(Co-written by Rachel Montgomery, Trainee Solicitor and Laura Trapnell, Partner and Head of Intellectual Property)

Protection and ownership of our intellectual property is at the forefront of our minds when initiating new commercial relationships. However, a recent case in the IPEC highlights the importance of continuing to proactively protect our intellectual property as working relationships develop.

The IPEC has recently confirmed that a supplemental agreement may have the effect of varying the ownership of IP rights even if the ownership of said rights were agreed in the original contract.

The IPEC held that an initial agreement between two parties, in which the claimant retained all rights in the designs that the defendant was tasked to create, had been varied by a further agreement which placed the design rights in the joint ownership of the parties.

Recorder Douglas Campbell QC, sitting in the IPEC, held that the variation of commercial terms relating to royalty payments was sufficient consideration to make the Supplementary Agreement (“SA”) varying the Design and Manufacture Agreement (“DMA”) legally binding.

Recorder Douglas Campbell QC found that the terms of the SA, namely that:

  1. the defendant owned some part of the final design of the scooters; and
  2. if the claimant found a third party to produce the goods, the defendant would not be restricted by any terms of the DMA and would therefore be able to sell the goods in any market,

altered the terms of the DMA with regard to the ownership of the design rights. The result of the SA was that the design rights were jointly owned by the parties. Recorder Douglas Campbell QC noted the key point was the recognition of the defendant’s contribution to and therefore joint ownership of, the design rights.

Case: Scomadi Ltd and another v RA Engineering Co Ltd and others [2017] EWHC 2658 (IPEC), 27 October 2017

The outcome of this case has highlighted the need for careful drafting of supplemental agreements to ensure that their effect is not to vary any attribution of IP rights previously agreed. If you would like assistance with the drafting of any supplemental agreements and/or advice on supplemental agreements, please email me.

For more information on the intellectual property services we provide please click here.