Though it’s rather useless to do so, let’s consider then the steps required by a Bayh-Dole compliant disclosure. I say it’s useless because no one complies with Bayh-Dole and federal agencies don’t care. The law doesn’t operate but enables something else to operate. It’s like using the rule of law to avoid the rule of law. If you follow this recursion, then you see the cleverness of Bayh-Dole. It’s the flip of “copyleft.” Rather than use copyright to require others to “share alike,” Bayh-Dole posits using patents to “defect on the commons that justifies the use of public resources” to justify the use of public resources. “We must prevent stuff that is publicly funded because it should be public to become public because if it became public then the public would not benefit from it not becoming public.”
Let’s put it in terms you may recognize: the public won’t benefit from publicly funded research unless that research is secured as patent monopolies and conveyed to single companies for their exclusive use, because no company will develop any such invention without a patent monopoly and freedom to exploit that monopoly–and that, my friends, is the only path to public benefit arising from publicly funded research. Any enforcement of Bayh-Dole would sour the whole enterprise and drive away these companies that are essential to the public benefit that may arise from publicly supported research.
Or, in its politically effective form: “what is available to all will be used by none.” Absurd? Yes, of course. Crazy? Yes, beyond simple lunacy. Inspired? Yes, but only if you are a BDCBF Bayh-Dole advocate.
Steps in Disclosure
It is important, then, that folks get the disclosure right. Bayh-Dole’s standard patent rights clause (at (f)(2)) requires contractors to require their technical employees to make a written agreement that includes a promise to disclose inventions to the contractor so the contractor can comply with the disclosure requirement. The disclosure must identify the funding agreement and the inventors, as well as any statutory bar to patenting. But the core of the disclosure is that:
It shall be sufficiently complete in technical detail to convey a clear understanding to the extent known at the time of the disclosure, of the nature, purpose, operation, and the physical, chemical, biological or electrical characteristics of the invention.
In other words, the disclosure is essentially the text needed for the specification part of a patent application–the part that teaches one with ordinary skill in art how to practice the invention. Put another way: before a contractor must disclose a subject invention, the contractor must
- determine that the invention is or may be patentable,
- obtain information on possible patent bars,
- acquire ownership of the invention,
- determine that the invention was made under a federal contract,
- obtain a sufficient description of the invention that it could use the description to prepare a patent application, and
- convey this description to its patent administrators.
This ought to look like a weird list. How can anyone determine that an invention may be patentable without having a full disclosure of the invention and information regarding patent bars? But none of these things are required until a contractor owns an invention made under a federal funding agreement–including, even, determining whether the invention was made under a federal contract.
Thus, in practice, here’s a reasonable sequence of events:
- Inventors report to supervisors that they have made an invention
Let’s call this the reported invention. It could be anything that folks think of as inventive. A folkways invention. An invention within the nebulous scope of badly drafted university patent policy. A discovery, an improvement, a “software,” a “technology,” a “know-how.”
- Supervisors refer the invention to university administrators
- University administrators gather sufficient information to determine whether the university has an interest in owning the invention.
This is the disclosed invention. That information includes whether the invention is within scope of a university claim of ownership, whether the invention appears to be patentable, and any bars to patenting. For this step, administrators often (and ought) to consult patent counsel.
- If the university has an interest in the invention, then administrators (or patent counsel, acting for the university) obtain a full disclosure of the invention and based on that disclosure obtain an assignment from the inventors.
The assignment, then, is directed at the disclosed invention rather than the reported invention. If the invention is also patentable and made within the scope of a federal funding agreement, it is upon assignment a subject invention.
- Now administrators (or their legal counsel) can determine whether the invention has been made under a federal funding agreement.
Their determination may be disputed by the federal agency. Bayh-Dole’s standard is that it can be “shown” that the invention arose within the “planned and committed” activities of a federally funded project, or otherwise did not “diminish or distract” from those activities.
An invention which is made outside of the research activities of a government-funded project is not viewed as a “subject invention” since it cannot be shown to have been “conceived or first actually reduced to practice” in performance of the project.
That is–there must be documentation of work to establish the connection–not documentation of spending. The core of it is comparing work “planned and committed” under the funding agreement–for which check the call for proposals, the proposal submitted, and any other university documents that set out the “planned and committed” activities. Compare with what has been done to make the invention. As the implementing regulations have it, it appears to be the federal government’s burden to “show”that an invention as been “conceived or first actually reduced to practice” in the performance of a project.
In practice, this sequence doesn’t happen. Instead, inventors send over a manuscript that will be published in five days or slides for a conference presentation taking place the next day, or a faculty member is going to talk to a company representative in a few hours, or inventors fill out a university disclosure form and list all their grants or check boxes that federal funding was used without regard to whether that federal funding bought an instrument five years before the invention was made and on another grant or even if the federal funding is a grant just about to start. In practice, virtually no one is diligent in determining whether an invention is a subject invention. It a subject invention because someone checks a box or because someone can’t be bothered or because someone out of brain-dead clueless bureaucratic fixation worries about “uncertainties.”
And here is one of the amazing things about Bayh-Dole. The law is set up with the presumption that contractors will have an incentive to exclude the inventions they acquire from being subject inventions. The presumption is that a contractor will argue if they can that an invention was made outside the scope of any federal funding agreement. And it is the government’s responsibility to “show” otherwise. The disclosure, then, is the documentation by which a contractor necessarily accepts that an invention has been made within scope of a federal funding agreement.
If one wanted to make a disclosure document do real work, the contractor preparing the disclosure would have to supply information showing that the invention was indeed “conceived or first actually reduced to practice” in performance of work under a federal funding agreement, or diminished or distracted from that work.
Disclosures take the form of written reports. The prime contractor must disclose subject inventions–inventions owned by the prime contractor or by its employee-inventors when those employee-inventors are also parties to the funding agreement. The disclosure must have the information needed to file a patent application. That is, the inventors have to be identified–not just the people who might be listed on a form–and the invention must be specified:
It shall be sufficiently complete in technical detail to convey a clear understanding to the extent known at the time of the disclosure, of the nature, purpose, operation, and the physical, chemical, biological or electrical characteristics of the invention.
That is, in effect, the specification for a patent application.
Why a Disclosure Requirement?
Here’s the scenario that you might think applies. An invention is made in federally supported research, and a university acquires ownership but decides that it doesn’t want to file a patent application. The university discloses the invention to the federal agency and the federal agency can then decide whether to request title to the invention and from there decide what to do–dedicate the invention to the public domain or force the inventors to file a patent application on behalf of the federal government. In this scenario, disclosure provides the federal government with the information necessary to determine whether it will seek a patent once a university has decided not to.
That’s pretty interesting. A non-selective university with a voracious appetite for filing patent applications decides not to seek a patent. Now the federal agency gets the chance to do so. Are we missing our brains here? If a university won’t file, why would a federal agency file? The scenario sounds reasonable until one things about it. Then it sounds stupid.
Let’s return to the old but good school framework that Bayh-Dole preempts. Under that framework, when an invention is made, it’s up to the federal agency (as may be constrained by statute) to decide whether to take ownership of any given invention made in the federally supported work, and if so, whether to dedicate the invention or patent it and license it non-exclusively and royalty-free except in exceptional circumstances. In that old but good school framework, inventors disclose to the federal government because nothing is riding on the disclosure other than that they get credit for doing useful things with public money. They know they will have access to their work and can pursue development of it beyond any federal award, and also without having to pay their own university for the right to have access. There, disclosure amounts to publication.
If there are patent rights held by the government, it’s likely that the purpose is to use the patent system to disseminate the invention. Using the patent system publishes the invention in a formal way. Using the patent system raises the bar for the patentability of future inventions–making those patents carry greater value. Using the patent system also permits the federal government another means to control quality and claims made by manufacturers, and may be used by the government to protect domestic industry from imported dumping of product made using the invention. That’s right, the preference for U.S. manufacturing is built into the idea of the federal government granting U.S. companies a royalty-free right to practice a government-owned invention while potentially blocking imports based on that practice as infringing. This is completely different from tariffs on imports. We are talking excluding imports based on a government-held patent right.
In all of this old school stuff, disclosure conveys to the government the information it needs to decide whether to use the patent system or dedicate an invention to the public domain. There’s no market analysis regarding speculative ROI from patenting. There’s no concern for whether preference should be given to patent monopolists over other potential users of an invention. There’s no need to consider generating money from patent positions. There’s no special desire to arrange things so that the federal government can sue American citizens and American companies for practicing the results of publicly funded research.
With Bayh-Dole, disclosure is transmogrified to mean something else. It is the gesture that triggers the preemption of public purposes with a private, unaccountable exploitation of an invention for its patent monopoly. Again, if a university did just what an old school federal agency would do, but better, we would be done. Universities would own inventions to make them available to the public by dedication or by using the patent system and granting royalty-free non-exclusive licenses. Everyone would have access in the United States. If a university wanted to block imports that would undermine American manufacturing it could do so. If a university wanted to file foreign patents to mess with foreign manufacturers on a royalty-bearing basis, that would be fine. In such a scenario–entirely possible under Bayh-Dole, by the way–disclosure would mean only that whatever had been reported would be available to all Americans without a patent monopoly interfering.
But that’s not what happens with Bayh-Dole in practice. The rationale behind Bayh-Dole is that without the assurance of a patent monopoly, no company will use any federally supported invention. Without the certainty, then, that nothing in the public protection apparatus will be invoked, no company will use any federally supported invention. Bayh-Dole enables nonprofits acting for the benefit of private companies and speculators to preempt the old school approach. Instead of increasing access to federally supported inventions, Bayh-Dole enables the exclusion of access and makes this exclusion appear to be a virtue. There’s no good information–but I’ve never heard of a university releasing a federally supported invention that the university has obtained a patent on royalty-free, non-exclusively. Yes, there are inventions made in NSF consortia, where the NSF arranges it that it won’t fund a proposed consortium unless the university involved adopts a royalty-free non-exclusive licensing protocol for consortium members. But that’s still a coterie of companies, and instead of paying a royalty on their patent licenses, they pay $50,000 or $100,000 a year to be “members.” Really, the membership fee is a royalty, and the university dedicates that royalty to research specified by the members. But you are not supposed to be smart enough, or foolish enough, to recognize this.
If it were not for this fixation on creating a patent monopoly pipeline running from publicly funded research through patent brokers at nonprofits to favored companies and speculators who would otherwise refuse to get involved unless they had the benefit of a full patent monopoly without public accountability, there would be no Bayh-Dole and certainly no need for Bayh-Dole disclosure. The most important things made in publicly supported research would be available to enrich the public domain, to supply technology to cumulative technology and commons and standards, to enable immediate research and professional uses, to permit parallel development, both collaborative and competitive. If something turned out to be a cure for cancer–it would get developed without patent monopolies. Anything of such small importance that it would not get developed without a patent monopoly would not be worth developing in the public interest. Such stuff only serves the expectations of speculators and exploiters of the public interest. One can make the case that such exploitation has become normalized and made to appear virtuous–but normalization does not mean effective; normalization does not mean public benefit; normalization does not mean we are better off.
In a sense, then, Bayh-Dole’s disclosure requirement serves to flag inventions that university administrators wish to have enter the patent monopoly pipeline, preempting whatever public purpose may have justified the federal funding, preempting the purposes of any faculty investigator who proposed the project and sought the funding, preempting access to the invention by anyone other than–perhaps–an exploiter or speculator of the monopoly patent right. Since Bayh-Dole requires disclosures to be kept as federal government secrets, disclosure has another delicious irony: disclosure is not public disclosure, but rather a non-disclosable disclosure–one may see a published patent application, but one does not get to see the invention disclosure on which the patent application is based. When the patent issues, the private preemption of public purpose has been completed. Were the public covenant set out in Bayh-Dole designed to operate, and were the bits and pieces that could operate enforced, there would be some hope of pushing most university licensing activity to non-exclusive, with some interesting variations. But that’s not how Bayh-Dole is–Bayh-Dole won’t be enforced, and Bayh-Dole’s advocates will be the first in line to argue that enforcing Bayh-Dole would damage Bayh-Dole, that enforcing Bayh-Dole should not involve reading Bayh-Dole and expecting the words of the law to be used to understand the law at all–instead, rely on pundits and a dead senator who the Supreme Court disregarded to interpret the law. The law that operates is faux Bayh-Dole, not law at all. The law that ought to operate, even with all its designed-to-fail provisions, doesn’t operate.
Disclosure in all this is just another bit of administrative apparatus that gives the appearance of some public duty but actually works against access to publicly supported research, works against rapid evaluation and use in research and industry settings, works against use that would lead to development and standards, and even to commercial products.