Universities must clarify ownership of inventions in staff contracts
Where an academic staff member at a university has a eureka moment and produces a fascinating and helpful invention, who holds the rights to that invention – the staff member or the university?
Contrary to my post below regarding copyright, an employee-employer relationship does not result in a presumption that the employer holds rights to the invention. The applicable rules in Canada were summarized in Techform Products v. Wolda:
- the federal statute on patents says that an inventor is the first owner of their inventions, but it says nothing about what happens when the inventor is an employee being paid to do research related to those inventions;
- the mere existence of an employment relationship does not disqualify employees from patenting inventions made during the course of their employment, even where (1) the invention relates to an aspect of the employer’s business, (2) the employee used the employer’s time and materials to bring his or her invention to completion, and (3) the employee has allowed the employer to use the invention while he or she was employed;
- the two exceptions to the presumption favouring employees are (1) a contract that says the opposite, and (2) where the inventor was employed for the purpose of inventing; and
- to define the true nature of an employee-employer relationship, the court will usually look at a series of factors, including whether the employee at the time of hiring had previously made inventions, whether the employer had incentive plans encouraging product development, whether the conduct of the employee once the invention was created suggested ownership was held by the employer, and so on.
A recent decision in Australia, which has rules on this issue that are similar to those in Canada, shows how these principles are applied in the university context. In University of Western Australia v. Gray, the university claimed that it owned the inventions of the head of the Department of Surgery, Gray, who disagreed. Gray had never explicitly assigned the rights to his inventions. The university maintained that Gray had implicitly assigned his rights by virtue of the nature of his position. The Federal Court of Australia sided with Gray and found he had no “duty to invent”.
The key for universities to avoid this mess: have each staff member explicitly assign his or her rights as inventors. Put it in writing.
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