Bayh-Dole Basics 6: enforcement

Back in February and March 2018, Research Enterprise published a series on Bayh-Dole basics. Here’s one more entry in that series.

As a first approximation, there is no enforcement of Bayh-Dole. Bayh-Dole is a do WTF you want law. University talk about compliance is for show.

  • Bayh-Dole establishes a public covenant that runs with property rights in patents on inventions arising in federally supported research and development, but no-one bothers with it.
  • Bayh-Dole authorizes standard patent rights clauses to be used in all federal funding agreements with nonprofits and small businesses for experimental, developmental, and research work, but almost every provision of these clauses can be waived or is ignored.
  • Bayh-Dole authorizes federal agencies to grant exclusive licenses (to the point of assignment) in inventions the federal government owns, but there is no public oversight of agency licensing programs.
  • Bayh-Dole requires invention use reports to be held as government secrets, provides no point of access for public or inventor appeals, sets out virtually no penalties for breach of the patent rights clause, and designates no one to enforce patent rights clauses.

A federal agency’s remedy for a university failing to report a subject invention is to request title to the invention. The agency must make this request within 60 days of “discovering” the failure to report. Otherwise, most everything else arises as a conditional within the standard patent rights clause, may be waived by the federal agency, the federal agency has no obligation to act on the rights provided it by the patent rights clause, and if a federal agency does act, it is to require a correction (such as amending a patent to carry a proper notice of federal funding and rights, or issuing a required government license).

Thus, while federal agencies generally comply with Bayh-Dole, there is no mandated government oversight of their behavior. Enforcement of the statute is largely a matter of university administrative objection and complaint.

But universities almost never comply with the Bayh-Dole public covenant (35 USC 200) or the standard patent rights clause (37 CFR 401.14), and their non-compliance is rarely enforced–and not at all for key provisions material to actual research innovation practice.

In particular, universities ignore restrictions on subject invention assignments (they hide invention assignments in exclusive patent license agreements); ignore the written agreement requirement to protect the government’s interest (they attempt instead to claim ownership of all inventions); and ignore restrictions on the use of income with respect to subject inventions (deducting unallowable expenses and using the balance as they please).

In all, there is no enforcement, there is very little to comply with that cannot be waived, and universities ignore key provisions that if followed would have a substantial effect on their patent policies and licensing practices.




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