A sense of proportion–5

One can see, then, where Bayh-Dole comes into play in this meaningless mess. Bayh-Dole was drafted by the same folks who created the IPA system. The IPA system was shut down in 1978 as ineffective and contrary to public policy. Bayh-Dole emerged the next year, slogged through Congress, failed, and then was revived, tacked onto a bill to make technical changes to federal patent law, and passed in a lame-duck session as a parting gift to Senator Bayh, who had lost his re-election campaign. Bayh-Dole was given the appearance of doing what the IPA program had done.

Norman Latker, the NIH patent counsel that had developed the IPA program, had a hand in the Nixon patent policy revisions of the Kennedy patent policy, and then had a hand in drafting the Federal Procurement Regulation that codified the Nixon patent policy (because the Nixon patent policy had added this requirement for codification, by perhaps total coincidence), wrote later that Bayh-Dole was based on the IPA program. Really, Bayh-Dole was based on the Federal Procurement Regulation, not the IPA program, but because the FPR, which become effective in 1975, was designed to create the opportunity to expand the IPA program government wide, really Bayh-Dole was constructed out of parts of the IPA and FPR, a sort of franken law raised from the dead to serve university patent administrators. Continue reading

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A sense of proportion–4

To lay it out in bullet points, the now dominant university patent-based approach to research inventions defaulting to exclusive licenses:

    • fragments invention platforms with no way to restore them
    • attracts speculative investors while pushing away companies
    • raises barriers to early adoption and variation on new technology
    • induces companies to work to undermine the invention rather than build on it
    • constricts the value of new technology to an institutional licensing relationship

None of this “protects” research inventions. None of this facilitates technology transfer. Quite the opposite. There’s enough money supporting this approach, however, that all that’s needed is one big financial outcome every two decades or every 5,000 inventions per university to make it all appear profitable–a patent license, a startup is acquired, an infringement judgment, a financial settlement in a contract dispute. All the other inventions in the university’s “portfolio” then become the grist for the successful deal, and the practice perpetuates itself for another couple of decades. Continue reading

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A sense of proportion–3

Prior to federal funding becoming the dominant source of university research funding, most universities operated their invention policies with a review committee that made recommendations to the university president with regard to particular inventions. The volume of invention reporting was sufficient low that people could consider possible a committee review. But with even a small uptick in the volume of inventions reported, committees were simply not workable. They would have to meet daily if not weekly, they would have to have technical, business, and legal knowledge from across the whole gamut of university research, they had no idea what to do if they said “no” to taking on any given invention, as “no” appeared to waive the whole invention policy apparatus. By the early 1980s, university invention review committees at a research university of any size were unworkable.

Instead, university administrators worked with Research Corporation to streamline reporting of inventions directly to Research Corporation. Research Corporation worked in the 1970s to create “technology transfer offices” at universities to help inventors recognize inventions and report them to Research Corporation for review. Thus, there were on many campuses people who knew something about inventions, how to document them for management review, and how to get them to Research Corporation or some other agent. These people were motivated to get invention agents to pick up reported inventions for management–each one represented the prospect of licensing income–and therefore of continued employment for the administrators involved. Conversely, each invention that was not adopted by an invention management agent meant the loss of the effort to get the invention fully documented and the prospect of having to waive the opportunity to make money for the university back to the inventor. Continue reading

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A sense of proportion–2

University administrators have engaged in a thirty-year effort of research invention management that creates patent gridlock for what amounts to a tiny bit of the overall inventive activity in the country. That’s the black border area on this nice blue circle:


This domestic block fest is particularly the case for federally funded inventions–but keep in mind we are talking about 0.8% of all US patents from 1981 to the present.

The federal government early on in its foray into funding research to advance the frontiers of science and whatnot constrained itself to avoid the concentration of economic power that might arise if only a few companies or regions gained the benefit of federal subsidies–as Vannevar Bush had done during World War 2, contracting with only select companies and universities to get the indicated work down. Instead, the government committed itself to spreading the work around. And in doing so, by design federal funding fragmented where inventorship would arise in its programs for any given field of scientific and technological inquiry. It wasn’t that much of a problem, however, because federal invention policy meant that the government would acquire inventions made under contract other than with companies who had established commercial positions and make those inventions available to all.

Put simply, companies with real business could keep their patents, subject to a government license, and non-profits and contract research organizations that just did research for doing research would treat inventions as contract deliverables, knowing that they would get a non-exclusive license to practice along with everyone else. Another way: the federal government aimed not to disturb the commercial marketplace by its contracting–it wanted companies to participate in a fashion so that no one company obtained a dominant position with regard to others merely for having latched on to a source of government subsidy not available to the rest.

Yet another way: the federal government maintained its commitment not to use the patent system to sue its own citizens for using what they had funded nor to take a financial interest–necessarily then conflicted with regard to regulation and justice–in anyone exploiting patent rights under a government license.

Thus, as long as university research inventions were treated as contract deliverables, available to all via the federal dedication of inventions to the American public, spreading the work around to various universities and regions of the country–research as a form of economic pork rather than for its timely and useful results–was not a big deal because the government in effect made inventors and their employers cooperate in the release of the inventions to all. Continue reading

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A sense of proportion–1

“If life is going to exist in a universe this size, the one thing it cannot afford to have is a sense of proportion.”

Douglas Adams, Hitchhikers Guide to the Galaxy

In the Bayh-Dole era–1981 to the present–the US Patent Office has issued somewhere around 6.1 million utility patents. During this time, American universities and their affiliated nonprofits have obtained around 120,000 patents, of which a bit over 50,000 cite federal funding. We can illustrate this situation:

The circle area represents all US utility patents in the Bayh-Dole era. The university contribution is 2%, the federally funded university contribution is 0.8%. That is, the university contribution is within the area taken up by the black border of the circle, and the federal contribution–for maybe a trillion dollars of research–is less than half of that black border.

Counting patents is pretty much goofball. A lot of patents does not mean a lot of innovation. A lot of patents might not mean anything at all. A lot of patents is like describing a baseball season as a lot of hits. There’s not much one can tell from counting hits. What did the hits do? Who won what games? Were the games fun to watch? One hit in a 1-0 nine inning game no hitter may be worth way more than 22 hits in a 17-2 blowout. Counting patents, like counting hits without context, is meaningless. Continue reading

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The 100x Model–1 Protection

Bayh-Dole uses “protectable” with respect to inventions 35 USC 201(d). That’s strange. Nothing else in patent law has to do with protecting inventions. What could “protection” have to do with inventions, as a matter of law no less? To get at an answer to this question, we will have to explore the policy scheme that back claims about why the Bayh-Dole Act is necessary.

Let’s talk patent “protection.”

The Bayh-Dole Act is part of federal patent law, Title 35 of the United States Code. Among the strange provisions of Bayh-Dole, we find this at 35 USC 201(d):

The term “invention” means any invention or discovery which is or may be patentable or otherwise protectable under this title or any novel variety of plant which is or may be protectable under the Plant Variety Protection Act (7 U.S.C. 2321 et seq.).

Why strange? First, this is the only definition of invention in federal patent law, and it stipulates–for the Bayh-Dole Act, in Chapter 18, at least–that an invention is any invention that is or may be “patentable or otherwise protectable” under federal patent law. To work the grammatical logic here, an invention is any invention that may be “protectable.” Patentable is just one form of protectable. Not particularly helpful. Perhaps the part that operates is that an invention may also be a plant variety protectable under the Plant Variety Protection Act–but that’s not federal patent law.

But the second strange thing is the use of “protectable” with regard to inventions. Nowhere else in federal patent law is protectable used this way. (There’s really no other use of protect, protection, or protectable in federal patent law but for a header “Patents and Protection of Patent Rights”–not protection of inventions by means of patent law, but protection of patent rights from loss by means of proper registration).

What then is this “protectable” doing here? What does it mean for an invention to be protected by federal patent law? It’s one thing for a patent to be issued for an invention–the patent gives the patent holder an exclusive right for a limited time to (1) prevent others from practicing the invention and (2) to receive compensation as awarded by a court for infringement of the patent. As a result of these two rights, patent holders then have (3) the opportunity to grant licenses under their patent rights to those willing to provide in return consideration for the license without being taken to court. And, according to patent law, patent rights have the attributes of personal property, (4) patent holders may assign their patents and may receive consideration for doing so–indeed, for an assignment to remain effective, the assignor pretty much has to receive something of value in return–see 35 USC 261. Continue reading

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Univeristy and Exclusive Licensee Exposure to Bayh-Dole Non-Compliance

I’ll try to make this simple.

When a university creates a written policy that commits it to attempting to commercialize inventions made with federal support, that policy alters the scope of any proposal the university submits for federal funding. Commercialization becomes a purpose of the funding.

When a university furthermore demands that faculty investigators assign all inventions to the university as a condition of employment or as a condition of participation in sponsored research, the university confirms that the scope of any federally funded project includes commercialization. What faculty investigators may intend by their work is irrelevant. The university intends to attempt commercialization with any invention within the scope of its claims.

When a university in addition claims that its technology transfer program provides it a competitive advantage in obtaining federal grants, the university makes it ever more clear that it intends commercialization to be an intended part of any federal project.

With me so far? Continue reading

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“Protection” of inventions in Bayh-Dole

Twitter thread:

Federal patent law uses “protect” with respect to inventions only in Bayh-Dole’s strange definition of invention at 35 USC 201(d): “is or may be patentable or otherwise protectable under this title” What does it mean to “protect” an invention?

“otherwise protectable” implies that “patent” as a matter of law is a form of “protection” A patent grants the patent holder with respect to practicing an invention (i) the right to exclude others and (ii) the right to require compensation. So what is the *protection*?

But wait, there’s more! Bayh-Dole’s policy requires the patent system to be used to *promote the utilization* of inventions arising from federally supported research or development. 35 USC 200. This is a working requirement that applies only to Bayh-Dole inventions. Continue reading

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Another question on RE: When does Bayh-Dole not apply?–6

To get at subject inventions, we will cover some of the same ground as that series of RE articles on subject inventions, but from a different angle. Bayh-Dole’s contracting provisions do not apply if an invention made under federal contract is not a subject invention. Most importantly, Bayh-Dole does not apply if an invention made under contract is not owned by a party to the funding agreement. Other federal laws or contracting requirements may apply, but not Bayh-Dole.Let’s say that Bayh-Dole does operate and (in a parallel universe) folks want to comply with (and enforce) the standard patent rights clause. For that, we must look at Bayh-Dole’s definition of subject invention.

Remember, here, “invention” has Bayh-Dole’s definition–a patentable or maybe not patentable invention or a plant variety (which is clearly not patentable) or something otherwise protectable (or not) under the federal patent statute. The “subject” in “subject”  invention means, roughly, “an invention that is subject to a federal claim of ownership under federal statute or executive branch patent policy operating through a patent rights clause in a funding agreement.”

Bayh-Dole’s policy statement (35 USC 200) applies to all inventions (as Bayh-Dole defines them) arising from federally supported research or development. That broad policy statement (not merely an objective), as part of federal patent law, sets the bounds for the property rights in patents on such inventions (see 35 USC 261).

Bayh-Dole’s contracting provisions (35 USC 202, 203, and 204) apply to subject inventions only. Bayh-Dole’s standard patent rights clause is restricted to implementing 35 USC 202, 203, and 204 (see 35 USC 206). So those contracting provisions apply only to subject inventions, not any inventions, not even any patentable inventions made under federal contract. All that disclosure and elect to retain title and filing patent applications and other fussy stuff has to do with subject inventions.

No matter what else, an invention cannot be a subject invention until it is owned by a party to the federal funding agreement–owned by a contractor. Continue reading

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Another question on RE: When does Bayh-Dole not apply?–5

We are working through when Bayh-Dole does not apply.

Bayh-Dole doesn’t apply to works of authorship or copyright or data or data rights or know how or trade secrets (except to keep trade secrets secret even when the trade secret involves the terms of a license with the government) or trade marks or trade names or mask works or software. Bayh-Dole doesn’t apply to federal funding agreements that are not for research, experimental work, or development. Applies to funding agreements primarily for education or training only to assert that it doesn’t apply other than that assertion. Doesn’t apply to stuff that’s determined to be not patentable (except for plant varieties), nor to stuff that that’s not made with federal assistance. For that matter, Bayh-Dole does not apply to universities, other nonprofits, or small businesses–Bayh-Dole applies to federal agencies, specifying what federal agencies must do with contracting for inventions and licensing of inventions. So Bayh-Dole doesn’t apply to anyone else.

Bayh-Dole engages contractors by means of its patent rights clauses, which are placed in federal funding agreements. When a contractor chooses to accept federal assistance under a funding agreement for research, experimental, or developmental work, a Bayh-Dole patent rights clause comes along. The patent rights clause is conditional. It applies when there is a subject invention. A contractor turns an invention into a subject invention by taking ownership of an invention made under the funding agreement. A contractor may add parties to the funding agreement by any assignment, substitution of parties, or subcontract of any type. So a contractor may also make inventors parties to the funding agreement. Then the inventors are also contractors. When they invent, they own their inventions. Those inventions then are also subject inventions. Got it?

Continue reading

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