Defining Patent Ownership in India: Employment Contracts as Valid Proof of Right

Introduction

In India, a patent application can be filed not just by the true and first inventor, but also by the assignee of an inventor. This is provided for under Section 6 of the Indian Patents Act, 1970 (the Act), which allows an application to be filed, either individually or jointly, by the true and first inventor, an assignee of the inventor, or a legal representative of the inventor or the assignee.

Procedure requires that, where an application is filed by an assignee, under Section 7(2) of the Act, read with Rule 10 of the the Indian Patent Rules, 2003 (the Rules), the proof of the right to make the application be furnished latest within six months of filing the application. This strict timeline is designed to ensure that only parties with legitimate entitlement seek patent protection.

Ordinarily, the Indian Patent Office (IPO) accepts the following documents to fulfil the proof of right requirement:

1. Form 1 (of the Rules) signed by the inventor;
2. Assignment deed executed between the inventor and the assignee;
3. Declaration submitted before World Intellectual Property Organisation (WIPO) for applications under the Patent Cooperation Treaty (PCT), as per under PCT Rule 4.17; or
4. An Employer-Employee (EE) agreement

Although seemingly straightforward, establishing proof of right before the IPO can be challenging, particularly when the inventor is not available. For instance, what happens if an inventor passes away, or an employee-inventor leaves the organization before signing proof-of-right documents? In the event of an inventor’s death, the IPO invokes Section 6(1)(c) of the Act, which requires an assignment executed by the deceased inventor’s legal representative. In cases where inventors’ signatures cannot be obtained on Form 1 or assignment deeds, applicants may submit EE agreements. In practice, the IPO has maintained that an EE agreement without an explicit intellectual property (IP) clause is insufficient to establish that inventions created by the employee have been validly assigned to the employer.

Recently, the Delhi High Court in Nippon Steel Corporation v. The Controller of Patents (C.A. (COMM.IPD-PAT) 10/2025, dated 24 December 2025), provided considerable clarity on the proof of right in India.

Background

The dispute arose in connection with an Indian patent application filed by Nippon Steel (the Appellant), which listed four inventors, all employees of Nippon Steel. At the time of filing, Form 1 was executed by three inventors; one inventor had passed away. For the deceased inventor, the Appellant submitted the company’s Basic Regulations and an EE Agreement (with an English translation signed by the deceased inventor) to establish proof of right. These documents effectively stated that, under the company’s internal policy, all IP, including patents, created by employees in the course of their work vests with the company, as per Article 8 of the Basic Regulations.

The IPO did not recognise these documents as valid proof of right, and the matter reached the Court. During the proceedings, the Controller of Patents (the Respondent) argued that the EE Agreement could not serve as valid proof of right or assignment because of its general nature, potential ambiguity, and non-compliance with specific requirements under Indian patent law. It also pointed out that the agreement lacked a clear IP transfer clause and did not have the requisite assignment from the inventor’s legal representative.

The Appellant had also submitted a declaration made by it before the United States Patent and Trademark Office (USPTO), but this too was rejected by the Respondent on grounds that the declaration merely stated that the inventor was deceased, which was insufficient under Indian law. The Respondent also relied on Section 68 of the Act, which mandates that assignments of the patents must be in writing.

The decision

The main issue before the Court was whether the EE agreement and declaration filed by the Appellant for proof of right was sufficient to establish ‘proof of right’ under the Act.

The Court held that when an assignee files a patent application, they must provide ‘proof of the right’ within six months. It further clarified that Section 6(1)(b) does not prohibit the assignee from filing an EE Agreement  as evidence to satisfy the proof of right requirement. Accordingly, an EE Agreement, duly signed by a deceased inventor, is an acceptable document to comply with the requirement of ‘proof of the right’ under Section 7(2) of the Act.

The Court also aligned its reasoning with global standards. The European Patent Guide permits any kind of written evidence of transfer, such as the original or a copy of the transfer instrument or other official documents. Similarly, the USPTO’s Manual of Patent Examining Procedure recognizes employment agreements as an acceptable document for ownership.

The clincher was perhaps the fact that the IPO had previously accepted similar documents from the same Appellant in six other patent applications with the same inventors, making the IPO’s refusal in this case appear arbitrary and unsustainable.

The Court rejected the Respondent’s reliance on Section 68, clarifying that it applies exclusively to assignment of granted patents and not in the case of the right to apply for a patent. The Court noted that procedural laws are meant to “subserve, and not to subvert” justice, and that, in this case, “non‑compliance with a procedural requirement is not frustrating”.

Implications

The Delhi High Court’s ruling is a significant and positive development for patent practice. Employers can now rely on EE Agreements and internal policies as proof of right, reducing the need for separate assignments, especially in cases where the inventor is not available for signing the documents. However, keeping documentation in order is always advisable, including ensuring that the EE agreements and internal policies relied upon clearly record that all IP, including patents, designs, etc., created by employees in the course of their work with the employer-assignee, vests with the employer-assignee. This will ensure that proof of right is clearly established. The Court’s clarifications on this account also help avoid delays and bring Indian practice closer to global standards. This will also hopefully lead to fewer technical rejections at the IPO, and fair and consistent standards being applied during examination.