In the context of patent rights assignment, judicial precedent establishes that the assignment of patent rights takes effect once the assignor and assignee have mutually expressed consistent and genuine intent to transfer such rights (see Supreme Court, Civil Judgment No. 113-Tai-Shang-Tzu-719). While Article 62 of the Patent Act provides that an assignment of patent rights is not enforceable against third parties unless it is registered with the competent authority, namely the Taiwan Intellectual Property Office ("TIPO"), such registration functions solely as a requirement for asserting the assignment against third parties and does not constitute a condition for the validity of the assignment itself (see Supreme Court, Civil Judgment No. 109-Tai-Shang-Tzu-11). In its Civil Judgment dated April 21, 2025 (No. 113-Ming-Chuan-Shang-Tzu-17), the Intellectual Property and Commercial Court (hereinafter, the "IP Court") further clarified that the purpose of assignment registration is to facilitate the administration of patent assignments by the competent authority. Consequently, where the parties enter into an assignment agreement based on a collusive and fictitious declaration of intent, such agreement is void under Paragraph 1, Article 87 of the Civil Code. In such cases, the assignee does not acquire the patent right merely by completing the patent assignment registration.

 

In the present case, the plaintiff, as the exclusive licensee of the patent, initiated a lawsuit in August 2022 against the defendant (namely, the original pantentee) Mr. Hsu and other related parties, seeking injunctive relief for patent infringement and damages. On April 12, 2023, the parties entered into a settlement agreement, pursuant to which the defendant Mr. Hsu agreed to assign the disputed patents to the plaintiff without consideration, and the plaintiff agreed to withdraw the lawsuit. Following the withdrawal of the lawsuit in April 2023, the plaintiff applied to the TIPO to register the patent assignment. However, the application was rejected on the grounds that the defendant Mr. Hsu failed to affix his personal chop to the application form. On August 11, 2023, the plaintiff filed a subsequent lawsuit requesting that defendant Mr. Hsu cooperate in effectuating the patent assignment. Thereafter, on August 25, 2023, the defendant Mr. Hsu executed a separate patent assignment agreement with the co-defendant Mr. Yang and completed the registration of such assignment. In response, the plaintiff petitioned the court for a declaratory judgment declaring the patent assignment agreement between the two defendants invalid, and sought registration of the patent assignment in the plaintiff's name. Further, the plaintiff alternatively requested revocation of the assignment, restoration of the patent rights to the defendant Mr. Hsu, and subsequent transfer of such rights from Mr. Hsu to the plaintiff.

 

In its first-instance judgment, the IP Court declared the patent assignment agreement at issue null and void, and ordered that the patent right be assigned and registered to the plaintiff. Following the defendant’s appeal, the IP Court, upon review in the second instance, upheld the original judgment. The Court first found that, pursuant to the assignment agreement executed by the appellants Mr. Hsu and Mr. Yang, the relevant patent was stipulated to be "owned and used" by Mr. Yang. However, Mr. Yang subsequently executed a letter of undertaking unconditionally consenting to Mr. Hsu’s use of the patent at issue, authorizing Mr. Hsu to transfer the registration at any time according to his instructions, and agreeing to pay liquidated damages in the event of breach. These terms directly contradict the nature of the assignment agreement. Moreover, given that Mr. Yang had already been assigned the disputed patent, it was unreasonable and contrary to common commercial practice for Mr. Yang to be obligated to pay an annual royalty of NT$30,000 to Mr. Hsu. Accordingly, the IP Court concluded that the assignment agreement between Mr. Hsu and Mr. Yang constituted a fictitious declaration of intent in collusion. Pursuant to Paragraph 1, Article 87 of the Civil Code, the agreement was therefore held to be null and void.

 

In this case, the IP Court reaffirmed that the assignment of a patent becomes effective upon the mutual agreement of the parties involved, with the registration of the assignment serving solely as a matter of administrative convenience. Consequently, where the parties enter into an assignment agreement based on a collusive or fraudulent declaration of intent, the assignment is rendered ineffective, and the mere registration of such an assignment in the name of the nominal assignee does not confer patent rights enforceable against third parties.