Allocating Patent Ownership in Joint Development Agreements: Inventorship, Subject Matter, Joint Ownership

Description

When a company wants to develop new technology, it either seeks to develop this new technology internally or, if it is unable or impractical to do so, it seeks a capable third party to either develop the new technology itself or in partnership with the company seeking its expertise. It may be possible for the company to obtain the newly developed technology and its corresponding intellectual property (IP) outright, in exchange for payment of those development services. However, there are many occasions both parties desire some ability to capitalize on the new development in some manner other than a simple payment for services. Any time a company contracts with a third party to develop technology for, or in partnership with, the company, one of the key issues in the agreement is allocating IP ownership.

As a result, the provisions addressing IP rights are among the most important ones in a JDA. Clearly drafted IP rights provisions help avoid later disputes and ensure that each party receives the benefit it expects from the agreement. The parties have wide latitude in allocating ownership in a JDA, and, consequently, there are many ways to achieve this. Inventorship and subject matter are the most often used ways to allocate ownership.

If the parties determine to allocate ownership of any developed IP based on inventorship, each party benefits from its own creativity and work. However, it may not promote collaboration and could lead to bitter ownership disputes in the future and make those patents subject to inventorship attacks. Alternatively, if ownership is allocated based on the subject matter, the allocation will more likely correspond to the company's business.

In addition to these issues, there are other legal concepts that may impact or control allocation and even determine whether the collaborative relationship is even desirable, namely, antitrust (competition) laws.

Our panel will also discuss the pros and cons of the different vehicles for developments, namely, service agreements, JDAs, and joint ventures.

Listen as our authoritative panel of attorneys examines the allocation of patent ownership in JDAs. The panel will discuss key considerations, including the challenges of joint ownership. The panel will discuss ownership based on inventorship and based on the subject matter, including the pros and cons of each basis for ownership and using a combination approach. The panel will also offer best practices for allocating patent ownership.