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IP Cases & Commentary – Details

15 July 2010

First Ownership of IP Rights Under UK Law

This article is written for the non-expert in UK law on Intellectual Property (IP), so incorporates several simplifications which hide some of the complexities.

The statute provisions governing ownership of IP rights in the United Kingdom are found in a number of separate statutes. While there are common threads, the laws on each form of IP are independent, and so there is the potential for confusion and complication, especially when multiple forms of IP are created in the same creative process. For example, in the course of designing a product, copyright, design and patent rights may be created, and multiple rights may cover exactly the same design aspect.

The UK laws are relevant for IP created by UK residents, since UK law will generally govern ownership of these rights worldwide. In the case of an ownership dispute, even in a foreign court, UK law would be applied.

The forms of IP considered in this article are:

  • copyright in literary works (e.g. software, manuals);
  • copyright in artistic works (e.g. technical drawings, design sketches);
  • registered designs (e.g. objects of novel shape, GUIs, representations);
  • unregistered design right (as for registered designs);
  • patents (i.e. protection for inventions);
  • trade marks (e.g. brands, logos).

The basic statute provisions are as follows (the statute language has been simplified for the sake of clarity and hyperlinks are provided to allow you to look at the full statute provision, should you be interested).

Copyright

Copyright, Designs and Patents Act 1988: http://www.ipo.gov.uk/cdpact1988.pdf
Section 11 - First ownership of copyright [paraphrased]

The author of a literary work (e.g. software, manuals) or artistic work (e.g. technical drawings) is generally the first owner of any copyright in it, but if the work was made by an employee in the course of his employment, his employer is the first owner subject to any agreement to the contrary.

Registered and Unregistered Design Rights

Copyright, Designs and Patents Act 1988: http://www.ipo.gov.uk/cdpact1988.pdf
Section 215 - Ownership of design right

  1. The designer is the first owner of any design right in a design which is not created in pursuance of a commission or in the course of employment.
  2. Where a design is created in pursuance of a commission, the person commissioning the design is the first owner of any design right in it.
  3. Where, in a case not falling within subsection (2) a design is created by an employee in the course of his employment, his employer is the first owner of any design right in the design.

However, for EU designs subsection (2) may be ineffective for both registered or unregistered rights. The commissioning provisions of UK law arguably do not apply, since the relevant regulation (EC6/2002) on Community Designs is silent on commissioned work and in Article 14 only reproduces the provisions of UK law whereby the first owner is generally the designer, but is the employer in the case that a design is developed by an employee.

Registered Designs Act 1949: http://www.ipo.gov.uk/regdesignactchanges.pdf
Section 2 - Proprietorship of designs [substantively the same as for design right although using different terms]

Patent Rights

Patents Act 1977 http://www.ipo.gov.uk/patentsact1977.pdf
Section 7(2) - Right to apply for and obtain a patent [paraphrased]

A patent for an invention is owned by the inventor or inventors; or by any person who is entitled to the inventors' rights by virtue of employment, contract or otherwise.

Patents Act 1977 http://www.ipo.gov.uk/patentsact1977.pdf
Section 39(1)(a) - Right to employees’ inventions [paraphrased]

An invention made by an employee belongs to his employer if it was made in the course of the normal duties of the employee.

Trade Mark Rights

There are no specific statutory provisions governing first ownership of trade marks in the UK, but the first owner will generally be the company that first uses the mark, subject to the mark not already being already registered by another. Copyright ownership will be relevant in those cases where the mark originates from a copyright work, such as a novel logo.

Points to Note and Potential Pitfalls

  1. It is not safe to rely on the commissioned work provisions in the UK statutes on registered and unregistered designs. Appropriate contracts should be in place. First, the commissioning provisions in the UK designs statutes are not mirrored in the EU regulation, so arguably cannot be relied upon to secure ownership of the EU rights. Second, there is no commissioning provision in the copyright or patent statute provisions, so copyright (e.g. in an artistic work) or invention rights associated with the design may be left with the designer or his employer even when the design rights pass to the commissioner under statute.
  2. If a trade mark is to be created by an outside design house, then an appropriate contract or assignment will be needed to transfer copyright in the case that the new trade mark is a copyright work created by the design house.
  3. Software is often subject to twin protection through copyright and patents. Care should be taken to ensure that ownership of these two IP rights is handled consistently, so that for example the applicant for a patent also has taken assignment of the copyright. Moreover, applications software is commonly "sold" using a shrink-wrap license, which may effectively include a licence to the patent as well.
  4. Clauses in UK employee contracts often appear that purport to regulate the ownership of IP created by the employee but are ineffective to the extent that they conflict with UK statute. In particular, the various UK statute provisions on patent rights, design rights and copyright, restrict the employer to ownership of IP rights that are created by the employee in the course of his duties: any blanket provision in an employment contract specifying that all IP rights created by an employee will be owned by the employer is ineffective.

 

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