Restoring voluntary assignment for university inventors is the first step in reconditioning university invention management–and putting that management on a road of development consistent with university mores and roles. Voluntary assignment can be accomplished a number of ways. I will outline a few here.
- correct interpretation of policy–often policies are drafted with a narrow scope on claims but that scope has been expanded by administrative interpretation
- change policy–often the change does not have to involve dramatic redrafting
- change acceptance practice in the IP office
- implement (f)(2) properly for subject inventions
- change state law (for public universities)
Let’s look at each for a bit, and then consider some of the advantages of voluntary assignment as well as how to handle voluntary assignment in typical situations that arise.
Correct Interpretation of Policy
University patent policies are frequently drafted to give the appearance that they claim a broad swath of inventions, when a careful and reasonable reading does not support that first impression. Consider this example. The analysis involves a careful reading–something that university patent administrators apparently often find objectionable! And yet, anything other than a careful reading suggests that the words do not mean anything–or, rather, the words together on the page are simply an expression of the authority of the administrator to make up anything that appeals to the administrator in the moment. That’s nice if one thirsts for power. But it runs against the idea of a formal written policy, which is premised on the idea that a written policy constrains such unruly administrative behavior and uses words to have a meaning that administrators, faculty, employees, and the general public can all agree upon using their ordinary reading skills. Let’s do some reading, then.
Here are the operative sentences from the University of Iowa patent policy:
Through its designee, the University of Iowa Research Foundation (UIRF), the University will assume ownership of patents on qualifying inventions made by its employees and appointees. In a limited number of situations, the University, through its designee, will assume ownership of patents on qualifying inventions made by students and institutional visitors.
Note the use of the future “will assume” in the present policy statement. There is no indication here that inventors must expressly assign their inventions (there is later, in part). It is as if inventions have free-form ownership floating about in space, to be gobbled up by an active university pac-man roaming the halls. There is also the strange ambiguity of “assuming” ownership–with the overtones of “treating the invention as already being owned by the university” or “taking on the appearance of ownership” rather than “taking for oneself” (see “arrogate”). One might think a clearer statement of the claim would be “the University will demand assignment of patents” or “the University requires the assignment of patents” or, perhaps closer to the truth of what happens, “the University will force the assignment of patents.” If one wanted to run closer to the law, then “the University will enter into agreements with its personnel that provide for the assignment of inventions that are or may be patentable.”
There is also the dissonance of the university claiming ownership of patents in the same breath that it designates a research foundation to take ownership of the patents. And, of course, there is the further problem that, actually, the university asserts that it assumes ownership of patents on “qualifying” inventions and does not wait for a patent to issue before “assuming” ownership of it.
The simple statement is this: “The University will take ownership of those inventions that this policy allows it to own.” Instead, however, we get the apparatus of “qualifying” inventions.
The use of “qualifying” is a stand-in for stating the scope of the claim on patents (or inventions) in the Iowa policy. Here are the conditions for “qualifying”:
Inventions made by University employees or postdoctoral appointees in the course of their employment or appointment or in a field or discipline reasonably related to the inventor(s)’ field(s) of employment or appointment.
“Course of employment” comes from liability law–what one does as the agent of a master to accomplish the master’s tasks. In this sense, the scope here starts with those activities that the university, as master, requires of “employees.” For non-faculty, such things are found in job descriptions and in particular work assignments. But for faculty, who also are appointed and who enjoy a policy-based commitment to academic freedom, the times in which faculty accept direction from the university administration for what they should do are necessarily limited. Read in this light, “course of employment” indicates assigned work faculty do for the university.
Generally, research is not assigned by the university, though the university administrators might expect faculty to do research, and may set up promotion decisions based on research grants and publications. Thus, in this first prong of what makes an invention “qualifying,” the criterion is that the faculty member has been hired to invent, directed to a task by the university, and the invention therefore shows up in the work the faculty member does to complete the assigned task. That’s narrow. Some universities handle this condition as a form of “commissioning” in writing for additional consideration (or compensation)–often this sort of language shows up in copyright policies, for instance.
The scoping statement here, however, adds two other elements, both of which carry a degree of cognitive dissonance. Let’s start with “course of appointment.” This is a strange construction. An appointment is necessarily not employment–the words here are distinct, and there’s no indication that the policy intends these to be read as synonyms being used for, say, stylistic variation to relieve the boredom of policy drafting. So there’s nothing to guide the understanding of what it means for one to have a “course of appointment.” Perhaps this means “what one does while appointed” but there’s nothing that connects any such doings back to tasks performed for a master who directs work. An appointment would stand outside such a thing–or there would be no need to reference it as a separate condition of engagement with the university.
It does appear to be clear from the parallelism that “employee” and “course of employment” are meant to be connected, as are “appointees” and “[course of] appointment.” It is not the case of mix and match–not “employees in the course of their employment or appointment” and “appointees in the course of their appointment or employment.” A reasonable reading of “course of appointment” is that the university here is making a claim parallel to that of employment, and so if the university commissions work to be done by an appointee–that is, the work is done under the direction of a university administrator, then any invention that results is “qualifying.”
We turn to the second bit of dissonance. The drafting here goes full on to double terminology, extending the scope of claim to include “a field or discipline reasonably related” to the inventor’s field(s) of “employment or appointment.” Here it appears that the drafting is trying to be economical and in doing so introduces strangeness–an inventor is either employed–is an employee–or is appointed–is an appointee. There is no need for the “or.” There are two parallel conditions, one for employees and one for appointees. But the real trouble starts with “field or discipline,” which gets carried through to the field(s) (but not disciplines) that are “reasonably related.”
In the first prong, the university claims inventions made in the course of directed activities for the master. In the second prong, those activities are placed in two categories–field and discipline. One may be asked to do work to design a custom air filter for a building ventilation system. Is one then working in the discipline of “mechanical engineering”? Is one’s field that of “environmental health”? What, even, is the difference between a “field” and a “discipline”? A field would appear to be a general term for any “area” in which one might be seen to operate. A discipline would appear to be a term for the areas recognized by university departments–physics, mechanical engineering. People from varied disciplines–mechanical engineering, medicine–then, might work in the same field of environmental health. It’s a subtle distinction that doesn’t appear to have any particular role in the policy statement, given that discipline is dropped when we move to what’s “reasonably related.”
Here’s the sequence. Take the invention. Assign it to a field or discipline. Now take the course of employment. Put that course in one or more fields, or areas of activity. Now ask whether the “field or discipline” of the invention is “reasonably related” to the fields to which the course of employment has been assigned. The policy generalizes the invention (without any guidance regarding who makes the generalization), generalizes the course of employment (again with no guidance), and then asks if the generalizations are “reasonably related” (without indicating who makes the relation and what it means to relate fields and disciplines). In a grand scheme of things, this is nonsensical stuff, but here it is formal written policy and we are expected to make some sense of it anyway.
If one is assigned to devise a new air filter for a campus ventilation system, and while doing that, one invents a new way of controlling the interior fan on a car, since both the course of work and invention can be said to be in “reasonably related” fields of environmental health, then the invention is “qualifying” and the university “assumes” ownership via the research foundation. Yet the work of devising an interior fan on a car has, arguably, nothing to do with a new design for a building air filter, especially from the perspective of a deliverable intended for the university. The extension of scope here goes beyond even a non-compete covenant, since the work on a car fan doesn’t compete at all with air filter designs in buildings. Perhaps if the work for the car had to do with designing a new air filter for the car, and that air filter could also be used in buildings, then one might ask whether the work for the car filter ran in the same “course” as the work on the building filter.
But the policy statement here doesn’t observe such niceties. It just makes an expansive claim without limitation or guidance. What possibly could someone reading this construction think they were agreeing to? That the university will own anything that university administrators can say is in a class of inventions reasonably related to one or more classes in which one might categorize a course of employment? Perhaps much depends on what’s “reasonable” about making a relationship–but even here, who gets to decide what’s reasonable? If the inventor has that privilege (adhesion contracts interpreted against the drafting party; the university not at liberty to assert its true intention at a later date; no obligation to agree to agree with later assertions or “clarifications” by the university), then it would be up to the inventor to make the connection that the work on a building air filter is “reasonably related” to work on a car air filter.
The two problems could be entirely different–different materials, different design issues, different particles to trap–or could be essentially the same problem, cast to different applications. Who could possibly know until the particulars are considered? But the policy goes the opposite way and throws out the particulars and requires the scope to be enlarged if the categories in which the activities take place–inventing, coursing–are related. If the inventor says that the category of the invention is “automotive improvements” and the category of the “course of employment” is “building ventilation” and asserts that these are not “reasonably related,” then is that finding determinative? If this is an adhesion contract, then perhaps the answer is yes, it is. Because of how the policy statement is drafted, it would fall to the inventor to make a decision regarding whether any invention that falls outside the “course” of employment is sufficiently related that it is reasonable to agree that the university appropriately has a claim to such an invention.
The alternative is that inventors here are made to agree to whatever the university decides when it does the assigning of the invention to categories (no procedure defined) and the course of employment to categories (no procedure defined) and then decides whether the categories are reasonably related (no procedure defined). The policy, if interpreted in this manner, amounts to an agreement to agree with regard to a non-compete requirement that exceeds the bounds of even an ordinary for-profit non-compete agreement. One cannot practice independently in the general area of one’s employment, or in any area related by the employer to that area of employment. That’s a pretty broad non-compete. One might argue that it runs against public policy (and in some states, such as California, state law) and is unenforceable. So why propose an unenforceable reading of the policy, other than to dare an inventor to come up with the $200,000 in legal fees to prove you wrong?
The upshot here is that one can interpret the policy statement so that it is at once narrow (assigned and directed work=course of employment) and any extension beyond that course of employment (by categorizing) is up to the inventor’s reasonable understanding. Because the policy is drafted nebulously, there’s really no other option. Most inventions will be outside the university’s statement of scope for “qualifying” inventions. Most inventions, under a reasonable interpretation of this policy, will be managed as voluntary.
But wait, there’s more. A second condition:
Inventions enabled by significant use of University resources when made by University employees, postdoctoral appointees, students whose inventive contribution did not arise from employment by the University, or institutional visitors not employed by the University. In both paragraph (a) above and paragraph (b), “employees” includes faculty members, staff members, part-time employees, and student employees.
Here we have a general statement qualified by four categories of possible inventors. Then there is a statement of class inclusion–“employees” includes members and employees–that points back not only to the previous sentence but also to the previous clause. And following this paragraph are additional explanatory paragraphs. Let’s work through it.
First, inventions, to be qualifying, must be “enabled by significant use of University resources.” What is “significant” gets dealt with in subsequent paragraphs. Consider, though, what “enabled” might mean. It is one thing to use “made”–“made with the use of.” When one uses resources to make an invention, one might expect the resources were used for experimentation, for trial and error to find what works, for prototype construction and testing, for actual reduction to practice of the invention, so that when there’s conception, reduction to practice, and recognition of something inventive, one has a potentially patentable invention. But “enabled” does not carry such a sense. The senses of “enable” include “to make possible,” “to give means to,” “to authorize,” “to make fit.”
The claim of policy here, then, is that if significant resources are used to make the invention possible, or provide the means to invent, then the university claims ownership of the invention. It is not that the resources must be allocated to the effort to invent–there just has to be a finding that an invention benefited from the presence of the resources. Imagine a situation in which an investigator is working with a wind tunnel to test a new building ventilation filter and gets to thinking about how the air blowing through the filter material could produce sounds if the material’s matrix was made with holes tuned to just the right sizes. The invention has nothing to do with the task. Arguably, it isn’t even in the same field as the course of work. Yet it has been “enabled” by the use of significant resources–the wind tunnel–and apparently the university “assumes” ownership. So the use of “enabled” has the effect of expanding the scope of claim involving resources from those directly used to any that might be said to “enable” the invention.
These possibilities for “enabled” are qualified in an expansive way by the listing of four groups for which the university claim of ownership is made: employees, appointees, non-employed students, and non-employed visitors. It is easier to see how employees and appointees might come within a policy claim–there is, presumably, some contractual arrangement under which they agree to terms. But for non-employees, how does the policy reach to make a claim on their personal property, their inventions? In patent law, mere use of an employer’s facilities does not give rise to an employer’s equitable claim to ownership of any employee’s inventions–so much further distant would be a non-employee’s inventions. There must be something in the provision of resources by which a non-employee agrees to the university’s terms. It would appear, however, that university policy drafters and approvers believe that an obligation of this form can be created simply by announcing it in a policy statement. Imagine posting land with an adhesion contract: if you step on this land, the land owner assumes ownership of everything in your pockets. That might work if the adhesion contract is clearly posted along the perimeter of the property. But if the adhesion contract is hidden away in a shed in the middle of the property, then it cannot possibly operate.
Perhaps a better way of construing the method of this policy’s operation is this. If you don’t empty your pockets and give everything to the university, the university will attempt to ruin your reputation and cause you to spend $200K defending yourself in court. But even this is not posted. So the best way of construing this policy is as an authorization for university administrators to use university resources–including attorneys–to demand ownership of inventions made by non-employee students and visitors. If this reading appears “extreme,” then there must be some way to temper it to a reading that doesn’t permit such administrative behaviors.
Here are the explanatory paragraphs regarding “significant use.”
The following, when customarily provided to researchers in their respective disciplines and units, shall not be considered significant use of University resources: salary, developmental assignment or award, library resources, computers, communications technologies, secretarial services, assigned offices and laboratories, and utilities.
So, the stuff that normally ends up in “indirect cost” inventories, along with salaries. Clearly, for non-employees, salaries are not going to be an issue. More:
Significant use of University resources may include: use of substantial funds received by the University through a contract or grant, use of funds allocated from internal discretionary pools, assistance of support staff outside of the inventor’s department or unit, or assistance of support staff from the inventor’s department when such assistance is greater than that normally provided others in the department. Significant use of University resources also may include use of shared research equipment or facilities.
The clarification here is less than clarifying. Start with “may include.” Does “may” indicate there is some doubt about what constitutes “significant use”? Or does “may” mean that someone will decide in the future what use is significant? Or does “may” authorize administrators to construct a list of significant uses of resources and here is giving examples of things that would be allowed on the list? There is no way to know, really, from the policy itself. We learn that “significant use” may involve “substantial funds” (with no indication whether “substantial” means $1,000 or $10,000 or $100,000); that any funds that are allocated may be “significant use” regardless of the amount; it may be a “significant use” to involve support staff from a different department (seems prissy); or it may be a significant use if the support staff work is “greater” than “normal,” without any indication of how “normal” is defined–it can’t be an average because then half (or so) of all assistance by support staff would be greater than “normal” and may trigger a finding of “significant use.” Finally, sharing or equipment or buildings (“facilities”) may be “significant use,” though there is no indication how or why.
The “use of substantial funds received by the University through a contract or grant” requires a bit of further examination. “Substantial” is not “significant”–so what is it? These funds cannot be “salary,” as salary has already been excluded from significant use of resources. Same for other indirect costs, such as for utilities. We are left with direct costs that aren’t salary–perhaps for the purchase of equipment and supplies, maybe some travel. Even here, these remaining funds have to be “substantial.” This is a most odd way of dealing with a claim. One would expect that the issue with grants and contracts has nothing to do with salary or direct expenses, regardless of amount spent–the issue is the scope of claims in deliverables under the contract or grant. What is the scope of work, and what obligations does the university have with regard to the results of that work, and how does the university communicate those obligations to those the university permits to participate in that work? But not here.
Later, the policy returns to sponsored research:
In the case of qualifying inventions arising from federal research support, this assertion of ownership rights follows from federal law.
This bit is, of course, utter nonsense. There is nothing in federal law that requires inventors to assign their inventions made with federal support to the university. After Stanford v Roche was decided in 2011 by the US Supreme Court, there wasn’t even an argument about it. The Court made it clear that Bayh-Dole did not vest ownership of subject inventions with the university that hosted the research, did not require assignment of such inventions to the university, did not create a right of refusal in the university, did not restrict inventors to assigning only to the host university:
Nowhere in the Act is title expressly vested in contractors or anyone else; nowhere in the Act are inventors expressly deprived of their interest in federally funded inventions. (8)
The Iowa policy here is in contempt of court and deceives readers into thinking that federal law governs the university’s claim to ownership, when that is simply not true.
If administrators get to decide at some later point what constitutes significant use–and the policy gives them a wide range of possibilities for what “significant use” may mean–then we have again an assertion that inventors must agree in the future with whatever administrators may decide. As an adhesion contract, the policy demands an agreement to agree, which is unenforceable. Of course, the university has attorneys, and so the threat to enforce an unenforceable claim may be the intended method of policy operation here. If, however, inventors are allowed to decide when resource use is “significant” and has “enabled” the invention, then the policy becomes largely voluntary and asks inventors to assign when an inventor believes there is an equitable reason to do so.
There is a third option: that the policy here requires administrators to make clear when they allocate resources whether the resources, when used, will result in a significant use. That’s a reasonable interpretation of the effect of the use of “may”: if an administrator in authorizing the use of resources not generally already authorized (such as support staff services), then the administrator must make arrangements with those requesting the resources with regard to qualifying inventions. If no arrangements are made, then the resource use is not significant–clearly, the administrator did not think the allocation of resources was sufficiently significant to raise the issue. “May” has this effect. Thus, a reasonable reading of this part of the policy is that unless administrators state clearly that the conditions of special resource use include the obligation to assign inventions to the university’s research foundation, there is no obligation for inventors to so assign.
A thoughtful, reasoned reading of the Iowa policy, then, leaves the following:
If the university hires someone to invent, and assigns and directs work that may lead to invention, then the university requires the assignment of any such inventions to its research foundation.
The university may allocate special resources on the condition that those using the resources assign any inventions enabled with those resources to the university’s research foundation, and if so, then the university requires the assignment of any such invention.
If inventors believe that their inventions are reasonably related to the tasks they are directed to undertake for the university, or are enabled by the use of resources, even if there is no express agreement on the matter, they may assign their inventions to the university’s research foundation.
Reduced to simpler terms:
The university requires assignment of inventions when it hires someone to invent, when it allocates special resources on the condition that any inventions made with the resources will be assigned, or when such assignment is required by a contract for research.
Reduced to simplest terms:
Assignment of inventions is voluntary unless the inventor has previously agreed in writing to assign inventions as a special condition of employment or use of resources.
Despite all the drafting kludginess, the Iowa policy already is a voluntary assignment policy. It is just drafted so ineptly (or so cleverly, depending on your point of view) to obscure the meaning that comes through after all the illegal, void, unenforceable, ambiguous, and nonsensical readings have been eliminated.
It is a common condition of university patent policies for administrators to insert all sorts of such possible inappropriate readings into the text, either because they not competent to draft such policy statements in the first place or perhaps on the chance that later administrators can take advantage of such happily inappropriate readings at need. It is administrative malpractice, however, to create the illusion that the university claims much more than the text of the policy, read carefully and reasonably, can possibly allow.
Many university patent policies, read carefully and reasonably, end up being voluntary assignment policies, obscured by the junk drafting of patent administrators who wish for a comprehensive, compulsory assignment regime. Folks just have to have the courage–and the quarter million in legal budget–to read the policy for what it is, not what some university administrators and their mercenary legal advisors wish it could be. There is an easier way, of course–change the policy to get rid of all the muck.