[Updated with new examples to replace ones since removed from the web–whack-a-mole time]
I have pointed out how AUTM’s summary of Bayh-Dole puts its own misleading spin on the law. Here is how this bad advice works in the wild. Again, AUTM’s widely distributed and repeated summary (with my emphasis):
Major provisions of the Act include:
- Non-profits, including universities, and small businesses may elect to retain title to innovations developed under federally-funded research programs
- Universities are encouraged to collaborate with commercial concerns to promote the utilization of inventions arising from federal funding
- Universities are expected to file patents on inventions they elect to own
- Universities are expected to give licensing preference to small businesses
- The government retains a non-exclusive license to practice the patent throughout the world
- The government retains march-in rights.
Now here is a summary of remarkable similarity from the University of Alaska, Fairbanks:
Some of the key points of the act are:
- Non-profits and universities can elect to retain the titles to inventions made under federal sponsorship;
- Universities are expected to file patents on inventions they elect to own;
- Universities are encouraged to commercialize the inventions;
- Inventors are obligated to disclose and assign inventions to the university;
- The government retains non-exclusive license to practice the patent; and
- The royalties must be shared with the inventors.
This is pretty much the same AUTM list, with bits of re-writing and no source citation. We leave aside bits like “the titles” for “title”, as if the names given to the inventions are the subject of the law. Notice how AUTM’s problematical restatment regarding collaboration to promote utilization of inventions is transformed into the equally but differently problematical “encouraged to commercialize the inventions.” Not really. Here is the sequence of relevant objectives from 35 USC 200 (again, my emphasis):
It is the policy and objective of the Congress to use the patent system to promote the utilization of inventions arising from federally supported research or development…
to promote collaboration between commercial concerns and nonprofit organizations, including universities;
to ensure that inventions made by nonprofit organizations and small business firms are used in a manner to promote free competition and enterprise without unduly encumbering future research and discovery;
to promote the commercialization and public availability of inventions made in the United States by United States industry and labor….
Apparently this statement of objectives is difficult to read. Folks want to read it to say, “It is the policy and objective of the Congress that universities use the patent system to promote royalty-bearing licenses to companies to inventions arising from federally supported research and development.” It is as if the authors of these summaries are striving to introduce into their statements of the law language that confirms their preferred practices–institutional ownership, fixation on commercialization, expectation that industry should be collaboratively and compliantly accepting royalty-bearing licenses. One might wonder that perhaps the reason for this effort is that the authors of these summaries cannot find the language they need, so they have to patch it together out of wording that sounds close.
But the UAF summary has points that are not what the law reads, or what it means. It is Congress’s intention to promote use of inventions and to promote collaboration–the law does not “encourage” these things in the sense of laying out an appeal to universities to make money granting exclusive patent licenses and to industry to willingly pay for everything universities patent. Rather, the law makes changes in federal agency contracting with universities with the idea that the changes will lead to collaboration, commercialization, and public availability. But UAF’s summary creates a new mandate under which universities are to commercialize inventions.
If this sounds “picky”–it is and it should be. These summaries should be accurate, not sloppy, not plain wrong. That’s because it matters what the words mean, and it matters that those who set themselves up to provide public guidance at universities get it right. State what the law really does require. Don’t mix into the law one’s institutional interests. If that’s what is indicated, then summarize how the university implements practices under the patent rights clauses in federal funding agreements.
So let’s work it through. Utilization–the use–of inventions is very general. Commercialization is one way to promote use of an invention. But then making an invention freely available is also a way to promote use. In Bayh-Dole, “commercialization” and “practical application” are used in parallel. There is no requirement to commercialize inventions that does not also give the alternative of practical application. Indeed, it is practical application, not commercialization, that merits a definition in Bayh-Dole.
It is the aim of the Congress to use the patent system to promote use of inventions. That’s the point for Bayh-Dole’s adjustments to federal agency procurement rules concerning inventions made in federal research. We get “commercialization and public availability of inventions made in the United States by United States industry and labor” later. In this construction, we have to figure out what “by United States industry and labor” modifies. The noun cannot be “inventions” because these are the inventions made by universities and non-profits (for the most part). The noun must be “commercialization and public availability”. That is, the objective is to promote commercialization and public availability by industry and labor–not by universities. Universities are not called upon to commercialize anything. The concern of the law is that university-made inventions are used to promote free competition. One wonders how university licensing programs promote free competition these days.
The UAF summary also misstates Bayh-Dole’s requirements with regard to assignment. Bayh-Dole authorizes the creation of standard patent rights clauses. The standard patent rights clause for universities requires that universities require their research employees to make a written agreement to protect the government’s interest. That’s the (f)(2) agreement, for those who have followed the work at Research Enterprise. Under that agreement inventors-to-be commit to disclose inventions to their university, to sign paperwork to allow patent applications to be filed, and to sign paperwork to establish the government’s rights. Bayh-Dole does not require inventors to assign inventions to universities, nor does it require the creation of a patent rights clause that requires such assignment. In fact, Bayh-Dole does not require assignment at all. Inventors can retain ownership of their inventions, with the approval of the funding agency. Inventors are required by the university, in compliance with the standard patent rights clause, to commit to “establish the government’s rights” whatever those rights end up being. If the inventors don’t assign to a pre-approved invention management agent, then the agency can rely upon the inventors’ written commitment to request, and receive, assignment of inventions.
In any case, nothing in Bayh-Dole requires assignment of inventions to the university. That is a position that Stanford v Roche dismissed. Universities really should revise their documents to reflect the law accurately. It may be that UAF requires assignment of inventions to the university (and it would be interesting to see how UAF handles that requirement), but a university requirement to assign ought to be set out as just that and not represented as if it were a requirement of federal law. My intent is not to pick on UAF–there are any number of universities with similar problems in their public guidance on Bayh-Dole. Here is NCCU:
Bayh-Dole did not “unlock” any inventions. The Act prevented federal agencies from requiring assignment of inventions in federally supported projects to the government as a default. Inventions assigned to the government were generally available non-exclusively. They were, then, unlocked by the government. Bayh-Dole prevented this unlocking, replacing it with whatever non-federal forces were able to act on inventors to extract ownership of subject inventions from them. Further, Bayh-Dole has nothing to do with “innovations”–it deals only in patentable inventions (plus plant variety protection). And there’s nothing in Bayh-Dole about encouraging university administrations to “participate in technology transfer activities.” The brochure is a mixture of conveniently sloppy summary and made-up stuff that sounds good.
here is the University of California (my emphasis)[document since removed]:
In 1980, however, legislators and the administration concluded that the public would benefit from a policy that permitted universities and small businesses to elect ownership of inventions made under federal funding and to become directly involved in the commercialization process.
(note the added bit claiming universities cannot assign their ownership to a third party–despite 37 CFR 401.14(a)(k)(1)).
here is UNCG (slides 26 and 27) [still up!]
here is Rice University
Bayh-Dole does not place the responsibility for “commercialization” with universities. It restricts what federal agencies may require to be assigned to the federal government. Throughout Bayh-Dole, the emphasis is on practical application, not commercialization. Practical application gets a definition. Commercialization does not. Wherever commercial sale shows up, so does “use.” One does not, generally, have to commercialize a research invention to allow it to be used.
Here is the University of Pittsburgh:
Bayh-Dole didn’t give institutions the right to claim title. It prevented federal agencies from claiming title except in exceptional circumstances. Institutions, via the standard patent rights clause, were allowed to keep title if they acquired title. Further, the title is not to “research results” (a wildly broad term) but only to patentable inventions within the scope of the “planned and committed” activities of the federally supported project. But it gets worse:
Bayh-Dole does not require universities to “claim title” in subject inventions. That’s pure nonsense. And remember, this document has been up long after Stanford v Roche was decided (it is still up as of May 2016).
In all this, AUTM’s misstatements, put forward as authoritative, appear to be a primary culprit in promulgating these sorts of mis-guidance throughout the country, leading authors of guidance to write in their own preferences as if those preferences were the law.