Employee inventions in Finland – claims and disputes concerning employee inventions

Employee inventions are subject to the Act on the Right in Employee Inventions(1) (the Act) in Finland. The Act is partly compulsory and governs:

• rights to an invention;
• invention remuneration;
• employee inventors' rights and obligations;
• employers' rights and obligations; and
• claims and disputes relating to employee inventions.

This article, the fifth in a series on employee invention issues,(2) focuses on employee invention related claims and disputes in Finland.

Competent Court and Employee Invention Committee

The Employee Invention Committee (the Committee) is a statutory committee that may issue opinions on matters concerning the application of the Act, including the application of the Act on the Right in Inventions made at Higher Education Institutions.(3) The opinions of the Committee are free of charge for the applicant. Both the employer and the employee inventor may request an opinion from the Committee.

The opinions of the Committee are considered as recommendations and are not legally binding on the parties. A party to the case must, however, notify the Committee of whether it intends to comply with the opinion. The Committee considers all matters in writing, but an oral hearing may be arranged if the Committee finds it necessary for the particular matter at issue.

The opinions of the Committee are made public unless publication in whole or in part would violate the secrecy obligation provided for in the Act on the Openness of Government Activities.(4) The Committee operates under the general secrecy obligation included in the Act on the Right in Employee Inventions and the Committee's opinions are published without disclosing the names of the parties to ensure that business or professional secrets are not compromised. The parties in the matter are provided with an opportunity to give their views regarding the publication of the opinion.

The competent court in Finland for employee invention-related matters is the Market Court, which acts as a specialised court in IP matters. Legislation and procedures applicable to civil patent disputes are followed, where applicable. Relatively few matters are brought to the Market Court, while the Committee handles a large number of cases yearly.

Remuneration matters

Typical matters brought to the Committee concern reasonable remuneration for the employee inventor and so-called "special remuneration". The Act provides little guidance for determining reasonable remuneration. Article 7 of the Act stipulates that when determining the amount of remuneration to be paid, particular attention must be paid to:

• the value of the invention;
• the scope of the right that the employer acquires;
• the terms and conditions of the employment contract; and
• the contribution that other circumstances connected with the employment made to the conception of the invention.

Further guidance is provided by the related Employee Inventions Regulation, which focuses on the value and benefits of the invention to the employer (for further details, see "Employee inventions in Finland – invention remuneration").

In remuneration-related disputes, the risk lies especially in situations where the invention turns out to be more valuable than initially estimated and, of course, if remuneration has been completely overlooked. The Act stipulates that with respect to special remuneration, regardless of a court decision or a contract concerning an invention remuneration, a competent court may order otherwise if a substantial change in circumstances has taken place. An employee inventor is never obliged to refund any remuneration already paid. Thus, the Act only enables a higher remuneration to be paid to an employee inventor if the invention turns out be a more valuable over time.

It should be noted that an employee inventor is entitled to bring a court action in a remuneration matter up to 10 years from the date on which the employer notified the inventor that it will acquire the rights to the invention. However, if a patent application related to the invention has been filed, the court action may be raised within one year from the grant date, which means that the time period for a court action in a remuneration matter could occur beyond the standard 10-year limit.

Rights to inventions

The right to an invention – in particular, the circumstances and conditions under which the invention was made – is another typical source of questions brought before the Committee. In such cases, the question is often not about whether the invention is an employee invention per se, but rather more commonly a question regarding conditions under which the invention arose and the extent of the employer's right to acquire and/or negotiate rights to the invention. These questions are also often brought before the Committee together with remuneration-related issues.

Non-entitlement claims

Finally, some attention should be paid to non-entitlement claims that occasionally arise in connection with employee inventions, especially in situations where a lack of clarity exists with respect to acquiring, transferring and assigning rights to an invention.

These types of claims may be raised if a party believes that a patent has been granted to or a patent application has been filed by a legal or natural person not entitled to do so. According to the Finnish Patents Act,(5) proceedings instituted on the grounds that a patent has been granted to a person other than the person entitled to it under the provisions of the Patents Act may only be instituted by the person who is claiming entitlement to the patent.

Such non-entitlement proceedings must be instituted within one year after the entitled person gained knowledge of the grant of the patent and of any other circumstances on which the proceedings are founded. Proceedings may not be instituted more than three years after the grant of the patent where the proprietor of the patent acted in good faith at the time the patent was granted or assigned to it.

Comment

Employers should pay close attention to managing invention processes in order to secure their rights under the Finnish Employee Inventions Act as the Act by nature can be considered quite pro-inventor. Well-managed invention processes in companies serve to boost innovation and help to avoid court proceedings while ensuring transparency and equal treatment of employees.

Endnotes

(1) 656/1967.

(2) For earlier articles in the series, see:

• "Employee inventions in Finland – ensuring proper transfer and assignment of IP rights to employers";
• "Employee inventions in Finland – inventors' rights and obligations"; and
• "Employee inventions in Finland – employers' rights and obligations";
• "Employee inventions in Finland – invention remuneration".

(3) 369/2006.

(4) 621/1999.

(5) 550/1967.