Here’s the rub for “the work” that necessarily includes “commercialization.” Any license or assignment of an invention made in “the work” draws that licensee or assignee into “the work.” That licensee, to the extent that commercialization is a requirement of the license, is performing work supported in part (an earlier part) by the federal government. The license is the documentary evidence that the university is commissioning the licensee to participate in “the work.” If the university did not have a formal declaration that it sought to commercialize inventions it owns, including at least the one that’s subject to the license requiring commercialization, then the commercializing “work” might be in doubt. Similarly, a non-exclusive license need not expect commercialization, and thus does not necessarily come within the scope of “the work” of commercialization. And alternatively, if the university does not assert a claim of ownership over inventions, then when it otherwise obtains an invention and seeks to commercialize it, again, there may be a reasonable doubt that the “work” that was funded by the federal government includes the university’s licensing for commercialization, since there never was any link between the funded work and subsequent activity of the university (or any university licensee or assignee).
Why does this matter? Consider drug development. If a university has a policy of ownership of all inventions and asserts that it is a matter of public interest that the university seek to commercialize these inventions, then “the work” that the federal government supports “in part” includes the commercialization effort, no matter how the university does this work (itself or through contractors or through contractors acting as licensees or assignees). They all operate in part to achieve “the work.” Any inventions they make in “the work” are supported in part by the federal funding. Their efforts are all directed at achieving the purpose of “the work,” which is a commercial version of the molecule cum drug. Any inventions they make are licensed to the federal government to practice and have practiced. They are all part of the same contractual, documentary ecosystem that comprises “the work.” They have chosen this condition. It has not been forced upon them. They have not been tricked into it. This is no clever ruse. This is the baseline of what’s equitable. Any other outcome involves a clever ruse, incompetence, negligence, fraud, or some other moral failing. Continue reading
What have we got to by musing on research projects at universities? First, that a sponsor may support a big project by providing support to a small project that is a component of that big project. The sponsor who does so has good reason to expect to have access not only to the work of the small project but also to the work of the big project. It is the big project that the sponsor supports. It is the outcomes of the big project that the sponsor ought to have access to. In a policy environment in which those involved in the project publish their findings, make their data available, make their new tools available, and license any patents on fair, reasonable, and non-discriminatory terms, sponsors of small projects indeed can expect to have access to the results of the big project, too.
It’s important that you see this. It is all too easy to game it otherwise.
If a big project intends to keep its results secret, or behind a patent paywall for the benefit of a single patent speculator, then why would anyone support a small project part of that big project when it is offered for sponsorship? Why, even, would donors support a small project if it was made explicit to them that their money subsidized the interest of a speculative investor in a patent that kept all others from having use of the results? If a small project lays the groundwork for later inventive work in the big project, then the small project also supports that inventive work. The small project is an integral part of the big project, regardless of how a university manages the accounting and regardless of the sequencing in time of the small project and other later work. Continue reading
Here is more misrepresentation of Bayh-Dole from the NIH, the creator of Bayh-Dole, purporting to be advice for inventors:
Under the Bayh-Dole Act, your institution as the grant recipient owns rights to the NIH-funded invention and has the right and obligation to patent under the Bayh-Dole Act.
This is from “Let’s Be Patently Clear About Patents,” published by NIAID. The assertion is flat out wrong. The Supreme Court established in Stanford v Roche in 2011 that Bayh-Dole did not take inventions from inventors, did not give university employers a right to take inventions. Nor is there an obligation for universities to patent inventions under Bayh-Dole unless they do acquire ownership, which they do not have to do. That the NIH permits pages like this to be posted is contempt of court.
More from the web site, talking of Bayh-Dole:
In a nutshell, it states that funding recipients, e.g., grantees, have the right to retain title to inventions made under federally funded research but must comply with regulations (37 CFR 401 et seq. ) to ensure the timely transfer of the technology to the public sector.
We can disagree on the nutshell version of Bayh-Dole. I might say it states that the federal government should allow funding recipients to create patent monopolies to pass to private speculators to exploit public needs for maximum profit, especially in matters of health. But that’s no doubt too starkly true for the NIH to find the courage to post. Continue reading
We are working through a recent article posted at Emory University’s technology transfer site. It claims that Bayh-Dole has something to do with copyrights and data, asserts that the reporting requirements are complicated, and then fusses around trying to make sense of its muddle. While the article itself is worthless as substance, it does provide an opportunity to work through the regulations and get a reliable understanding of how things work in federal grants to nonprofit organizations.
The article continues its discussion of copyright with another confused, if institutionally self-interested claim:
Grantee institutions may apply for copyright protection for their research results as well as any data that result from a federally funded research study.
A problematic sentence. One does not “apply” for “copyright protection.” “Research results” are not within the scope of copyright anyway, nor are “data.” Gibberish. Spouting. Blistering blue barnacles. Of greater concern is that the article allows the impression that federal regulations somehow provide grantee institutions with the authority to own copyrights and data. They don’t. They simply provide that the federal government won’t demand delivery of that ownership claim as a condition of the federal award. Nothing in the regulations for grants makes it a compliance requirement that a grantee-entity assert an ownership claim in copyrights or research data. The “may” is ambiguous, then: “may” may mean “has the federal government’s permission” or may mean “has the federal government’s mandate.”
The general statement in the regulations on intangible property makes clear that the issue is where title vests when intangible property is acquired by a grantee-entity, not that a grantee-entity has any compliance obligation to acquire intangible property or even a mandate to do so. The article makes it appear that federal regulations give universities a right to take copyrights and data just as they claim such a right under Bayh-Dole–and all of that is total absolute utter nonsense. In a contracting environment, it is fraud. In a statutory environment, it involves a conspiracy to deny citizens of their constitutional and statutory rights (see 18 USC 241). In a legal environment, it is malpractice and unethical. And in an environment in which one provides education to faculty, staff, and students, it is a betrayal of trust–not just a tolerable incompetence. Continue reading
Confusion is like spilled milk. It’s only a mess because it has been spilled, and the effort to clean it up is much greater than the effort to pour a glass of milk to drink. Thus we have two articles rather than two sentences.
A little over a week ago, Linda Kesselring, the Operations Manager at Emory’s technology transfer office, posted “Bayh-Dole Reporting for Copyrights” on the Emory University technology transfer office blog. At first I thought it must be a joke title to draw in the curiously knowledgeable reader. But alas, no. I pointed out the problems with the article to the folks at Emory via Twitter, since they had announced the article there, and all I got back from them was a look at my LinkedIn profile. The article is still up, uncorrected. So let’s break it down and see if we can tease out the confusion and learn something helpful in the process.
Let’s get one thing out of the way from the start. Bayh-Dole has nothing to do with copyrights. Bayh-Dole is part of federal patent law. Its scope is restricted to inventions that “are or may be patentable” (or covered by plant variety certificates) when owned by a party to a federal funding agreement. Nothing about copyrights. Nothing.
But it’s worse that simply that. Observe.
With the passage of the Bayh-Dole Act in 1980, researchers are generally allowed to establish rights to their data, even when their research was supported by federally funded grants.
Rights in data also has nothing to do with Bayh-Dole. Continue reading
We have looked at projects. Small projects can be pieces of bigger projects. It’s the big project that controls. Now let’s look at inventions, small and greater. We will see roughly the same thing: the idea of “invention” can be narrow (and made narrower by a patent strategy) or broad (as, formally and expressly defined by many university IP policies).
Invention does not have a formal definition in patent law. Even Bayh-Dole bites its tale with regard to the definition of invention. Here is 35 USC 201(d):
The term “invention” means any invention or discovery which is or may be patentable or otherwise protectable under this title or any novel variety of plant which is or may be protectable under the Plant Variety Protection Act (7 U.S.C. 2321et seq.).
That is, invention isn’t defined at all! It’s just restricted to what’s “protectable” by patent law. The function of the definition is to eliminate the need to repeat “discovery” along with “invention” and to include plant varieties under Bayh-Dole’s contracting requirements, as if they were patentable. The definition doesn’t do anything at all for an understanding of invention–other than to create cognitive dissonance because in Bayh-Dole, a part of federal patent law, we now have to remember that invention doesn’t mean even an invention “protectable” under patent law–patent law has been twisted to include non-patent law–the Plant Variety Protection Act, which is distinct from plant patents. Why not also mask works? Or rights in technical data? Sigh. This definition is contract language elevated without much thought to be made patent law. Continue reading
Most of the Bayh-Dole pundits out there in the university patent and license world have never understood Bayh-Dole. I’m not sure all that many have read the statute. Certainly if they did so, they read without comprehension. Take this recent article on Bayh-Dole copyrights. Pure incompetence–but also designed to mislead, to make it appear that federal law gives universities a mandate to take ownership of everything created by their faculty, in defiance of that “free play of free intellects” that Vannevar Bush so highly regarded, and in defiance of what used to be important ideas, such as freedom to publish. And not to mention the idea baked in to federal patent law that inventors own their inventions and employment alone does not give an employer any equitable right to an employee’s invention.
Bayh-Dole is a law that doesn’t get read. Instead, people rely on pundits who have set up shop with a faux version of the law. They claim that Bayh-Dole gives invention rights to universities (despite the Supreme Court ruling not); they claim that Bayh-Dole requires commercialization (no, the standard is practical application); they claim that Bayh-Dole applies to universities (bah–the law is directed at federal agencies); they claim that universities must create new IP policies to comply with Bayh-Dole (there is no requirement that a university even have an IP policy in Bayh-Dole); they claim that universities must take ownership of inventions to comply with Bayh-Dole (absolutely not–there is nothing in the standard patent rights clause that requires ownership–and anyway, all substantive elements of the patent rights clause are not enforced). Continue reading
Consider the implications of an assignment of an invention in the context of big projects and greater inventions. If one assigns an invention, having already granted a license to that invention, then the license follows the assignment–unless, of course, the owner of the invention terminates the license (if it has that right). That is, the new owner has the same obligations under the license as did the prior owner. If the prior owner granted a sponsor a license that extends to a big project–say, commercialization–then assigning an invention to a patent management firm does not change the scope of that license. We are still dealing with the big project, but now it has expanded to include a new assignee of the invention. Same deal if the assignee is a “commercialization partner.” The big project defined by the university and used to justify obtaining ownership of the invention, obtaining patent(s), and assigning the invention is still on, regardless of how the university subsequently deals with ownership of the invention.
If it were otherwise–if a university could define a big project (commercialization) and claim that small research projects are justified by being part of the big project, but then cut off sponsors of the small research projects from access to greater inventions simply by assigning rights in some aspect of those inventions to a private monopoly interest, then we would have a classic bait-and-switch scam. “You will get a non-exclusive license, but it will help you only if we don’t assign the invention to someone else, which we are determined to do if you don’t commit to fund the entire big project and make commercial product, so if you refuse, you you won’t get anything you can actually use, you poor loser sucker sponsor. We will see to it that the development necessary to create commercial products (and any associated patent rights) prevent you from having full access to the results of our big project, even though you have supported that big project.” No wonder industry sponsored research agreements at universities are so fraught with company bitterness! Continue reading
Look, if two different units of the same company come to you to support research, and the units offer different and conflicting terms for their funding, then you tell them to knock their heads together and figure out just what they are going to do. You don’t take their money and then splutter about the problems. At worst, you take the work from the unit with the more favorable terms, and tell the other unit to figure things out. Well, if the sponsor is the federal government, then perhaps the different agencies might not be able to coordinate their requirements–it might take all sorts of regulatory blah-blah to do that. But then that’s a reality of contracting with regulatory blah-blah. Choose one agency and dance with it. You don’t have to have two dates to every prom.
Even Bayh-Dole, for all the gibberish about “uniform” federal policy, doesn’t actually do that. Bayh-Dole requires the Department of Commerce to come up with standard patent rights clauses, but it doesn’t dictate how many such clauses Commerce can create. In fact, there are at present four patent rights clauses. One for small businesses, one for non-profits, one for inventors, and one for some naval weapons systems. There could just as easily be twenty. Furthermore, Bayh-Dole does not actually require agencies to use any of these clauses. What the law does is make it difficult for an agency to vary from the default clauses. It does this by introducing all sorts of regulatory blah-blah about how determinations of exceptional circumstances can be made–and the same for other such reasons to vary from the default requirements.
The effect of Bayh-Dole’s regulatory blah-blah is to make it difficult for federal agencies to vary from the default patent rights clause even when the public interest would be served by doing so. The need for university patent brokers to bring more than one date to the prom is more important than the prom itself. Continue reading
Let’s repeat, for the sake of emphasis. If a sponsor supports a project, and that project is part of a larger project, then the sponsor necessarily also supports the larger project. It doesn’t matter that there is separate accounting for the project and the other projects that comprise the larger project. It also doesn’t matter that a sponsor supports a small project first, and that project is followed later by the next projects in the larger project. The small projects are parts of a whole project, regardless of how the money is booked and regardless of the sequencing.
University administrators insist that there is always a larger project, one of commercialization, that all university inventors must participate in. Any sponsor who supports a small project in a university with such policy claims–and public claims, and established practices–necessarily also supports these bigger projects of commercialization. Small projects must support these bigger projects. Sponsors of small projects necessarily support later commercialization projects. They do so because university policy demands that they do so.
If you see this point, then you will also recognize that if a sponsor expects deliverables from its support, it is entirely reasonable for the sponsor to expect deliverables from the larger project, not just from the small project that it directly supports–access to data, to software, to inventions, to reports. University administrators may think that there are no such sponsors with these expectations. But if they do think this way, they are wrong. Continue reading