Summary:
Section 216(3) of the Copyright, Designs and Patents Act 1988 was not limited to cases in which an employee made designs "for" his employer. It applied equally where the designer was the managing director and majority or sole shareholder of a company, who carried out the design in the company's time and with its equipment.
Court:
Ch.D (Laddie J) 3/10/2002
Text:
Trial of a number of preliminary issues as to the subsistence, ownership and infringement of the "Quickfit" system for constructing conservatory roofs. The claimant ('Ultraframe') claimed to be the owner of the design rights in that system under an assignment from the trustees in bankruptcy of the system's designer ('D'). The first defendant ('Burnden'), of which the second and third defendants were directors, admitted that it had exploited some of the Quickfit designs but claimed to have done so legitimately: (a) under a licence from an assignee of one of D's companies, of which he was the sole shareholder and director; and/or (b) as the assignee of one or more of D's companies, all of which were now in liquidation or dissolved. The issues for determination were: (i) what design rights (if any) existed in the Quickfit system; (ii) who owned them, both in law and in equity, at the date of D's bankruptcy; (iii) whether Ultraframe was now the owner of any such design rights; and (iv) whether any licence by D of his design rights to his companies had survived his bankruptcy.
HELD:
(1) Section 216(3) of the Copyright, Designs and Patents Act 1988 was not limited to cases in which an employee made designs "for" his employer. It applied equally where the designer was the managing director and majority or sole shareholder of a company, who carried out the design in the company's time and with its equipment. All the circumstances pointed to D having been employed by his companies, with the consequence that design right in the Quickfit system belonged to them and not to D. (2) There was only one component in the Quickfit system that was not commonplace or which did not fall foul of the "must fit" "must match" exceptions from protection. That component clearly had been infringed by Burnden.
Source: Lawtel http://www.lawtel.co.uk , copyright acknowledged.
Comment
The reference to s216(3) appears to be a misprint and should read s215(3).
The relevant part of s215(3) provides that in the case of design right,
‘where…a design is created by an employee in the course of his employment, his employer is the first owner of any design right in the design’
The corresponding provision in relation to copyright is in s11(2) of the act, and that provides that where a work:
‘'is made by an employee in the course of his employment, his employer is the first owner of any copyright, subject to any agreement to the contrary'
The point about this case is that it makes clear that the rule in the case of design right (that the employer is generally the first owner) applies in the case of a sole shareholder / director carrying out the work in the company’s time and with the company’s equipment; by analogy, it would seem likely that the same will apply in the case of copyrights created by a sole shareholder / director carrying out the work in the company’s time and with the company’s equipment.
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