An amazing consequence of the Bayh-Dole Act is that no university technology transfer office is required for its implementation. No OTL, no affiliated research foundation, no nuthin’. A university can operate perfectly well under standard patent rights clauses by waiving its right to elect to retain title or transferring that interest to other organizations, meet the objectives of Bayh-Dole, and stay out of the patent accumulation and litigation business.
This does not mean that a university should not have a technology transfer office. There are good reasons for universities to do so. It does mean, however, that those reasons do not include “because Bayh-Dole requires it”. Doesn’t. Bayh-Dole also doesn’t require compulsory assignment of inventions to the university, and does not ensure that universities own every invention, or patent, made with federal support. We have been over this ground in other discussions. A technology transfer function is an important thing. It works as a kind of library for new stuff, an institutional effort to identify and make available results from research efforts. A technology transfer function also works as a kind of publication capability, preparing results for access in ways that conventional manuscripts don’t require. Third, a technology transfer function works as a form of university extension, as instruction, to provide capable audiences with the ability to learn new practices. If technology is transferred, it is because it is taught, not merely owned and licensed. These are good things. A university really ought to pay attention to this stuff.
One might go so far to say, making licensing a required first step, rather than a necessarily included later step, may be one of the great defects in the present way in which US universities go about managing intellectual property. Making licensing more important than instruction is a sure way for universities to forget what they do well, and what the public expects of them. Technology transfer as turned into a tool of forgetfulness both of public mission and of how innovation adoption comes about.
By not electing to retain title under its Standard Patent Rights Clause (SPRC), a university leaves title with the inventors and stes up a up a negotiation between the inventors and the funding agency. An agency may then allow the inventors to decide whether their invention is sufficiently valuable that they wish to take a personal interest in it, or whether the funding agency is better positioned to manage the invention, at the agency’s expense. In other words, by not electing to retain title, a university permits its creative employees to work directly with the government on a strategy for development.
As an alternative, a university can assign its interest in subject inventions under a patent rights clause to one or more other organizations. A university may do this prospectively, or after a given funding agreement has been accepted, and even after a subject invention has been reported. The university may obtain a financial interest in the organization’s exploitation of the invention (as universities do in transferring subject inventions to their affiliated research foundations) or not.
Using this approach, universities can designate their inventors or principal investigators to make choices regarding invention management. Nothing in the SPRC specifies who makes the decision for the university regarding election to retain title. The university may designate whomever it pleases. Members of the faculty are employees of the university ever as much as patent administrators are. Designate faculty inventors. And for non-faculty inventors, designate principal investigators. Following this approach, a university could report the invention to the agency, and then ask the inventors what they want to do. If they want the government to hold title, it’s easy: the university notifies the government that it will not elect to retain title. If the inventors want to retain title themselves, then the university can query the government as to its willingness to do a 37 CFR 401.9 agreement with the inventors. If the agency will, then the university gives notice that it waives its interest in title concurrent with the agency approving the inventors’ retaining title.
If the agency declines to approve personal ownership, then the university can come back to the inventors and ask them to identify an organization that could hold the rights on their behalf. If the organization qualifies for outright assignment under SPRC (k)(1), and the organization agrees to the transfer, then the university can elect to retain title and transfer its Bayh-Dole obligations to the organization, which then can take assignment from the inventors under SPRC (f)(2). If the organization doesn’t qualify, then the university can request approval from the agency before the transfer.
For transactions with other organizations, the university can do the same thing for the inventors that it would do in working with federal agencies. It will only transfer its SPRC interests if the organization has reached a deal acceptable to the inventors. No deal, no transfer.
This kind of work is low overhead. It could be done, even in a research university with $500m or more in federal funding, by one person. An arrangement a day, many happy groups of inventors. No technology triage assessments, no patenting expenses, no marketing, no license negotiations, no threatening litigation—nothing, in short, that a university patent administrator taking advantage of compulsory university ownership loves.
For all this, a university can still “make money” from such a program. First, it might expect that for helping inventors in this way, if some of them turn out to be successful, they might be motivated to give back to the university. This is a strategy that is well documented as successful. The development office could even fund the patent officer position, and everyone would be happy, regardless of whether the inventor’s gifts went to engineering or to comparative literature.
Second, the university could cut deals with organizations that wanted to work with its inventors, so that those organizations shared a portion of their side of any income with the university. That would be something that university’s inventors would also approve, then, in selecting organizations with such deals. But what does it matter to the inventors what their collaborating organizations do with the organization’s share of any money that’s made? Finally, a university might “make money” by becoming associated with successful deployment of research inventions. Companies and the government might prefer to sponsor additional research at the university, based on its reputation for collaboration. If the university handles its indirect costs well, that could be an ongoing source of income, long after the first patents have expired.
Imagine a university choosing to do what it does really well—reporting research results, teaching others how to practice new things, providing support to its innovators, and advocating for the community to take up its discoveries, mediating where there are problems, and bringing people together to get things done. Imagine a university giving up the effort to compel all faculty inventors to give over their work to a patent bureaucracy under the control of the institution, often poorly resourced or matched to opportunities that is expensive, difficult, and ready to create liability and adverse press at any time. It is possible. It can be done. It would be really cool. I’d love to work in a technology transfer office set up with this approach. It would be very, very successful in its work.