Just sign the _____ form

sign here1A reader has asked IP Draughts the following question.


A university has entered into a research collaboration agreement with a commercial company, under which any inventions made in the course of the research are to be licensed to the company. Employees of the university – academic researchers – are engaged on the research and make an invention. The university asks the academics to execute a written assignment of the invention in favour of the university.

persuadeThe academics query the need to execute the assignment. Perhaps they are suspicious that they are being asked to give away their rights, or they are naturally loathe to commit themselves in writing. Perhaps they secretly know that someone else has rights in the invention. Or they just hate anything to do with the university’s administration. They point out that the university has a written IP policy which states when an invention belongs to the employer, and say that this should be sufficient.

Why, asks a reader of this blog, should the academics execute the assignment?

Several points occur to IP Draughts, not all of which are suitable for publication. We will leave aside the general argument that an employee should comply with all reasonable instructions from his employer. Even though this argument is strong in law, there is a strand of thinking among academics that rejects such a proposition, and a university’s senior management (eg its President or Vice Chancellor) may be slow to walk in that minefield. Instead, this article focuses on some pragmatic points.

  1. General duty of cooperation in relation to external contracts. The university has entered into the collaboration agreement at the request of the academics. This imposes some duties on the academics to cooperate with the university to ensure that the university can comply with its contractual obligations to the company. If an academic is not willing to give such cooperation, he shouldn’t ask the university to enter into contracts.
  2. Responsibility lies with the administration. The university’s administrators (eg its research contracts or technology transfer teams) are responsible for managing contractual obligations in relation to IP. The academics’ starting point should be to cooperate with, and comply with requests from, those administrators in relation to those obligations, unless they are manifestly wrong.  If the academics think that a request is inappropriate, the onus is on them to articulate why it is wrong and to persuade the administration to take a different line.Where a request is reasonable and conventional, any argument for refusing needs to be exceptionally strong.
  3. Invention is subject to external contractual obligations. The premiss of the question is that an invention has arisen under a research collaboration agreement with a company, and is subject to a licensing obligation to the company. If the academics think there is any doubt about this, they have a duty to articulate to the university what their concerns are. In the absence of any such explanation, the university is entitled to assume that the invention should belong to the university so that it can comply with its obligation to license the company.
  4. Company expectations. The company will expect to see a formal assignment from the inventors to the university, so that that university can grant a licence to the company. This is a normal part of the paper trail that a company would expect to see as part of its ‘due diligence’ into its rights to exploit the invention.
  5. Executing assignments is normal. It is normal for academics to execute assignments in favour of their employing university, particularly when patent applications are made or the university has obligations to a sponsor to license or assign the invention. The academic should be reassured that this is not an exceptional request; it is a conventional practice. Indeed, it may be necessary to enable the university to pursue patent applications in some countries.
  6. Legal reason for executing assignments. In the UK, the question of whether an employer or an employee owns an invention made by an employer is subject to the detailed and complex rules set out in section 39 of the Patents Act 1977. Oversimplifying, if the employee’s employment duties include the making of the invention, the invention will belong to the employer; otherwise it belongs to the employee. Nothing in an employment contract can override that statutory position, at least in relation to future inventions. Whether an academic employee has a duty to make inventions is unclear. Unlike many researchers in companies, researchers in universities rarely have contracts of employment that state explicitly that they are employed to invent. For this reason, IP Draughts would usually recommend to a university that it obtain a specific assignment of IP after an invention has been made, rather than rely on an argument that the IP belongs to the university as a matter of general law or under the employment contract. The latter argument may sometimes be valid, but the uncertainties mentioned above make a specific assignment highly desirable.
  7. Don’t rely on the IP policy. A university’s IP policy is generally useful to clarify the university’s approach, and to set expectations among its employees, but it should not be treated as an alternative to a formal assignment of IP as recommended above. There are several reasons for this, including: (a) it is not always clear whether the policy has been incorporated into an individual’s contract of employment or otherwise made legally binding; (b) the policy cannot override section 39 of the Patents Act 1977; and (c) the wording of the policy is sometimes inadequate from a legal perspective, particularly if its drafting has been the subject of negotiation with a union, or has not been supervised by a specialist IP lawyer, or the wording has been copied from another university’s IP policy that suffered from these problems. For example, many policies say that the university “claims” certain rights, the meaning of which is obscure from a legal perspective but is probably designed to be more conciliatory than a simple statement that the university owns those rights.
  8. No good reason to refuse. For the reasons mentioned above, an academic inventor should generally comply with a university’s request to execute an assignment. Assuming that the academic has acted in good faith, there should not be any personal risk on the academic from signing a simple document that transfers title to the invention to the employer. By executing such an assignment, the academic is not entering into a direct contract with the external company that could expose him to liability, and anyway his employer has a general duty to indemnify him against liabilities arising from the performance of his employment duties. This is subject to some exceptions, eg if he has acted fraudulently, but these cases are likely to be very rare. If the employee thinks there is a good reason to refuse, he should explain to his employer what the issue is. For example, if an academic is concerned that the invention may incorporate material owned by a third party, then he almost certainly has a duty to make this clear to the university so that the university can decide whether to disclose the issue to the company.

In summary, just sign the form!get on


Leave a comment

Filed under Intellectual Property

World IP Day: inheritance books

world ip dayRhoda Baxter is the nom de plume of a UK-based IP practitioner who also writes romantic fiction. Her first novel, published in 2012, was originally called Patently in Love. It was reviewed on IPKat here. In the words of the book’s Amazon blurb:

A job in a patent law firm is a far cry from the glamorous existence of a popstar’s girlfriend. But it’s just what Jane Porter needs to distance herself from her cheating ex, Ashby, and the press furore that surrounds the wreckage of her love life.

Patently in Love was reissued in 2014 under the title Girl on the Run, presumably for sound commercial reasons. Is there a lesson here about the lack of appeal of IP to the general public?

Rhoda also writes a blog about creative writing. As a regular feature of the blog, Rhoda interviews other writers about their ‘inheritance books’. These are books which have some personal associations for the interviewee, and which they have inherited from a previous generation, or which they would pass on to the next generation.

To coincide with World IP Day 2016, Rhoda interviewed IP Draughts about his inheritance books. The results can be found here.

zitherIn the interview, IP Draughts refers to the books of the late Graham Greene, who was possibly the leading British novelist of the 20th century. IP Draughts is not aware of any major IP issue associated with Greene, but Greene was involved in at least one law suit. In 1937, Twentieth Century Fox successfully sued him for libel, for writing an article that suggested a sexual connotation to the film Wee Willie Winkie, which starred an 8-year-old Shirley Temple.

There is no charge for this valuable piece of information.



Leave a comment

Filed under Book review

Why professional values matter

poppyEvery few years, political pressure is applied to the professions, to make them more like ordinary people, or to provide services in a similar way to high-street retailers, or to accept external regulation and complaints-handling, or to admit non-graduates to their ranks, or to allow external ownership by people who are not part of the profession, or to remove any remaining monopoly rights they may have in favour of more competition from unlicensed competitors.

Some of these pressures contradict one another. Increasing the burden of regulation on a profession, while at the same time allowing unregulated, non-professionals to provide the same services, is intellectually incoherent. We are pulled in one direction by a belief in open markets, and in another direction by a belief in consumer protection.

There is also a contradiction between professions. The English education minister has recently referred to the importance of teachers regulating themselves; at the same time, the government is proposing independent regulation for solicitors. The nursing profession is moving to an all-graduate entry; at the same time, pressure is being applied to solicitors to admit non-graduates.

Some of the pressures may be contradictory, but the overall theme is clear. Over time, professionals are losing control over many aspects of their professional life, including entry to the profession, training, qualification, rules of conduct, the structure of firms, the terms of their relationships with clients, complaints handling, and expulsion of defaulting members.

In the case of solicitors, the process of emasculation has been a gradual one. First, the profession delegates control over these matters to a ring-fenced subsidiary, with a minority of external lay Board members. The subsidiary employs professional regulators who look at the profession from the outside, and apply their own professional values to regulation, rather than those of the profession that they are regulating. Gradually, they change the rules governing the profession, to make them more like laws than statements of ethical principle.

let goA few years later, the number of lay Board members is increased so that they form a majority, and a lay Chair is appointed. The regulatory body becomes more remote from its parent. Some of the regulations for solicitors seem designed to reduce the SRA’s workload rather than being proper matters for regulation, eg requiring solicitors to run a viable business. Finally, the Chair leads a move to make the regulatory body completely independent from its former parent.

This is what is happening with the solicitors’ profession in England and Wales. In IP Draughts’ view it is the wrong direction for solicitors to take. If we are forced by the government to accept external regulation, so be it. But the model of external regulation should not be based on the self-regulatory model. Self-regulation covers many aspects, including the values that the profession seeks to embody.

familyWhen the Solicitors Regulation Authority was formed, all aspects of the solicitors’ profession, other than representation, were hived off into the SRA, including training, ethical conduct and insurance obligations. This made sense when the SRA was still part of the Law Society family, but in hindsight it was a dangerous route to take. If the SRA is to become completely independent, as the current Chair has recently suggested, then its role should be strictly limited to those aspects that need to be independent, eg misconduct and complaints handling.

This will allow a level, competitive playing field between solicitors and other legal service providers who are bound by the same regulations. At the same time, solicitor should be allowed to impose higher standards on their members, and to offer an upmarket service to clients based on those higher, common standards.

To take a few examples, solicitors have stricter rules than some other service providers in areas such as handling conflicts of interest, acting in the best interests of the client, compulsory insurance (and the terms of that insurance, which seem to annoy some underwriters), and so on.  These and other areas should be under the control of the profession, as part of its USP, rather than a matter for general regulation.

Leave a comment

Filed under Legal policy, Legal practice

Issue spotting in IP agreements

ip manAnother year has gone by. Last week we had the fourth annual outing of the UCL 5-day course, IP Transactions: Law and Practice. This year’s students came from City and specialist law firms, well-known companies, government departments and public bodies, and universities in the UK and overseas.

Several students made favourable comments to IP Draughts on the high quality of the teachers and the practical content of the talks. Thanks are due to our volunteer speakers from Anderson Law, Ashurst, Baker & McKenzie, Bristows, Bird & Bird, Eversheds, Farrer, Hill Dickinson, Linklaters, Nabarro, Olswang, Pennington Manches, Pinsent Masons, Taylor Wessing, and other organisations. You are giving your time and expertise to help train the next generation of specialist IP lawyers, and your efforts are appreciated.

The course provides insights into legal and practice issues that are relevant to IP transactions across different market sectors, including M&A, life sciences, IT, media, universities, and finance transactions. As well as covering core topics such as the law affecting IP ownership, assignment and licensing, we explore some of the wider legal issues that IP lawyers need to be aware of, including competition law, tax, insolvency, charges and dispute resolution.

red flagNo-one can be expert in all of these areas, but you can be aware of when an issue needs to be explored further, and when specialist advice should be sought. When reviewing an IP agreement, you should be able to spot these issues. They should sound a warning bell, or raise a red flag, in your mind.

Does the draft agreement contain provisions about insolvency that may not be legally effective (eg a reversion of IP), or terms that breach EU competition laws (eg an assignment of licensee improvements), or payment terms that address tax issues in an unfavourable way to your client (eg grossing up of witholding tax), or terms that are unlikely to be acceptable to a university (eg an absolute ban on publications)? None of these examples concerns intellectual property law, but they are part of the larger category of commercial laws that affect IP transactions. Having at least a basic awareness of them is part of the legal toolkit of the transactional IP lawyer.

mastersHopefully, this course will continue for many years to come. In addition, IP Draughts is planning to create another course on IP transactions, this time for LLM students. This is a more difficult category of people to teach a subject of this kind, as LLM students tend to have very little experience of practice. The teaching style and content need to be tailored. If you are an IP practitioner and are interested in helping to design and teach on a future LLM module, to be run by UCL Faculty of Laws from 2017 or 2018, please let Mark know on msa@andlaw.eu or 01865 858 878.


Leave a comment

Filed under Intellectual Property, Licensing