Federal patent policy for the 21st Century, Part 2

In Part 1, I proposed a new law governing federal patent policy for public interest research conducted at universities–research to advance science and technology, or to address matters of public welfare. That new law carried with it public covenants that ran with each patent on a subject invention, created commons for research and public use, and limited exclusive licensing in ways imagined by the original Bayh-Dole but amended away by the conniving forces of university bureaucrats with power lust and no desire for accountability. But all of this is predicated on the policy position that the federal patent system on its own is inadequate to meet the needs of advancing science and technology and all that, and so there has to be a second set of requirements falling on all patents made in public interest research at universities.

That has been federal policy since 1947, at least. The Kennedy patent policy expanded it. The Institutional Patent Agreements bowed to it at least (while doing their end-run). Bayh-Dole incorporates it (though walks it back everywhere it can, and where it can’t walk it back, it gets amended away a few years later, and in the meantime, everyone misrepresents the law and ignores compliance so that when amendments are proposed they appear to track “best practice” and therefore are only “clarifications.” Right NIST?) Just “clarifying” that (f)(2) requirement in the regulations to make sure that Bayh-Dole “requires” assignment when the law does nothing of the sort and the Supreme Court was crystal clear on the point. But will anyone at NIST care?

So the law proposed in Part 1 captures the social requirements that attend to a patent law “tuned” to the expectations of public science, public technology, and public interest research. But with freedom for inventors, so they don’t have to feel the sweaty hand of some university bureaucrat on their shoulder every time they happen to invent or discover something.

Now, in the alternative, if federal patent law as it stands is truly God’s gift to American innovation, then we can simplify things even further. We can eliminate the working requirement and the various commons. We still need the protection from institutional predation–so continue to have a “bill of rights” clause that prevents bureaucrats from thumbing each new invention for institutional claims. There should be no institutional claims: the institution exists for a public purpose, not a profit purpose and enjoys tax relief for doing so. The institution releases faculty to work on projects that the faculty have proposed, expressly to advance science or technology for general use and benefit, or to address matters of public welfare.

The federal government could require inventions as deliverables for such work–the federal government, after all, is paying for the work and so ought to be free to contract with faculty for whatever the government wants by way of deliverables.

Certainly no university administration has any basis to claim ownership–does not propose the work, does not choose who does the work, does not direct or supervise the work, does not pay the salaries or expenses for the work, and gets compensated for the overhead of managing the facilities and grant logistics. If a university licensing office believes they can do a better job than either the government, or the inventors, or anyone else that the inventors might partner with (including startups, established companies, invention management agents, open innovation foundations, professional organizations, private equity funds, or state governments), then the university licensing office folks should make a case for it, invention by invention. If they are wrong, then they are done for, and a good thing, too. If they are right, then inventors will be curled up on the door step waiting for the office to open each morning.

And why not, then, the same deal with the federal government? The federal government has no profit motive in managing patents on inventions. The federal government could dedicate inventions to the public, or could patent (and so publish in a formal way) inventions made with its support, granting non-exclusive licenses. But there’s virtually no reason for the government to support invention, snatch away that invention, issue a patent to itself, and then set about “exclusively licensing” or assigning that patent to someone other than inventor. That’s like running a second patent office, one that “issues” patents that already exist to folks based not on having invented, but based on showing up and wanting the monopoly that otherwise would be the inventors’ or would not exist at all.

If the patent system is so wonderful, then there’s no reason for the government to issue patents to itself and then farm them out as petty monopolies. Nor is there any purpose in the argument that university bureaucrats could do that farming out more effectively than could the government. And that useless argument is the one underlying Bayh-Dole–that there must be middlemen, send in the middlemen to re-issue patents lifted from inventors, fumbled by the government, to be made into petty paying monopolies 1 out of 200 attempts, the rest held hostage to prevent any possible use without payment. How can things get much dumber? Oh, yeah, modify the (f)(2) clause as a way to “clarify” Bayh-Dole–that is, to amend Bayh-Dole by changing the implementing regulations. Things can still get dumber in federal patent policy management. All the more reason to get the bureaucrats out of the action all together.

In a Dole/Bayh law that swears off placing restrictions on subject inventions so the patent law can do its thing, then leave inventors free to do what they will–no license to the federal government needed, no predation by institutional bureaucrats allowed. Perhaps all one might do is make the use of subject inventions a reviewable element for any future federal grant application: “So, in your previous federal funding, did you invent anything? If so, what did you do with each invention? Explain what has happened. Why should we be impressed by that?”

In such a treatment, federal patent policy for research conducted by faculty at universities to advance science, technology, and address matters of public welfare is left to “free play of free intellects.” Accountability comes when those free playing intellects come back for more funding. The best federal policy for inventions made with federal support would be just the requirement that the host institution had no right to acquire subject inventions made by faculty and others working on a federal funding agreement.

For all that, perhaps the most powerful bit of federal accountability would be to provide funding to faculty without the need for any research proposal. First year, a small amount. Show what you’ve done. If that’s interesting, more for the second year and perhaps third. After five years of funding, no more funding for three years. Go do something in the world with what you’ve studied. Come back and tell us what you’ve accomplished. Based on that accomplishment (or lack thereof), more funding. No proposals, none of the awful waste of effort now, where only 1 in 8 or 10 proposals gets funded–that’s 180 hours of work (or more) wasted for every 20 hours that pays off on the proposal side–not to mention all the time spent reading and scoring proposals and sending out notices. Waste everywhere.

§200 Policy and objective

It is the policy and objective of Congress to enable inventors to use the patent system for inventions arising in federally funded research to advance scientific or technological knowledge or to address matters of public welfare.

[no restriction to promoting use]

§201 Definitions

(a) “Federal agency” means any executive agency as defined in section 105 of title 5, and the military departments as defined by section 102 of title 5.

(b) “Funding agreement” means any agreement between the Federal Government and a contractor for the performance of experimental, developmental, or research work designated to advance scientific knowledge or to address matters of public welfare. Such term includes any assignment, substitution of parties, or subcontract of any type entered into for the performance of experimental, developmental, or research work under a funding agreement as herein defined.

(c) “Contractor” means any a party to a funding agreement.

(d) “Subject invention” means any invention protectable under this title and made in the performance of a funding agreement.

[still need definitions and scope to keep university bureaucratic claims off subject inventions]

§202 Disposition of rights

(a) Each funding agreement entered into by a Federal agency with a contractor shall contain a patent rights clause to effectuate the following:

(1) The contractor shall not, as a condition of performance under the funding agreement, obtain rights in any inventor’s subject inventions.

(2) The contractor will include the patent rights clause, suitably modified to identify the parties, in all subcontracts for experimental, developmental or research work.

(3) The contractor shall not, as part of the consideration for awarding a subcontract, obtain rights in any subcontractor’s subject inventions.

[The contractor cannot claim an inventor’s invention–it will be a free invention, not a service invention, not for the government, not for the middlemen. And the same applies to subcontractors. Turtles, all the way down. A freedom to innovate bill of rights. If the government wants rights, it can ask for them (if an inventor files a patent application); otherwise, don’t offer a grant–go do a procurement deal with a for-profit or a non-university nonprofit.]


That’s it. No reporting of inventions, no practical application standard. No restrictions on assignment or preference for small business or made in the U.S. of A. Let the free play of free intellects support science and technology and chase down opportunities however it will. Call it to account when it comes back asking for more. At some point, if a university’s faculty come back hat in hand having done nothing useful with their inventions, then that university won’t get so much funding in the future. Better make sure it has a functional, agent-based TLO.

That would be the best Dole/Bayh Act of all. Freedom. Anything less argues that the patent system needs to be adjusted to advance science and technology, and to address public welfare–and we are back to the Dole/Bayh Act with social restrictions. Not so good, but way better than the rotten law, non-compliant practices, and gross ineffectiveness that we have now.

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