Bayh-Dole Nutshell 1: Use it or lose it

If you don’t achieve practical application in a reasonable time, you lose the right to enforce your patent. 

Bayh-Dole’s fundamental policy is that the patent system must be used to promote the utilization of inventions arising from federally supported research or development. 35 USC 200. This is a working requirement added to federal patent law for Bayh-Dole inventions. These inventions are not ordinary inventions, and patents on these inventions are not ordinary patents.

Bayh-Dole defines practical application as the use of an invention such that the benefits of the invention are available to the public on reasonable terms 35 USC 201(f). 

If the invention is not used, or if used there’s no benefit available to the public, or if that benefit is not available on reasonable terms, then you lose the monopoly right of your patent. This condition is not just nonuse but also unreasonable use–that is, use without benefits available to the public on reasonable terms. “Available to the public” means available to all, not selectively. On reasonable terms means, especially but not only, reasonable price, not a monopoly price. Reasonable terms does not–to be blunt about it–mean “on any terms that a patent holder decides” or “on the terms that other patent holders have decided when not subject to this requirement.” Reasonable terms for the public are terms that the public finds reasonable. Simple enough.

And if only a part of an invention gets used, then the parts that are not used are subject to the same treatment. Practically applying part of an invention allows you to keep your patent monopoly on that part. Not on the rest. Bayh-Dole’s policy is clear–use patents to promote use. Using one part of an invention does not relieve you of the obligation to use the other parts, too, or lose your right to exclude others from the use of those parts.

If you fail to achieve practical application in a timely manner, then the federal agency that provided support may march-in and compel licensing. 35 USC 203(a)(1). 

That’s right, compelling licensing means that you lose the power to enforce your patent. The government, on behalf of the public, may break the patent monopoly that the government has otherwise granted you on the condition that you promote the utilization of the claimed invention and achieve practical application.

This is the framework of Bayh-Dole. But the folks drafting Bayh-Dole wanted this apparatus to look like it protected the public interest while not operating. Thus, where the Kennedy patent policy set a definite time of three years from date of patent issue to achieve practical application, Bayh-Dole talks about “reasonable” time. Deliberate ambiguity. Who decides, then, what’s reasonable? Each agency, for each instance? Talk about not getting to uniform practice. What a hoot of nonsense “uniform” is.

As for “reasonable terms,” advocates of fake Bayh-Dole have spent years claiming this wording has to do with university licensing–and that’s total nonsense. The wording has to do with what’s on offer to the public. And the number one thing on offer has to be the price. But Bayh-Dole does not spell this out for the weasel-tongued advocates of fake Bayh-Dole, who think the discussion about a real law is just as much political bluffery as the rabblizing that folks indulge in to get a law passed. Sucks to be them. Sucks to have to deal with them. But there it is. Ambiguity of what’s “reasonable” ices use of march-in for price gouging.

Finally, march-in itself was designed to look good but never operate. Howard Bremer bragged about his work to make sure march-in would not operate. The NIH designed Bayh-Dole and saw to it that march-in was delegated to each federal agency–again, nothing uniform about this approach–rather than having, say, the Department of Justice oversee compliance with the law and its patent rights clauses. Since federal agencies get to decide whether to march-in, Bayh-Dole basically waives the entire march-in apparatus. A federal agency, what through indifference, incompetence, failure of will, or having been bought out by lobbyists, can simply not bother with march-in. And there goes the entire architecture of public protection in Bayh-Dole–there goes the basic deal, and the public ends up getting shafted.

Getting shafted, then, we are told is something we should be so very happy about. “Without getting shafted, you would never get speculators to step in ahead of everyone else to exploit patent monopolies on inventions  in publicly supported work for their own benefit.” Sucks to be us, too.

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