Federal Supreme Court on entitlement to remuneration in the case of only a majority decision on the permission of use in a community of inventors – consequences for the drafting of contracts

Inventions are often not made by one inventor alone, but by several inventors who then form an inventor’s community. As far as there are no deviating contractual regulations, the legal relationships of the members of the community of inventors are based on the regulations concerning the community of fractions according to §§ 741ff. of the German Civil Code. The German Federal Supreme Court (FSC) has now decided on the question of the entitlement to remuneration in a case in which a third party was only permitted to use the joint invention by a majority decision of the community of inventors (decision of June 9, 2020, X ZR 142/18 – Penetrometer).

Right of disposal of each co-inventor over his share of the invention

In the decision, the Federal Court of Justice first of all clarifies once again that, in the absence of deviating agreements, each co-inventor may in principle dispose of his share of the invention and is also entitled to allow third parties to use the invention as long as a majority decision is reached within the community of inventors in accordance with the shares in the joint invention.

Majority resolution does not remove the entitlement of the non-approving members of the community of inventors to claim

The special feature of the case decided by the Federal Court of Justice, however, was that the permission of use only provided for payment of the fee to the co-inventor who had agreed to the granting of rights by majority resolution, but not to the community of inventors as such. The other members of the Inventors’ Association therefore had no direct claim for payment against the third party from the use granted by the co-inventor. In this respect, the Federal Court of Justice came to the conclusion that the interests of the other members of the community of inventors with regard to the drawing of the fruits from the joint invention were unlawfully impaired, notwithstanding the majority resolution at hand. The arrangement made between the co-inventor and the third party should have provided that the fees to be paid were not to be paid to a co-inventor alone, but to the community of inventors as such, so that all members of the community of inventors had equal access to them. The mere fact that the other members of the community of inventors would have a claim for compensation against the co-inventor in the internal relationship would not be sufficient to eliminate the impairment.

Consequences for contracts

The decision of the FSC makes it clear that great attention is still required for legal regulations which deal with the granting of rights to joint inventions. This is especially true if not all members of the community of inventors agree to the granting of rights, but only by majority vote. Although the granting of rights by majority vote is possible under the rules of the fractional community, the Federal Supreme Court emphasized that in this case all members of the community of inventors must be equally entitled to claim the fruits of their efforts in the form of compensation. From a contractual point of view, this means that the creditor side of the payment claim must be defined accordingly and that appropriate arrangements for payment processing must also be made. For example, a payment made only to an account to which only one co-inventor has access is unlikely to meet these requirements.