University Invention Management Policy Drift

In the olden days, when at least this part of the university world had not become captivated by a misrepresented Bayh-Dole Act, faculty were often expected to negotiate the IP provisions of sponsored research agreements, which often took on the character of institutionally approved consulting. The University of Wisconsin maintained this policy long after most other institutions had suppressed it. However, a faculty member still has the freedom to refuse to participate in an award if he or she objects to the sponsor’s IP requirements, or to the IP requirements inserted into the award by the university’s administration.

Insertion of IP terms by a university administration in sponsored research contracts to take rights from faculty has been a primary scheme to circumvent otherwise liberal policies on faculty ownership of inventions. The university, not the sponsor, uses the university’s policy that contracts take precedence over policy defaults to in effect impose a new policy–if work is sponsored, then the university must own. Faculty generally accept this imposition because they have no alternative but to reject the contract. Negotiation with the administration is–generally–futile and requires litigation and thus requires $200,000 and a couple of years. The university administration understands this–and thus, believes it can do what it wants, take what it wants, so long as it operates over the financial and time thresholds that would trigger faculty opposition.

In federal funding agreements, there is no requirement that the university own rights in patent or copyright to anything produced in the funded project. A university does not have to own anything to comply with law or with the funding agreement or with the patent rights clause in the funding agreement. The university does not have to own deliverables to the government. Information and data may be delivered without an ownership claim. Patents may be dealt with directly between the government and the inventors. Same for copyrights and authors.

An imposed requirement that the university own inventions comes from university administrators, either by policy or by whim. In many cases, it is challengeable whether the administrators have clear standing under the university’s policy apparatus to impose such adverse terms on federal awards. Often, they don’t. Often the policy requirement that an approved contract’s terms take precedence over patent policy defaults was formed in a policy regime in which faculty owned their inventions. The purpose of the provision, then, was to provide for those cases in which a sponsor desired to deal with the university rather than with inventors, and as a contractual condition of the funding. Administrators exploit the suppression of the policy history and interpretation to construe statements of contract precedence to allow the insertion of university-initiated claims. In effect, to change the policy by contracting it away rather than going through a formal process of negotiation with the faculty.

In parallel, university administrators for thirty years repeated the untruth that federal funding vested ownership of inventions outright with the university. It was federal law, or a mandate, or university ownership was necessary to comply, or the university had a first right to take ownership or a right of refusal–they made up any number of rationalizations–all unsupported by the law and the standard patent rights clauses.

Here is the argument: If the federal policy was for universities to own faculty inventions and represent these to industry and investors, then that federal policy, for the sake of consistency and to avoid the risk of non-compliance, ought to be applied to all inventions. Invention, in turn, should be broadened to include non-inventive stuff, just in case an invention happened to be unrecognized in that code or data analysis or expertise or business idea or compound. It was easy, then, to conflate disclosure of commercially valuable things (a conflict of interest issue), fake compliance with federal law (presented as both compliance and fulfilling national policy) to create the illusion that a university had best own everything, just “to be safe.”

The argument undermines academic freedom, public access, collaboration, and independent initiative. It does so without foundation. Worse, the effect of acting on the policy is to create a load of problems that do create compliance liability and lead to even more restrictions and bureaucracy on research, publication, and collaboration. For instance, if a university owns everything, then any representation in any research contract or license with regard to what a company may use invokes the entire ownership portfolio of a university. Any exclusive grant in any agreement may invoke “background rights” throughout the university, whether reported or secured or not. Lab B’s to Z’s results and collaborations and future research funding are potentially compromised when Lab A’s results are licensed exclusively. University administrators then have to work to exclude background rights–a source of huge (and understandable) bitterness by research sponsors and licensees, and have to demand disclosure of everything (or at least make a show of it, so that if a double licensing issue arises, the university can attempt to pass the blame to the investigators in the offending Lab L or Lab T.

Here’s the chain:

Pre-Bayh-Dole

  • Employer has no special right to worker’s inventions.
  • Faculty aren’t employees in the normal sense anyway.
  • Academic freedom.
  • Faculty own inventions.
  • Sponsors may require otherwise, and then those terms supersede policy.
  • The university also may provide special resources, and then special terms apply.
  • Contracts thus supersede patent policy.

Post-Bayh-Dole

  • Federal law and policy requires universities to own.
  • To comply, universities must own everything.
  • Federal expectation and source of greatest income is to license exclusively.
  • Universities must insert ownership claims in all contracts.
  • Since that’s the defacto policy, policy statements should change to reflect it.

Research and Licensing Administrative Clusterf*ck

  • Universities must expand ownership claims to cover background rights.
  • Any use of funds, resources, facilities, supplies, or anything done within the scope of one’s employment or expertise or under the auspices of the university or in collaboration with anyone at the university gives rise to a policy claim of ownership.
  • Universities must withhold background rights and future inventions in licenses.
  • Policy must protect administrators from inventor and industry complaints.
  • Administrators must have freedom to change the policy to deal with uncertainties.

Everyone is screwed (clusterf*ck used in its technical sense) while administrators grapple with the consequences of this chain of reasoning, scattered as it is over fifty years of policy and practice. As administrators adopt the policies of their “peer” institutions, they look at the most recent policies and adopt those, and so like promiscuous lemmings they have produced the worst possible policy, all the while congratulating themselves that they have taken advantage of the most brilliant thinking already done for them at their peer universities. The problem is, the thinking that’s getting advertised is done by not very clear thinkers–clearly many of them cannot draft policy worth a bean. And the good thinking–and there is some great thinking going on–doesn’t make it into policy. So crap comes out, gets the benefit of the University of Michigan reputation, say, and can be then copied by university administrators throughout the world hoping to stay current by copying rather than thinking.

As one administrator was happy to point out to me, my ideas might be workable, but it was professionally proper to work with practices “accepted as normal.” Being “proper” was more important than reason, responsiveness, or doing the right thing. Or, rather, the “right” thing was the “safe” thing, and the “safe” thing was to do what everyone else *said* they were doing. To be different was not to be a leader, or to be responsive, or to be innovative–it was to be “unsafe”–for which one would have to have reasons, have to explain, have to take risk, have to deal with extra work, would have to challenge other administrators in the happy rut of whatever it is they believe about IP or their own careers. Bozonets work this way.

 

 

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