We can work a few variations now with faculty member F. The university has a standard IP policy with a promise to assign to the university. Let’s look at four basic possible outcomes. Then we can start to add variations.
F obtains a federal grant. So Bayh-Dole provides for the standard patent clause at 37 CFR 401.14(a), which is implemented through Circular A-110 ___.36(3), which sets the terms for the grant to the university. The university implements Bayh-Dole by requiring F to protect the government’s interest through a written agreement by timely reporting inventions and executing the papers necessary to permit patent applications to be filed and to establish the government’s interest in these inventions. F reports the invention to the university. The university reports the invention to the government.
Way 1. The university declines to elect to retain title, the government requests title from F, and F assigns title to the government, pursuant to the written agreement required by the university to protect the government’s interest, in compliance with Bayh-Dole.
With this way, a university does not need to have a technology transfer office. It is the closest to a pre-Bayh-Dole implementation, but uniform and expecting the university to provide notice of invention and confirming that the university declines to elect to retain title.
Way 2. The university elects to retain title, the university requests title from F, and F assigns title to the university, pursuant to the written agreement required by the university to protect the government’s interest, in compliance with Bayh-Dole.
This is the way, presumptively, a number of technology transfer offices want things to end up. They see it as more efficient to have Bayh-Dole simply changed to require this outcome, without any action by the inventors (they never hold title) and without any choice by the university. The university’s choice to retain title is shifted to whether to keep it or assign it, not whether to request it or decline to request it. It is a huge difference, unless you don’t care about choice. Given that commercialization folks often refuse to acknowledge choices—the Little Linear Model is the only one that’s not sub-optimal—it is clear why they would like to suppress those choices. Not only is choice inefficient, but it also could create competition with their claims of how “technology transfer” works. Further, they wish to take Bayh-Dole’s regularization of agency protocols for procurement of patent rights as deliverables in federal contracts to start a regularization of the process by which inventions are “commercialized”. That is, take a procedure and make it stand for making mechanical how innovation arises. That also is a huge difference. Bayh-Dole’s brilliance is in allow a diversity of approaches. The commercialization crowd cannot tolerate such diversity. It is inefficient and worse it makes them look bad when they make general claims to their superiors, the faculty, and the public about how things work, when it is only how things work in their own heads, and that doesn’t work very well, and they cannot bring themselves to imagine that other ways might work better, but it would cost them their standing, and worse they would have to roll up their sleeves and learn something new in the world.
Way 3. The university assigns its Bayh-Dole interest to an affiliated research foundation, and that foundation elects to retain title, requests title from F, who assigns title to the research foundation, pursuant to the written agreement required by the university to protect the government’s interest, in compliance with Bayh-Dole.
In this approach, the university never holds title to the invention, nor even retains the title, because title is retained by the research foundation, and then is conveyed as requested through the obligations created by that same written agreement. Note that the university’s IP policy simply doesn’t operate with regard to ownership. It is superseded by the written agreement. Where the university relies on the IP policy as its implementation of the written agreement, it is only those parts of the IP policy that in fact implement the written agreement that operate.
Way 4. The university declines to elect to retain title, the government declines to request title, F requests to retain title, and the government after consulting with the university, concurs, citing the minimum conditions for its approval as set forth at 37 CFR 401.9.
Bayh-Dole provides for inventors to retain title. That is, in the absence of any claims on title as a deliverable, title is not a deliverable under the federal award, and title remains where it always is under any normal Patent Act, and that is with the inventors. One might ask, then, if the inventors can have valid, conditional agreements that obligate the title they may retain. Of course, provided these agreements are compatible with the Bayh-Dole obligations required of them in the agreement under which they are permitted to retain title.
As a special question, one might ask, if the university declines to elect to retain title under Bayh-Dole, can it then come back around and say to the inventors, “but under university IP policy we can still claim the invention, but now with only the minimum of requirements to the government, which is a better deal, so you are out of luck and have to assign.”? One might argue, if the university declines to elect title, that *does* have an effect not only of waiving its interest in title under Bayh-Dole *and* exhausting its interest in title under its own IP policy. That is, Bayh-Dole supersedes that IP policy in matters pertaining to the government’s interest, but not in matters pertaining the university’s interest.
To see how this works, recognize that for the university to obtain title under Bayh-Dole, it does so under the written agreement, which is a university required agreement to comply with a federal regulation. The university’s own IP policy is no good at this point, but for stipulating that a written agreement will be required pursuant to Bayh-Dole (repeating the obvious) and that employees will comply with that written agreement (yes, since it is required that they do so by federal regulation). The university is not at liberty to throw anything else into the mix. The written agreement sets out the terms, and that’s what is required, no more, no less. But the university’s decision whether to elect to retain title lies outside the scope of this written agreement. It is a university decision. It is not constrained one way or another by Bayh-Dole. It does not even have to be made. The university can default, not notify the government of a choice, and Bayh-Dole operates on its merry way. But when the university makes a claim to title, it does so as its own action, and likewise if it waives an interest in title, it does so under its own IP policy. Once waived, the opportunity to obtain title is exhausted. It stands as a quit claim, an action by the university under its own terms, not those of Bayh-Dole.
One might see in this how a conflation of Bayh-Dole obligations and those that arise from the university’s own administrative choices might serve the interests of folks who want to have power over decisions and actions but do not want anyone to recognize the basis for that power. It’s good enough if Bayh-Dole requires it. Here’s the rub: if Bayh-Dole does not require it, and a university’s administrators put out that it does, and they know otherwise, or should know otherwise, that is professionally incumbent on them to know otherwise, then it is malpractice if not a kind of fraud. Employees are being induced to take actions on improper grounds. Where this inducement comes from public universities acting as governmental agencies, one might even go so far to say that it is a corrupt practice to claim personal assets citing an inapplicable federal regulation or an improperly applied state or university policy regulation.
Malpractice, fraud, corruption. These are big words. But folks shouldn’t be in such denial that it’s not possible. And one should at least recognize that triggering these concerns might at least reflect that there’s a potential breach of good faith, of integrity, of reciprocity that otherwise ought to be present between university inventors and those asked to work with them to realize a public benefit.