Don't be a coward when approaching IP ownership
A recent case provides a timely reminder of just how important it is to address the ownership of intellectual property early on when embarking on a new business venture.Last Friday, Justice Asplin
A recent case provides a timely reminder of just how important it is to address the ownership of intellectual property early on when embarking on a new business venture.
Last Friday, Justice Asplin handed down her judgment in the case of Coward v Phaestos Ltd [2013] EWHC 1292 (Ch). In the case, a husband and wife team began work on a venture providing hedge fund management services to professional investors. Key to that business was an automated system which made investment decisions based on mathematical models and algorithms implemented in software and databases.
The partnership was founded in the early nineties, although the exact date was not agreed upon by the pair, who have since divorced. The corporate structure of the business had, by the time this dispute occurred, become quite complex to reduce certain tax liabilities. However, the key issue in the case was that Mr Coward, who wrote much of the software to be used by the business, did not expressly set out his ownership to the intellectual property in that software. Following breakdown of the personal and business relationships, a dispute arose as to the ownership of the intellectual property in the software involving a number of claims and counterclaims alleging breach of copyright and database rights.
On the facts the High Court eventually held that the software formed part of the partnership assets, but lengthy and costly litigation could have been avoided if the issue had been dealt with during formation.
Last Friday, Justice Asplin handed down her judgment in the case of Coward v Phaestos Ltd [2013] EWHC 1292 (Ch). In the case, a husband and wife team began work on a venture providing hedge fund management services to professional investors. Key to that business was an automated system which made investment decisions based on mathematical models and algorithms implemented in software and databases.
The partnership was founded in the early nineties, although the exact date was not agreed upon by the pair, who have since divorced. The corporate structure of the business had, by the time this dispute occurred, become quite complex to reduce certain tax liabilities. However, the key issue in the case was that Mr Coward, who wrote much of the software to be used by the business, did not expressly set out his ownership to the intellectual property in that software. Following breakdown of the personal and business relationships, a dispute arose as to the ownership of the intellectual property in the software involving a number of claims and counterclaims alleging breach of copyright and database rights.
On the facts the High Court eventually held that the software formed part of the partnership assets, but lengthy and costly litigation could have been avoided if the issue had been dealt with during formation.