Patent Ownership on the World Stage

Prospective patentees of inventions that involve academic inventors would do well to revisit their employment contracts, collaborative agreements and internal procedures in view of the September 3, 2009 decision of the Full Court of the Federal Court of Australia in University of Western Australia v. Gray1.

In this case, the Full Court considered whether the employer, the University of Western Australia (UWA), was entitled to own an invention of one of its employees, Dr. Bruce Gray. Under the terms of his appointment, Dr. Gray was required "to undertake research and to organize and generally stimulate research among the staff and students." A previous lower court decision considered the disputed ownership of a number of inventions relating to targeted treatments for cancer which were alleged to have been made by Dr. Gray during his term of employment with UWA2. On appeal, only one of these inventions was at issue.

The University argued that the provisions of its Patent Regulations, as set out in the University of Western Australia Act, formed part of the terms and conditions of Dr. Gray's contract. The Regulations required inventors of inventions made or developed using the University's facilities to immediately inform the Vice-Chancellor, allowing the University an opportunity to exercise its right of ownership. On appeal, the University also submitted that Dr. Gray's contractual "duty to research" carried an implied "duty to invent" in the context of its institutional objections, and that Dr. Gray was therefore in breach of his contract.

While the Full Court accepted the argument that the University of Western Australia Act was applicable to the employment contract, the Full Court noted that the Act's Patent Regulations specified a requirement for the University's Vice-Chancellor to refer any patent-related matter to an internal Patents Committee which would advise whether UWA's rights in an invention should be exercised. The inventor would be informed accordingly. The Full Court upheld the primary judge's finding that UWA had failed to maintain its Patent Committee, which constituted an essential element of the mechanism required for Dr. Gray to maintain his contractual obligation. This failure, in effect, excused Dr. Gray from that obligation.

The Full Court also affirmed the primary judge's decision that the wording of Dr. Gray's contract, which set out a "duty to conduct and stimulate research", did not imply a "duty to produce...