APPLICATION OF U.K. PATENT LAW GRANTING EMPLOYEES EXTRA COMPENSATION FOR PATENTED INVENTION

A U.K court has recently applied the rarely-used section 40 of the Patents Act 1977, which allows for extra payments to be made to employees for inventions patented by their employers, in exceptional circumstances. The England and Wales High Court has awarded two former employees extra compensation from their former employer for an invention that was of “outstanding benefit to the employer.” Dr Duncan Kelly and Dr Kwok Wai Chiu received £1million and £500,000 respectively.

The following questions have been addressed in this article:

How is compensation to be determined under the Act?
What kind of employee is eligible for such an award?
What type of benefit must have accrued to the employer for section 40 to apply?
What does the term “patent” under section 40 exclude?

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