A non-compliant Bayh-Dole written agreement at Yale-4

We are working through Yale’s “Patent Policy Acknowledgement & Agreement.” Most recently we borked about employment and faculty freedom. Now let’s look at how the agreement deals with consulting. It tries to worry the problem of conflicting obligations–Yale doesn’t want to agree to deliver rights in inventions to a sponsor only to find that its own personnel have obligated those same rights to someone else. It is a real worry worth worrying, but Yale deals with it ineffectively. What can be worse than a real worry that you think you have dealt with but haven’t? If one hasn’t covered the problem and instead has a piece of untested paper instead, and then lets down one’s practice awareness–that’s a recipe for inviting the very thing one has stopped worrying about.

So here is provision 3 of the Yale agreement:

3. I do not have any consulting or other agreement with any third person or organization which grants rights that are in conflict with this agreement, nor will I knowingly enter into any such agreement.

This provision, too, is interesting. There’s the oddness of “any third person or organization” where we would expect “third party.” There’s the oddness of the restriction to agreements which “grant rights” rather than a broader “would conflict with the obligations I hereby undertake.” Again, this provision smacks of misplaced angst over the Stanford v Roche situation. But there, Stanford officials knowingly encouraged a Stanford employee to “visit” Cetus for nine months to learn Cetus’s PCR technology for use in areas that Cetus was already exploring for use. Stanford officials knew and approved of Cetus’s requirements with regard to possible inventions. One of Stanford’s faculty members–and the post-doc’s supervisor at Stanford–even served on Cetus’s board. So, Stanford knew. Even if there had been a conflict between a promise to assign and Cetus’s added present assignment, Stanford had waived any claim it could make under its own policy. All that was left was the hope that somehow Bayh-Dole took precedence over Stanford’s waiver of interest and forced Stanford to take title, so it could sue Roche for a quarter billion dollars for using an invention that, so the general university argument goes, could not be used but for university patenting and grant of an exclusive license to enable financial investment to develop the invention for use.

Here in the Yale agreement, all that burden is transferred to the employee. But does the agreement do what it appears to set out to do? No. Look at it–it just requires a statement that the employee doesn’t have any agreements that are in conflict with this agreement–not any agreements that are in conflict with the Yale patent policy. This agreement–that the employee will “abide” by the Yale patent policy. Okay, as if the Yale patent policy doesn’t otherwise control. But the Yale patent policy’s sole statement on rights is that assignment may be requested after a detailed evaluation and decision to file a patent application–and then only for work done under Yale’s “auspices.” If a Yale employee makes an invention in consulting, then that invention–reasonably enough–has not been made under Yale’s “auspices.” Inventions made in consulting are not “inventions which result from teaching, research, and other intellectual activity performed under University auspices” unless the consulting work involves work that Yale has directed its employee to undertake or has been done in the “course” of such work.

For faculty there’s no problem here. Yale does not generally assign faculty to conduct specific research–faculty, rather, decide what research they will do, and they decide under what auspices they will do it. A faculty member may choose to do research at Yale, or do that research not at Yale–at home, perhaps, or in consulting. Yale’s faculty handbook makes it clear that faculty have “freedom of inquiry.” Yale does not have any standing to force a faculty member to do lucrative invention-making research at Yale. Each faculty member decides. That’s freedom of inquiry. If a faculty member decides to consult, that too arises from freedom of inquiry and means that the faculty member has chosen to conduct some inquiry–freely–not under the auspices of Yale. If Yale claims that all “intellectual activity” (whatever that might mean–another vagary) necessarily takes place under Yale’s auspices, then we have a grossly overbroad claim, in the form that Yale owns all one’s thoughts and by means of a patent policy acknowledgement and agreement has taken assignment in advance of all those thoughts–to the extent any of them may be labeled inventions–so that an Office can force disclosure of those thoughts as a matter of compliance and rifle through them at its leisure to see what it might make money from by way of patents and licenses. Autocrats might rejoice at such creative policy work, but otherwise, we ought to take a dim view to such things as a matter of university practice and as a matter of how good ideas happen (as Steven Johnson puts it in his book by that title).

Yale handles this problem of possible conflict between its own claims and whatever a Yale employee might otherwise do by making the employee assert there are no conflicts. But from a faculty employee’s reasonable interpretation, there can be no conflicts because the faculty member has the right under Yale policy to decide what work is and what isn’t going to be done at Yale.

Yale has a policy statement on “Inventions Not under University Auspices”–paragraph 6 of the patent policy:

Inventions by University employees usually result from teaching, research, or other intellectual activity involving University facilities or personnel.

There’s no reason to think this statement is true. Inventions may easily result from “intellectual activity” that does not involve Yale’s facilities or personnel. Further, federal patent law clearly establishes that neither employment nor use of an employer’s facilities has anything to do with an employer’s claims on any resulting inventions. Ever since Dubilier in 1933, employers have worked to find ways to bind up claims to inventions made by employees. University administrators are late to the game, and pretty stupid about it, for the most part. What they don’t have, in addition, is a claim that faculty are even employees with regard to their research and inventive activities. Administrators representing the executive powers of a university do not have any equitable claim on inventions made by faculty other than by means of special agreements under which faculty agree to waive their right to freedom of inquiry and publication in favor of some university benefit otherwise not properly available to them.

Here, Yale makes it out that faculty have no right of association (personnel) nor right to use facilities, but for a claim by Yale to own all that “results” from such association or use. If Yale and its faculty wanted Yale to have such a broad claim, they would have to remove the “freedom of inquiry” bit from the Faculty Handbook and would have to create a binding contract by which faculty agreed that their intellectual activity came within the auspices of Yale and expressly gave up ownership of their intellectual activity to the extent that Yale determined it constituted inventions–whether or not patentable–and decided it wanted to own that activity. To make that agreement binding on tenured faculty, Yale would have to offer something other than employment (and the access to personnel and facilities that necessarily comes with employment) or continued employment (despite the Fenn court’s reasoning). Whatever that something might be, it cannot be merely that Yale has permitted employees to use its facilities and associate with its personnel.

But meanwhile:

Accordingly, all inventions by University employees must be reported to the Office of Cooperative Research.

This is not what policy requires. It requires the disclosure of only those inventions resulting from intellectual activity performed under Yale’s auspices. Not all inventions–just those under Yale’s auspices. But here we can see the bureaucratic strategy:

When the University determines that an invention by a University employee is unrelated to the activities for which the individual is employed and has not involved the use of University facilities, then the University will make no claim to such an invention.

The idea is, Yale has to see everything. Yale then can pick through it and decide what “under University auspices” means in any particular circumstance. The standard that’s stated is (i) “unrelated to the activities for which the individual is employed” and (ii) “has not involved the use of University facilities.” In a general sense, invention almost never involves the use of facilities–conception of an invention takes place in the mind. Where the mind happens to be is not particularly relevant. A mind may be standing over an experimental apparatus and imagining why the apparatus is all wrong or the research is barking up the wrong tree. Such conception does not involve the use of facilities. The use of facilities is almost entirely a matter of construction and testing of prototypes. If an inventor conceives an invention and drafts a patent application and therefore provides constructive reduction to practice, then again as a general matter it is difficult to show that the invention arises from the use of facilities.

Take it one step further. If the inventor, having filed a patent application and obtaining a patent then uses university facilities in the course of using the invention, the making of the invention cannot be reasonable said to involve the use of facilities. Here, too, we see the gulf between Yale patent policy statements. In the first paragraph, Yale worries inventions that “result from . . . intellectual activity performed under University auspices.” Here in paragraph 6, it’s merely that an invention “has not involved the use of University facilities”–not the making of the invention, not that the invention results from the use of facilities, but rather that the invention has not involved the use of facilities. Not the inventing, but the invention. This policy is the work of confused and negligent thought.

It is really quite simple. If an invention does not meet the standard of “under the auspices” then it is not subject to a Yale claim. The burden of the policy is to make clear what those auspices are–and cannot be merely employment or use of facilities. Indeed, the burden of the Patent Policy Acknowledgement & Agreement is whatever claims Yale may have as a result of its contracting with external parties to provide research services. Even there, Yale tacitly agrees to provide the facilities necessary to perform the research and takes in consideration for such provision an indirect cost charge against the money provided in the contract. If Yale is paid to provide facilities to its personnel, then Yale cannot turn around and construe the provision of those very facilities as consideration for inventor’s giving up ownership of their inventions. Do you see? Yale cannot sell the same facilities twice. But that’s what it is doing.

We can do a similar analysis on “activities for which the individual is employed.” Here, “individual” must mean “inventor.” Why Yale cannot write is beyond me. Employment has a definite meaning–there’s the matter of master and servant, of agency representing the interest of the employer and duty to the employer and in exchange the employer undertakes liability for the actions of its servant, of the right of the employer to direct and control the servant, and of the scope of control that an employer may exercise–the scope of employment–the scope of the employer’s control.

So look at this. Yale purports to have a claim if the invention is “related” to the activities for which an inventor is employed. If an inventor is “employed” to teach electrical engineering, then Yale asserts a claim if an invention involves teaching electrical engineering. That’s strange. If an inventor is “employed” to conduct research involving electrical engineering, then Yale asserts a claim if an invention involves researching electrical engineering. That is, the invention is related to the activity for which an inventor is employed. It’s not a claim based on an invention being the result of an activity for which an inventor is employed.

More so, for faculty, much of their activity is not a matter of employment. While faculty may loosely said to be employed, the actual master-servant relationship by which an employee might be employed is very narrow for faculty. When it comes to their teaching, they may be assigned to a department, and the department may assign them courses, but Yale does not have standing to direct the substance of their teaching. Inventions arising in faculty instruction are not made in an activity for which a faculty member is employed. For the substance of teaching, as that of research, faculty are appointed. They may even be assigned or permitted. But they aren’t employed unless they expressly waive their freedoms of inquiry and speech and publication. To do so in general would require abrogating academic freedoms that are foundational to the university. The university would no longer be a university. It would be a corporation and the control of its activities would be administrative.

That might be the administrator’s dream, but it’s a corruption of the idea of the university and why we give universities special standing, such as to receive billions of dollars in federal research awards. Those awards do not come because universities are corporations but rather they come because we judge it to be in our interest that faculty with freedom from corporate controls propose research that might discover or validate or collect or invent or compose things that will prove to be, someday, of importance to us. A university does not become more interesting and competitive for public assistance because it asserts corporate control over the activities of its faculty. It becomes less–much less– competitive for federal assistance. It is much less attractive than, say, contract research organizations that bring a focus on providing competitive services to clients. University administrators, once they get this bug, however, disregard the idea that a university might depend on the freedom of its faculty for its social authority and tend to think that all that matters is the efficient means by which they assert their authority.

Yale’s policy here is “report everything and Yale decides what it means by auspices when it claims ownership.” In the other part of Yale’s policy, the idea is “you decide what’s under Yale’s auspices and report that, and then Yale will evaluate it and decide whether to file a patent application, and if so, will request assignment.” These two are different things. In the case of inventions that aren’t made under Yale’s auspices, Yale has no legitimate business to see those inventions in advance of their publication in the patent literature. Yale has by policy no claim on them. Yet here Yale asserts that claim anyway. Why? Apparently because it does not trust its personnel to determine what is and isn’t Yale-claimable.

But for the Patent Policy Acknowledgement & Agreement, the issue has nothing to do with facilities or personnel. It has to do with what patentable invention deliverables under contract Yale has agreed to produce. For these, it does not matter whether Yale facilities have been used or other Yale personnel are involved. All that matters is that an invention has been made, it is patentable, and it is within scope of a research agreement as a deliverable. In trying to be broad–overly broad, so that its generalizations become ambiguous when not unconscionable–the Yale agreement fails to articulate the actual scope of concern for any given research funding agreement, federal or non-federal. The Yale agreement doesn’t do what it should and does what it shouldn’t. How can people get things so very wrong?

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