University IP policies are an unusual subject matter for the English courts, so it was a rare occurrence that the English Patent Court had to grapple with the terms of a university intellectual property policy to decide whether the university could validly claim rights under its IP policy.

The case – Oxford University Innovation Ltd v Oxford Nanoimaging Ltd [2022] EWHC 3200 (Pat)

This case was brought by Oxford University for outstanding royalties of over £700,000payable by Oxford Nanoimaging Limited, a spin out company of the university. The defence to payment of these royalties was that the terms of the university’s IP policy were too broad, as the university could claim patent rights in respect of inventions created by a DPhil student “in the course of or incidentally to” their studies, and as such the IP policy was unfairly balanced in favour of the university and therefore void and unenforceable.

While the court rejected the university’s arguments that the DPhil student contracts were not subject to consumer protection legislation (they were and so the Unfair Terms in Consumer Contracts Regulations 1999 applied), the court then went on to assess whether the terms of the IP policy were significantly imbalanced in favour of the university and whether they were made in good faith.

Court findings of the IP policy

The court found the terms of the IP policy did not cause a significant imbalance between students and the university, and were made in good faith, it did comment on the IP policy generally, particularly as there were two versions at issue: one that was incorporated into the DPhil student’s contract and the subsequent amendments that had been made by the university following concerns expressed by students as to the scope of student-created IP.

The court found that in the previous version of the IP policy (which was incorporated into the DPhil student’s contract) there was a “potential imbalance” between students and the university for claims of IP made or created “in the course of or incidentally to their studies”, for the following reasons:

1. Such terms would deprive the student of their IP rights in circumstances where the university’s contribution was negligible.
2. Students were not paid to invent (unlike employees), but generally pay to receive an education.
3. Such terms went beyond national law.
4. Such terms were out of line with other universities’ IP policies (the court in fact consulted 10 other university IP policies in assessing the claim and preparing its judgment).
5. Such imbalance had been acknowledged and debated by the university itself (which led to an amendment and removal of such term in the amended IP policy).

The court did acknowledge there were some circumstances where such a position would be reasonable i.e. where inventions were created jointly with university employees, where students further developed existing inventions owned by the university, created using University facilities, etc.

However, the court did not believe the IP policy created a significant imbalance to the detriment of the DPhil student and found it not to be unfair. There was no significant impact on students generally as the university was found to only apply for 100 patents through World Intellectual Property Office per year, and there was no evidence that the university had in fact enforced its rights under the IP policy to apply for patents so as to claim rights from students. When the wording of the IP policy was brought to the University’s attention, they changed the wording to address the potential imbalance and unfairness this could cause. The University justified the amendments as not intending to alter the meaning of the University’s policy or practice, as reflecting the position more accurately.

A first for English courts

The court itself acknowledged this is the first case heard in the English courts which dealt with issues of applicability and impact of consumer protection legislation of terms relating to the intellectual property rights of students and terms relating to employed academics.

It is a stark reminder for universities not to overreach in their claims over IP rights created or developed by students. IP policies should include appropriate sections which set out the position on IP ownership between academics, undergraduates, postgraduate research students, and employees.

Contracts/agreements

Contact:  Carys Thompson  carys.thompson@shma.co.uk

With reduced customers due to the cost of living crises, staff shortages and soaring energy prices, added to the effects that the Covid-19 pandemic has had over the past two years, the hospitality industry is facing extreme pressure.

Although the promise of support by the government to help businesses in the sector has been made nothing has yet materialised, leaving businesses feeling uncertain and being forced to decide if they can continue to trade.

How has the Covid-19 pandemic affected the sector?

There is a misconception that the hospitality sector recovered during 2022, however briefly, however this was most certainly not the case. With the sector being one of the industries hit hardest by the pandemic, it has taken far longer to recover. The restrictions imposed on businesses during Covid-19 led to many workers leaving the sector to look for alternative employment. Added to the Brexit immigration measures that were implemented around the same time, staff shortages are rife, further dissuading talent from staying in the sector.

With so many other important areas to support, such as the NHS and the social care industry, the government has almost overlooked hospitality and has provided no specific measures to help struggling businesses in this sector recover long-term.

Cost of living crisis

There’s no doubt that the cost of living crisis is deterring people from spending money on non-essentials, such as eating and drinking outside of their homes. Even those who can afford to spend are tightening their purse strings as a precautionary measure.

This means the hospitality sector is once again trying to navigate a near impossible situation, and it is no wonder that venues up and down the UK are beginning 2023 with caution. January, February and March are notoriously the most difficult months for the industry and with surging energy prices, many venues are already resorting to opening reduced hours or even forced closures the first part of the year due to the limited bookings in preparation to ensure some balance for the year.

How businesses is the hospitality sector are supporting each other

Whilst government support is conspicuous by its absence, the sector is pulling together to support itself wherever possible. For example, Boxpark uses its experience with flexible and accessible retail locations to hire out venue space to smaller, independent restaurants, bars or cafes, which may otherwise not be able to afford a bricks and mortar presence. This model helps smaller businesses by keeping the cost of rent and utilities down, whilst potentially increasing footfall to what can be marketed as a destination venue.

As similar groups, like First Table, provide opportunities for restaurants to offer reduced priced tables between specific times in the day (for example 3pm-6pm), this is largely utilised by businesses who use the time to have meetings with clients and contacts. This is fantastically beneficial to restaurants, as those are particularly quiet times to fill a restaurant.

Additionally other hospitality businesses providers have reached out to businesses with larger workplaces in order to run onsite cafés, or provide their products to an existing one to diversify their offering and provide additional income streams.

These examples demonstrate that if hospitality businesses start to think laterally, flexibly and creatively with regard to diversifying income streams, they can put themselves in the best possible financial position for the year ahead.

Government support

Although many providers are coming up with their solutions and working collaboratively with others, the government still needs to provide specific targeted support for the sector in order for it to survive, and grow.

While the past few years have been tough for the industry, and 2023 currently appears as if it will be no different, the hospitality sector is resilient and innovative, and fully capable of overcoming the challenges on the horizon. It will continue to find ways to keep going from strength to strength.

Food safety, licensing and regulatory compliance

Contact: Melissa  Toney   melissa.toney@shma.co.uk