The Full Court of the Federal Court of Australia has answered the above question in the affirmative and ruled that intellectual property rights in inventions made by a university professor in the course of his employment were owned by the professor and not the university. The Court reasoned that while the professor was under a duty to conduct research, he was not under a duty to invent.

A critical finding in this case was that there was no express term in the professor's employment contract which provided that the university would own the intellectual property rights subsisting in any inventions that he made in the course of his employment. Therefore, the university had to resort to an argument that such a term could be implied. The trial court ruled that the terms of the professor's employment in this case weighed against such implication. In particular, the Court found that he was not under a duty to invent and was free to publish the results of his research and any inventions that he made notwithstanding that such publication might destroy patentability. The Court found that a duty to research does not carry with it a duty to invent. The Court appears to have put store in what it described as the distinctive nature of the university/academic relationship such that it was inappropriate to accept "as a general proposition that there is a presumption at law that the university will be entitled to the rights to inventions developed by such staff in the course of their research".

The appeal court also appears to have distinguished between employee inventions in universities and businesses in the private sector. However, the Court said that this "should not be taken as suggesting that the solution reached by the use of the implied term in law is necessarily a desirable one in either case".

The case underlines the importance of employers ensuring that employment contracts contain provisions that deal with intellectual property rights developed by employees.