We have worked through a 1945 appeals court reasoning about the University of Wisconsin’s president’s refusal to allow the licensing of an invention beneficial to public health for use in food products that might compete with State of Wisconsin dairy products. The court found that the opportunity to bolster the state’s dairy industry and make money for the university is outweighed by the public interest in having broad access to the invention.
The court finds the patents are invalid–and these are the anchor patents with which WARF was started–but along the way constructs an argument that the University of Wisconsin’s president has acted against the public interest by refusing to direct WARF to license the inventions for use in all food. Dairy industry profits–even to the extent that these profits provide a benefit to dairy owners and dairy workers–don’t outweigh the public interest in having access to inventions that treat or prevent disease. That is, the benefit of the invention takes precedence over a benefit of exploiting a monopoly on the invention that excludes public access.
Now consider the situation we have with Bayh-Dole. Public university administrators insist that they must own inventions made by personnel at their institutions. When a university takes ownership of an invention made in a project receiving federal support, the invention becomes a “subject” invention and Bayh-Dole preempts any requirements of ownership that may otherwise be made by any other law (but for Stevenson-Wydler and any later law that recites Bayh-Dole). Bayh-Dole substitutes instead its own public covenant that constrains the patent property rights for owners of subject inventions. It’s just that nearly all of this public covenant is wrapped up in a standard patent rights clause–a part of a federal contract–and delegated to the federal agency that provided the research funding to waive, enforce, ignore, or otherwise not act upon.
But the federal enforcement of the standard patent rights clause is not the only basis for enforcing Bayh-Dole–there’s also Bayh-Dole’s statement of policy at 35 USC 200, and that statement does more than just recite the Congressional intent for Bayh-Dole–it also provides the statutory policy that constrains patent property rights. Bayh-Dole is after all part of federal patent law, and 35 USC 200 states the scope of patent property rights for inventions made in projects receiving federal support, regardless of who might own the patent rights, regardless of whether an invention becomes a subject invention or is owned by the federal government. That portion of the law is not delegated to federal agencies for enforcement, or even to the Department of Commerce–that’s for the Attorney General.
There’s more. Federal patent law is not the only law applicable to the actions of university presidents in the deployment of inventions. Universities are also subject to their charters, the declarations by which they obtain non-profit standing, and in the case of public universities, laws pertaining to the proper conduct of instruments of state government. There’s no law that provides that when a university president has control of a patent, the university may do anything it wants, just as any private owner of a patent might do. The outer constraint is not antitrust law. The outer constraint is the law of public interest.
In this, the monopoly meme has no life. Continue reading