Invention is not a thing, 11: Working requirements and the scope of “work”

A similar analysis then can be done for the working requirement under Bayh-Dole for patents on subject inventions in other countries. Just because a contractor achieves practical application of an instance of a subject invention in the United States does not relieve the contractor of doing the same in all other countries in which it obtains a patent on the subject invention. It’s just that in those countries, “available on reasonable terms” might be different than what’s reasonable in the United States. Much depends on what a given public considers “reasonable.” In any case, one can see that a federal agency under Bayh-Dole has a mandate to march-in, not just on behalf of the United States public, but on behalf of the publics throughout the world that are subject to the patent use required by Bayh-Dole of institutional contractors who acquire ownership of inventions made in work receiving federal support.

Bayh-Dole’s statement of policy and objective is broad. It does not depend on inventions being utilized only in the United States (though there is a gesture for inventions being manufactured in the United States by United States labor). Nor is the policy and objective of promoting free competition and enterprise restricted to the United States. Nor is the policy and objective of providing the federal government with sufficient rights to protect the public from nonuse or unreasonable use of inventions.

Bayh-Dole’s scope of claim on inventions is also broad. It has to be as broad as the broadest federal statute that Bayh-Dole would preempt whenever a contractor acquires title to an invention arising in “the performance of work under a funding agreement.” The definition of invention is itself broad–an invention is not only one that is patentable but also any that “may be” patentable–as well as unpatentable plant varieties. But the scope of claim to inventions broadens in the definition of funding agreement, combined with the definition of subject invention. A contractor extends a funding agreement by any assignment, substitution of parties, or subcontract of any type. Any “work” performed under any of these extensions is also “under” the funding agreement or “under contract.” Thus, if a contractor, say, upfront before any work was undertaken assigned all inventions it might otherwise acquire in work done under a federal funding agreement, the assignee would become a party to the federal funding agreement–a contractor–and any inventions made–conceived or first actually reduced to practice–would become subject inventions within the scope of Bayh-Dole. But there’s more. The definition of “funding agreement” in Bayh-Dole points to work only partially supported by federal funding:

for the performance of experimental, developmental, or research work funded in whole or in part by the Federal Government

Strip it to its broadest formulation, and leaving aside the qualifiers on work:

for the performance of work funded in part by the Federal Government

Clearly, the “work” is not work specified to be performed entirely under the federal funding agreement. The “work” is in the general case broader than the portion of the work provided with federal support. “Work funded at least in part by the Federal Government.”

To form the correct mental image, you must first identify the “work” that is undertaken. Then you must identify the parts or phases of that work–distributed over time, with division of labor among various parties. Now determine if at least any one of those parts or phases has been supported by federal funding. If so, then the work as a whole has been funded in part by the federal government because the federal government has funded at least a part. Anything inventive that anyone makes in performing any portion of that work, if that anyone is a party to the federal funding agreement, becomes a subject invention when it is acquired by that anyone. That’s broadness.

Definition of invention is broad
(includes unpatentable stuff).

Definition of funding agreement is broad
(includes assignments, substitutions, subcontracts)

Scope of work is broad
(includes partial federal funding)

Definition of subject invention is broad
(conceived or first actually reduced to practice)

If subject invention was not this broad, then there would be instances in which a federal statute would make a claim of ownership on federally funded inventions and a contractor could not use Bayh-Dole to preempt that statute by acquiring ownership of the invention, disclosing the invention, and electing to retain title to it. Bayh-Dole would not be the uniform statute that it purports to be. It would be another partial patch. Thus, if Bayh-Dole is to be uniform and preempt all the statutes listed in 35 USC 210, it must be as broad as the broadest of any of those statutes.

Inventions that meet the statutory definition of subject invention are subject inventions. There’s no room for private agreements about it–not even private agreements like those in copyright law to create works made for hire by employment agreement or by independent contractors. If a contractor fails to disclose a subject invention to the federal government, then it denies the federal government its license to practice and have practiced the invention and it denies the federal government the apparatus in Bayh-Dole to protect the public from nonuse and unreasonable use of the undisclosed subject invention (such as march-in). The government’s remedy in such a case is to require that the subject invention be assigned to the federal government, and the contractor’s defense in such a case is to appeal under 37 CFR 401.11(b)(2).

Thus, Bayh-Dole’s ownership, government license, and march-in provisions are broad in scope. Any instances of a subject invention that do not achieve practical application and any instances that do achieve practical application but that fail to meet demand not only could be marched-in but, consistent with Bayh-Dole’s statement of policy and objective, really must be marched-in to protect the public from nonuse or unreasonable use.

Because march-in itself is a defective procedure that smacks of eminent domain, as if the government is taking something from private hands for a public purpose when the something was expressly placed by the government into private hands for that public purpose to start with–because of all this mess, federal agencies should adopt an alternative patent rights clause for funding agreements involving public health or safety, where march-in simply happens, as it would under the Kennedy patent policy. It is up to a contractor to extend the duration of its exclusivity by establishing that it has achieved practical application or has licensed non-exclusively on FRAND terms or can make a case for extended rights–but it has to make a case, rather than defend against the government acting in the public interest–and that is a public interest around the globe, everywhere Bayh-Dole has induced a contractor to obtain patent rights in an invention made in work committed to public benefit.

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