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Should the Patentee Listed on the Patent Certificate be the Actual Holder of Said Patent? — The Circumstance of Lending One's Name for Patentee's Registration

Hsiu-Ru Chien/Shih-I Wu


Patents are a type of intangible asset.  What a patent right seeks to protect is a technical concept or design that does not possess any specific tangible form.  To demonstrate the existence, scope and ownership of such rights, the patent authority, the Taiwan Intellectual Property Office ("TIPO"), will publish relevant information as the external manifestation of such rights.  The TIPO would, in addition, issue a patent certificate to the right holder as proof.  Even if there is an assignment, trust, licensing to others, or pledge establishment, etc. that would cause changes to the ownership of such rights, such changes are required to be recorded with the TIPO in accordance with Article 62 of the Patent Act; failing which the patentee shall have no position against any third party.  In other words, in principle, the patentee's name published by the TIPO or indicated on the patent certificate should enjoy exclusive rights granted under the Patent Act and may claim infringement from anyone who exploits their inventions, creations or designs.
 
However, under the 2013-Min-Zhuan-Su-121 judgment ruled on October 31, 2014, the Intellectual Property Court took the view that, although the Plaintiff was the right holder on the patent certificate and the patent application, the Plaintiff's name was merely "lent" to the true owner for patent registration.  As such, the Plaintiff was not the true owner of the patent at issue.
 
The facts of this case are as follows: X (the Plaintiff) was the patentee of a new utility patent at issue.  He is the brother of Y (the defendant) who was alleged to have infringed on the patent at issue.  Both had, at one time, been in partnership but ultimately went their separate ways and each set up their own company.  X discovered that Y was selling products that infringed on the patent at issue and thus sued Y, seeking compensation for damages and requesting to exclude Y's infringement.  Y argued that the patent was actually the creation of Z (their father), and that it was registered under the name borrowed from X.  As the actual inventor, Z agreed that both parties could use the patent at issue, and Y claimed that he did not infringe the patent at issue.
 
The court ultimately dismissed X's claims based on the reasons that (1) Despite X's argument that the patent at issue was his work following further improvement to their father's ideas, the fact shows that the inventor of the patent at issue did not only include X but also included Y; (2) Z had testified that he was the actual inventor of the patent at issue and that the patent was registered under a name lent by X.  The court did not find Z's statements in violation of the rule of thumb based on his many years of empirical experience in this industry; (3) Witness W also testified that Y had participated in the invention that resulted in the patent at issue; (4) X failed to show proof that the patent at issue was composed of only his ideas.  Thus the court determined that since Y was one of the inventors, he would not be excluded from using the patent.  In addition, X had entered into a Name Lent Contract for patent registration with Z (his father).  Thus, although the patent at issue was registered under the name borrowed from X, its true owner should be Z.
 
According to the judgment of the Intellectual Property Court in this case, the "Name Lent Contract for Registration" under the Civil Act can apply to patent rights that do not possess physical entity.  However, in the absence of explicit provisions under the Patent Act, it remains to be seen what the court's further opinion might be concerning whether such undisclosed "Name Lent Contract for Registration" between the parties can be used to circumvent the fundamental principles of the patent publication system and how a third party can determine the ownership of a patent to achieve the purpose of securing safe transactions.


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