I have been mulling over “scope of employment” and “course of employment” and “official duties” and related constructions that show up repeatedly in university patent policies. A strange thing about these matters is that there are two very different bodies of law that pertain to such expressions. The one you might expect in a patent policy is that of intellectual property. The other is employer liability, such as for workers compensation or tort claims for the actions of employees. Given the woeful, horrid, words-can’t-describe-how-awful most university patent policies are, I’m coming around to the idea that those doing the drafting really have no understanding of intellectual property law and in fact are drafting using concepts based on employment liability.
Consider some definitions:
Activities of an employee that are in furtherance of duties that are owed to an employer and where the employer is, or could be, exercising some control, directly or indirectly, over the activities of the employee.
Under the doctrine of Respondeat Superior, a principal is liable for the torts, civil wrongs, of an agent committed within the ambit of the agent’s occupation.
The scope of employment includes all acts reasonably necessary or incident to the performance of work, including matters of personal convenience and comfort that do not conflict with specific instructions.
As set forth inWorkers’ Compensationacts, the time, place, and conditions under which an on-the-job accident occurs. The performance of an act that an employee might prudently do while in the appropriate area during working hours.
In the event that an employee causes an injury to another or another’s property, it is necessary to ascertain whether the employee was acting within the course of employment. The employer is legally responsible for the damages if the employee caused them while performing a job.
The scope of employment is the set of activities an employee is expected to do to perform work for the employer, under the employer’s control. Course of employment is the actual acts of an employee and the circumstances pertaining to those acts. Scope is abstract; what is assigned and what is required to meet that assignment. Course is factual; what happened and under what conditions. An employer might establish scope; but an employee in the course of employment might violate employer orders or otherwise do things that would have a benefit to the employer, but have not been expressly required by the employer. In liability cases, this gets into things like whether an employer is liable for an employee’s car accident. If the employee is talking business on the cell phone, or if the employer expects employees to use their personal vehicles to run errands for the employer, then the employer is potentially liable under the respondeat superior doctrine–the master is responsible for the acts of the servant:
an employer is vicariously or strictly liable for an employee’s negligent acts or omissions committed in the “course and scope” of employment.
That is, negligent acts or omissions are not “within the scope of employment” generally–they are acts that the employer typically disavows. “The company has a policy that employees are not to take shortcuts or substitute cheap parts for the proper parts.” And the like. Scope is what’s reasonable to expect. Course is what happens. “Arising out of employment,” in the context of injuries, requires a connection between the risks of employment and an actual injury. If an employee is driving to a conference paid for by the employer, and has an accident, the employee is outside the scope of employment (not hired to drive to conferences) and is not performing a duty for the employer (not the course of employment) but is engaged in an activity for which the employer expects a benefit (the training and networking and company visibility at the conference). Thus, an injury from an accident in such a situation “arises out of employment.”
An employer has lots to worry about. Scope of employment may be broad–employees might be expected to perform any number of duties; course of employment is what they actually do, but that may be broader than scope in an entirely different direction, since they may do things an employer would not approve; and arising out of employment can be broader in yet another direction, as it may involve neither scope nor course but still end up with the employer because the employer might expect some benefit from the activity.
That is, from an employer’s perspective, liability is broader than scope, broader than course, to include as well anything arising out of employment. Damages are broad. Now consider that most university attorneys are not hired for the intellectual property knowledge. Most, in my experience, have next to no intellectual property understanding or training. They are hired to deal with liabilities. Then they discover that intellectual property has liabilities–infringement, product liability, breach of contract, regulatory violations, Bayh-Dole, export control law and ITAR, conflict of interest laws, misuse of resources, securities law, unrelated business income tax issues, sales tax issues, the status of tax-free bonds, public disclosure law, liability for failure to obtain a patent, or failure to license, or to enforce license requirements, accounting irregularities (does that administrative fee come off the royalty check before patenting costs are deducted?), failure to follow policy, failure to properly delegate authority, inadequate review of process or response to notice of problems, whistleblowers, bribes, misrepresentation of technology, misrepresentation of licensing performance and impact, fraud, scientific misconduct, anti-trust, unfair competition with the private sector, pissing off wealthy boosters and research sponsors.
And that’s just the stuff off the top of my head. For university attorneys, liability is best managed by preventing anything from happening in the first place. If that cannot be done, then the next best is to require everything to happen in the same way. At least then things are known and process can be put in place to force things into the known, and doing this can be pitched as “fair” so no one has special treatment–that is, everyone gets an equal share of the stench, like the Somnour’s fart-sharing technology (line 545ff). Think about it: if university attorneys are primarily concerned about risk, and risk exceeds scope and course of employment, then to control things, they have to control intellectual property in this same manner. If they cannot prevent intellectual property, then it must be managed through a single process. Since happy, confident, well-speaking patent managers show up with a broadly endorsed, plausible sounding technology transfer “process” in hand, one that MIT uses, one that starts with Bayh-Dole requiring university ownership. that’s good enough. Time to write policy to make it so.
University attorneys see inventions as injuries.
University administrators and their legal advisors have drafted IP policies using definitions regarding employment drawn from workers compensation and tort avoidance practice. An invention may arise in just the same way as an injury–in the scope of employment, in the course of employment, or arising from employment–whether the employer has assigned the work or whether the employee violates employer orders, or is simply taking a shower, since office hygiene has some benefit to the employer. If a university can be liable for an injury in such circumstances, and if an invention is an injury waiting to happen, then, why, a university should have the right to own and control any such invention, as if it were potential injury. Technology transfer folks don’t have to make the argument for university ownership–the university attorneys are more than ready to do it on their own.
The presence of “scope of employment” and “official duties” in university patent policies does not come from IP law and practice, but from liability law and practice. If an employer can be liable, then the employer should own. That’s the simplistic thought. It does not follow, but it does create a sweet opportunity for folks who really do want the university to own, and don’t want to wait for an inventor to decide to patent, and having decided to patent, to work through the university licensing office rather than use some other agent. Why have competition? Why, even, let an inventor decide what should be patented? Especially when university legal counsel is already warm to the idea that ownership reduces the risk of damage. Of course, compulsory institutional ownership may in fact be the primary, most devastating damage that one can inflict on a nascent idea arising in university research. But it is not a kind of damage that university attorneys recognize–it is merely a lost opportunity, hardly documented, not a tort, for which the prowess and resources and diligence of the university licensing office more than compensates.
The burden, then, of university IP policies is to look like university policies on risk, to deflect responsibility from the institution, to limit liabilities. Thus, universities require employees to submit to “training” in areas such as “ethics”–not that the training is any good, or has any effect on bad apples, but rather the fact of the “training” is a rhetorical token to argue that the employer should not be held responsible for the failure of the employee. The master should not be accountable for the servant. That’s what the university attorney is generally up against. Fighting the ghost of respondeat superior.
The scoping statements on liability in employment become scoping statements on the ownership of intellectual property–cast broadly–not just inventions that are or may be patentable, but software, data, works of authorship, web sites, know how, show how, expertise, trade secrets, cell lines, mice, other tangible stuff, anything that can be “used,” anything that can be “licensed,” anything that can be “owned”–and even stuff that can’t be owned–all of it. That’s what the university attorney wants for openers. Later, trusting to administrative processes, stuff can be re-assigned once all risk to the university is over, such as when the asset has become a non-asset, when the invention is worthless, when everyone has lost interest. Naturally, when the asset is a dead parrot, then what’s the point, even, of re-assigning it? And if someone still wants the dead parrot reassigned, then it must not be quite dead yet–meaning someone is still around who should be made to pay for it.
The result of this conflation of invention and injury is that scoping statements that were amazingly narrow in past university patent policies are inflated dramatically in present university “liability = ownership” policies. The purpose of past patent policy was generally to authorize the use of resources to assist inventors, and set out a protocol so that inventors would know when the provision of resources also came with an expectation of “equity” in inventions. That is, past policy limited institutional claims, delegated authority, and established protocols for special assistance. Inventors did not have to be “bound” to the policy: the policy was there to help them. They chose the policy, it didn’t choose them. Present “intellectual property” policy, by contrast, aims to “apply” to employees any way it can–as a condition of employment, as an unannounced condition for using facilities, or supplies, or salary, or showing up, as a requirement to participate in sponsored research, or as a condition for being affiliated with, collaborating with, or visiting the university.
From the point of liability, invention as injury, this all works. The policy makes sense. From the perspective of the IP officer without regard for academic freedom, tenure, innovation generally, or the particulars of intellectual property in employment or federal research agreements, it’s just too easy to go along with the university attorneys, and take what they are willing to give. In fact, it may be near impossible to challenge the attorneys on this point. Worse if the attorneys have been fed the foolishness about Bayh-Dole and invention vesting. Much worse if the attorneys think that somehow institutional ownership is necessary for innovation, or that having taken (in mind) everyone’s IP, it would run counter to institutional financial interests to somehow “give it back” without someone being made to pay. It is like the thief looking for compensation to return stolen goods.
In other essays, I have worked through the intellectual property issues with ownership and employment, especially as these issues pertain to faculty. The clear answer was that universities don’t have a legitimate ownership claim on faculty inventions, the Bayh-Dole claim utterly fails, the analysis based on employer direction and control fails, the state laws prohibiting such employer claims turn universities making such claims into scofflaws, and the patent policies themselves are so atrociously, wretchedly, and cleverly deceptively drafted to fail to implement the claimed requirement to assign ownership. We are left with the stark assertion of university ownership, the threat of university retaliation for refusal to accept it, and the damage done by forcing all faculty work that meets the outer angst of university attorney liability through a university licensing office. Resistance costs something north of $100K to get into court, work through the details, and show that the university has nothing to stand on. Doug Shaw did that, to his credit, and stuck up for the contract he signed with the University of California. But not everyone can afford the time and expense, to save their research, their collaborations, their standing.
University patent policies exist because they were directed, originally, at the relationship of faculty to inventors, and of administration in the support of inventors. They were not employment agreements, were not “conditions of employment,” or of tenure, but rather were “conditions of invention”–things that were available to inventors when they did invent. Yes, there were claims that when someone was hired to invent–had agreed to try to invent–for the university, the university would own. But that’s equitable, and voluntary. Yes, there were statements by faculty in medicine that it was against public policy for the university or medical faculty to trade in patents on matters of public health, but that was out of a regard for public policy, that some inventions and discoveries should not be owned, much less exploited for institutional profit by”maximizing” value, such as (to use Cornell’s argument) by suing research partners for infringement every so often, just to keep them willing to dutifully pay, and pay more. Creating a little Machiavellian fear to keep the prince in power. The primary reason for patent policy was that, for faculty, university administrations had no way to compel assignment of patents or copyrights: they were not directing the work; the work was not for them; academic freedom forbad such control and interest.
The point of the university was simply not to acquire, control, and exploit faculty scholarship in this way, disrupting the ability to teach (have to ask a bureaucrat if students can have a license), the purpose of publication (becomes an advertisement for a bureaucrat’s deal, because no one can practice what the learn without permission), and the ability to collaborate (the university claims the work of collaborators, too, unless bureaucrats decide otherwise). The point was to be a university, amid intellectual property, and stay on track to serve the public through teaching and discovery. That’s pretty basic stuff. There is no compelling reason why this cannot be the way universities operate now. They aren’t making money from their compulsory policies, and they are destroying a lot of the goodwill that they had created for themselves. They are soiling their nest, and it appears that the ones happiest about this outcome are the university attorneys fixated on liability rather than on public purpose.