Here is another example in the wild of the mischaracterization of Bayh-Dole. This is a document that offers a “Brief Guide to Intellectual Property in a University Context”. My point is to document how Bayh-Dole has been represented by university officials. I expect the document to come down soon after I’ve posted this note, so if the link to it is broken, that’s a good sign.
After defining “intellectual property” to include patents, copyrights, trademarks, and trade secrets, we get this under “Key Laws, Regulations and Policies Regarding Intellectual Property”:
A. The Bayh-Dole Act (Public Law 96-517, 98-620)
· Intellectual property that results from research funded by the Federal Government is owned by the institution that performs the research.
· The Federal Government retains limited rights to such IP, including, but not limited to:
o Non-exclusive right to use for government purposes
o Right to claim ownership if ownership is waived by institution
o Right to claim ownership if commercialization does not proceed fast enough
This statement gets it wrong multiple ways. I will highlight a few.
First, the Brief Guide asserts that Bayh-Dole applies to all intellectual property, which is not the case. Bayh-Dole is concerned only with inventions and patents, not with intellectual property in general. Circular A-110 (2 CFR 215), which governs federal grants made to universities, addresses intangible property, including intellectual property (but, as to ownership, only copyright). Data rights are also address by A-110, which requires data release under FOIA when published findings are used for federal agency rule-making with the force of law. By overstating the case, the Brief Guide makes it appear that federal law hands ownership of all sorts of things to the university. Utterly untrue.
Second, with regard to inventions, Bayh-Dole does not give ownership to universities. That’s flat out wrong, as anyone knows after Stanford v Roche.
Finally, the Brief Guide is wrong about march-in rights. There is nothing in Bayh-Dole about problems with “commercialization” not going “fast enough.” This is pure fabrication. The March-in rights at 35 USC 203 provide for a funding agency to require the contractor, assignee, or exclusive licensee to grant licenses, or the agency may grant such licenses. There are four enumerated conditions under which march-in can be done:
(1) action is necessary because the contractor or assignee has not taken, or is not expected to take within a reasonable time, effective steps to achieve practical application of the subject invention in such field of use;
(2) action is necessary to alleviate health or safety needs which are not reasonably satisfied by the contractor, assignee, or their licensees;
(3) action is necessary to meet requirements for public use specified by Federal regulations and such requirements are not reasonably satisfied by the contractor, assignee, or licensees; or
(4) action is necessary because the agreement required by section 204 [preference for US industry] has not been obtained or waived or because a licensee of the exclusive right to use or sell any subject invention in the United States is in breach of its agreement obtained pursuant to section 204.
The issue is “practical application.” There is no requirement in Bayh-Dole to “commercialize” inventions–commercialization is one objective among a number, and it is mentioned with regard to industry, not university, activity. “Commercialization” is an activity that may follow from achieving practical application, but it is not necessary for inventions to be used–especially research inventions, which may be used to support more research, practiced without the need for a product version, or contributed to a standard and form the basis for products without any one product being developed first.
“Practical application” is defined in Bayh-Dole; “commercialization” is not–and is hardly mentioned:
(f) The term “practical application” means to manufacture in the case of a composition or product, to practice in the case of a process or method, or to operate in the case of a machine or system; and, in each case, under such conditions as to establish that the invention is being utilized and that its benefits are to the extent permitted by law or Government regulations available to the public on reasonable terms.
This Brief Guide misrepresents federal law and contracting, and makes it appear that the university has rights under federal law that it simply does not have. One is struck by how shoddy the restatement is, yet how confidently self-serving the document is with regard to Bayh-Dole. It is this confident wrongness that has pervaded university IP practice.
I expect that some folks now feel a lot of pressure to change policy to make it clear that Bayh-Dole doesn’t matter–universities will unilaterally claim ownership of inventions, regardless. Thus the present assignment movement. Even if university administrators can salvage their ownership claim under a different rationale–unilateral assertion rather than federal law–we still have not got to the heart of *why* university institutional ownership is so favorable and federal agency ownership–another sort of institutional ownership–is so bad, and for all that what institutional ownership of research inventions means for scholarship, collaboration, innovation, and even commercialization.
It would seem that many university administrators, who should care the most about Bayh-Dole, respect it the least.