Normally, there is little difficulty identifying when an employer has the rights to an employee's invention and when those rights remain with the employee. Broadly speaking, it depends on the nature of the employee's duties. In LIFFE Administration and Management v Pavel Pinkava, the Court of Appeal has taken the chance to set out some useful guidelines.

In 2004, the employee invented a system allowing new classes of derivatives to be traded on an exchange. He filed four US patent applications in 2005, but his employers sued, claiming that under the Patents Act they were the rightful owner. At first instance, Mr Justice Kitchin upheld the employers' claim. On appeal, Dr Pinkava argued that his dayto- day duties did not include making the inventions in question, and neither had such duties been specifically assigned to him.

The Court of Appeal, however, held that the inventions were made in the course of Dr Pinkava's normal duties and that it was reasonably to be expected of him that inventions might result from his carrying out of those duties. The Court considered that the primary source of the employee's duties is the contract of employment, but this is an evolving agreement and what the contract said on the date when it was written is not the end of the story. The employee's duties may expand or contract, by ‘a continuous process of subtle variation’. So new duties may become normal ones, with the passage of time.

The Court considered that this was precisely what had happened here, and it went on to say (in case that turned out to be wrong) that by the time the inventions were made the employee's duties had been augmented with new ones specifically assigned to him that included developing the system.

Employers should continue to make contracts of employment as specific as possible about the employee's duties, but also bear in mind that the court may have regard to other factors too. If specific new duties are to be assigned to an employee, this must be recorded in writing with a copy given to the employee.