We have written previously about issues which can cause problems to patent applicants who seek to claim priority from an earlier filed application. You can see our earlier summary of the issues here and, for a detailed analysis, see here.

In relation to the question of the party which is entitled to claim priority from an earlier application, a recent UK High Court decision has provided further guidance. As we identified in our earlier detailed analysis, there can be consequences if the party which believes itself to hold the legal title to the right to priority is different from the party which holds the title in equity.

The distinction between legal and equitable title arises in some countries, such as the UK and USA, having legal systems in which the ownership of an item of property can fairly be considered to have been transferred to a party, even if the legal documentation required to complete the transaction was not correctly completed. In relation to the right to priority, this equitable right has been relied on in some earlier UK cases, to enable a party which held the equitable title to the priority right to claim priority validly, even though the legal documentation had not been completed in time. A recent EPO Board of Appeal case T1201/14 also confirmed that “implicit” transfer of the priority right may be sufficient in the absence of a formal assignment of the right to priority, provided that evidence is available sufficiently to demonstrate that the parties indeed have an agreement to transfer the right.

However, the concept of equitable or implicit transfer can also pose problems, as well as providing solutions. Judges in previous UK cases had hinted that, in the event that legal title has been transferred but equitable title has not, this could result in a priority claim being held invalid. This issue arose again in Accord Healthcare Ltd v Research Technologies Corporation, Inc. ([2017] EWHC 2711 (Pat)).

In this case, the judge provided the following useful summary as to what is considered to be settled UK law on issues of priority:

“i)  Usually the right to claim priority goes with the right to the invention.

ii)  The right to claim priority must be with the person making the patent application in which that right is claimed when they make that claim, i.e. when the application is filed. A later acquisition of that right cannot make good a lack of it on the relevant date. If the right was not in place at the time then the right is lost for all time.

iii)  But if the local law applicable to rights of the applicant and the patent application at the place and time when it was made allows for a splitting of property rights into legal and equitable interests, then it will be sufficient to establish an entitlement to priority if the applicant holds the entire equitable interest at the relevant date.

iv)  A person with a legally enforceable right to call for the assignment of the legal title to a piece of property such as an invention (or a right to claim priority) [is the party which] has the equitable title to that property.”

This concurs with many of the points provided by the EPO Board of Appeal in T1201/14, mentioned above, which examined the various national law provisions which might have applied to the priority claim in that case.

The UK judge went on to note that:

“… following from those principles, a person who at the relevant time and under the relevant applicable law, acquired only the bare legal title to an invention and not the equitable title, when the equitable title is held by another, does not then hold the substantive right and title to the claim to priority.” (emphasis added)

Although it was concluded the patent applicant had indeed held both the equitable and legal title to the right to priority, this serves as a timely reminder to applicants and their advisers to examine carefully the question of which party holds the right to priority.

Even if an assignment document has been completed prior to the priority claim being made, questions should be asked of the assigning party to ensure that the right has not already transferred in equity to some other party, for example as a result of an employment contract or some other agreement which may be in place between the parties involved. Careful preparation and analysis of the issues should be conducted in plenty of time before the date on which the priority-claiming application is to be filed, to allow for the resolution and documentation of any issues.

This update is for general information and does not constitute legal advice. If you have any questions regarding these issues, or a particular case which you are concerned about, please get in touch with Rhiannon Turner or your usual Greaves Brewster contact.