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Consequences of indication in a patent of a person as a patent holder who is not such

May 29, 2020

We often come up against situations in our lives when someone wants to embezzle something that does not belong to him. Speaking of this, one should not be limited only by an ordinary shoplifting. So, for example, one assigns authorship of an art work. Someone’s glory is galling the other, and a man makes up stories about himself in which he allegedly performed a heroic act.

There are cases of misappropriation with the objects of a patent law. Such assignments include the indication in a patent of a person who is not a real patent owner. I will try to explain to you how this can happen on the simple example.

So, in a company engaged with production and sale of dairy products there is an accountant who has a talent in drawing.

Out of duty, in the evening, over a cup of tea, this employee draws a composition, which depicts the decoration of the dairy stores’ facade.

The employee decides to show the results of his work to his manager and offered him to buy the rights to the design so that the company could later use it for decoration of its stores, which, in turn, would attract additional customers.

The manager tells that he would consider the employee’s proposal and, if he decides to use the design invented by the employee, he will certainly inform him and pay a fee.

The design, invented by the employee, really turns out to be unusual and interesting, the company begins to decorate the stores in one style using the above design, but the employee doesn’t receive any compensation for this. Having mentioned about the promised payment to the manager, he is cursed and shown the door with the words that he is getting a salary and there is no question of any reward, and he will be fired if mentions about the reward once again.

At the same time, the employee also learned out that the employer, in order to protect himself from copying of the stores’ design by competitors, registered a patent for a design in the name of the company.

Thus, the employer actually appropriated the rights to the patent that does not belong to him. In order to understand this situation and find a way out, I propose to turn to the legislation.

In accordance with article 1347 of the Civil Code of the Russian Federation, the author of an invention, utility model or industrial design is the citizen by whose creative labour the relevant result of intellectual activity has been created. Unless otherwise proven, the person mentioned as the author in a patent application filed for an invention, utility model or industrial design shall be deemed the author of the invention, utility model or industrial design.

By virtue of paragraph 2 of Article 1345 of the Civil Code of the Russian Federation, the author of an invention, utility model or industrial design owns the following rights: 1) an exclusive right; 2) the right of attribution. In the cases envisaged by the present Code the author of an invention, utility model or industrial design also owns other rights, including a right to obtain a patent, a right to a fee for a service invention, utility model or industrial design (clause 3 of the same article).

According to paragraphs 1 and 2 of Article 1357 of the Civil Code, the right to obtain a patent for an invention, utility model or industrial design initially is owned by the author of the invention, utility model or industrial design. The right to obtain a patent for an invention, utility model or industrial design may pass to another person (successor) or may be assigned thereto in the cases and on the grounds established by law, including in line of universal succession or under a contract including a labour contract.

Clause 1 of Article 1374 of the Civil Code of the Russian Federation states that a patent application for an invention, utility model or industrial design shall be filed with the federal executive power body charged with intellectual property matters by a person entitled to obtain a patent according to the present Code (applicant).

Thus, the right to obtain a patent for an industrial design originally belongs to its author. The indicated right can be transferred to another person only on the grounds established by Article 1357 of the Civil Code of the Russian Federation, including the conclusion between the author and such a person a labor contract or an alienation agreement to obtain a patent for an industrial design.

As we can see, an alienation agreement to obtain a patent between the employee and the employer was not concluded. However, a labor contract was concluded between them. Perhaps the employer, receiving a patent in his name, considered that that was enough?

According to paragraph 1 of Article 1370 of the Civil Code of the Russian Federation, an invention, utility model or industrial design created by an employee in the course of his duties or a specific assignment of the employer shall be deemed a service invention, utility model or industrial design, the right of attribution in respect of which is owned by the employee (author), the exclusive right to them and the right of obtaining a patent are owned by the employer, except as otherwise envisaged by a labor contract or civil law contract between the employee and the employer.

 In this case, if an employee creates a service invention, a service utility model or an industrial design, an agreement is not required between him and the employer to alienate the right to a patent. This right arises from the employer on the basis of the law by virtue of the creation by the employee of the corresponding result of intellectual activity during his labor duties or a specific task of the employer.

The existence of such duties or tasks is possible only within the framework of an employment relationship.

Clause 129 of the resolution of the Plenum of the Supreme Court of the Russian Federation dated 23.04.2019 No. 10 “On the application of part four of the Civil Code of the Russian Federation” contains an explanation according to which the recognition of a technical solution as official does not require that the document, defining the employee’s labor duties (employment contract, job description), there was a specific indication of the performance of work to create specific patentable objects or to improve known technical solutions.

The fact that it is created within the framework of labor duties, the content of which can follow from the labor function or can be expressed in the form of a specific task, is crucial for the recognition of a technical solution as official.

In particular, acts of the employer containing instructions given to the employee, the activities carried out by the employer, with the sphere in which the patentable object is created, the limits of the employee's labor duties, the place of work, the source of equipment and tools  used for their creation, the possibility for the employer to control the work in the framework of which the patentable object is created, the purpose of creating the patentable object, subsequent behavior of the employee and the employer, documents drawn up by them in the course of the employee’s labor activity, which together could indicate the development of technical solutions in connection with the performance of labor duties, other circumstances as a whole.

If there is a dispute between the employee and the employer about whether a particular invention, utility model or industrial design is an official one (clause 1 of Article 1370 of the Civil Code of the Russian Federation), it should be considered that the content of the employee’s labor duties, the presence or absence of a specific task from the employer and the fact of an invention, utility model or industrial design creation in connection with the performance of these duties or tasks are proved by the employer.

A similar legal position was reflected in the ruling of the Presidium of the Intellectual Property Rights Court dated 01.11.2019 in case No. SIP-598/2018.

As mentioned above, a labor contract was concluded between the employee and the employer, according to which the employee was hired as an accountant. It is obvious that the accountant’s labor duties are unlikely include design of the stores’ appearance or other creative activities for promoting the company among consumers. There was no task to create a design either.

Thus, based on the above legal norms, the employer did not have the right to receive a patent in the described situation. Then what should the employee do in this situation?

In accordance with subparagraph 5 of paragraph 1 of Article 1398 of the Civil Code of the Russian Federation, a patent for an invention, utility model or industrial design may be declared invalid in full or in part if the patent has been issued with an indication therein as the author or patent holder of a person not being such in accordance with this Code or without an indication in the patent as the author or patent holder of the person being such in accordance with this Code.

According to clause 122 of Resolution No. 10, disputes regarding the establishment of a patent holder (recognition of the patent holder right), that is, disputes about who owns the exclusive right to invention, utility model or industrial design (subparagraph 2 of paragraph 1 of Article 1406 of the Civil Code of the Russian Federation), are examined in the lawsuit proceedings on the claim of a person who considers himself an appropriate patent holder to the person indicated in the patent as the patent holder by contesting the granted patent on the basis of subparagraph 5 of paragraph 1 of Article 1398 of the Civil Code of the Russian Federation.

In case a patent for an invention, utility model, and industrial design is established partially invalid, the federal executive body for intellectual property grants a new patent. That is, the obligation of Rospatent to grant a new patent is established by law, and this patent should include information about the author and the patent holder determined by the court, the court only indicates the person in whose name a new patent should be issued as an author and patent holder.   

In the event a court recognizes a patent for an invention, utility model or industrial design, a new patent is partially granted by the federal executive authority for intellectual property. That is, the obligation of Rospatent to grant a new patent is established by law, indicating in it the author and patent holder of a person determined by the court, the court only indicates the person in whose name a new patent is to be issued as the author and the patent holder.

Thus, if the court concludes that a person indicated as a patent holder is not such, then the patent  will be the recognized invalid in this part and a new patent will be issued by the Rospatent with indication of the appropriate patent holder.

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Author of article

Roman Larshin

Roman Larshin

Lawyer