The Allocation of Patent Ownership in R&D Partnerships: Default Rules v. Contractual Practices

Abstract

Due to the increased complexity of new technologies and rapid technological developments, organisations often cannot independently keep up with the technological progress and engage in open innovation activities by setting up R&D partnerships. The allocation of patent ownership of jointly developed inventions is a difficult issue during the negotiations of such partnerships and can be extremely problematic due to the lack of regulation and harmonisation of patent legislation. This entails the need to consult a considerable number of legal systems that may be involved in large-scale international partnerships. The difficulties in allocating ownership can also arise due to non-legal reasons, such as diverging business interests. While many patent systems suggest coownership as a default regime, in practice organisations often avoid it due to the complexity related to further joint exploitation. The principle of freedom of contract allows organisations to establish their own applicable rules governing the allocation of ownership and exploitation of jointly developed inventions. Those rules provide more flexibility, but also imply some transaction costs in designing contracts. In this paper I examine why (2020) 17:1 SCRIPTed 4 5 certain default rules are not “sticky” and whether it would be possible to establish a default rule accepted by the majority of the negotiating parties.