Recently, the writer has dealt with an ownership dispute related to a patent. A resigned from the original employer, established a new company dealing with the similar business as the original employer, and took the role as the legal representative of this new company. Although he had never participated in R&D, when the new company applied for patent, he named himself as the inventor. Unexpectedly, the original employer claimed for the patent right in terms of service invention.
Whether the original employer’s claim could be affirmed by the court, it depends. However, the right of authorship of the inventor is an important issue for service invention.
In practice, many companies fail to pay attention to such issue. In order to pay less remuneration to inventors for service invention, or eliminate the possibility of the ownership dispute related to service invention, these companies are likely to name the legal representative or manager as the inventor when applying for a patent, although he/she has never been engaged in R&D. However, this practice includes many legal risks.
The most typical risk is the dispute related to the right of authorship of the inventor or designer. Article 17 of ‘’Patent Law” states that an inventor or designer has the right to expressly indicate in the patent documents that he is the inventor or designer. Article 13 of “Rules for the Implementation of the Patent Law” explicitly states that “inventor” or “creator” means any person who makes creative contributions to the substantive features of an invention-creation. In case that the legal representative or manager has not been engaged in R&D, it is difficult to prove that he/she has made creative contributions to the substantive features of an invention-creation. Therefore, the court will affirm the claims of the real inventor, and the claims for the remuneration to inventor for service invention may be appealed to the employer later on.
Another potential risk is the harmful effect on the stability of the ownership of the patent. For example, as the case described above, other unit may claim for the ownership of the patent by stating that the inventor is its former employee. In fact, it is not rare that many employees resigned from the original employers, established their own companies and took the role of the legal representative or manager. It has a high possibility for the dispute of the ownership of the patent, especially when the employee has been engaged in R&D in the original work, dealt with none R&D in the new company, but named himself/herself as the inventor for the patent applied by the new company.
In addition, the right of authorship of the inventor may bring a significant impact to the patent infringement dispute. For example, in a patent infringement dispute, if the defendant is the R&D employee who has not been stated as the inventor, the defendant can claim for the right of authorship of the inventor, and the remuneration to inventor for service invention, which will mess the original employer’s lawsuit strategy and path up. Especially, when the defendant has made an agreement with the original employer on the ownership and/or use of the invention, and the agreement is in favor of the defendant, the defendant may counterclaim for the misusage of the patent.
In fact, except the above mentioned legal risks, in order to develop faster and faster, a company has to innovate consistently. The key point for the consistent innovation is to motivate the R&D employees, so the principle says as “Inventor invents invention” shall be the basic rule for the R&D system of each company.