In a decision that effectively dismissed all contested claims, Japan’s Intellectual Property High Court held that merely filing a Patent Cooperation Treaty application does not confer enforceable patent rights without corresponding national phase entries — and that because key technical contributions to the blood vessel plug invention came from an external professor rather than from an internal employee, the disputed invention could not be treated as a work-for-hire employee invention.
In a decision that effectively dismissed all contested claims, Japan’s Intellectual Property High Court held that merely filing a Patent Cooperation Treaty, or PCT, application does not confer enforceable patent rights without corresponding national phase entries — and that because key technical contributions to the blood vessel plug invention came from an external professor rather than from an internal employee, the disputed invention could not be treated as a work-for-hire employee invention.The case pits Biomedical Solutions, a subsidiary of Japanese healthcare conglomerate Otsuka Holdings, against former company employees and an affiliated corporation, SG-1 Medical, over several inventions pertaining to a blood vessel to treat vascular aneurysms that were allegedly developed during employment.
At the heart of the case lies a dispute over who holds the right to obtain patents for multiple inventions. The plaintiff, Biomedical Solutions, argued that these were employee inventions that under its established internal protocols rightfully belong to the company. To assert its claim, the company sought judicial confirmation of its right to the patents, relying on both international PCT applications and a domestic patent filing.
The defendants — the former Biomedical Solutions representative director, another former employee, and the ex-director’s affiliated company SG-1 Medical — claimed that the plaintiff’s exclusive patent rights are premature and invalid because the necessary national-phase filings have not been completed, the internal transfer procedures were not properly followed and the true inventorship of the inventions remains in question.
A major procedural issue in this dispute was whether filing a PCT application alone can secure a claim for confirmed patent rights. While the PCT filing streamlines international protection, it is merely an initial step; enforceable rights only arise after the application enters the national phase in each jurisdiction. The defendants argue that without these subsequent steps, the plaintiff's claim to validated patent rights is premature.
The court ruled that simply filing a PCT application does not suffice to secure enforceable patent rights. In the absence of completing the necessary national phase filings, Biomedical Solution's claim to confirmed patent rights was deemed premature.
The Tokyo District Court dismissed the claims based on the international filing process determining that they did not confer any confirmed benefits, while accepting the patent claim stemming from the domestic application. Both the plaintiff and defendant companies appealed the portions of the decision that did not favor them.
Subsequently, Biomedical Solutions amended its lawsuit by adding a supplementary request to secure confirmation of its right to obtain a European patent for the disputed inventions.
In its April 24 ruling, the IP court dismissed all claims, due to the fact that the rights claims based on the PCT application lacked a demonstrable legal benefit, and the disputed invention did not qualify as an employee invention.
In practical terms, the PCT application merely serves as a unified filing procedure; definitive patent rights are only established under the local laws of each country where a national phase entry takes place.
The court noted that while a PCT filing covers all contracting states in principle, Biomedical Solutions had not executed concrete national phase entries in any of the designated countries. Without these follow-up steps, the claimed right lacks the “immediate benefit” required by law.
Although the plaintiff had already been confirmed with the right to have a patent granted under the PCT application, granting its supplemental request for European patent confirmation — without having taken concrete steps in the relevant countries — would only delay the litigation and contradict the principle that patent rights are governed by each country's local laws.
Additionally, a significant part of the procedural review involved the proper identification of the invention’s origin — specifically, whether the disputed invention could be classified as an employee invention.
Biomedical Solutions claimed that the inventions in question were developed during the course of its ex-director defendant’s employment and, hence, the company held the right to secure the patents. However, a closer investigation into two of the contested inventions revealed a twist in the inventorship narrative.
While the ex-director — with a background in business and finance — was initially credited with originating the invention, evidence pointed to a collaborating professor with substantial clinical expertise as the true technical contributor. The professor’s detailed research notes documented the inventive steps taken to overcome significant technical challenges.
The court noted that for someone to be recognized as an inventor, there must be a direct, creative contribution to solving a technical problem. In this instance, the professor’s involvement was seen as much more than supervisory or administrative — it was a hands-on, technical contribution fundamental to the invention’s success.
By establishing that the professor was the primary source of the inventive idea, the court diminished the notion that the invention could automatically be treated as a work-for-hire. This not only affected the legitimacy of the company’s claim to the invention but also influenced the overall assessment of the patent rights’ attribution.
Ultimately, the court dismissed the confirmation claims based on the PCT filings, ruling that because no specific national implementation had occurred, there was no immediate benefit to justify a judgment. Additionally, the court reversed part of the lower court’s decision regarding the domestic patent application associated with one of the inventions, declaring that in the absence of a fully executed employee invention transfer process, the claim could not stand.
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