Can a corporate executive file a patent in his name?
Many corporate executives in France file patent applications in their own name, as a natural person, while exploitation of the invention is managed by their company.
Conversely, corporate executives file patent applications directly in the name of their company as they believe that it is an intangible asset which is part of their assets linked to their professional activity. Thus, with this logic, the patent would then belong to the company.
Thus, we find that for a similar situation, practices may differ.
Now if a corporate executive is the inventor, who should file the patent application? What are the right questions to ask and what are the pitfalls to avoid in such a situation?
Article L611-6 of the Intellectual Property Code states that the rights over an invention belongs to its inventor. A special system is in place for a salaried inventor. Since a corporate executive; however, is not considered an employee as defined under article L611-7 of the Intellectual Property Code and since the corporate executive is the inventor, the title rights belong to them.
In the event that the corporate executive wants the title to belong to their company from the outset andfrom the time the patent application was filed, it is necessary to assign the inventor’s rights to the company. This assignment must be done on a date prior to the patent application filing and must be established in writing.
Interestingly, the Intellectual Property Code indicates that acts involving transfer or licensing of the rights attached to a patent application or to a patent must be put in writing, “under penalty of invalidity” (Article L613-8). Although an invention, before it is filed is not considered a patent application or a patent so-to-speak, application of this provision to acts involving transfer of the rights of the inventor over the invention to the company prior to filing is more of a precautionary measure. Additionally, the cost is very low.
Moreover, a corporate executive planning to leave the company is tempted to file a patent application in his own name to manage its use. Such a situation is possible but should then be formalised by granting a license which should also be set in writing. In the contract, it should indicate that the transfer covers the costs associated with acquisition, maintenance and defence of the title in return for the company to be able to use this invention. Additionally, it should indicate the amount of royalties it may receive which should be proportional to the associated turnover.
Beware; however, of the situation in which the executive files a patent application in his own name while the company incurs costs related to acquiring or maintaining the title. Such a situation could be considered an offence of misuse of corporate assets.
Thus, a corporate executive has the choice of filing a patent application in his own name or in the name of his company, but he must do so in compliance with regulatory provisions. Anticipating these situations by written contracts also has the effect of reassuring potential investors and industrial partners who would like to participate, directly or indirectly, in deriving value from the patent.
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This post is also available in: French