[1] The case holding that in a case where the issue was whether Company A acquired a non-exclusive license on the patent right or utility model right registered in a foreign country on the basis of an employee invention on the patent right and utility model right registered in the Republic of Korea, which was completed under an employment contract entered into with Company B, as a preliminary issue of the claim for prohibition of interference with business of Company B, the court of the Republic of Korea has international jurisdiction on the above

[2] The governing law applicable to a legal relationship regarding an employee invention (i.e., the governing law on an employment contract which serves as the basis of occurrence), and whether such a legal principle is likewise applicable to utility models (affirmative)

[1] The case affirming the judgment below holding that in case where Gap company acquired non-exclusive licenses on Eul company's patent rights or utility model rights registered in a foreign country on the basis of the patent rights and utility model rights completed under an employment contract entered into with Eul company and registered in the Republic of Korea on the basis of the invention for patent rights and utility model rights, since Eul company's completion of its employee invention is the Republic of Korea, and the patent rights or utility model rights registered in a foreign country on the basis of the employee invention are not related to the establishment, invalidity, etc. of patent rights or utility model rights registered in a foreign country and are not within the exclusive jurisdiction of the country where the registration was requested, the above party and the disputed case are substantially related to the Republic of Korea, and thus the court of Korea has international jurisdiction

[2] Matters pertaining to the attribution and succession of the right to obtain a patent in an employee invention, the employer’s acquisition of a non-exclusive license, and the employee’s right to claim compensation constitutes rights and obligations based on an employment relationship between the employer and the employee. Therefore, even in relation to extra legal relations, the rights and obligations arising from an employee invention do not relate to the establishment, loss, invalidation, or revocation of a patent right required by registration due to its nature, and thus, cannot be subject to Article 24 of the Private International Act, which provides for the protection of intellectual property rights based on the principle of territorialism or the principle thereof. The right to obtain a patent in each country for an employee invention arises from the same invention assessed as one of the social facts on the basis of a single employment relationship, and requires a uniform interpretation in accordance with the law of the country where the employment relationship exists with respect to legal relations arising from an employee invention for the protection of the interests and legal stability of the parties. Considering these circumstances, it is reasonable to view that the applicable law to extra legal relations regarding an employee invention is the applicable law to a utility model.

[1] Article 2 of the Private International Act, Article 39(1) of the former Patent Act (amended by Act No. 7869 of March 3, 2006) (see Article 10(1) of the current Invention Promotion Act), Article 20(1) of the former Utility Model Act (amended by Act No. 7872 of March 3, 2006) (see Article 10(1) of the current Invention Promotion Act) / [2] Articles 2, 24, and 28(1) and (2) of the Private International Act, Article 10(1) of the Invention Promotion Act

A.M. Co., Ltd. (Attorneys Lee Im-soo et al., Counsel for the plaintiff-appellant)

Defendant (Law Firm Dao, Attorneys Park Jong-mun et al., Counsel for the defendant-appellant)

Seoul High Court Decision 2011Na20210 decided December 8, 2011

The appeal is dismissed. The costs of appeal are assessed against the defendant.

The grounds of appeal are examined (to the extent of supplement in case of supplemental appellate briefs not timely filed).

1. As to the ground of appeal on international jurisdiction

Article 2(1) of the Private International Act provides, “Where a party to a lawsuit or a disputed case is substantially related to the Republic of Korea, the court shall have the international jurisdiction. In this case, the court shall comply with reasonable principles consistent with the ideology of allocation of international jurisdiction in determining the existence or absence of substantial relation.” Article 2(2) provides, “The court shall determine the existence or absence of international jurisdiction, taking into account the provisions of the domestic law, and shall fully consider the special nature of international jurisdiction in light of the purport of the provision of paragraph (1).” Therefore, the court shall determine international jurisdiction in accordance with the basic ideology of ensuring the fairness, appropriateness, speed and economy between the parties, such as equity, convenience and predictability of the parties to the lawsuit, as well as the interests of the court or the State, such as the appropriateness, speed, efficiency, and effectiveness of the judgment, shall also be considered together, and whether there is a need to protect any of these diverse interests shall be determined reasonably based on objective criteria for individual cases, such as the substantial relation between the suspension of law and the parties, and the suspension of law and the dispute (see, etc.).

According to the records, the plaintiff is a legal entity established under the laws of the Republic of Korea, and the defendant resides in the Republic of Korea as a citizen of the Republic of Korea. The issue of this case is whether the plaintiff acquires a non-exclusive license on the patent right or utility model right registered in a foreign country based on an employee invention (hereinafter "employee invention in this case") registered in the Republic of Korea, which was completed under the employment contract entered into with the plaintiff and registered in the Republic of Korea. The defendant's completion of the employee invention in this case can be known to the Republic of Korea. And the issue of whether the plaintiff has a non-exclusive license on the patent right or utility model right registered in a foreign country based on the employee invention in this case is not related to the establishment, loss, invalidation, etc. of the patent right or utility model right, and it does not fall under the exclusive jurisdiction of the country where the registration was requested or the court of the country where the registration was requested (see Supreme Court Decision 2009Da19093, Apr. 28, 2011).

The judgment below to the same purport is just and there is no error in the misapprehension of legal principles as to international jurisdiction, as alleged in the grounds of appeal.

2. As to the ground of appeal on the governing law for the acquisition of non-exclusive license

A. Matters pertaining to the attribution and succession of the right to obtain a patent in an employee’s invention, the employer’s acquisition of a non-exclusive license, and the employee’s right to claim compensation constitutes rights and obligations based on an employment relationship between the employer and the employee. Therefore, even in relation to extra legal relations, the rights and obligations arising from an employee’s invention do not relate to the establishment, loss, invalidation, or revocation of a patent right required by registration due to its nature, and thus cannot be subject to Article 24 of the Private International Act, which provides for the protection of intellectual property rights based on the principle of territorialism or the principle thereof. The right to obtain a patent in each country for an employee’s invention arises from the same invention that is substantially evaluated as a single social fact based on one employment relationship, and requires a uniform interpretation in accordance with the laws of the country governing employment relations with respect to legal relations arising from an employee’s invention for the protection of the interests and legal stability of the parties. Considering these circumstances, it is reasonable to view that the applicable law to extra legal relations with respect to the employee’s invention is the law governing the employment contract.

B. In light of the parties’ reasonable intent, etc. taking into account the following factors, the Plaintiff and the Defendant are corporations established under the laws of the Republic of Korea, and the place where the Defendant performed the labor contract with the Plaintiff as a national of the Republic of Korea, and the Plaintiff and the Defendant have an implied intent to conclude the labor contract as the law of the Republic of Korea. Even if not, since the place where the Defendant ordinarily provided labor is the Republic of Korea, the governing law on the labor contract between the Plaintiff and the Defendant ought to be deemed as the law of the Republic of Korea under Article 28(1) or (2) of the Private International Act.

In addition, according to the above legal principles, the law applicable to whether the Plaintiff acquires a non-exclusive license to the patent right and utility model right registered in a foreign country on the basis of the employee’s invention completed under the above employment contract is also the law of the Republic of Korea, which is the law applicable to the above employment contract. This law is Article 39(1) of the former Patent Act (amended by Act No. 7869 of Mar. 3, 2006; hereinafter “former Patent Act”) and Article 20(1) of the former Utility Model Act which applies mutatis mutandis under the former Patent Act (amended by Act No. 7872 of Mar. 3, 2006; hereinafter “former Utility Model Act”).

Therefore, even if the Defendant is registered in a foreign country on the basis of the instant work invention completed under an employment contract concluded with the Plaintiff, the Plaintiff shall have a non-exclusive license pursuant to Article 39(1) of the former Patent Act and Article 20(1) of the former Utility Model Act which applies mutatis mutandis thereto.

Although part of the judgment below is not appropriate at the time of the original adjudication, it is acceptable to this purport. Contrary to the allegations in the grounds of appeal, the court below did not err by misapprehending the legal principles on the legal nature of intellectual property rights and the applicable law of the acquisition of the non-exclusive license, or failing to exhaust all necessary deliberations.

3. Conclusion

Therefore, the appeal is dismissed, and the costs of appeal are assessed against the losing party. It is so decided as per Disposition by the assent of all participating Justices on the bench.

Justices Kim So-young (Presiding Justice)