We have been working through the arguments for universities implementing one-size-fits-all licensing templates for their spinout companies, so that all spinouts are treated the same–as if university spinouts are all the same, or should be made to become all the same through a process that university administrators call “negotiation.”
Consider these different university spinout situations.
(1) university employees expressly hired to invent by the university and working under university direction. Under patent law, any inventions produced in such an arrangement are equitably the university’s. Why should these inventors get the same terms as others if they choose to spin out a company?
(2) faculty or student envisions a business idea that has nothing directly to do with any invention they have made at the university. They spin out a company. Why should the university assert any interest in anything they have done that they place in that company?
(3) inventions are made in work that’s been identified by the researchers and the university as for the public. Why should the results of that work be sequestered for the exclusive benefit of any spinout company? And why should the university be complicit in helping the company secure exclusive control?
(4) researchers want to spin out a company that provides public services related to their research that are easier to provide as a company than as a project within the university. Why should the university demand an equity stake in such a company, or a royalty?–all these demands do is raise the cost of providing the service.
(5) researchers spin out a company based on work that they have done with other university researchers who object to the spin out company getting exclusive rights. Why should the university take title to the rights of all researchers and then offer the standard deal via template to the ones wanting the spinout?
(6) researchers want to gain access to SBIR or STTR funding and so they create a company to apply for these grants and subcontract work back to their university lab. Should the university even allow such a spinout (many do)? and if so, why should such a deal look just like any other?
You get the idea–there are all sorts of situations that call for special treatment rather than a single template agreement that makes all spinouts the same, makes a virtue of doing so, and gives as the “intention” to decrease costs, speed up deals (because no review is necessary), and somehow make things better. One imagines then beat down researchers giving up to accept administrative dictates. Continue reading