Bayh-Dole’s statement of policy at 35 USC 200 includes a provision calling for the use of the patent system “to promote the commercialization and public availability of inventions made in the United States by United States industry and labor.” Folks often misread this requirement as if it states that Bayh-Dole mandates commercialization–it does not. Rather, this provision focuses on the making inventions in the United States by United States industry and labor, regardless of whether those inventions are commercialized or are made publicly available. Note–not making of inventions in the United States by foreign industry, or making of inventions in the United States with foreign labor.
Bayh-Dole’s statement of policy at 35 USC 200 stands on its own. The rest of the statute provides guidance for specific situations–when a contractor licenses exclusively in certain situations, when the federal government licenses, and when the federal government permits a federal employee to own an invention. We have worked through Section 204 in detail in previous installments. Now let’s consider the federal side of Bayh-Dole’s use of the patent system to promote United States industry and labor.
First, a refresh. Section 204 of the Bayh-Dole Act positions itself as the most important part of the law. Section 204 requires that owners of subject inventions must, in exclusive licenses to use or to sell, have licensees agree to source product based on the invention “manufactured substantially” in the United States. The requirement is a weak one–it applies only to exclusive licenses in the United States, not to a patent owner’s own exploitation of a subject invention. The requirement is further weakened because it authorizes federal agencies to grant waivers to the requirement. The requirement is weakened further still because the requirement is placed in the standard patent rights clause, federal agencies are given authority over the standard patent rights clause, and federal agencies have no obligation to enforce the standard patent rights clause. Thus, Section 204 is mostly administrative fluster. Continue reading