Clauses 137 and 138 in the Patent Law determine special provisions regarding government employees’ “service inventions”.
The following was published in the Calcalist financial newspaper (calcalist.co.il) on December 23 and 24, 2009, in articles by Mark Shaun, Meir Orbach and Lital Dovrovitzki:
The State of Israel is suing the Omrix Company and its founder, the entrepreneur Mr. Robert Taub, for the vast sum of NIS half a billion.
A biological adhesive was invented and patented by Professor Uriel Martinowitz, a Government employee at the “Sheba” hospital. The Omrix Company was sold to Johnson and Johnson for the sum of $438 million.
A “service invention” is defined in Clause 132 to the Patent Law as: “an invention by an employee and that invention was reached by that employee due to that employee’s service and during the period of that service”.
If there is no prior agreement between the employee and the employee (in this case, the State) on the subject of the employee’s inventions and patents, that invented by the employee and the patents for those inventions shall belong to the employer (the State).
“The State asks the Court to declare that the patents registered in the Defendant’s name, referring to the biological adhesive preparation and the biological adhesive preparations are based on technology, knowledge and innovations, which are the property of the State”.
The Omrix Company claims that the biological adhesive was invented during the perod of the inventor’s vacation abroad and the State has no rights to the intellectual copyright on his invention and patents.
Salaried Employees’ Patents and Inventions
Israeli Law states that a salaried employee’s inventions, which that employee reached due to the employee’s service and during the period of that service, shall become the employer’s property if they have no prior agreement between them on the matter. This applies to the employee even if the salaried employee works on the development of the inventions and registers the patents during the employee’s own time and not during working hours. A hired employee must notify the employer regarding such inventions and patents.
Clause 137 to the Law obliges employees of the State, soldiers, policemen, workers in Government factories or institutions. If patent is granted to an employee of the state, soldier, policeman, worker in a Government factory or institution, or to any other person receiving a salary from one of those bodies, in accordance with Clauses 55 and 180, the State is entitled to: “exploitation of a patented product forfeited to the State in accordance with Law shall not constitute a breach” and the State is entitled to exploit it for its needs without payment of royalties or compensation to the owner of the patent.
In some countries around the world, a hired employee’s inventions are divided into service inventions and free inventions and there are various guidelines and laws pertaining to the ownership of those inventions. To prevent any future disputes, a hired employee and the employer can draw up a special agreement on the ownership of the employee’s inventions and patents.