When improvements are claimed by both sides: what it costs to be wrong
A dispute over who owns improvements made under a licence rarely settles itself. The licence must state, in advance, who owns adaptations and enhancements, and whether the improving party keeps a right to use them once the licence ends. Where the licence is silent, ownership follows the underlying right, not the party who paid for the work.
Basis
Three types of asset generate this dispute most often, and each sits under a different EU act. The act does not decide who owns the improvement. It decides which right is at stake once ownership is settled, and therefore which registry, term and remedy apply.
| Asset improved | Governing EU act | What it settles |
|---|---|---|
| Software adaptation | Directive 2009/24/EC | Economic rights over a computer program, including its adaptation and translation |
| Database enhancement | Directive 96/9/EC | The sui generis right that arises from substantial new investment in a database's contents |
| Patentable improvement | Regulation (EU) No 1257/2012 | The unitary patent route, available once an improvement is itself patentable |
If the improvement is a modified computer program, Directive 2009/24/EC governs who holds the economic rights over the adaptation, separately from who wrote the code. If the improvement is a materially enlarged database, Directive 96/9/EC asks whether the new investment was substantial enough to generate a fresh right, held by whoever made that investment. If the improvement is patentable on its own terms, Regulation (EU) No 1257/2012 sets out the unitary route the parties can use once ownership of the invention is agreed or decided.
Practical consequence
Being wrong about ownership does not stay theoretical. A licensee who assumes ownership of an improvement and starts selling a product built on it can be enjoined from using that improvement once the true owner is established. A licensor who assumes ownership and sublicenses the improvement to a third party can find that sublicence void from the start. Either mistake stops a deal, a funding round or a product launch until the ownership question is closed.
The cost is rarely the improvement itself. It is the time lost while both sides freeze development, the legal spend on establishing who did what and when, and the commercial exposure if a third party has already relied on the wrong answer.
What to do
- Pull the licence and check, clause by clause, whether it defines "improvement" and states who owns it. Counsel does this first, before any other step.
- Identify which underlying right the improvement touches: a computer program, a database, or a patentable invention. This decides which act applies and which registry matters.
- Freeze use of the disputed improvement by both sides until ownership is confirmed, by agreement or by an interim order. Both parties carry this step jointly.
- Send a written notice stating the claimed ownership and the basis for it, dated and delivered to the other party. Counsel drafts and sends this notice.
- Request the other side's development records, version history or deposit records as evidence of who created the improvement and when. Counsel makes this request formally.
- Escalate to the forum named in the licence, or to court if no forum is named and no agreement follows. Counsel manages the escalation from this point.
Who decides
| Forum | Decider | Typical evidence |
|---|---|---|
| Forum named in the licence, if one is named | Arbitrator or judge under that clause | Development logs, version history, deposit records |
| Patent office route, once the improvement is filed | Examiner, then a court on validity or entitlement | Filing date, inventor records, prior correspondence on the invention |
| No forum named in the licence | Court of the licence's governing law | Correspondence, invoices for development work, project records |
Forks
If the licence and any related development agreement are silent beyond the words "work for hire", the improvement's ownership still follows the law protecting the underlying right, not the label the parties used. See When the contract says work for hire and nothing for how that specific gap is closed.
If the improvement sits on branding rather than on the licensed technology itself, the dispute usually turns into a separate question about use of the mark once the licence ends. See A licensee keeps using the brand after termination trade for how that scenario is handled.
If the improved asset is tokenised and custody sits with a platform rather than with either party, the ownership question is compounded by a separate control question. See When custody is held by a platform in practice for that overlap.
Limit
This page does not resolve inventorship disputes between individual employees or contractors; that question sits inside employment and assignment terms, not inside the licence itself. It does not set filing strategy across multiple jurisdictions once ownership is confirmed. It does not replace a review of the specific licence wording, which controls before any of these mechanisms apply.
Verified
Reviewed on 4 February 2025. Sources: Directive 2009/24/EC of the European Parliament and of the Council of 23 April 2009, in force from 25 May 2009; Directive 96/9/EC of the European Parliament and of the Council of 11 March 1996, in force from 27 March 1996; Regulation (EU) No 1257/2012 implementing enhanced cooperation in the area of unitary patent protection, in force from 1 June 2023. For related data-handling duties that often run alongside a licensing dispute, see Data processing agreement overview and the deadline.
Related publications
A related dispute arises when the licence itself does not survive the insolvency of one of the parties. See A licence survives insolvency, or does not IP licence for how that risk is assessed separately from an improvements dispute.
FAQ
What is the first step when improvements are claimed by both sides?
Pull the licence and check whether it defines "improvement" and states who owns it. That clause, if present, decides the dispute before any other evidence is needed.
Which deadline is already running?
Any deadline the licence sets for notice of a claim, and any deadline for filing a patentable improvement, both continue to run while the parties argue about ownership. Neither pauses on its own.
Who decides, and on what evidence?
The forum named in the licence decides first, on development logs, version history and deposit records. Where no forum is named, a court applies the licence's governing law to the same evidence.