Inventive concept is at the heart of entitlement

• Published date: 08 June 2022
• Subject Matter: Intellectual Property, Patent
• Law Firm: Spruson & Ferguson
• Author: Dr. David Hvasanov, Mike Zammit and Duncan Longstaff

Introduction

Following on from our previous article where we looked at the options to contest entitlement at the Australian Patent Office under the Patents Act 1990 (under section 36 and section 59). In this article we turn our attention to an entitlement dispute heard before the Federal Court, namely Vector Corrosion Technologies Limited v E-Chem Technologies Ltd [2022] FCA 188.

This recent Federal Court decision highlights the complexity of entitlement challenges in matters with substantial disputes regarding the relevant facts. Such cases are generally more amenable to being contested in the Federal Court than through an application to the Patent Office, particularly given the Court's processes such as discovery of documents, joint expert evidence and cross-examination of witnesses.

Further, the entitlement challenge was made after the patent was granted, and therefore an Australian Patent Office entitlement challenge would not be available.

Background

The patent in dispute is Australian patent No. 2006224340 B2 titled "Treatment process for concrete" (the E-Chem patent), and relates to products and systems for the electrochemical protection of steel and/or prevention of corrosion in reinforced concrete structures.

The E-Chem patentwas granted on 18 November 2010 and its priority claims are dated March and October 2005, and January 2006. E-Chem Technologies Limited is the registered patentee of the E-Chem patent, which names Dr Davison, Mr Roberts and Dr Glass as inventors (the inventors). Prior to the filing of the E-Chem patent, in the period between 2002 and 2004, the inventors were employees of Fosroc. Dr Davison and Mr Roberts ceased to be employees of Fosroc on 14 July 2004 and 13 May 2004, respectively. Dr Glass (the "principal inventor") ceased to be an employee of Fosroc on 8 March 2004, and established E-Chem in March 2004.

Vector Corrosion Technologies Limited (Vector) claimed that it is solely or jointly entitled to the E-Chem patent as a result of its purchase of a corrosion business from Fosroc International Limited and its related companies (Fosroc) in January 2009 pursuant to contracts including a deed of assignment and a sale and purchase agreement.

According to Vector, the inventive concept the subject of the E-Chem patent was conceived of by the inventors while they were employed by Fosroc, and (because the invention had been created in the UK) by operation of section 39 of the Patents Act 1977 (UK) the invention would belong to Fosroc. Further, Vector asserted that it purchased from Fosroc the rights in the invention claimed in the E-Chem patent under the relevant contracts.

Accordingly, Vector sought a declaration to that effect that it is the "eligible person" to whom a patent for the E-Chem invention may be granted, and that the Patents Register be rectified under section 192(2) of the Australian Patents Act 1990 (Cth) to record Vector as either the registered sole or joint owner of the E-Chem patent.

According to E-Chem, the inventors conceived of the inventive concept the subject of the E-Chem patent after they had ceased to be employed by Fosroc and while they were working for their new company, E-Chem. It would follow from this that Fosroc had no rights in respect of the invention and Vector could not purchase any such rights from Fosroc, as E-Chem always had those rights.

The principles relating to entitlement to a patent under Australian law.

After reviewing the relevant statutes, Jagot J outlined (at [17]) the relevant principles relating to entitlement, including the...