A former engineer leaves, starts a company, and files a patent. Months later the original employer discovers the application describes technology that looks remarkably like a project the engineer worked on internally.

This is one of the more under-managed risks in any R&D-heavy business — and a recent Federal Court decision shows just how fast it can move once it surfaces. The Court ordered the respondents to withdraw a patent application, including filings under the Patent Cooperation Treaty, that claimed priority from technology a former laser engineer had access to during his employment with a defence systems group. The applicant secured an interlocutory injunction — urgent relief granted before trial — on the strength of a serious question that the engineer had misused confidential information under section 183 of the Corporations Act.

The strategic lesson sits underneath the drama: the case was won on the paper trail. Expert evidence aligning the internal concept report with the patent claims, a signed contract assigning IP and defining confidential information, and contemporaneous emails reminding the engineer he could not draw on employer IP — that disciplined record is what made the claim credible enough to justify the order.

The takeaway for in-house IP leads, GCs and founders is that who owns employee inventions in Australia is decided long before a dispute, in the IP clauses in employment contracts and the documentation habits around sensitive projects. Three things are worth checking now: that your contracts assign IP and define confidential information in terms that survive public disclosure; that significant R&D leaves a dated, attributable trail linking people to concepts; and that you monitor patent databases for filings by former staff, because timing is decisive — a forced withdrawal can cost a competitor its priority date permanently, which is exactly why the relief had bite here.

The harder truth is that protecting confidential information from employees is a strategy, not a clause. Once an invention is published, the confidentiality is gone for good, so the value of a strong contract and clean records is that they let you act in the narrow window before that happens.

Read the full judgment — EOS Defence Systems Pty Limited v Pahlavani [2026] FCA 688.