Reasons to record 1, 2, 3…
Failure to record transactions/changes relating to registered intellectual property rights (IPRs) at relevant IP offices can have significant consequences

Registered IPRs (e.g. patents, SPCs, trade marks and designs) can be highly valuable assets, and significant time, effort and investment goes into their creation, development, exploitation and acquisition.  All too often, however, changes to registered owners’ details or transactions affecting registered IPRs are not recorded at the relevant IP offices.  This can have significant consequences for the interested parties (including the potential loss of rights) and can complicate future dealings in those IPRs.

This note outlines the types of transactions that are registerable and the key reasons for recording those transactions at the relevant IP offices as soon as possible after the relevant transaction has taken place, including, in particular the United Kingdom Intellectual Property Office (UK IPO), European Union Intellectual Property Office (EUIPO) and, in the case of European patent applications, the European Patent Office (EPO).

Types of registerable transactions

Not all transactions involving registered IPRs are recordable and this varies from country to country.  The types of transactions that can be recorded at the UK IPO, EUIPO and EPO include:

  • Changes in ownership – the transfer of legal title to a registered IPR from one entity to another (e.g. by assignment or merger).
  • Changes to the owner’s name and/or address.
  • Third party interests – for example, the grant of a licence or security interest (e.g. the use of a registered IPR as security for a loan).

Key reasons for recording registerable transactions

In our experience, the three key general reasons for recording registerable transactions as soon as possible after the relevant transaction has taken place are: (1) putting third parties on notice of the transaction; (2) ensuring legal standing for the owner/licensee to take enforcement action; and (3) potential time/cost savings.

  1. Notice to Third Parties

Under English law, a party acquiring rights in registered IPRs will not be affected by an earlier transaction unless they knew about it at the time of their own acquisition.  Recording an assignment, licence or other registerable interest at the UK IPO is deemed to put third parties on notice of those rights.  For example, if B acquired a UK patent from A and the assignment was not recorded at the UK IPO and then C subsequently acquired the same patent from A without notice of B’s interest, C would retain ownership of the patent.  However, had B recorded its acquisition of the patent at the UK IPO before the patent was sold to C, C would have been bound by B’s earlier rights.  Similarly, if B licensed an EUTM from A and the licence was not recorded at the EUIPO, B’s rights would not necessarily be protected if A subsequently assigned the EUTM to C.

Recordal as a means of providing protection against third parties who subsequently acquire conflicting interests in registered IPRs is not limited to the UK or EUIPO as similar principles apply in many other countries.  Therefore, to protect your rights in registered IPRs against third parties, it is critical that the relevant transaction is recorded at all relevant IP offices.

  1. Legal standing to take enforcement action

In some countries, owners or licensees of registered IPRs do not have legal standing to start infringement proceedings unless and until their interest in the IPR has been recorded at the relevant national IP office.  Also, whilst in Europe there is generally no requirement to record a transaction within a certain period of time after it has completed, there can be implications for litigation where the recordal is not carried out promptly (e.g. implications on the recovery of legal costs in UK litigation as explained further below).

  1. Potential time/cost savings

Assuming that the relevant IPR assignment, licence or other documentation is in order, recording registerable transactions at the relevant IP offices is, in theory, straightforward.  In practice, however, it is not uncommon to find that previous registerable transactions and/or other changes affecting registered IPRs have not been recorded and, as a result, the details of the registered IPRs are out of date on the official registers.  In such situations, it is necessary to locate all relevant documentation and perfect the chain of title (sometimes requiring confirmatory assignments or licences, or official company documents, powers of attorney etc.) before the latest registerable transaction can be recorded.  The more out of date the register is, the more complicated, time consuming and expensive this can become, particularly where companies earlier in the chain of title no longer exist.

Whilst it may seem like an unnecessary administrative burden at the time (particularly where the change only affects the registrant’s name or address, rather than ownership changes or third party interests), keeping the official IP registers up to date on an incremental basis each time a registerable transaction or other change takes place can lead to time and cost savings in the long run.

Specific reasons for recording registerable transactions at the UK IPO

There is no statutory obligation to record registerable transactions at the UK IPO, but, in addition to the general reasons for recording registrable transactions set out above, a specific reason to record registerable transactions at the UK IPO relates to the recovery of legal costs in infringement proceedings.

Recovery of costs in the event of infringement proceedings

In patent and registered trade mark infringement proceedings at the UK courts, a successful claimant will normally be awarded their legal costs (i.e. the losing party will be ordered to pay some or all of the successful claimant’s legal costs).  However, where the patent or registered trade mark in question has been assigned or exclusively licensed to the claimant, legal costs are only recoverable from the date of registration of the assignment or licence.

Therefore, if a new owner or exclusive licensee of a patent or registered trade mark intends to bring infringement proceedings in the UK, it should ensure that the relevant assignment/licence is recorded at the UK IPO as soon as possible, certainly before infringement proceedings are commenced and, ideally, within six months after the date of the assignment/licence transaction.

The importance of prompt recordal on the recovery of legal costs in UK IP infringement proceedings was highlighted in the case of L’Oréal Société Anonyme & L’Oréal (UK) Limited v RN Ventures Limited (a decision of the UK High Court from February 2018).  See here for our case report.

Specific advantages of recording registerable transactions at the EPO

Before grant of the European patent

A European patent provides its owner with a bundle of national rights in countries which are members of the EPC.  During the pendency of a European patent application it is possible to record an assignment or other registrable transaction (e.g. grant of a licence or security interest, or change of name or merger) via one central recordal at the EPO.  Changes in ownership or to the registered owner’s name or address that are recorded centrally will flow down into each of the national patents once the European patent grants.  This is a highly cost-effective way of recording such changes as not only does it eliminate the need to apply for separate national recordals in each jurisdiction, but it also circumvents additional formalities and execution requirements that may otherwise be required at the national level.

Note that a third party interest recorded at the EPO will need to be recorded at national level after grant of the relevant European patent.

Within the 9-month opposition period or whilst the European patent is under opposition

Recording an assignment or other registrable transaction of a recently granted European patent during the 9-month opposition period or whilst the European patent is under opposition can also assist with meeting local recordal requirements in many national patent offices across Europe.  This is because the official EPO communication confirming recordal of the registrable transaction provides supporting documentary evidence of the transfer.  At many national patent offices, this EPO communication can be used to satisfy local documentary requirements and greatly simplify the recordal process at national level.

Specific advantages of recording registerable transactions at the EUIPO

Recording a registerable transaction concerning an EU trade mark (EUTM) at the EUIPO is not mandatory, but the recordal of licences, rights in rem (e.g. security interests) and certain other registerable transactions has specific additional advantages (see the EUIPO’s Trade Mark Guidelines):

  • The owner of the EUTM cannot surrender the mark without showing that the registered licensee/pledgee has been informed in advance of the owner’s intention to surrender.
  • The EUIPO will inform the registered licensee/pledgee of the expiry of the EUTM at least six months in advance.

Please contact our IP Transactions team if you have any questions about recording a registrable transaction or otherwise making any changes to your IPR registrations.