Q. Can a university violate the Bayh-Dole Act?
A. No.
Bayh-Dole applies to federal agencies. The law requires federal agencies to adopt uniform practices regarding patent rights to inventions in funding agreements. Bayh-Dole (now) authorizes the Department of Commerce to create standard patent rights clauses for these funding agreements.
There are presently three such clauses: 1) 37 CFR 401.14(a), the general-purpose clause; 2) 37 CFR 401.14(b), a specialized clause for the Department of Energy’s nuclear propulsion and weapons program; and 3) 37 CFR 401.9, a clause for use when inventors retain their invention rights. The general-purpose clause is actually two clauses–one for small businesses, and another created by adding a special section for nonprofits. A standard patent rights clause may be modified by an agency in accordance with Bayh-Dole when there is a finding of “exceptional circumstances” and certain other circumstances involving foreign countries, intelligence gathering, and some DOE owned, contractor-operated laboratories. The DOE nuclear propulsion and energy clause at 37 CFR 401.14(b) is an example of such a clause.
The actual requirements that a university must follow for grant-funded research are therefore a matter of federal contracting in each instance of an award. The standard federal grant funding agreement is 2 CFR 200, and intangible property rights, including patent rights, are addressed at 2 CFR 200.315 and 2 CFR 200.316. 2 CFR 200.315(c) incorporates 37 CFR part 401 by reference. A university may breach its federal contract obligations by failing to comply with the standard patent rights clause, but a university cannot violate the Bayh-Dole law.
Q. What are the implications for university policy of this distinction between Bayh-Dole the statute and the patent rights clauses authorized by Bayh-Dole?
A. The requirements created by Bayh-Dole come within a university’s policies on sponsored research. Continue reading