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It can be easy to let your guard down once a business relationship has developed. You’ve manoeuvred your way through the negotiation stage, signed the contracts and the partnership is going well; surely you can be a little more relaxed now? Sadly not! The Intellectual Property Enterprise Court has shown that, even if a contract identifies the owners of certain intellectual property rights, a subsequent agreement can transfer ownership without the parties even being aware.

In this particular case[1], the defendant was tasked with creating designs for an Italian scooter. The initial agreement clearly specified that the two registered Community designs would belong to the claimant. However, a supplemental agreement was held by the IPEC to vary this so that the parties owned these rights jointly, even though this was never explicitly stated. It was decided that both parties were allowed to continue to make the products in accordance with the design, meaning that the defendant could continue to manufacture these scooters even after the claimant had found a new supplier.

This is a useful reminder that supplementary and side agreements are just as important as the initial contracts between two businesses, and that careful drafting is key (which will come as no surprise to any lawyer). It is also important to state, clearly and unequivocally, who is to own the rights in any intellectual property that is created as part of any business venture.

After spending so much time, money and effort at the beginning of a joint venture it can be tempting to skip the formalities later down the line, but this could be costly (as the claimant in the above case found out). Take care when making new arrangements, preparing new contracts and generally when dealing with your intellectual property rights.

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If you would like to discuss how to protect your brand further or require additional information, please contact one of our Intellectual Property experts.

This article is for general information only and does not constitute legal or professional advice. Please note that the law may have changed since this article was published

[1] Scomadi Ltd and another v RA Engineering Co Ltd and others [2017] EWHC 2658 (IPEC), 27 October 2017