Inventor remuneration and change in ownership of the company
Could a company be liable to pay compensation for a property right position based on an employee invention even though the employee inventor has never worked for that company?
The short answer is "yes". This is particularly possible if there is a sale, change of ownership or reorganisation of the company after the inventor has left.
Inventor remuneration after the inventor leaves the company
In principle, if the employer has granted a licence to the property right position or sold the property right position, the employee must participate in the resulting proceeds. This follows logically from the utilisation of the monopoly position created by the service invention.
If a service invention is utilised by the employee, there are no such direct proceeds for the monopoly protection, but there are monetary benefits. Therefore, the employee must then participate in a fictitious patent licence fee to be determined in line with market conditions. Pursuant to Section 26 ArbEG, the employee's entitlement to a share continues to exist even after the end of the employment relationship; pursuant to Section 9 (1) ArbEG, the legal debtor of the remuneration claim is the employer.
If there is a sale, the decisive question with regard to the inventor's remuneration is how the change of ownership was legally realised:
Asset deal
If a patent is sold by the employer between independent market participants - known as an asset deal, individual property right positions or an entire property right portfolio are sold - the debtor of the remuneration is not exchanged, but the employee is to be remunerated from the sales price. This also applies if the assets are transferred individually (singular succession).
Share deal
If the company shares are transferred ("shares" - depending on the legal form: shares, business shares, capital shares), the company has a new owner (or several owners). However, since the company continues to exist unchanged in principle, there has been no legal change of ownership with regard to the patent (see also Bartenbach/Volz, Employees' Inventions Act, 6th edition, Section 1 para. 114).
There is therefore still a claim to remuneration from the exploitation activities of the transferred company. After a share deal, the debtor of the remuneration is the transferred company, namely for past and future exploitations.
Sale of the property rights position with a change of debtor order
The situation is different only if labour law (in German: Arbeitsrecht) orders a change of debtor in connection with the sale of the property rights position due to a transfer of business pursuant to § 613 a BGB (German: Bürgerliches Gesetzbuch).
In this case, the employee is not to be remunerated from the sales price, but from the monopoly advantages of the company acquirer. If an employee inventor does not participate in the transfer of business, in particular because he has previously left the company, the decisive question for the inventor's remuneration is whether the sale was an asset deal or a share deal.
As already said, an employee inventor is to be remunerated conclusively and from the proceeds of the sale in the case of a sale as an asset deal, whereas in the case of a sale as a share deal, there is still a claim to remuneration from utilisation activities such as own use within the company.
Merger or demerger under the German Reorganisation Act
If there is a merger of different legal entities or a demerger in accordance with the German Reorganisation of Companies Act (§ 2 UmwG), there is no separate transfer of individual assets as in an asset deal, but the assets of the transferring legal entities are transferred to the acquiring legal entity by way of universal succession in accordance with § 20 No. 1 UmwG, including the liabilities. If these assets include property right positions based on service inventions, these liabilities also include the employee's remuneration claims.
Therefore, the remuneration claim of an employee inventor who has already left the company at the time of the merger continues to exist against the absorbing company. The absorbing or new company is then liable for remuneration for past and future utilisation (see Arb.Erf. 23/21).
It is therefore quite possible that a company is or becomes liable to pay remuneration for IP rights positions even though the employee inventors were never employed there.
In this context, you may also like to read:
Inventor remuneration and agreement on R & D
Co-inventors in companies - mention of the inventor
Inflation compensation for staggered reducted remuneration
Calculation of inventor remuneration
The calculation of an appropriate inventor's remuneration in accordance with the Employee Inventions Act requires the consideration of a large number of parameters and the complex legal requirements.
We are happy to support you in this. We have many years of expertise in the calculation and interpretation of employee remuneration and can provide you with competent and legally compliant advice.
Please contact us by telephone on +49 69 69 59 60-0 or please send us an email info@kollner.eu.
