On February 18, 2025, the Italian Supreme Court issued Judgment No. 4131, redefining the boundaries of patent exploitation rights among co-owners in the absence of an agreement or consent from other co-owners.
The Case
The case involved a dispute between an Italian company and a Slovenian company, both co-owners of a patent for an industrial invention. The two companies had entered into an agreement regulating their relationship regarding the use of the invention and the exploitation of patent rights. However, this agreement was terminated due to mutual allegations of non-fulfillment.
After the agreement was terminated, the Italian company continued to unilaterally exploit the shared patent by producing and selling the goods covered by the invention. Although it did not have the Slovenian company’s consent for these activities, it did not prevent the other company from doing the same, thereby exploiting the shared patent.
The Slovenian company sought judicial intervention, requesting that the Italian company be ordered to pay royalties or, at the very least, compensation for the unilateral exploitation of the patent following the termination of the agreement.
Both the first and second-instance courts rejected the Slovenian company’s claims.
Specifically, the Court of Appeal of Venice referred to Article 6 of the Industrial Property Code (CPI), which links the regulation of co-ownership of industrial property rights to the rules on co-ownership in the Civil Code, particularly Article 1102. According to the Court, this provision allows a co-owner to use the common property, provided it does not alter its intended use and does not prevent other co-owners from using it according to their rights. In the context of industrial property rights, this means that a co-owner has the right to economically exploit the patented invention exclusively against all parties except the other co-owner.
The Court of Appeal argued that if each co-owner were prohibited from using the patent without the other’s consent, it would render the property right virtually meaningless, as it would always require the other co-owner’s approval to proceed with typical activities such as industrializing the invention and commercializing the products derived from it.
The Italian Supreme Court’s Ruling
Upon reviewing the appeal, the Italian Supreme Court overturned the previous decisions, establishing a new legal principle that contrasts sharply with the conclusions of the lower courts.
The Court emphasized that the primary right granted by a patent is the economic exploitation of the invention, which is exclusive against all parties except the co-owner. Therefore, the Court stated that the patent should be viewed in its market-oriented context, recognizing an undeniable correlation between the rights conferred by the patent and market dynamics.
The Court further explained that since the use allowed to a co-owner under Article 1102 of the Civil Code cannot alter the intended use of the common property, unilateral exploitation of the patent is inadmissible. Such exploitation would undoubtedly alter the patent’s intended use, as individual exploitation diminishes its intrinsic value, changes its purpose, and prejudices the rights of other co-owners to derive benefits from the exclusive rights granted by the patent.
Consequently, the Court annulled the contested judgment and issued the following legal principle:
“In the case of a patent co-owned by two or more parties, the reference in Article 6, paragraph 1, of the Industrial Property Code to the rules on co-ownership of real rights must be understood to mean that, in the absence of a contrary agreement, under Article 1102, paragraph 1, of the Civil Code, a co-owner is prohibited from unilaterally exploiting the invention, as this alters the intended use of the property and thereby infringes upon the exclusive rights of the other co-owners.”
Ilaria Feriti