Article originally published in PLC Life Sciences Handbook 2009/2010

Many life science companies rely on their employees’ inventiveness to fuel their research and development (R&D) efforts and generate patents. The most successful inventions can generate billions of euros of sales annually. In some circumstances, the employees who created the patentable inventions may be entitled to compensation. However, the laws in this area vary significantly across European jurisdictions.

A number of substantial compensation awards have been made recently. For example, the UK Patents Court awarded compensation for the first time in 2009, in the case of Kelly v GE Healthcare [2009] EWHC 181. Between them, the two inventors were awarded GB£1.5 million (about US$2.2 million). A former employee of French National Railways (Société Nationale des Chemins de fer français (SNCF)) received more than US$750,000 (about EUR503,000) from a court of first instance in Paris for inventing a system that allowed SNCF to save around US$22 million (about EUR14.8 million) annually (X c. Société Nationale des Chemins de Fer Français et Vape Rail International SAS (VRI), Tribunal de grande instance of Paris, 3rd chamber, 1st section, 19 May 2009).

However, despite companies’ potentially significant exposure, there is much uncertainty regarding employees’ rights to compensation. In large part this is due to the complexity of national laws and the lack of harmonisation across Europe. Even where a right to compensation can be established, the amount is often unpredictable.

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Photo of Morag Peberdy Morag Peberdy

Morag Peberdy has broad experience in all areas of intellectual property, where she advises on both contentious and non-contentious issues. Her wide-ranging expertise includes patents, trademarks, designs, copyright, database rights and confidential information, and covers drafting intellectual property agreements and infringement and contractual…

Morag Peberdy has broad experience in all areas of intellectual property, where she advises on both contentious and non-contentious issues. Her wide-ranging expertise includes patents, trademarks, designs, copyright, database rights and confidential information, and covers drafting intellectual property agreements and infringement and contractual disputes. Her particular focuses have been on patent work in the life science sector, and in advising branded goods companies.