A landmark patent decision today where Unilever must pay Professor Shanks a further £2 million as a fair share of the outstanding benefit that Unilever has received from his invention: a diabetes testing device used by millions of people worldwide since its conception in the 80s.
Note - the questions of ownership was not at issue here. Unilever correctly derived the patent rights to the invention from Shanks - an employee at the time. However, under UK patent law, if an invention turns out to be of outstanding benefit to an employer, the inventor must be rewarded - typically many years after the patent has been filed
This raises an interesting question as to whether we will see more inventors appearing out of the woodwork to demand their "fair share". And what can companies do to offset the challenges presented by this? It may be possible to minimise the chance of a claim through the creative structuring of employment terms and good staff management. Non-employees (e.g. contractors) may fail to benefit from this provision for example.
But surely, companies should simply accept this as a fair and reasonable part of their relationship with prolific inventors? This is, after all, what section 40 of the UK Patents Act sets out to do, and in fact was amended in 2005 to make its effect more favourable to the employee.
In practice, there is a high bar to successfully argue that an invention is of outstanding benefit, and also that a fair share of that benefit is of an amount that is worth pursuing. (The "going rate" seems to be between 3-5%).
However, with high-tech companies scaling like nothing before, we may very well see more claims like these in the near future.
