Patent co-ownership

Patent co-ownership is the situation in which several persons hold a patent or a patent application together. It most often arises from a joint invention, a research contract or a succession. The French Intellectual Property Code devotes a specific regime to it, in Articles L. 613-29 to L. 613-32. That regime sets aside the joint ownership rules of the Civil Code. The provisions can be consulted on Légifrance. In practice, absent an agreement, patent co-ownership is a frequent source of deadlock.

The rights of each co-owner

First, each co-owner may exploit the invention for its own benefit. It must however fairly compensate the co-owners who do not exploit the invention themselves and have not granted a licence. Failing agreement, the judicial court sets that compensation.

Second, each co-owner may sue for infringement alone, for its sole benefit. It must however notify the writ to the others. Failing that, the court stays the proceedings until proof of that notification.

Third, each co-owner may grant a non-exclusive licence for its own benefit. Here again, it must fairly compensate the others, who may moreover oppose the project within a certain period by offering to buy its share. By contrast, an exclusive licence requires the agreement of all the co-owners or a court authorisation.

Assignment of shares and co-ownership agreements

Each co-owner may assign its share. The others then have a right of pre-emption for three months from the notification of the project. Failing agreement, the judicial court sets the price.

The co-owners may however set aside all these rules through a co-ownership agreement. That agreement organises the exploitation, the sharing of royalties and the conduct of proceedings. It also settles the payment of renewal fees and the fate of improvements. It is therefore strongly recommended from the outset, in particular in consortium agreements and research contracts.

Key points

In practice, an unorganised co-ownership creates several risks. An exclusive licence may be blocked. The co-owners may also disagree on the exploitation compensation or on the conduct of the litigation. Disputes thus concern the amount of the compensation, the validity of licences granted by a single co-owner and the exercise of pre-emption. The firm drafts co-ownership agreements and acts in these disputes, as presented on the page contracts. See also the article how to manage patent co-ownership.