The Secret Fingers-Crossed Version of Bayh-Dole

Posted on March 4, 2011 by Gerald Barnett

[This article was written before the Supreme Court decided Stanford v Roche (June, 2011). It was also written before NIST did its crazy stupid overhaul of the codification of Bayh-Dole at 37 CFR 401, changing references and adding its dumber than dumb requirement that contractors require inventors to assign to the contractors all those inventions that the contractors must already own for the assignment requirement to apply. Fathom that. These people are in control of the Bayh-Dole submarine and don’t know surface from dive. They have one ping only.]

Bayh-Dole lays out things a federal agency has to do in contracting for research with universities (and nonprofits, and small companies). These things get packed into the Standard Patent Rights Clause (SPRC, 37 CFR 401.14(a)) and a university agrees to these things as a condition of its federal funding. One of those things a university agrees to do is to get an agreement with its employees (other than clerical and non-technical ones, and not with non-employees, and not with independent contractors) that they will report inventions, sign papers so patent applications can be filed, and sign papers to establish the government’s rights in inventions. That is, our friend the widely ignored (f)(2) agreement.

That is, there is a wonderful chain of apparatus from the Bayh-Dole law in 35 USC 200-212 to the Department of Commerce regs at 37 CFR 401.1-16, to the SPRC at 37 CFR 401.14 and its agency by agency implementation in contracting policy, to the introduction of a conforming patent rights clause in each funding agreement, and university actions to protect the government’s interest by obtaining agreements from its employees to that effect. It is all very clear, very doable. A chain of agreements required by the law.

Just, universities are not doing it. Further, patent administrators are arguing they don’t have to. And yet they insist that a compulsory system of taking title to inventions is necessary for the public to benefit from research at universities. It is as if there are two laws. The one on the books and the secret fingers-crossed convenience law for bureaucrats.   Continue reading →

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Making the Connection

Posted on March 3, 2011 by Gerald Barnett

Under the standard patent rights clause (SPRC) in a federal funding agreement, a university is required to obtain the agreement of its research employees (that is, other than its clerical and non-technical employees) to protect the government’s interest.  The requirement for this agreement shows up in section (f)(2) of the SPRC.

Since the SPRC is part of a federal agreement, it supersedes any agreements that the university may have to the contrary, including agreements with employees that run counter to (f)(2).   Further, a university in agreeing to a given patent rights clause, let’s say the SPRC, is agreeing to implement the (f)(2) agreement, and not some other agreement “on the side” that differs from the (f)(2) agreement.   In essence, the SPRC displaces any such other agreement.   This includes IP policy statements and agreements to assign.  It does so not by fiat, but because a university agrees to do so.  The university chooses to do so.   This is the difference between a law and a contract.   Somehow this difference gets lost by university patent administrators looking for shortcuts to power.  Continue reading →

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The Bayh-Dole Experiment That Has Failed

Posted on March 3, 2011 by Gerald Barnett

Bayh-Dole is a law directed at federal agency research contracting with universities, other nonprofits, and small businesses. Bayh-Dole makes uniform agency procurement of subject inventions—inventions made with federal support and falling within the definition of subject invention in Bayh-Dole—requiring agencies to use a standard patent rights clause in funding agreements, with any modifications of this clause following an established protocol.

University patent administrators have distorted Bayh-Dole to make it read as an entitlement under which university administrations obtain title outright to federally supported inventions made by research faculty. No assignment necessary. No protections for inventors required. Thereby creating the only general class of inventors in America who do not own title to their inventions, as required by the US Constitution. This is nonsense, bad innovation policy, and bad university governance. But it’s more. It shows that many leading university patent administrators do not have a working knowledge of the law that frames their livelihood. And they intend now to kill Bayh-Dole off. Continue reading →

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Innovation Interfaces

Posted on February 28, 2011 by Gerald Barnett

If we are going to talk innovation, then we also have to talk status quo. Innovation points to change, and so we may ask, “change from what?” We can call this what the “status quo”. The status quo is the way things are, but it is important that we see that the way things are is not a static thing. It is a thing that also changes, and has peaks and valleys of opportunity. Just that the status quo has its dominant modes and players. In terms of markets, the status quo is shaped by the industry leaders. They define what is manufactured or offered as services. Whatever changes the leaders introduce is by way of features added to a platform, or efficiencies that reduce costs and increase margins, or regulations or deals to create barriers to competition. The leaders also may make mistakes, or cause accidents, and these too are part of the status quo, though they may in their way lead to innovation. The Post-It note effect, if you will. Continue reading →

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Housekeeping

Posted on February 27, 2011 by Gerald Barnett

The blog was down for a bit while Yahoo site hosting dealt with a server glitch. Things appear to be back up now.

I have been busy traveling over the past few weeks, and dealing with some health issues, but I expect to be adding more posts soon.

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Five Key Elements of Open Innovation

Posted on February 3, 2011 by Gerald Barnett

I work with five key elements in open innovation business models:

  1. critical mass
  2. congestion
  3. externalities
  4. weak ties
  5. drivers

Critical mass is a restatement that open doesn’t matter if it’s solitary. There has to be at least another player. Generally, a number of other players. We find that in adoption, the logic changes. First there are those who test new things, hold fast those that work. Then there are those that want to know what the leaders are testing and holding. Then there are those that want whatever is emerging as the thing to have. Finally, there are those who adopt because it is the standard, the safest, best, lowest cost, least uncertain thing that does the job.

Critical mass marks these transition points in social (and therefore economic, imaginative, er, business) reasoning. We might say, molecules of humanity do not have the same properties as individual instances of humanity, and longer network molecules of humanity differ in non-linear ways from shorter network molecules.  Critical mass is about the changing character of social logics. Externalities are properties of these social logics and weak ties are a special form of externality that appear to be a sweet spot for the referral of opportunity, and in particular for the kind of opportunity that one cannot imagine looking for.  Weak ties, essentially, posit that the world that is, is much, much richer than one can possibly imagine, richer than one can even *know what to look for*. Weak tie opportunities find you. They are not a result of your priorities, your plans, your diligence, your efficiencies. Nope.

IP is one of a number of ways of gating among these elements. Think of it as a kind of “social diode” on analogy with “circuit logic.” Given that IP is instantly a source of congestion, the first order of business is to find drivers that create interest that gets past this congestion and deploy IP so that the congestion doesn’t arise before critical mass.  Then it is a matter of balancing and routing critical mass and congestion to keep centered on value points, which may arise directly (sales of product) and may arise as externalities (enabling other transactions, such as support or related product), and finding opportunity (weak tie referrals).

Drivers are the most interesting of all. The thing is, without voltage in a circuit all the logic one has doesn’t do much! Drivers matter. In this, it doesn’t appear that profits and power are the only ones out there, don’t make very good mission statements, and certainly aren’t the things that drive early uptake. Not even utility. There are other things at work, that both short- and long-network molecules of humanity respond to.

I expect to build out on these concepts in future posts.

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IP for nuthin' and your deals for free

Posted on February 2, 2011 by Gerald Barnett

In IP relationships, I talk about the “Big Five”:

  1. Ownership
  2. Control
  3. Money
  4. Attribution
  5. Risk

In the most basic treatment of IP, folks tend to introduce these in binaries.  Perhaps the most common is ownership for money.  But in licensing, it’s often control for money and risk.   In scholarly publishing, it is often ownership for attribution with divided control.  In practice, all five are typically in play all the time. Continue reading →

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How the Grudging Farmer Really Feels About the Hens

Posted on January 31, 2011 by Gerald Barnett

Here is an entirely typical start to a university IP policy.  I have picked it almost at random.  I don’t have any particular agenda with the school involved.  This sort of reading can be done with most any university’s IP policy.   Let’s take a look, sentence by sentence.

Our text consists of three sentences of Preamble and goes thus:

As a state-supported institution of higher learning, the University of Arkansas has a responsibility for and an interest in the advancement of knowledge and creative work that will enhance its educational mission and promote the economic and social welfare of the public it serves, particularly the people of the State of Arkansas. This responsibility and interest are advanced by engaging in research, the results of which may, on occasion, have commercial applications which are patentable or copyrightable. While Inventions and copyrightable works are not the primary objectives of University Research, when they occur the University has the responsibility of insuring that such Inventions and Works are used and controlled in a manner that benefits the public, the Inventor or Author and the University to the fullest extent possible.

It rather flows along.  Continue reading →

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All for Outcomes, and Outcomes for All

Posted on January 24, 2011 by Gerald Barnett

In Stanford v. Roche, the discussion for folks on the sidelines is *not* who “wins” but rather the consequences of the arguments used to “win”.  If the interpretation of certain university-controlled organizations win, then the outcomes will affect *everyone*, regardless of what happens in the case–which, for all that, might end up with patents being declared invalid and Stanford not getting anything at all–and not able to license to anyone else.  *And* we could all still be saddled with B-D as a vesting statute!

If that happens, there goes faculty consulting, student internships, and industry collaboration.   *That’s* what’s at stake for the sideline watchers, and that’s where they could make a real contribution, asking other universities to wise up on the consequences, not just follow the heady rush of picking sides to “win”.

As we’ve said before, by following the assignments rather than voiding them, one gets to perfectly wonderful outcomes for the inventors, and for Stanford, if that’s what one wants, without any need for a vesting statute.  The lessons learned would be these:

  • Universities have to manage their agreements for the rights they want, even if that means being diligent;
  • Companies would do well not to claim entire right, title, and interest to individual work where that may include subject inventions–unless they want the obligations that go with subject inventions;
  • The sequence in Bayh-Dole is report, elect, assign, file–getting the steps out of order doesn’t help one’s case; and
  • It works best to read carefully before jumping to self-interested shortcuts that make a mess of the law.
  • Get the facts before you pick sides–not everything arising around federal funding is a subject invention, and not all subject inventions are subject to a standard patent rights clause.
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Which side of the door?

Posted on January 24, 2011 by Gerald Barnett

Why do universities claim faculty inventions rather than offer to accept them?

To put an edge on it, the difference between a workplace and a prison is which side of the door the lock is on.  Continue reading →

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