyssey in order to utilize S.39 ( 1 ) . If Bill is established to be an employee, same rules apply as applied to Ben. Conversely, if Bill is non an employee of Odyssey, he is likely to hold ownership of the patent.

If Bill has a right of ownership to the patent but Ben does so Odyssey will hold co-ownership in equal portions with Bill as under subdivision 36 of the PA 1977. The fact does non propose whether application for patent is granted or non, in the event that it is non granted Odyssey may do an application under S.8 that it has a right to be granted the patent. If it is granted the application is made under S.9 of the 1977 Act. Subject to the statutory innovation, no contractual innovation can decrease the employee’s right in an innovation under subdivision 42 ( 1 ) and ( 2 ) .


In the event that Odyssey has a full ownership of the patent Ben and Bill would be entitles to claim compensation under subdivision 40 of the PA1977, which entitles the employee to compensation where the patent belong to the employer. The sum of compensation is determinable by subdivision 41 of the Act. Under S.41, the employee is entitled to a just portion holding respects to the fortunes. Furthermore, the employee is entitles to any benefit derived or is likely to be derived from assignment, tryst or grant ( S.41 ( 2 ) ) . Section 39-42 is merely applicable if the employee was chiefly employed in the UK or if the topographic point of employment is non determinable that the employer concern was based in the UK ( S.43 ( 2 ) )

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Furthermore, harmonizing to developed caselaw and under S.39 does non let an employee to retain a good involvement in his innovation as identified inGallic v. Mason [ 1999 ]( 5 ). Since there is no right to good involvement, Odyssey would hold no trouble in subsequent licenses of the patent expect from the fact that it would hold to do a just payment to the discoverer.

1[ 1956 ] 2 All ER 897 ; [ 1956 ] 1 WLR 1190 ; see besides Sterling Engineering Co Ltd v. Patchett [ 1955 ] AC 534, [ 155 ] 1 All ER 369 HL

2Patents and Registered Designs Vol 35 ( Reissue ) para 394

3 [ 1985 ] IRLR 232 EAT

4[ 1985 ] RPC 19

5[ 1999 ] FRS 597.



Torremans’ P Intellectual Property Law 4ThursdayEdt 2003 OUP

Davis, J Intellectual Property Law 2neodymiumEdt 2003 OUP

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