e-ISSN 2231-8542
ISSN 1511-3701

Home / Regular Issue / JTAS Vol. 22 (S) Jan. 2014 / JSSH-0967-2013


The Default Rules Relating To Joint Ownership of Patents - Pitfalls for the Unwary

Lim Heng Gee

Pertanika Journal of Tropical Agricultural Science, Volume 22, Issue S, January 2014

Keywords: Patents, joint-ownership, co-owners, default rules, assignment, sharing of profits, license, suits against infringers

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The issue of joint ownership of patents is vital in relation to university entrepreneurship and startups. Since the invention, which is the subject of commercial exploitation is likely to result from a collaborative effort or joint venture with a third party, there is likelihood that any patents issued from such collaborative efforts will be jointly owned. The parties involved in such ventures may logically believe that joint ownership means that the parties will jointly control the patents and share the profits from the joint venture corresponding to contributions - or at least equally. However, in the absence of any agreement relating to the above matter, the default rules as laid down in statutes and the case law will apply. The default rules relating to the rights of joint owners of patents vary from country to country, but it has long been recognised by the courts that "joint owners are at the mercy of each other". In an ideal world, co-owners would have arrived at an amicable agreement regarding their respective rights, interests and duties in their joint patent even before the patent is granted or obtained. However, this is not so in the real world; it is not inconceivable that parties involved in applying jointly for patents would initially be more concerned with matters directly related to the grant of the patent. They may not be aware of or appreciate the features and incidents connected with joint ownership under the default rules and, therefore, would initially not realise the importance of the need to make contractual provisions regulating the rights and relationship between themselves. This paper illustrates the default rules relating to the rights of joint owners of patents in Malaysia, the United Kingdom and the United States. Where relevant, the default positions in other countries will also be referred to. This paper aims to show that the default rules may give rise to disastrous consequences, and concludes by stressing the importance of a carefully thought-out ownership agreement, in order to avoid the various pitfalls arising from the statutory default rules.

ISSN 1511-3701

e-ISSN 2231-8542

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