Facts

The invention in question was a method of wagering on card games whereby a player is given a secondary bet or wage option. This could be used with alternative card games, to exercise bet options on a primary game concurrently or sequentially with a secondary or auxiliary game. A provisional application was filed that identified Mr Davis (the respondent) as the inventor and disclosed a supplementary betting option only for the game of baccarat.

Following this, Mr Kafataris (the applicant) was sought for his expertise in the wagering and gaming industries. In negotiations, he wanted to pursue a commercial relationship that would recognise him as a contributor and consequently, would enable him to benefit from pecuniary reward. The respondents did not agree to his terms and, as such, negotiations fell through. It was found, however, that changes were subsequently made to the PCT application from the provisional application, in which the game of blackjack was included.

Mr Kafataris sought recognition pursuant to section 15 of the Patents Act 1990 (Cth) as a co-inventor of the PCT application, on the basis of this contribution.

Co-Inventorship – quality contributions, not quantity

At first instance, Sackar J of the New South Wales Supreme Court held that Mr Kafataris had not made a material contribution to the invention. His Honour held that, although the parties worked closely together (which may be indicative of a joint-invention), there was still a need for the Court to distinguish between qualitative and quantitative contributions to the invention as a matter of fact.

The Full Federal Court on appeal upheld Sackar J's finding that Mr Kafataris' involvement and analysis of the game did not involve an inventive step and should not be seen as a material contribution to the invention. The Full Court found that Mr Kafataris merely provided another example in which the invention could be used, and this alone was not enough to confer entitlement on him as a co-inventor.

Notwithstanding that the provisional application focused exclusively on baccarat to the exclusion of anything else, in the circumstances, the Court considered that there was nothing new about baccarat or blackjack. The novelty of the invention was instead identified in the supplementary betting option, which the inventor Mr Davis had contemplated at all times.

The Court restated accepted principles from cases such as University of Western Australia v Gray, that in determining inventorship, a two part inquiry is involved:

  1. analysis of the inventive concept of the patent application; and
  2. consideration of whether the alleged co-inventor made contributions that had a material effect on the inventive concept.

Confidentiality, or lack thereof

Mr Kafataris claimed that there was an equitable obligation to keep his additions and "blackjack invention" confidential, insofar as to preclude disclosure or use of that confidential information other than for the benefit of the appellants and respondents, or unless Mr Kafataris was named in the PCT application as an inventor or an applicant.

The evidence, however, suggested otherwise, as Mr Kafataris made clear in cross-examination that he circulated the information freely and without imposing obligations of confidence. The Court held accordingly that no fetter of confidence should be implied. Further, the Court held that the material lacked the requisite qualities to be protected as confidential information given the ease at which it could be replicated. Even though Mr Kafataris spent many hours and days calculating the odds, it was largely, if not entirely, based on information available on a public website.

Implications

This case demonstrates that whether or not an individual's contributions will amount to him or her being recognised as a co-inventor depends on qualitative rather than quantitative effort.

To prevent uncertainty in situations where more than one contributor is involved and avoid potential invalidation of patent protection, parties should clarify their obligations within the arrangement to ensure awareness of roles and entitlements pertaining to the invention.