My Invention or Our Invention? - Intellectual Property High Court of South Korea Deliberates on the Joint Application Rule
According to Article 44 the Korean Patent Act, where the right to obtain a patent is jointly owned, the owners must apply for the patent jointly (referred to in this article as the “joint application rule”). One co-owner filing an independent application in violation of this rule constitutes a ground for invalidating the patent under Article 133(1)(2).
The Intellectual Property High Court of South Korea recently applied this provision to invalidate a granted patent, in a dispute arising from a contractual research arrangement. This article addresses this thought-provoking result.
Facts
The case involved outsourced research: a university (“the University”) and a corporation (“the Corporation”) had entered into a research service contract according to which the Corporation was to conduct experiments using its own microorganisms and samples but with funding from the University, and submit a final research report at the end of the contract period. Importantly, the parties expressly agreed in the contract that any patent applications based on the results of the research would be made jointly by both parties.
However, after the final research report was submitted and the research service contract had ended, the Corporation went ahead and independently filed a patent application based on the subject matter of the research. The patent was granted, and the University objected, asserting before the Intellectual Property Trial and Appeal Board (IPTAB) that, due to the contract, they at least co-owned the right to obtain a patent for the invention. The IPTAB agreed, and invalidated the patent as violating the joint application rule of Article 44. The Corporation appealed to the Intellectual Property High Court.
Faced with the unambiguous language of the contract, the Corporation’s assertion was that the invention in their application was in fact a new, independent invention, and was thus outside the ambit of the contract and the joint application rule. The gist of their assertion was as follows:
Decision
The court disagreed with the Corporation and upheld the IPTAB’s judgment, holding that the invention was in fact completed during the contract period, and the invention was identical to the result of the contract. Thus, the invention fell within the scope of the contract, and the right to obtain a patent for the invention was jointly owned. The Corporation’s independent application thus violated the joint application rule, and the patent was invalidated.
Commentary
When is the invention a new invention?
Due to the cumulative and often collaborative nature of modern scientific research, the question of when an invention that builds on previous collaborative research is new and independently patentable, and when it is not, is an important one in the research field. A key takeaway from the present case is thus how the court addressed this question. In finding that the Corporation’s invention was the same as the result of the research, the court based its opinion on the following factual and legal grounds:
The court found that the Corporation’s alleged new effect was in fact already detailed in the final research report, and the result of the research service contract can be said to be a completed invention.
The Corporation’s alleged addition and the effect thereof were not explicitly recited in the claims or the specification.
The court found that the Corporation’s addition was an obvious step that would normally be adopted by a person skilled in the art, and it thus cannot be regarded that the addition resulted in a separate invention different from the result of the research.
Thus, for the invention to be a new invention, beyond the obvious requirements that the new features and effects must actually be demonstrated and must be adequately claimed, they must also involve an inventive step. Rather than a novelty standard of sameness or substantial sameness, the court here applied the inventiveness standard of obviousness; a more onerous standard for parties in the Corporation’s position. While the court quickly disposed of this question in the present case, the inventiveness inquiry can be expected to be the key area of contention in less clear-cut cases. For example, even in a case where a later novel addition involving substantial independent efforts is clearly made, the court may still find that the invention is not new and independent if it lacks an inventive step.
Questions of strategy
While the University in this case was seeking the invalidation of the patent, it should be noted that this is not the only remedy for a violation of Article 44. Under Article 99-2 of the Korean Patent Act, a party co-owning the right to obtain a patent can also request the court to transfer their share in the granted patent. As such, rather than taking the destructive step of invalidating the patent entirely, a party in the University’s position could instead take the more constructive step of claiming their share in the patent. Furthermore, invalidation actions here can only be brought by a party claiming to be a joint owner, thus affording the parties the leeway to resolve their dispute between themselves without the possibility of a third-party invalidation action. The University in this case opted, so to speak, for the ‘nuclear option,’ when a more cooperative approach could have kept the patent alive and allowed both parties to share in its benefits.
Finally, this case highlights the importance of the contract. It was the research contract itself that created the joint right to obtain the patent and brought this dispute into the ambit of Article 44. Parties to research contracts should thus be keenly aware of terms dealing with future patent application rights, and carefully draft them in such a way as to anticipate future disputes.
Written by Ben YUU and Simon VOGET
Endnotes