Navigating Patent Entitlement and Ownership in Australia.

BY: HEDIE MEKA PhD

The Australian Patents Act 1990 (‘the Act’) uses the terms “applicant”, “nominated person”, “eligible person”, “entitlement”, and “patentee” in broad reference throughout the Act to refer to patent ownership or rights that flow therefrom. This overlap in language can be confusing and this article briefly sets out the intertwined concepts of inventorship, ownership, and entitlement under the Act.

Entitlement to the grant of a patent is set out under section 15 of the Act, which states that a patent may only be granted to:

(i) an inventor; or
(ii) a person who would, on the grant of a patent, be entitled to have the patent assigned to them; or
(iii) derives titled from (i) or (ii); or
(iv) a legal representative of a deceased person mentioned in (i), (ii), or (iii).

Put simply, a patent may be granted to the inventor of an invention or a party who derives title to the invention from the inventor.

An eligible person, in relation to an invention, means a person to whom a patent for the invention may be granted under section 15.

The patent request that accompanies the patent application sets out the person/s nominated for the grant of the patent. Nominated person is defined in the Act as the person identified in a patent request as the person to whom the patent is to be granted. That is, the nominated person is the person claiming entitlement to the patent. The applicant as set out in the patent request is taken to be the nominated person for the grant of the patent.

Before acceptance of a patent, the nominated person must file a Notice of Entitlement asserting their entitlement to the grant of the patent pursuant to (i) to (iv) under section 15 (above).

Since section 15 prescribes who may be granted a patent, at acceptance, the applicant (who then becomes the patentee) must be a person eligible to be granted a patent, and who is entitled or can claim entitlement to the patent. Despite the prescriptive wording of section 15, the Act explicitly states under section 22A that a patent is not invalid merely because it was granted to a person who is not entitled to it or not granted to a person who is entitled to it.

Since the ownership rights to a patent flow from an inventor, determining inventorship is the crux of entitlement. Australian authorities have formulated an extensive framework for consideration of the contribution to inventorship. Two cases are pivotal to the law on inventorship/entitlement: University of Western Australia v Gray University of Western Australia v Gray (No 20) [2008] FCA 498 (“UWA”; issue undisturbed on appeal), and Polwood Pty Ltd v Foxworth Pty Ltd [2008] FCAFC 9 (“Polwood”).

Justice French in UWA applied the following steps for determining entitlement:

  1. identify the “inventive concept” of the invention as defined by the claims;
  2. determine inventorship including the person responsible for the inventive concept and the time of conception as distinct from its verification and reduction into practice; and
  3. determine how any contractual or fiduciary relationships give rise to proprietary rights in the invention.

French J also drew upon foreign authorities in this determination, and in particular propositions set out in the US Court of Appeals in Burroughs Wellcome Co v Barr Laboratories Inc [1994] USCAFED 1225; (1994) 40 F 3d 1223 (Burroughs Wellcome) which are reproduced below:

  1. Conception is the touchstone of inventorship, the completion of the mental part of inventions.
  2. Conception is the “formation in the mind of the inventor of a definite and permanent idea of the complete and operative invention as it is hereafter to be applied in practice”. It is complete only when the idea is so clearly defined in the inventor’s mind that only ordinary skill would be necessary to reduce the invention to practice without extensive research or experimentation.
  3. An inventor need not know that the invention will work for conception to be complete. The inventor need only show that he or she had the idea. The discovery that an invention actually works is part of its reduction to practice.
  4. It is not the law that the inventor’s definite and permanent idea must include a reasonable expectation that the invention will work for its intended purpose even when it deals with uncertain or experimental disciplines where the inventor cannot reasonably believe that an idea will be operable until some result supports that conclusion.

Under both Burroughs Wellcome and Australian law, “invention” is defined “by reference to completion in concept which distinguishes the invention from its verification and reduction to practice.”

Polwood fleshes out the consideration for determining inventorship:

“The entitlement to the grant of a patent as the inventor is not determined by quantitative contribution. The role of joint inventors does not have to be equal; it is qualitative rather than quantitative. It may involve joint contribution or independent contributions. The issue is whether the contribution was to the invention. What constitutes the invention can be determined from the particular patent specification which includes the claims. In some cases, evidence can assist. In some cases, the reduction of a concept to a working apparatus by a person may not be part of the invention, in other cases it may be. For example, the construction of an apparatus may involve no more than carrying out the instructions in the specification. This would not normally entitle that person to joint inventorship. On the other hand, joint inventorship may arise where the invention is in the apparatus itself, or where the person constructing the apparatus contributed to a different or better working of it which is then described and claimed.

One criterion for inventorship may be to determine whether the person’s contribution had a material effect on the final invention. It may be that an invention is made as part of a collaborative effort. In those circumstances, it would ordinarily follow that the collaborators are joint inventors of the product of the collaboration. ….

To ascertain the inventor for the purposes of entitlement to the grant of the patent it is therefore necessary to determine the contributions to the invention described in the patent application. The claims may assist in that determination, bearing in mind that the claims may be to less than the totality of the invention. It may also be appropriate to investigate the contributions to the inventive steps giving rise to the invention.”

The Full Court pointed out in Polwood that when considering inventorship, “what one is normally looking for is “the heart” of the invention. There may be more than one “heart” but each claim is not to be considered as a separate “heart” on its own.” Moreover, the reduction to practice of an inventive concept may or may not require an invention or inventive step. If not, reduction to practice does not demonstrate inventorship.

In disputes regarding entitlement to the grant of a patent, the Australian Patent Office applies the principles set out in UWA with the approach taken in Polwood.

In a nutshell, the law regarding inventorship in Australia is that a putative inventor or putative joint inventor must have made a material contribution to the invention. An aid to assessing whether a contribution is a material contribution to conception of the invention is the “but for” test as set out in JMVB Enterprises Pty Ltd v Camoflag Pty Ltd [2005] FCA 1474:

“Rights in an invention are determined by objectively assessing contributions to the invention, rather than an assessment of the inventiveness of respective contributions. If the final concept of the invention would not have come about without a particular person’s involvement, then that person has entitlement to the invention. One must have regard to the invention as a whole, as well as the component parts and the relationship between the participants…”.