On 17 April 2008, Justice French of the Federal Court of Australia handed down a decision that will potentially have significant implications for organisations with staff that create intellectual property that their employer wishes to claim as its own.
University of Western Australia (UWA) v Gray (No 20) [2008] FCA 498 was an action between UWA and previous employee, Dr Bruce Gray. There were additional parties to the case and further causes of action which are not discussed in this article due to the case's complexity.
Dr Gray had participated in the research and development of technologies for the delivery of treatments for cancer while working as an academic at UWA. After a long and difficult relationship with UWA, Dr Gray left to form the biotechnology company Sirtex. UWA commenced legal proceedings against Dr Gray alleging that applications for patents were for inventions made while Dr Gray was an employee of the UWA, and were the property of UWA.
The critical issue for the judge was Dr Gray's obligations as an employee of UWA. The Court decided that Dr Gray's employment gave rise to a duty to research, not a duty to invent. This meant that Dr Gray had no express or implied duty to produce inventions in the course of his employment. Accordingly, even inventions made in the course of employment remained the property of Dr Gray.
Importantly, Dr Gray's contract of employment with the UWA did not contain any express provisions governing the ownership of intellectual property created in the course of Dr Gray's research. University Regulations did purport to vest ownership of intellectual property in UWA, but these were not effective. Consequently, the judge held that the UWA did not have any interest in the inventions developed by Dr Gray in the course of his employment.
The UWA is currently considering whether it will appeal.
Although the case involved a university and an academic, the messages in the decision should be heeded by research institutions, companies and other entities which seek to develop and capitalise on intellectual property.
The decision is a timely reminder to all organisations to review their employment contracts and arrangements in relation to the ownership and management of intellectual property. It identifies the importance of clear agreements between organisations and their staff which expressly stipulate ownership rights for intellectual property created in the course of employment.
Where applicable, staff agreements should also deal with the publishing of research findings by an employee. An employee's rights to publish may infer that ownership resides with the employee. In addition, publication of research may constitute prior disclosure, potentially jeopardising any future attempt to protect the intellectual property.
The waters may be further muddied where research commences prior to employment of a researcher by a university, where other entities contribute to or collaborate in the research or where researchers cease employment with a university or other employer to form their own "spin off" company.
Should you have any concerns regarding the implications of this decision, please contact Sandy Donaldson, Partner specialising in Intellectual Property. For a more detailed commentary on this case and the issues it raises, please click on the link below to read the full article "Who Owns the IP You Use?".
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
