Who would be the owner of the rights to an invention created in your company by an employee?

Intellectual Property Law is divided into two categories: Industrial Law and Copyrights. Within the branch of Industrial Law is the protection of inventions, which are protected through patents and, due to all the requirements that are demanded for its concession, it is the most complex procedure of those foreseen in the Industrial Property Law, that is why, the procedure lasts from 3 to 5 years but once it is granted, the patent is for 20 years.

So, what happens when i. a company hires an employee specifically to carry out the creation of a new inventionThe company provides it with all the necessary means (facilities and equipment) or, ii. an employee, as part of his duties in the company (i.e., without having received an express instruction from his employer), carries it out. In such cases, Who would have the right to own the patent on an invention created under these circumstances: the company, which in both cases provides all the resources for the invention to be carried out, or the worker, who finally materialized an idea, either on his own or under the instruction of his employer?

Before answering the above case, it is important to note the following: a. what is considered an invention and, b. to whom the ownership of the same is granted, according to the Industrial Property Law.

1. An invention, in accordance with article 46 of the IPL, is any human creation that allows the transformation of matter or energy that exists in nature, for its use by man to satisfy his specific needs.. Similarly, Articles 47 and 49 delimit what is not considered an invention and what, even if it could be considered, is not patentable.

1. According to Article 36 of the IPL, the owner of an invention is clearly the person who makes the invention and to whom the law confers the right to use it. exclusive and temporary right of exploitation for his benefit, by himself or by others with his consent. Likewise, according to article 38, there may be more than one owner of the same patent.

This ownership gives rise to two types of rights: moral and patrimonial/economic, the former corresponding to the recognition of the fact that the company has created an invention (i.e., they always correspond to the person who actually and materially carried out the invention, which logically cannot vary once an invention has been created and, in accordance with Article 39 of the Law, they always correspond to the person who actually and materially carried out the invention, which logically cannot vary once an invention has been created. are inalienable); on the other hand, the latter derive from the former, since an invention gives rise to economic rights to exploit it (which may be assigned by the owner, either for a fee or free of charge, under the terms of article 38).

Now, returning to the specific case, the answer is different for each one and is provided for in article 163 of the Federal Labor Lawwhich establishes the following:

Article 163. The attribution of the rights to a name (moral character) and to property and operation (patrimonial nature) of inventions carried out in the companyshall be governed by the following rules:

1. The inventor shall have the right to be named as the author of the invention;

1. When the worker is engaged in research work or improvement of the procedures used in the company, the ownership of the invention and the right to exploit the patent will correspond to the employer on behalf of the company. The inventor, independently of the salary that he has received, will have the right to a complementary compensation, which will be fixed by agreement of the parties or by the Conciliation and Arbitration Board when the importance of the invention and the benefits that they can report to the employer do not keep proportion with the salary received by the inventor; and

III. In any other case, the ownership of the invention shall correspond to the person or persons who made it, but the employer shall have a preferential right, all other things being equal, to the exclusive use or acquisition of the invention and the corresponding patents.

Based on the above, the following can be inferred:

1. According to the second section, when a company hires a worker especially to carry out an invention, that is to say, it has the idea in mind and only needs to "materialize" it, for which it needs experts in the field or who must dedicate all their time to the project, the holder of the economic/property rights of the patent will be exclusively the company. However, the employee involved will be entitled to an "extra compensation" when the economic returns of the patent are of great importance for the company and the employee's salary is evidently not proportional to his contribution in such invention, which will generate high returns to his employer.

This raises the following question: Does the second section of the aforementioned article really provide legal certainty as to the scope that this article may have? supplementary compensation? Also, what are the parameters for the Conciliation and Arbitration Board to determine such compensation? In this sense, such fraction could be insufficient to solve real life cases, added to the fact that there are no criteria that provide more information in this regard. Therefore, the best option would be to reach an agreement with the employee, determining the amount or scope of the referred compensation, from the moment he/she starts working in the company.

1. In accordance with the third section, if the above assumption is not met, the holder of the moral and patrimonial/economic rights will be exclusively the employeeThe only right recognized to the employer is that of the employee, regardless of whether it was carried out on the employer's premises and with the employer's resources (as long as there was no instruction to that effect). The only right that is recognized to the employer is that of preference on the economic/property rights However, this will depend on the employee's willingness to assign them (which in most cases will be for valuable consideration and the price will be set by the employee), since such fraction does not oblige him to act under such terms, i.e., the employee may decide not to assign his patent rights in any way whatsoever.

The reality is that the most important aspect of a patent is the economic rights, since it is possible to have the moral rights over it, but if it is not exploited, the simple fact of having created it does not generate an economic benefit. However, the economic rights (which can be assigned for a certain period of time or for the entire term of the patent) derive from the moral rights, which is why such recognition is essential to start commercializing and exploiting a patent.

1. In both cases, the employee has the right to be recognized as an employee of the company. author of the investment, which means that it is also the holder of the moral rights the same, regardless of the fact that the latter has only been in the involved in the creation of the invention or who is the sole owner of the patent in the case mentioned in the previous point.

In conclusion, if a company hires a worker for the creation of an invention, the labor contract must be very clear and establish that the work to be performed is precisely the creation of an invention and if possible, from that moment on, establish the amount of the complementary compensation to which the worker is entitled or establish the parameters that will determine it (taking into account the returns that the invention will generate). However, if the labor relationship was not agreed in those terms, all the rights recognized in the IPL on a patent correspond to the employee if he/she was the one who created it and he/she will be the only one who can decide on the use of the patent, regardless of whether he/she created it within the company and with the company's resources.