August 17, 2013
Dr. Peter Salovey
President, Yale University
Dear President Salovey,
I am writing to ask you to review the situation with regard to late Professor John Fenn in light of new developments in the matter of federal laws pertaining to research. As I am sure you are aware, Professor Fenn invented electrospray ionization mass spectrometry, was awarded the Nobel Prize, and had a six-decade affiliation with Yale. He was also involved in a series of lawsuits with Yale over ownership of his invention. As the matter stands, Yale prevailed in these disputes, persuading the court that Professor Fenn breached his contract and fiduciary duty to Yale and committed fraud. As a result, Yale obtained ownership of Professor Fenn’s patents and made Professor Fenn pay over one million dollars in damages and legal fees. From an institutional perspective, no doubt there is a wish to consider the matter closed and move on. It should not be so easy.
Since Professor Fenn has died and no longer has a voice in the matter, I write to you on his behalf. I have no connection with Professor Fenn or his estate. I care only that intellectual property play a useful role in promoting public use of discoveries made by creative folks at universities. Although you have served Yale as provost, you are new to the position of president and have an opportunity to make things right with regard to Professor Fenn. Even if it is too late for Professor Fenn, it is not too late for the University.
In June 2011, the US Supreme Court in the case of Stanford v Roche rejected the prevailing claim made by university administrators that the Bayh-Dole Act vested ownership of inventions made with federal support in the university that hosted the research. The Court was clear: the Bayh-Dole Act did not give a university employer any special rights to take ownership of inventions from inventors, but only provided the basis for a contract under which a federal agency might agree with a university with regard to the disposition of inventions that the university had obtained from an inventor.
In the matter of Professor Fenn, Judge Droney followed the discredited claim of university administrators and held “If a contracting institution elects to retain title to a subject invention, the individual inventor (who typically is employed by the institution) has no further rights.” This reasoning has been overturned by the Supreme Court. A subject invention is one that the university has already obtained ownership of. Yale’s election to retain title under Bayh-Dole has no bearing on the rights of Yale to require assignment of any inventor’s inventions to Yale. Such an election creates no equitable right to title nor executes a transfer of title in inventions and associated patents.
It is clear that Professor Fenn was correct about Bayh-Dole, and Yale has been wrong, even though Yale persuaded a judge otherwise.
Furthermore, it is clear that Yale has failed to comply with the requirements established under the authority of Bayh-Dole for the delegation of responsibilities with regard to federally supported inventions. The Bayh-Dole Act authorizes the creation of standard patent rights clauses. These clauses are then inserted into federal funding agreements accepted by universities as a condition of the award of funds. Thus, the disposition of any given invention made with federal support is subject to the patent rights clause in effect for the funding agreement under which the invention was made.
A fundamental requirement of these clauses is that the university requires its research personnel to make a written agreement to protect the government’s interest. This requirement is set forth at 37 CFR 401.14(a)(f)(2). This written agreement has been commonly misunderstood to refer to an agreement under which potential inventors agree to assign inventions to the university. It is nothing of the sort. Instead, it is a requirement that universities delegate to these potential inventors specific obligations–to disclose subject inventions, sign papers to permit patent applications to be filed, and to sign papers to establish the government’s rights in inventions. An inventor cannot sign papers to establish the government’s rights if the inventor has no such rights.
Clearly, the effect of the (f)(2) requirement in the standard patent rights clause is to delegate authority to potential inventors to represent their own interest in inventions, until they agree otherwise. Thus, the (f)(2) requirement, should Yale choose to comply with it, requires Yale to waive any policy claims to inventions that would conflict with the delegations required by the standard patent rights clause. If Yale seeks ownership of inventions made by its faculty, it cannot do so on the basis of managing federal funds award to support the work of its faculty. Any such agreement regarding inventions is distinct both from employment and from federal support for research.
Yale is in breach of its federal agreements, including those for the support of Professor Fenn, and has misappropriated his inventions on an unsupportable, invalidated premise.
Even today, Yale requires a “Patent Policy Acknowledgement & Agreement” that misrepresents the federal law and fails to comply with the standard patent rights clause. The Policy Acknowledgement makes it appear that federal law and regulations grant Yale special rights in their inventions, when the law and regulations do no such thing. The same misrepresentation is put forward in Paragraph 9 of the Yale patent policy (1998 revision), making it appear that the “retention” of rights in inventions has something to do with obtaining those rights from inventors, when the Supreme Court clearly rejected this reading. Yale’s patent policy goes so far as to write the university into the federal requirements “to protect the rights of the government and/or the University.” This is as untrue as it is self-serving. As the Fenn court has held: “A patent is property which, when wrongfully obtained, may be reassigned to its rightful owner.”
Yale has wrongfully obtained Professor Fenn’s patents, and should restore them to their rightful owner.
Professor Fenn joined Yale as a faculty member in 1967. The Yale patent policy in place as of 1962 includes this statement: “In general it is not the policy of the University to hold title to patents.” The policy goes on to nominate Research Corporation as its designated agent, and authorizes a Committee on Patents to decide whether an invention is to be referred to Research Corporation or waived to the inventor. The policy continues:
If the Committee decides that patenting of the invention is not contrary to University policy, but if neither Research Corporation under its agreement with the University nor the University through other arrangements is willing to undertake such patenting, the University shall have no further interest in the invention and the inventor shall be free to handle or dispose of his invention as he wishes.
I recognize that Yale has long since changed its patent policy. However, there are considerations. In the case of Shaw v The Regents of the University of California, which concerned a university’s effort to change its patent policy without the consent of an employee-inventor, the court was adamant:
We also reject the University’s argument that the Patent Policy is a mere personnel policy which it may modify unilaterally. Although the University is entitled to revise its Patent Policy, it cannot do so with respect to Shaw because of its written agreement with him.
If the patent policy that was in place when Professor Fenn was first employed by Yale was not contractual, then how is that any more the case for the patent policy in place when the dispute over inventions arose with Professor Fenn? If the patent policy went from voluntary to contractual at some point during Professor Fenn’s employment, where is the additional consideration for this change? Where is the written agreement with the Professor to this change? The policy that should control Professor Fenn’s invention is the policy he originally agreed to, until he voluntarily chose to agree to another. Under the policy in place in the 1960s, an inventor has no obligation to represent the value of the invention. That is the work of the Committee on Patents and Yale’s contracted invention management agent. It does not matter one speck under the Yale policy whether an inventor thinks an invention is valuable, or not, or chooses for whatever reason to downplay an invention’s importance: the matter rests with the Committee on Patents.
Yale has not allowed Professor Fenn’s inventions to be managed under the patent policy he agreed to when he was hired by Yale.
I understand that there are those that have no desire to understand the force of this argument. Yale beat Professor Fenn in court, and that is sufficient. But justice was not served. The judge argued that Professor Fenn as a faculty member should be held to a higher standard than any ordinary employee of a company. A similar argument, however, must be made for university administrators operating for the benefit of the public trust, and all the more so when the university is one with such visibility as Yale. Yale has a responsibility to set a leadership example. Presently that example is one of overwhelming the arguments of others, relying on misinformation, and taking what does not belong to the university.
It is easy to dismiss my letter as a string of technicalities and arguments that are no longer relevant: but the fact of the matter is, Professor Fenn was right, Yale and its policies even now are incorrect and improperly applied, and Yale has used its reputation and financial resources to hire very good attorneys who made an effective, and winning, case to the court.
That case, however, was untrue, and unjust. The decision did not “vindicate the patent policy”; all it has done is demonstrate the power of a university administration to get its way. If the case was merely about money, so much the worse. The winning arguments were based in part on a false claim regarding Bayh-Dole, a failure to comply with the terms of federal funding, and an imposition of a patent policy on an employee without appropriate consideration and concurrence.
President Salovey, do the right thing: choose to revisit the dispute with Professor Fenn, and make things right with history, and with his estate. Winning feels good, I am sure. But doing the right thing establishes one’s legacy forever.
Sincerely yours,
Gerald Barnett