Working patents - who can do it?

Co-owners - how can they work the patented invention?

In Henry Brothers (Magerfeld) -v- Ministry of Defence the Court considered the rights of co-owners under Section 36(2) Patents Act 1997 which provides that "each of them shall be entitled by himself or his agents ... for his own benefit ... to work the invention".

The patent is for a bomb resistant prefabricated building, useful in Northern Ireland. The Court held that the Crown, as co-owner of the patent, could get a third party contractor to make the buildings for it as its agent within the section, providing the patented article for the Crown, which used it itself. The Judge referred to it as "Home use".

This contrasts with a much earlier decision where the co-owner was not entitled to get a third party to make and sell the patented product as agent for the co-owner. The result of this arrangement was effectively to grant a licence, which was not permitted.

This decision leaves a gap. Can a co-owner get a product manufactured for him by his agent and then sell that product on to third parties himself; or is that more than working by the co-owner itself and so outside the ambit of the permitted activities of co-owners under Section 36(2)? It certainly seems to be more than "Home Use" but not outside S.36(5) (which allows a co-proprietor to dispose of a patented product as if he were the sole proprietor). If it is outside the scope of Section 36(2), why is a co-owner himself entitled to manufacture a product and sell it; and to have a product manufactured for it and use it himself; but not allowed to have a product manufactured for him and then sell it himself? Indeed why is a co-owner not entitled to employ an agent both to make, and then to sell, the patented product? Are the words "for his own benefit" to be construed as being only for his own personal direct benefit in making use of the invention, as opposed to his financial benefit by producing and selling the invention? The rights of a co-owner are still not entirely clear!

Compulsory licences - but not usually compulsory sub-licensees

Therma-Tru Corporation's Patent was an appeal to the Court from the Comptroller, who had refused an application for a compulsory licence. The applicant wanted to work the licence through a sub-licensee.

The Court stated that the underlying policy behind the grant of compulsory licences is set out in Section 50(1)(a) Patents Act 1977 "that an invention which can be worked on a commercial scale in the United Kingdom [now the EU/EEA] and which should in the public interest be so worked shall be so worked here [there] without undue delay and to the fullest extent reasonably practical".

The Court considered that is was clear that there was jurisdiction to permit sub-licensing but that it would only do so in exceptional cases. In particular the applicants must adduce evidence as to why sub-licensing is needed. The Judge said that he should require the party which it is intended should be responsible for manufacturing and selling to be a party to the application. He did not believe that the objectives of sub-section 50(1) could be met by the applicant since it would not itself be working the licence and he dismissed the application.

He also discussed, obiter, the procedure which the Comptroller should adopt once one of the grounds set out in Section 48(3) Patents Act for the grant of a compulsory licence had been established. He considered that once one or more grounds had been established, if it could be shown that working in the United Kingdom was not possible, or had not in the past been possible, the Comptroller should consider whether to invoke the power to adjourn the application to give the patentee an opportunity to work the invention fully.