In a case having significant implications for academic institutions, the Full Federal Court in University of Western Australia v Gray  FCAFC 116rejected the claim that the University of Western Australia owned the rights to inventions made by one of its academics, upholding French J’s first instance decision in University of Western Australia v Gray (No 20)  FCA 498.
In the decision, the Full Court highlighted the “distinctiveness of a university such as UWA and of academic employment in it as considerations relevant to [its decision regarding the ownership of an academic’s inventions]” and noted that its conclusion “recognises a distinction between the ownership of employee inventions in universities and in private sector business entities”.
This case concerned the ownership of patents for inventions related to treating cancer. The inventions were developed by Dr Gray, a Professor of Surgery employed the University of Western Australia (“UWA”) between 1985 and 1999. UWA claimed that it was the rightful owner of the patents covering Dr Gray’s inventions for a number of reasons, including that there was an implied term in the university’s employment contracts that inventions developed by the university’s employees belong to the university. At first instance, French J found that UWA was not entitled to ownership of the inventions and patents in question. In finding that there was no such implied term in the employment contract with Dr Gray, His Honour held that a duty to research does not carry with it a duty to invent.
On appeal, UWA challenged the finding in relation to the existence of an implied term in Dr Gray’s employment contract and also the correctness of the approach taken by Justice French in identifying when Dr Gray had conceived the inventions..
Duty to Invent
The Full Court in a joint decision of Lindgren, Finn and Bennett JJ agreed with French J that Dr Gray’s terms of employment did not include an implied term that UWA had proprietary rights in the inventions and patents.
The Full Court relied on a number of key reasons in affirming French J’s decision. Firstly, the Full Court noted that Dr Gray had not been engaged to use his inventive faculty in an agreed way or for an agreed purpose, for UWA’s benefit. Accordingly, Dr Gray’s duty to research could not be “transformed into a duty to invent” if the research carries the possibility of developing inventions capable of attracting patent protection.
Secondly, the Full Court found that the existence of an implied duty to invent would be inconsistent with the freedom Dr Gray had to share and to publish his research results.
Thirdly, the grants and funding Dr Gray obtained from third parties for his research pointed against there being a duty to invent in UWA’s favour. The Court found UWA’s role in the research and grants process to be limited, stating:
Dr Gray was raising the funds for his research, the metes and bounds of which he determined, though UWA received and managed the funds. Further, it also can probably be inferred that the grants were made to Dr Gray as an established researcher and not to UWA as such, although its involvement as institutional manager of the grant would also be taken into account by the funding body. So considered, the “grant factor” can properly be said to be a consideration that further weakens UWA’s claim to the benefits of any inventions so generated.
Fourthly, the need for inter-institutional cooperation to conduct Dr Gray’s research also told against there being an implied term permitting UWA to exclusively appropriate the products of Dr Gray’s research.
Conception of invention
At first instance, French J found that, except for one invention (which UWA was not entitled to in any event), Dr Gray had conceived the inventions which were the subject of the patents in dispute outside of the time period he was employed by UWA.
On appeal, UWA pressed its claim that the ideas Dr Gray had formed prior to joining UWA were not yet sufficiently developed and tested to constitute an invention.
In determining what constituted the invention, UWA submitted that French J focussed upon selected claims of the patents in question to identify what the relevant inventions or inventive concepts were, rather than discerning the inventive concept from the whole of the patent specification including the body of the specification.
In rejecting UWA’s submission, the Full Court noted that UWA’s case on appeal was fundamentally inconsistent with the case it made at trial in this respect. At trial UWA had advocated assessing each claim specifically to determine the inventive concept. At the time, following this approach was beneficial to UWA because the most specific claims were likely to embody developments latest in time.
The Full Court held that French J had adopted the correct approach of discerning the inventive concept from the whole of the patent specification, as was set out in the recent Full Federal Court decision in Polwood Pty Ltd v Foxworth Pty Ltd  FCAFC 9. The Full Court also noted that Polwood did not change the law of inventorship in Australia: as the law stands, to constitute an inventor, a person “must have made a material contribution to the invention”.
It has been reported that UWA is considering seeking leave to appeal the decision to the High Court. Interestingly, since handing down the first instance decision, Justice French was appointed the Chief Justice of the High Court of Australia.