Beware of Brazilian legislation when negotiating your R&D agreement

QTechnology is a Portuguese SME engaged in selling software. The company, interested in improving one of its software products, contacted a Brazilian university, whose Department of Computing has established a strong reputation in artificial intelligence.

The company and the university concluded an R&D agreement, by which the university was in charge of performing research in the area of face recognition with the financial support of the company. In addition, the company provided the university with access rights to the source code and know-how of the computer software to be upgraded. 

Six months later, the university informed QTechnology that they had made improvements in the face recognition system by making modifications. Thus, the program had become consistent and reliable. The university claimed that the improvements were theirs and that they were already negotiating with a local institution to use this system. 

QTechnology was puzzled since the section ‘use and exploitation of intellectual property’ of their R&D agreement establishes that the company would own the intellectual property rights of the project results. Moreover, the same section of the agreement clearly stated that the company had granted the university access rights to the computer system in face recognition for the purpose of carrying out the project, but not for other purposes.