New legislation which came into force today makes a significant change to the legal position on commissioned designs. Historically, the ownership position for commissioned designs has contrasted with that for copyright as these designs were owned by the commissioner unless the parties contractually agreed otherwise. Under the Intellectual Property Act 2014, registered and unregistered commissioned designs created on or after 1 October 2014 will now be owned by the designer rather than the commissioner unless the rights are assigned to the commissioner in a written contract.

Many see this as a welcome change as it aligns the English law legal framework with the EU system as well as with the position for copyright.

What action should I take?

If you or your business commission designs then we recommend that you review contracts with designers and any standard terms and conditions to ensure that you own the design rights in light of the amended legislation.

Is the position the same with other IP rights?

As a reminder, we have set out below a high level summary of the English law position regarding ownership as between the commissioned party and the commissioner.

Designs

The new position from 1 October 2014 is that a commissioned design will be owned by the designer rather than the commissioner, unless the parties contractually agree alternative ownership arrangements.

Copyright

A commissioned copyright work will be owned by the commissioned party who creates the copyright (and not the commissioner) unless the parties contractually agree alternative ownership arrangements. Therefore, the commissioning agreement should include assignment provisions (including in relation to future copyright) or an express licence for the commissioner to use and exploit the copyright work.

Patents

The inventor of a patent is the deviser of the invention. Usually the inventor will be the owner of the patent but there are some important exceptions to this general rule. Where the inventor is an employee, the owner will usually be the inventor’s employer but this will not be the case for commissioned patents. For commissioned patents, the default position is that the commissioned party will own the invention unless the parties contractually agree alternative ownership arrangements. We would therefore advise commissioners to enter an agreement with the commissioned party to assign the invention to the commissioner or provide for an express licence for the commissioner to use and exploit the invention. The agreement should also grant the commissioner the express right to file the patent application.

Trade marks

There are no provisions at law which establish ownership of trade marks in a commissioned party/commissioner relationship. However, if a commissioned party applied to register a trade mark which he had created for a commissioner then the commissioner could object to the application by arguing that the commissioned party is making the application in bad faith. As proving bad faith can be difficult in practice, a more practical approach would be to enter an agreement with the commissioned party under which the commissioned party agrees that he will not have a right to apply for a trade mark. In addition, the commissioner could seek to oppose or invalidate the trade mark applied for or registered by the commissioned party on the grounds of the commissioner’s earlier use of that mark.