Are university faculty employees wrt research IP?

Are faculty “employees” for the purpose of intellectual property in research?  I argue they are not.  Here’s a sketch of my reasoning.

Consider:

Faculty choose their research topics.  They choose where they will do their work (university or not).  They choose their collaborators.  They choose their funding.  They choose their methods, identify results, and choose where and when they will publish.  They even have to request approval to obtain extramural funding–in essence they ask to be released from their “official duties” to do extramural work.  The university does not commission the work, direct the work, review the work, or approve or accept the work.  It does not even know about the work, but for a record of the funding.

With their research there is no way that faculty are working for the financial benefit of the institution with regard to work product. With sponsored research, the faculty investigator is working by special performance for the sponsor.  If the PI quits, the sponsor can pull the plug on the project.  If there’s any benefit in doing the work, it’s for the sponsor, or for those the sponsor wants to benefit.  And the sponsor may very well wish to benefit those doing the work!  That rarely is the university’s administrators.  The sponsor does not fund the project so that the university has the benefit of the results of the work for the purpose of making money through licensing.  (It does happen.  I even tried to make that happen with a half million in funding, but the university administrators weren’t having any of it, and so I had to do the work in the conventional way for the benefit of the sponsor and for other universities!)

There is nothing to indicate that the university is the employer of faculty for research IP.  Faculty are more ancient than the corporate structure of the university.  If one reasons from the ancient forms, the corporate is a modern scaffolding to manage stuff like pay and benefits and contracting logistics.  It’s not anything at all as an employer as master and professor as Biff-servant waxing the car (as in the movie Back to the Future).   One might go further and argue that it’s not in the state’s interest (for a public university) to have faculty be Biff-servants of administrators.  Administrators do not know what to do to boss Biff-servant faculty around to do research.  It’s a waste of time.   No, the benefit to the public is that faculty are not Biff-servants of the state, or of administrators, trying to make money for the state or university masters, but rather faculty are independent and tasked with doing things that they choose to do to improve their own skills and discover and prove and disconfirm and test and inspire and train.  I know, unicorn and rainbow time, and some readers don’t like that stuff.   The point is–the idea of a university that really works is that the faculty are independent of institutional controls for the outcomes of their scholarship –whether state, church, military, corporate.  And that includes the university’s own institutional controls, to the extent that means administrators have the right to approve or disapprove publication of scholarship or practice of discoveries or inventions.

Now enter a technology transfer program.  In itself, it means nothing for faculty employment or IP.  It is a resource like any other–the library, the university press, telephones.  The university doesn’t claim your inventions because you worked in the library or talked on a university-provided telephone.  Nor does the university require you only to work in its library and none other, and only to talk on university-provided telephones.   But now take that tech transfer program and make it compulsory.  Make it a requirement that faculty have to use it, and that it is an ethics violation to try to use any other service that would compete with it.  Now go further and say, because this technology transfer office intends to make money off of all faculty IP, then it has a right to claim ownership of that IP.  Doesn’t matter much the rationalization–employment, use of facilities, use of other resources, violation of conflict of interest policies to do anything else, protection of the public from inept rampaging faculty full of the must of profiteering from inventions or being indifferent to such must altogether.

The question then arises:  is it right for an employer to demand all inventions made by employees in whatever area simply because the employer has set up a business unit devoted to making money on owning (but not producing products based on) all employee inventions?  What prevents any employer from doing that?  State laws like RCW 49.44.140 aim to limit claims by employers on employee inventions.  But these laws are drafted with the assumption that a company has an actual line of business and can’t claim just anything that employees invent by starting a business unit that aims to exploit anything and everything as the business’s “business direction”.  Universities in states with these laws thumb their noses at them and claim everything when they should be claiming next to nothing and letting the work come to them.

The scope of “official duties” for faculty involves classes that are assigned and administrative work, like giving grades and serving on committees.  If the university wants to own inventions arising in that work, fine.  But for research–whether departmental or sponsored–these are outside official duties, scope of employment.  Heck even course curriculum isn’t work for hire unless commissioned.

One of the challenges in all this is recognizing that employment for IP purposes is not the same as employment in the sense of “getting a paycheck”.  While copyright and patent have somewhat different traditions reflecting their origins and different subject matter, they share the idea that mere employment is not sufficient to establish an employer’s claim to copyright or patent.

For copyright, we see this in work for hire.  In work made for hire, the employer is the author.  This happens because the employer exercises authorial control over the work, and there is a multi-point test for agency to ascertain whether the employer is authoring.  If not, then the work is not made for hire, the authors are the individuals who prepare the work.   There are even cases in which employees are working within the scope of their employment and expect that their contributions are work for hire but that the author is someone else entirely, who in fact exercises authorial control over the work they prepare.  Even though this other person has never constructed a lick of the work materially, the authorship is where it is, and neither the employer or the employee ends up with the copyright.

This matters for things such as university-supplied assistance with web design for faculty projects.  A faculty member wants help with a web site for, say, a course project.  The web designer is an employee of the university, working within her scope of employment.  Her work is going to be a work for hire, from the point of view of university administrators.  But the faculty member is the one shaping the work.  If the faculty member reviews the work at each point and shapes it to her requirements, then the faculty member is the author.  The web site copyright is with her by operation of federal law.  A university can work to change this outcome, but it isn’t via an *employment* agreement because the work is *outside* the employment!

Of course, an employer can try to guard against such outcomes by demanding an agreement to assign on top of trying to enforce a scope of employment argument.  But here, if the work is outside the scope of employment (so a demand for assignment is necessary), then we are already dealing with the problem that faculty are working outside the scope of employment for their creative work, so why is it that the employer has a right to demand their work anyway?

Put it simply.  If an employee is working within the scope of employment, then the employer is the author and owns the copyright.  If the employer demands assignment of the copyright, then the work is *not within the scope of employment*.  Whatever the deal is by which the copyright is required to be assigned, it is not employment.

This has given rise to some worries that faculty scholarship is secretly owned by the university because faculty are hired to do research and publish.  It’s just that nothing the university does would give rise to a finding that it has exercised the requisite authorial control over faculty scholarship.  It just isn’t a worry.  There’s no way that faculty scholarship is work for hire unless it is commissioned in writing or expressly within a scope of employment–which would be entirely odd.

Whatever the deal–use of facilities, for instances–it’s not within scope of employment.  Faculty are not university employees for copyright in their scholarship.   How then can it be a condition of employment for them to assign their work to the university?   Hmmm.

A similar situation arises with inventions.  As with copyright, patents are constitutionally protected personal rights in the United States.  (Not so in other venues, such as the UK).  An invention is owned by its inventor.  That’s the foundation of US patent law.  How the inventor comes to assign ownership to another is a matter of private actions (like signing assignment paperwork) and private agreements (under which the inventor gets something of value in return).  That is, for a patent agreement to be enforceable as a contract, there has to be offer, acceptance, and consideration.

In an employment situation, the employer is entitled to a “shop right” in an employee’s invention made with the employer’s resources or information.  The shop right allows the employer to use the invention under an implied license, which the courts are willing to construct to preserve a basic equity between what the employer provides and what the employee exploits to make an invention.   Essentially, the courts have constructed an agreement between the employer and inventing employee that prevents the employee from asserting patent rights against the employer for the employer’s own use, when an invention is one that an employer might reasonably expect to use.  If the employer wants greater rights, or ownership, then there has to be a patent agreement in place.  Same thing–offer, acceptance, and consideration.  Typically a company will make the assignment a condition of employment.  That is, if one doesn’t assign, then the employer may dismiss the employee–but that doesn’t mean the employer gets ownership!  or even a license beyond the shop right.  As long as the scope of that requirement is limited to the company’s business, business information, and use of facilities (for the purpose of the business), then state laws approve the requirement.  But if the company goes further and defines facilities to include the parking lot or riding in a company car coming back from a weekend meeting, then it is not clear at all these are legitimate claims.  For faculty, especially those with tenure, is a university administration really proposing that if the institution does not get ownership of an invention, it has grounds for dismissal?

In these settings, one might even go so far as to say overreaching claims violate a sensibility about innovation, that the inventor does have a right to inventions, and ought to.  Gosh, maybe the founding fathers had it thought through.  Life, liberty, happiness stuff.  Sort of like unicorns and rainbows.  Administrators in universities don’t think that way anymore, and certainly don’t talk that way, except at graduation time, and sometimes when begging for money from donors or the state legislature.  Then it’s full on glitter and stuff, but everyone knows it’s the dull practical potato eyes when they get back on campus.  In any event, the employer shouldn’t have a right to everything, but only the stuff that’s clearly related to the business and the employee’s work *for the employer*.

But now we get to the university, with its “public mission”.  And with a tech transfer office with a “public mission” to make money to support the university’s “public mission.”   Does the use of the words “public mission” turn the employer who would take everything from a big nasty overreaching ogre into a fluffy doe-eyed bambi?  Is it all okay because the employer has a really really really sincerely good intention in taking ownership?

How to be a dictator in one easy step.  Say you are interested in everyone’s well being.  Now, would folks please hand over all their personal possessions.  (Do not say the previous sentence as if it were a question).  As dictator, I know better how everyone should live than they do, so their personal possessions really should be mine.   Please conform so that society will be orderly and enjoyable for all.  If you all cooperate, you will make my dictatorship successful, and that would be good for all of us.

No, the aspiration to a public mission does not trump taking personal property, no matter how you rationalize it.  And IP is personal property.  If it’s not okay to be taking it in commercial settings, it’s not any more okay to be taking it in nonprofit settings!  It’s even less okay to be taking it when the nonprofit is a university.  The decision by a tech transfer to deal in everything a faculty member could possibly come up with–so long as it looks “valuable” or “has commercial potential”–does not justify making assignment of IP to the university compulsory, whether as a condition of employment or use of facilities or use of resources unless there is an express agreement regarding the provision of the facilities or resources for which ownership of any resulting IP is reasonable consideration in exchange for access.

It’s hard to see how that would be true very often.   Only the desperate, lazy, and ignorant would fall for it, on general principles.    Everyone else would pick another place to do the work–like, say, consulting with industry–where there might be the same claims to ownership but a) one gets paid real money for doing the work and b) the company one consults with is generally working on what one is doing, so there’s a fighting chance (no assurances) that the company won’t totally bungle things.   Better, just do the work in the garage, if you must.

While a university can demand ownership of faculty IP–clearly, this is possible because administrators across the US are doing just this–I have yet to see a cogent argument for it.  Urges yes, rationalizations yes, sincerity–bottles and bottles of 80 proof sincerity.   But nothing that buttons down how it comes that faculty are employees of the university for purposes of scholarship or IP.  It just doesn’t work.  Nor that when approved to work in sponsored projects, where the costs (including facilities costs) are paid for by the sponsors, that somehow the provision of the facilities is also compensation for the assignment of title to inventions or works of authorship.  There appears to be no justification, except perhaps bullying and envy.

The basis for faculty employment may include the expectation of scholarship, but not that the works of authorship and discoveries that may come about are intended to be for the benefit of the university.  The claim that the university will share benefit with the author or inventor also doesn’t get at it.  I’m fine with that if it’s a voluntary deal and an inventor says, “Sure–you pay the patent costs, I’ll write a paragraph for a web invention marketing database, and if anyone licenses, we’ll split it 1/3 me and 2/3 you, as long as a lot of the 2/3 you goes to help students.”  I’m not fine with it if the university says, it’s a compulsory deal–we take title, and we will pay you 1/3 if we ever get around to licensing it, but we may not, since we are really busy, underfunded, and have a business model that always chooses some marketing pitch that costs more than the market is willing to pay, which we call the “funding gap” rather than the “fuzzy-headed gap”.

Taking title and having no obligation to license renders any royalty sharing schedule meaningless in terms of compensation.  There is no consideration in the deal.  It’s not an enforceable contract.  It’s not a contract at all.  It’s just an employer’s chronic threat.

Again, if the deal is voluntary, and includes “we may never be able to license the invention” and the inventor takes that deal, fine.  But if the deal is compulsory, then the inventor has no say in the conditionals.  It’s not fine.  It’s wrong.  No amount of sincerity and rationalization makes it less wrong.

Maybe there is a good reader who can help me out.  Faculty are not employees with regard to their scholarship unless they expressly agree in an instance to bring their scholarship within the scope of employment.  Faculty are not compensated for assigning title to their creative work in their pay for services that doesn’t involve their creative work.   Universities as employers have no right to claim anything and everything just because a university operates courses in many areas and encourages faculty to pursue research in many areas.   Public universities do not avoid constitutional questions of eminent domain when they demand faculty IP–personal property for a public purpose–without due process and just compensation.   I don’t see why anyone would *want* faculty to be Biff-servants to a university administration for any creative or scholarly or inventive reason.

So what is going on?  Why the present assignments?  Why the arguments that it is only reasonable and fair that employers own employee’s work, and universities employ faculty, so universities should own faculty work?  It’s not reasonable and fair at all.   Universities do not employ faculty as a company employees its workers.  It is an ancient structure.  It is worthy of respect.  It exists for a reason.  It is not to benefit administrators with grist for a commercialization mill–even if that mill actually produced what it claimed.

I am expecting this demand to own is something basic, like envy or a will to power or lulz.  I don’t see any reason in it.  University administrators should withdraw the compulsory ownership bit.  They should be making an argument for freedom not compulsion.   They will have stronger tech transfer programs.  They will make more money.  The public will like them (sort of) again.  Innovation will happen.  Universities will be in the thick of things, as they were in the 60s and 70s–right up until Bayh-Dole and that whole big misunderstanding that “elect to retain” title meant “get to take” title.  They will sleep at night knowing they are once again on the right side of history.