A High Priority Assignment

This article was included in our Spring/Summer 2011 edition of Inside IP magazine.

A decision of the German Federal Patent Court on 28 October 2010 has recently published (11 W (pat) 14/09) providing some further insight into the somewhat complex rules governing the assignment of priority rights. 

Under Article 4A(1) of the Paris Convention, ‘Any person who has duly filed an application for a patent … or his successor in title, shall enjoy, for the purpose of filing in other countries, a right of priority …’.  One of the underlying purposes of the priority right is to address the negative consequences of the principle of territoriality in the patent system, providing applicants with a 12 month period, following the filing of an initial application for a particular invention, within which to make subsequent applications in other territories of the world.  This may sound straightforward enough, but many of the decisions in recent years concerning priority rights have hinged on the identity of the specific ‘person’ entitled to the right of priority and, in particular, the way in which that right may be legitimately transferred in cases where the applicants listed for the initial and subsequent applications are different.  If the transfer of priority right is deemed not to have taken place, this can have the potentially catastrophic consequence that the priority claim is considered invalid and any public disclosures within the priority period would therefore be relevant to the validity of any subsequent applications. 

In relation to the assignment of priority rights, the German Federal Patent Court found that:

1) a priority right is an independent, freely-transferable right (i.e. separable from rights in the earlier patent application itself); and

2) the priority right should be transferred before the declaration of priority is filed for the subsequent application (which may be after the date of filing the subsequent application). 

The first point above appears to confirm the importance that assignment documents specifically refer to the assignment of the right of priority, as a separate right from the earlier patent application.  This could, for instance, address any later challenge that the earlier application was assigned without the associated right of priority. 

The second point above is of particular interest in cases in which the declaration of priority (i.e. the means via which the filing date of the earlier patent application is claimed) is filed after the filing date of the subsequent application.  Under the European Patent Convention (EPC), a declaration of priority can, if necessary, be filed after the subsequent application is filed, and up to 16 months from the filing date of the initial application.  The German Federal Patent Court indicate in their decision that the transfer of priority right need only have been completed prior to the declaration of priority, not necessarily prior to the filing date of the subsequent application.

Although this decision is a useful addition to the case law in this area, it remains to be seen what influence it will have in shaping the law and practice followed outside Germany.  Although under the EPC declarations of priority can be filed after the filing date of the subsequent application and outside the 12 month priority period, in many patent systems this is not the case, and therefore it is highly advisable to ensure that any transfer of a priority right takes place prior to filing of any subsequent applications.  The legitimacy of the transfer is usually only questioned following a challenge to the validity of a subsequent application, for instance by a potential infringer, at the patent office or national court of the country where the subsequent application was filed.  The laws which are applied by national patent offices and courts differ widely, and yet these requirements must be complied with by the patentee at the time the assignment is made in order to ensure a valid priority claim.

In the USA, a further complexity results from the fact that applications are filed in the name of the inventors, not, for instance, a company (who may be the applicant elsewhere in the world) deriving rights from the inventors.  For a priority right based on an earlier application filed in the name of an assignee different from the inventors, a Court of Appeals for the Federal Circuit decision (Boston Scientific Scimed, Inc. v. Medtronic Vascular, Inc.) requires that a ‘nexus’ existed between the inventors and the assignee at the time the initial application was filed, in particular showing that the applicant was filing the initial application ‘on behalf of’ the inventors.  Whilst this should be evident in cases in which the inventors are employees of an assignee company, in cases where a subsequent US filing is likely to be made and particularly where inventors are not employees of the assignee, it is highly advisable to ensure that rights are transferred (or at least a nexus is shown) before the initial priority-establishing application is filed.     

There are a number of practical steps which can be taken to help to ensure the legitimate transfer of priority rights where the applicants for the initial and subsequent patent applications are different.  Key points, in addition to establishing an early ‘nexus’ for future US applications, are that the assignment document should specifically mention the assignment of the priority right, provide full details of the earlier application and be executed prior to the filing of any subsequent applications.  The assignment should also be in writing and signed by both the assignor and the assignee.

Philip Harrison 24 May 2011

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