Patent Policies of Confidence, and Patent Policies of Fear

Vannevar Bush, writing in the introduction to Modern Arms and Free Men (1949):

This is not a history of what science did in the war; that has already been written.  It is an attempt to explore its meaning in the relations between man and man, as individuals and in the organizations they create.  Since the beginning of organizations there have been two controlling motivations that have held them together.  One is fear, utilized in the elaboration of systems of discipline and taboos.  The other is the confidence of one man in another, confidence in his integrity, confidence that he is governed by a moral code transcending expediency.  Most governing organizations have involved a mixture of these motivations; they always will as long as the nature of man remains unaltered, but one may be controlling and the other subsidiary, incidental, or extraneous.  There has been a general feeling that the second is the higher motivation, but that it is inherently weaker in dealing with the harsh and complex conditions of existence. (7)

Bush then goes on to discuss the confrontation between democracies and totalitarian regimes in the time following the end of the second world  war.  The challenge for democracies is to address the expediencies of existence “if the world is to be more than a mere police state.”  As Bush puts it, “The philosophy men live by determines the form in which their governments will be molded” (9).  This is true not only for nation states, but also for organizations.

Universities, as organizations, are also faced with this same challenge, especially when it comes to innovation from research.  They can become police states elaborating rules and taboos, or they can be based on confidence in the integrity of individuals.  It will always be expedient to assume the worse, to loath inventors, to imagine oneself to be superior in the exercise of judgment, or to bury any need for judgment in committees and policy statements that eliminate any need for personal responsibility, not only from the decision-maker, but also from the university worker–the faculty member, the staff employee, the student, the volunteer, the visitor.

There is absolutely no need for a policy on inventions to provide a mandate to turn a university into a police–policey–state in which the first purpose of the institution, upon learning of an invention, is to make the event a test case of service to authority, ceding judgment and interest to bureaucrats, and following a set of prescribed rules that generally cannot possibly anticipate the interests of community, or inventors, but serve, fundamentally the convenience of the rule-makers, as they envision the university.  A policy can be used, not to grasp the work of others, but to limit the reach of that grasp by the organization.  In universities, especially, the wellspring of innovation is confidence, not fear.  As a university administration adopts fear as the primary component of its patent policy, it destroys the distinctive fabric that makes a university a place of discovery.

Policy fear takes odd forms.  It takes the form of gross ambiguity in policy statements that attempt to connect public service with arbitrary institutional ownership.  Policy statements written to “leave wiggle room” or written by incompetents or written to serve the convenience of administrators.   Policy fear takes the form of expansive lists of what is claimed, written in legal-speak, that go beyond something simple, like the right to obtain a patent, and claim “know how” and “scholarship” and “unpatentable inventions”–things that have no meaningful theory of ownership.  Policy fear takes the form of the implication that failure to follow the policy, even screwball foolish grasping policy, is unethical, actionable, criminal–the policy becomes rather than delegation or guidelines, a kind of sacred text, a test of loyalty to authority, an implicit threat to employment and reputation.  Policy fear takes the form of uncertainty with regard to the application of policy, with its exceptions, and autocratic application, ignorant of and indifferent to the circumstances under which something new has been discovered.  Fear takes the form of the recognition that those demanding institutional ownership may be utterly unsuited to the task of taking the initial steps to act on what has been discovered, invented, developed, or composed.

Yet fear is the stronger argument.  It is easier to suppose all inventors are somehow gullible or incompetent or indifferent (as an attorney for WARF did in a Stanford v Roche amicus brief).  If the inventors were not depraved before they invent, they will be when they believe their invention is valuable.  And if they do not believe their invention is valuable, then it is easy to propose that they are indifferent, or fools, or lack proper understanding of markets, or how patents can be used to threaten to disrupt markets.  It looks positively fluffy and uselessly idealistic to a policy written to exploit fear to suggest that confidence, rather than fear, is a better way to manage university-hosted innovation.

It takes courage to write a policy that restrains institutional reach, predicated on confidence, predicating on placing resources where the circumstances indicate.  It takes only a petty mind, directed at solving administrative problems, or eliminating them before they arise, to draft a policy that presupposes incompetence, lack of integrity, and institutional loss as the natural companions of the inventive faculty member, staff member, or student.  Current university patent policies are largely drafted to eliminate the need to consider circumstances.   Many university invention disclosure forms don’t even bother with asking what support the inventors received from the institution.  The forms ask only about grant funding.

Inventor-loathing is the domain of the administrative coward, but the coward casts such loathing as prudent, even a necessity, critical to the institution’s revenue-seeking, and (with handwaving without substance) essential to the public mission of the university, which apparently is to make money for itself by using the threat of patent rights.

The relationship of individuals to each other, and to the organizations they create, is still in play when it comes to innovation in a university setting.  Present university policies pertaining to inventions have largely moved to the side of fear.  National organizations such as AUTM have endorsed such policies, including their vocal support for the idea that federal law vested ownership of inventions with the universities that hosted federally funded research.  They did not argue merely that institutional ownership was a perhaps regrettable but technically necessary outcome of the law (of course, it wasn’t even that)–no, they argued that outright institutional ownership was a really keen thing.  And when the Supreme Court considered their claims carefully and then threw them all out on their ear, the AUTM folks got up, dusted themselves off, and popped off with the argument that institutional ownership was still a really good thing, even if the silly old Supreme Court couldn’t figure that out, hiding as it did behind the Constitution and the actual construction of federal law.  Thus, now we have the rage for present assignments.

Yes, there is something to be outraged about, or deeply disappointed about, and motivated to do something about.  The practice of transferring technology for public use has been given over to the service of institutional policies rooted in fear:  badly conceived, badly written, poorly implemented, incapably practiced, justified by the lack of confidence in inventors to take an appropriate action with their work.  In universities, of all places, administrators depict faculty and student inventors in policy as proto-thieves, or mere work-a-day employees, hired for their hands, not their heads.  A university is an organization that has its smarts at the periphery, and even in the periphery of the periphery.  Facebook wasn’t launched at Harvard by senior administrators with some master insight into what is needed; not even by faculty.  Certainly not by technology transfer officers.  Not even graduate students.   Undergraduates who didn’t even finish.  Same for Microsoft, another Harvard spin-out.  The innovation periphery is not well served by central control or central planning.  It is served by organizational resources being directed, effectively, out to the edges, not to control the edges, but to continue to leave control with the edges.

It is a night and day situation.   Either new stuff is free of institutional claims, or it’s a matter of what form of fear the institution will inject into discovery activities.  It does not matter that the conventional practice that’s all the rage these days is institutional ownership of just about everything. It does not matter that a “system” of licensing offices has been built up like parasites on the institutional practice of strong-arming inventions from the inventors, citing federal law.  It would not even matter if most of those offices were “successful” as well in placing those inventions for use–and sadly, they are largely not successful, given the nature of the model of ownership and the model of licensing that they have adopted.

In the context of voluntary choice of invention management agent, a university licensing office is necessarily selective and competitive–both critically important to the task of getting anything done.  In such a context, there are still huge challenges in getting something patented, licensed (hopefully a lot of times), and from that licensing work, new products and practices.   Where the arrangement is voluntary, and mutually negotiated, a 20% or 30% “hit” rate is perfectly acceptable.  Universities have rarely done much better, once n > 10.    But when ownership is compulsory, even a 30% “hit” rate means that 70% of a university’s output is held hostage to the office’s model and marketing and self-image.  That 70% does not “lack commercial potential”–rather, its potential is destroyed at the hands of a university policy that takes ownership but cannot possibly recognize what might be done.  At best, it is the same dull effort to secure a patent, and push the patent off on industry, which when that fails exhausts the capabilities and interests of the office.  After all, only one deal a decade defines success in a portfolio model, while anything less than activity for every invention under management is unacceptable in an agent model.

Some folks like things to be simple, and so they have come up with the idea that the university as employer should own everything that an employee does.  Simple.   Well, here’s another simple proposition:  Universities should not own anything unless they are asked to do so, and they accept.   One of these propositions is based on an implied totalitarian notion of university employment–that faculty, staff, and students are directed by administrators who assign, control, review, approve, and dispose of their work–what “employment” means.  The other is based on the idea that in a university, at least, one can proceed based on confidence that individuals working in association with each other and the organization will make good choices, or will seek assistance with their choices, and if there is disagreement on such choices, then there is an impartial resource for appeal, so that everyone can get on with things.

The university administration, by imposing itself as owner of the creative work of the periphery, abandons its role as that resource for appeal.  By eliminating faculty governance from the matter of inventions, the administration further prevents the faculty to manage its own decisions with regard to its members, and their relationship to the university.  And by imposing its own ownership interests, it necessarily damages opportunities for innovation and places its own technology licensing program at a disadvantage.  If a university administration truly wanted to make money, it would adopt a patent policy based on confidence, not fear.  If a university administration truly wanted to serve the public interest, it would adopt a patent policy based on confidence, not fear.  If a university administration wanted to provide an environment in which innovation would thrive, then it would direct patent policy toward limiting institutional claims, while authorizing the use of institutional resources, rather than expanding institutional claims, while ignoring whether institutional resources were used, or under what circumstances.

It is easy to get lost in complicated arguments.  Indeed, complicated arguments are just the thing the status quo likes to keep anyone from taking action.  Fuss with the complications until the word smiths have beaten everything into a pulp.   University innovation must be free.   The talent at the periphery must be free.  A university’s role is to provide resources that serve that freedom.  A university’s role is to adjudicate conflicts when those involved are unable to resolve them.  A university’s role is to ensure that service, not money, is the primary motivation for action.  If service sounds old fashioned, and money is all happy-modern, then that too reflects the values that folks live by, and the form of governance that they institute in the organizations that they create.

Universities have swallowed a poison pill in imposing compulsory patent policies.  Present assignments are simply a way of pushing the pill deeper into the organization.  One way or another, the pill has to come out before it destroys the research enterprise, academic freedom, and the public imagination of the university as something valuable.   Patent administration is no ancillary thing, off in a corner doing its little rainbow-seeking dance.  As it demands the ownership of all meaningful research outputs, it has got to the heart of the research enterprise, and it would happily throttle that enterprise to save its own self-imagine.   Every snake oil salesman advocates for the benefits and reliability and past successes of the product.  Every totalitarian regime speaks about order and care and efficiency.   Every company champions the vision of its managers, especially when things go right, or can be made to appear to go right, or can be made to appear to have gone wrong but for outside reasons beyond their control.

There is not much to it:  Repeal compulsory university patent policies.  Restore confidence in the individuals entrusted with $60b a year in research funding.  Restore the role of the university to one of advocacy, stewardship, and adjudication.   Focus on the needs of the talented periphery.  Restrain the reach of central control.   Let people be free to innovate.  Get rid of a bureaucratic system built on a premise of inventor loathing, intellectual slavery, and policy fear.  Revitalize technology transfer throughout the country.  Allow the potential of Bayh-Dole to be realized, or at least explored as it has not been permitted to do since it was enacted.   Stanford v Roche set the stage.  Now it is time to act.   Demand policy freedom.  Demand an audit of inventions in compulsory licensing programs.  Demand faculty shared governance in intellectual property policy and decisions.  Defund university payments for employee membership in lobbying organizations like AUTM.  Get on with it, folks, before the poison pill breaks open and there’s nothing for it.