The new 1969 Wisconsin patent policy broadens the scope of the university’s interest in patents yet further:
Here is the Wisconsin IPA definition of “subject invention”:
Both elements are essential to the definition. First, a subject invention is not just any invention “arising out of” or “in any way connected” with a federally funded project. Rather, that invention must be “made in the course of or under research supported” by HEW grants. “Under research” means that the research specifies that the inventive work. “In the course of” means what is done to achieve the specified work. “Made” means that the specified work anticipates conception of the invention or the first actual reduction to practice. This definition is a limiting definition of invention deliverables. The government bargains for inventions that are anticipated in the work proposed, or made in the course of doing that work–as evidenced by the grant documents.
Wisconsin, however, construes the claims broadly, so that not only are inventions to be reported more broadly than the IPA requires (but Wisconsin might require such reporting since it does so in the general case, regardless of any ownership claims by sponsors) but also requires the assignment of such inventions “if assignment is required under the terms of the grant, contract, or award.” The university gets to interpret the IPA to decide what is assignable to the university–but the investigators and inventors apparently have no access to interpretation of the IPA and so are caught in the scheme–they are stuck with whatever the university decides the university must do to comply with the IPA requirements on assignment of subject inventions.
The university, of course, represents itself to be “scrupulous” in compliance, and so it will have to be safe in making sure that it accounts to the government for everything that the government might have intended in its definition of subject invention. The university has given up its neutral position and presents its diligence to the inventor as if the university is merely complying with sponsor requirements, when the university has actually put itself in the position to negotiate for itself those requirements and eliminate investigators or inventors in having any say in the matter. The say goes to the deans, business officers (for whatever reason) and to university administrators in “Central Administration.” In just this little bit of clever work, Wisconsin turns a remarkably open patent policy controlled by investigators (in their negotiations with sponsors over iP) into a compulsory one operated by administrators, to which inventors have no access to negotiate anything.
It is this alignment of bureaucrats standing between faculty investigators (and inventors) and federal research sponsors that creates the conditions for bureaucrats to stand between investigators and investigators in all funding agreements–to insist on university ownership as if the sponsor were insisting in such ownership, and making sponsors agree to such a requirement, whether the sponsor wanted it or not, and then enforcing that agreement on investigators and inventors, to their disadvantage and without “protections” (as the Supreme Court put it, in Stanford v Roche).
The Wisconsin patent policy also opens up the question of how inventions become patentable. In doing so, it also suggests a line of thinking that expands institutional interest in patents. The patent policy includes a discussion of what constitutes an “invention.” There are two kinds of inventions, according to the policy–patentable and not patentable. The ones that matter, obviously, are the patentable ones. But under the IPA, the issue of ownership–of assignment–is directed at the invention, not specifically at the patent on the invention. Thus, the requirement in the IPA that Wisconsin require assignment of inventions is easily misread. The IPA requirement for assignment depends on the university deciding to file a patent application–that is, it depends on the university determining that an invention is at least potentially patentable. But it is easy to switch things around and claim that inventors must assign all inventions–patentable or not–and the university will sort out which ones are patentable.
This review for patentability creates a second institutional conflict of interest. Let me show you how it works. Here’s the interesting bit of 1969 Wisconsin patent policy:
Patentable inventions have various attributes. The common ones are that such inventions are “new, useful, and non-obvious.” But it is also the case that patentability depends on an inventor recognizing the invention as patentable–this was called the “contemporaneous recognition and appreciation of the invention.” Only when an inventor recognizes some development as inventive is that development also potentially patentable (all other requirements for patentability being met).
For an inventor working in a garage (where inventors frequently park, apparently), it’s entirely up to his or her own decision whether to recognize something as inventive. If an inventor says, “No, that’s not anything important, not an invention” then whatever it is, invention or not, is not patentable because there’s been no “contemporaneous recognition.”
The U.S. transition to “first inventor to file” procedures makes the issue of “contemporaneous recognition” a non-factor in determining who is entitled to a patent (no longer “first to invent”), but the underlying concept remains in effect. If an inventor does not recognize work as inventive, the inventor has no standing to sign the affidavit and oath that accompanies a patent application that he or she is a “true inventor.” An inventor must be persuaded that he or she has contributed to a patentable invention before that person’s invention is indeed patentable.
The effect of the Wisconsin patent policy is to encourage university personnel to take their inventions–or potential inventions–to be reviewed for patentability. This is a typical corporate approach–report all inventions (patentable or not) and we’ll have experts determine whether an invention is patentable (and then persuade you of it, too). Since corporations typically enforce trade secret requirements, they can assert ownership of all inventions, patentable or not as a matter of non-disclosure and use only for the benefit of the corporation.
But a university with an open policy on publication and academic freedom does not so readily have the means to create a trade secret regime. To do so now would move a university out of exemptions to basic research in export control law, requiring the university to apply for export licenses to allow various foreign nationals (including students and visitors) to have access to research information subject to university trade secret requirements. Thus, a university is not in a position to claim ownership of non-patentable inventions–though many universities these days have just this claim in their patent policies. Some goofball administrator must have thought it sounded “comprehensive” to claim all inventions, whether or not patentable, making a patent policy also be a non-patent policy.
Thus, here’s the challenge for administrative compliance with reporting inventions to research sponsors. If the purpose of the reporting is to establish rights in those inventions–that is, the right to patent, or a right to a license under a patent–then the inventions to be reported are patentable ones–ones for which a patent might be obtained. If the reporting obligation is any “new technology”–then investigators report what they have done that’s new, regardless of whether it is merely new to their work or a new thing on the face of the earth for the first time. Absolute novelty doesn’t matter, originality doesn’t matter. Whatever has been produced gets reported. (This is how NASA handles New Technology, by the way.) There is no need for any dean or business officer to review reports of new technology. There’s simply nothing for them to do that a researcher doesn’t already know. The only way that the dean or business officer has anything to contribute is if the dean or business officer represents a university ownership interest as a result of the review–that is, the review matters if the concern is that (i) a patent position will be taken on the new thing, and (ii) the new thing has been made within the scope of the statement of work governing the research project.
It’s when the review is for patentability that things get interesting. Then “experts” can consider whether some new thing is also patentable. That’s where we get to the Wisconsin policy approach–experts should decide what’s patentable. Now, it is certainly the case that it’s a legal matter whether something new meets the legal requirements for “new, useful, and non-obvious” and is directed to statutory subject matter, and whether a specification is enabling and discloses the best mode of use, and the like. But it is not a legal matter whether an individual recognizes something new as inventive. (It may be a legal matter to determine if and how an individual recognized something new as inventive–but that’s different, and later). Either an individual recognizes something or doesn’t. No attorney is needed for the recognition part of patentability.
But of course if an attorney does get involved, he or she can make an effort to bring about that recognition in the inventor. That’s the gist of Richard Feynman’s story about inventing–he could think up any number of things, and told a few to the patent attorney at Los Alamos, and next thing you know, he has patents to his name: “I just mentioned all these obvious things.” Here’s the thing, then. What to an expert scientist might seem obvious by way of application could be considered patentable to a different audience. It’s not that such inventions are rare; rather, it is that expert scientists don’t have the time in their day to begin to write them all down. It’s different when an expert scientist recognizes something new as inventive–beyond the obvious, beyond what’s ordinarily the subject of work. The recognition step is deeply important to separate anything that might be patentable, if a patent attorney gets the chance to spin it right, and what might be patentable and important as a matter of discovery, of scientific advance.
The standard of “obvious” for patentability is referenced to one with “ordinary skill in the art.” It’s a big question whether university researchers have such “ordinary” skill or perhaps “extraordinary” skill, in which case most anything they happen to burble out may well be patentable, even if they don’t recognize it or acknowledge it or even respect it. They are not in the habit of assessing their thoughts from the perspective of a legal definition of “ordinary skill in the art.” Think then about the problem of deciding whether some new thing thought of by a university faculty researcher is inventive, is patentable. From the researcher’s perspective, few things may be. From a patent attorney’s perspective, patentable inventions may be dropping like manna every morning.
It’s even worse if one adds in now the matter of compliance with a research agreement. How does one decide when an invention-like idea arose in doing that research or just happened to arise like any number of such ideas arise every day. Was that invention made in the scope of the research–in doing what was proposed in writing–or is that invention just another idea that has flitted from head to hand or mouth and made its way into the world? For the procurement world, the response is straightforward–define what it is that you want to procure, and when you get that, it comes with whatever rights might be attached to it. If those presenting the work haven’t thought about invention and the sponsor’s attorneys think something in those deliverables is patentable, then it’s up to the sponsor to persuade the putative inventors of the fact and obtain their assignments (or licenses, as the case may be).
In the subvention world, however, the response is almost impossible. The deliverables are whatever it is that the project has proposed to do–and the delivery is not to the sponsor, but to whomever the investigators have promised their work. The subvention is a grant-in-aid, not a procurement of deliverables for the sponsor. This is actually a tough problem, one that federal contracting officials haven’t worked out. The Kennedy patent policy did a pretty good job with it, but conflated procurement and subvention. The IPA program end-ran the Kennedy patent policy, creating a patent monopoly pipeline that ran from university to corporation, taking advantage of federal funding to faculty and turning those funds into an unacknowledged subsidy for shareholders, all the while pitching the pipeline as something in the public interest. Bayh-Dole makes the pipeline even bigger, but with no protections for inventors and few for public interest–and none that are enforced.
In all this apparatus regarding patents on subject inventions, there’s next to nothing that indicates how it is that any given invention comes within the scope of a federal funding agreement. The implementing regulations for Bayh-Dole try to explain things (see 37 CFR 401.1), but the best they can do is stipulate that an invention must be made in the “planned and committed activities” of the project or must otherwise “diminish or distract” from the planned and committed activities. That is, the invention must be anticipated by the written statement of work or there’s documentary evidence that money that should have been spent to get that work done was spent elsewhere–on the invention–and that prevented the planned and committed work from getting done. And the invention must be patentable (“is or may be patentable”). And for an invention to meet this definition, it must be recognized as inventive by the inventor.
By now it must be apparent that there’s a huge problem for university patent brokers. If they “walk the halls” they can, like Richard Feynman’s patent attorney, elicit all sorts of ideas that may well turn out to be patentable inventions. They could file patent applications until patents came out the university’s wazoo, if only university researchers would cooperate, or participate. But this sort of hunting for inventions is rather different from the sort of inventive activity that arises because researchers recognize in their work something inventive. One can sit around and invent–that’s what sessions at Intellectual Ventures are reported to do, with patent attorneys ready to reduce each idea to a patent application and so paper over swaths of the possible future, just in case. Or one can work on a project and recognize an invention, and focus on that. Or one can, while also working on a project, recognize other ideas as valuable–perhaps for other projects, even related projects. The open question is just what inventions are within the scope of the “planned and committed activities (as Bayh-Dole’s implementing regulations put it) of a subvention project and what ones come about because those involved in the project could be spilling patentable ideas left and right, and all that’s needed is an expert (like the attorney that Feynman dealt with) to tell them what’s inventive, what’s patentably inventive.
The new 1969 Wisconsin patent policy, then, by requiring reporting of all inventions and asserting the importance that someone other than the inventor–“expert opinion”–should decide whether an invention is patentable creates another institutional conflict of interest. The university, by directing research personnel to “expert opinion” creates the conditions under which patentable inventions may multiply, creating more opportunities for institutional ownership claims as these inventions can be associated with federally supported research. For the IPA, a “subject invention” is any invention “which is or may be patentable” that has been “made in the course of or under research supported by grants and awards” from HEW. The university’s assertion of the need to be “scrupulous” in monitoring compliance takes on a different sense. Under the IPA program, the government is not concerned with inventions that are published openly and so avoid issues raised by patent monopolies. The problem comes when patents are obtained. When the university intervenes to encourage “expert opinion” to determine whether an invention is patentable, it is also creating an environment to generate many more apparent inventions and to associate those inventions with federal funding and so gain the benefit of the claim on ownership that the IPA provides.
This potential for intervention, then, creates an institutional conflict of interest. If the institution does not intervene, a great many things may be published or disclosed that will have no patent significance because the inventors of those things–faculty scientists–simply don’t recognize these things as inventive. Further, once the institution does intervene, the IPA with HEW creates an incentive to expand the interpretation of “course or under” scope of subject inventions and thus come into a claim of ownership of those inventions ahead of the federal government. Thus, “scrutinize” and “fully examined” and “expert opinion” all work to create a theme that the university, not individual investigators, determines when an invention has been made, when that invention is within the scope of a funding agreement, and what is then required to comply with that funding agreement. And the funding agreement that matters, the one that prompts the new policy, is the IPA. The university–administrators acting for the university rather than faculty acting for the university–“have the responsibility for determining if an obligation to a grantor does exist and to insure that any such obligations are fully met.” Put simply, university patent brokers will decide whether each invention is a patentable invention and whether it has been made under the IPA and therefore whether those same university patent brokers will take ownership of the invention.
Wisconsin patent policy in this way distinguishes between “restricted inventions” and “unrestricted inventions.” One is led to understand the distinction as one of compliance with research contracts, but actually the distinction is one created by institutional conflicts of interest. Nothing in the IPA restricts any invention. If there were federal requirements on inventions, those requirements were in the funding agreements, not in the IPA. The IPA worked to disrupt those federal requirements, by contract, and gave university administrators incentives to scope federal research broadly and require the disclosure of all possible inventions, for “compliance” with the IPA. It’s a complex apparatus presented as providing faculty inventors with “greater latitude” in the management of inventions. But really, it does no such thing. Instead, the patent policy works to undermine the university’s disinterest in inventions made by the personnel it hosts.
The wish the university has, at least expressed by its patent administrators, is to create contractual arrangements that transfer control of inventions from inventors to administrators. That control includes whether an invention has been made, whether it is within scope of a contract, and whether the invention should be patented. By entering into the IPA, university administrators overrode the long-standing policy by which the university did not take an interest in inventions. They then turned institutional invention ownership into a matter of federal compliance. From there, the institutional conflicts of interest that arose could be dismissed as fulfillment of federal requirements. This practice has persisted and spread across the country, reaching its fulfillment in the ubiquitous misrepresentation that Bayh-Dole requires these same things as a matter of compliance.
If you find all this complicated, you aren’t alone. It’s a “cleverly crafted scheme,” as WARF called it (in reference to Bayh-Dole) in an amicus brief filed in the case of Stanford v Roche. As a scheme, it is difficult to unravel by design. Once the scheme had been given the attributes of federal compliance, a public mandate for institutions to patent and commercialize, and a prophetic claim that such activity will lead to all manner of public good, it takes a huge effort to show how it works (or doesn’t) and expose it for what it is. Bayh-Dole makes invention reporting a state secret. Universities are unwilling to report the actual condition of their patent portfolios. And research activity gets encumbered with FOIL practices–fragemented ownership, institutionally licensed technology (except most institutionally claimed technology is never licensed, and if licensed does not produce the asserted benefits).
We might observe that patenting is “up” at universities less because research is more inventive than in the past, but rather because university administrators, having been given the incentives offered by the faux version of Bayh-Dole, set out to control not only research deliverables but also any invention, however trivial, on the prospect that some day, some few of these inventions would turn out to have great financial value. All that’s needed, it turns out, is one lucrative deal every twenty to thirty years. One may as well be predicting UFOs arriving from Planet Clarion as to be arguing that by 2047, at least, we’ll surely have found a big hit patent license in all the inventions we have been accumulating. Maybe. But I have greater expectations for the UFO than for the success of the cleverly crafted scheme, for which the 1969 Wisconsin patent policy is the type locality, the ground zero, the place where university patent administration went from hopeful to very bad.