Bayh-Dole 30 years old – Must the government remain the owner of patents obtained as a result of its subsidies?

BAYH-DOLE30YEARSOLD-MUSTTHEGOVERNMENTREMAINTHEOWNER
OFPATENTSOBTAINEDASARESULTOFITSSUBSIDIES?
FRANÇOISPAINCHAUD&GABRIELLEMOISAN*
ROBIC,
LLP
L
AWYERS,PATENTANDTRADE-MARKSAGENTS

EnactedintheUnitedStatesinDecember1980,theBayh-DoleActiscelebratingits
30thanniversary.ThisActsettledtwobasicissues:1)whoobtainstheownershipof
intellectualpropertyrightsofaninventionpatentedasaresultofAmerican
governmentfinancingand2)howaretheseIPrightstobemanaged?

TheBayh-DoleActintheUnitedStates
Before1980,theU.S.governmentwastheowneroftheresultsoftheresearchitfinanced,but
obtainedfewpatentsandveryrarelymarketedtheseresults.Theperceptionatthattimewasthatthis
researchbelongedtothepublicandthatnofinancialprofitscouldbemadefromit.Thisiswhyless
than5%ofpatentsbelongingtothegovernmentbeforethatdateweremarketedandyieldedresults
forAmericancitizens.
ForthepurposeofrestoringthecompetitivenessofAmericanindustry,in1980,twosenators,the
DemocratBirchBayhfromIndianaandtheRepublicanBobDolefromKansas,introducedabill
allowingsmallbusinessesandNPOssuchasuniversities,hospitalsandresearchcentrestohave
controlovertheseintellectualpropertyrights,providedtheymarketedthem.

Certainconditionsapply:recipientsofsubsidiesmustcomplywithaprecisetimelineandreportany
inventiontothesubsidisingagency,notifyitiftheyintendtoretainownership,filepatentapplications,
negotiatelicences(insteadofassignments)preferablywithsmallAmericanbusinesses,todevelop
andmarkettheseinventions,whilereinvestingtheprofitsmadeintoeducationandresearch.The
universityremainstheowneroftheintellectualpropertyandthankstothedevelopmentoftheirown
TechnologyTransferOfficesor“TTOs,”financingisobtainedtodevelopthesepreliminaryresults.The
governmentalsohasanon-exclusivelicenceandcertainotherrights,especiallyincasesinwhichthe
resultsofresearcharenotmarketedbythesubsidizingenterprise,called“March-inrights”whichhave
neverbeenusedbutwhichremainanimportantnegotiationfactorandanincentivetomarketthe
researchresults.
ThankstothisActwhichappliesuniformlytoallfederalagencies(nearly30,includingtheNIHand
NASA)whichsubsidizethem,thousandsofprivatecompanieswerefounded,billionsofdollarswere
invested,hundredsofpatentswereissuedandhundredsofproductsandvariousmedicineswere
developedandmarketed,therebystimulatingtheeconomyandimprovingthewell-beingofAmericans
fornearly30years.

©CIPS,2011.
*WithROBIC,LLPamultidisciplinaryfirmofLawyers,andPatentandTrade-markAgents.Published
intheWinter2011Newsletterofthefirm(Vol.14,No.4).Publication068.129E.

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TheSituationinCanada
UnfortunatelythereisnofederalorprovinciallegislationinCanadawhichgovernsthemanagementof
IPrightsresultingfromresearchsubsidizedbypublicfunds.Eachpublicsubsidizingorganizationhas
accordinglydevelopeditsownrules.Someofthem,(CNRC,CRIQ)retainownershipandgrant
licences,whileothers(NSERC,FRSQ)donotretainownership,andinsteadownershipistransferred
toauniversityortoaresearchcentre.Researchersandemployeesgenerallyassigntheirrightsto
theiremployerwhointurnassignsthoserightstoatechtransferorganization,whichmaythenfile
patentapplicationsandnegotiatetherightsregardingIPonacasebycasebasisbygrantinglicences
orbyassigningtherightstoprivatecompanies.Thesituationisthereforenotclearlydefinedin
CanadaandtheresultismorethanmitigatedincomparisonwiththeUnitedStates.Itwould
undoubtedlybenecessarytorealizethisandactaccordingly…Weunderlinetherecent2010-2013
ProvincialQuebecResearchandInnovationStrategy,whichbarelymentionsintellectualproperty,and
doesnotspecifyanyguidelines.Thisisamajorshortcoming.

TheSituationinEurope
TheEuropeansituationisscarcelybetter,withstateandculturaldifferencesasadditional
complexities.ThereisnothingequivalenttotheBayh-DoyleActandtheproblemsnotedalsorelateto
clausesspecifyinganobligationtomarketinonlyonememberStateanddifficultiesrelatedtothe
subsidiesofamemberStatewhichhaveanegativeeffectoncompetitionwithothermemberStates.

TheSituationinAsia
TheAsiansituationvariesfromcountrytocountry.SomecountriessuchasKorea(averyimportant
countryforfilingpatentapplications)andIndiahaveimplementedinitiativesbasedonBayh-Doleto
stimulatethemarketingoftheirtechnologicaldevelopments.Onthispoint,thepurposeofanewIndian
legislativebillistohaveIndiaacknowledgedasaninnovativecountryratherthanacountrywhich
copies.Thisbillspecificallyincludesprinciplesdealingwiththeobligationtofilepatentapplicationsto
discloseknowledge,theresponsibilitytotransferknowledgeandtherightforresearcherstoreceive
royalties.
Conclusion
Theharmonizationofpoliciesbetweenthevariousorganizationsfacilitatesresearchanddevelopment.
Theobligationtofilepatentapplicationsandobtainpatentscanonlymakeacountryoraregionmore
competitiveonaglobalscale.ItisnowhightimethatCanada(andourprovinces)taketheexampleof
theBayh-DoleActseriously.
Abbreviations:
CNRC:NationalResearchCouncilCanada
CRIQ:CentrederechercheindustrielleduQuébec
FRSQ:FondsdelarechercheensantéduQuébec
DOD:DepartmentofDefense(USgovernment)
DOE:DepartmentOfEnergy(USA)
FDA:Food&DrugAdministration(USA)
IP:IntellectualProperty
NASA:NationalAeronauticsandSpaceAdministration(USA)
NIH:NationalInstituteofHealth(USA)
NPO:Non-profitorganization
NSERC:NaturalSciencesandEngineeringResearchCouncilofCanada
USC:UScode

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Formoreinformation,youmayread:
35USC200:http://www.uspto.gov/web/offices/pac/mpep/consolidated_laws.pdf

37CFRPart401http://www.access.gpo.gov/nara/cfr/waisidx_02/37cfr401_02.html

GAO-09-742reporttoCongressionalCommittees,FederalResearch
InformationontheGovernment’sRighttoAssertOwnershipControloverFederally
FundedInventions,UnitedStatesGovernmentAccountabilityOffice.July2009,
http://www.ott.nih.gov/PDFs/GAOreportTT.pdf

Thepositiveimpactofacademicinnovationsonqualityoflife
http://www.betterworldproject.org/AUTM2010BWR.pdf

Bayh-Dole–Drivinginnovation
http://b-d30.org/app/webroot/Profiles/acclaim

PolitiqueduCRSNGsurlapropriétéintellectuelle
http://www.nserc-crsng.gc.ca/_doc/Policy-Politique_fra.pdf

LaPolitiqueduCRSNGsurlapropriétéintellectuelle-Raisonsdel’examende2008-
2009
http://www.nserc-crsng.gc.ca/_doc/Policies-Politiques/IPReasons-RaisonsPI_fra.pdf

Stratégiequébécoisedelarechercheetdel’innovation2010-2013
http://www.mdeie.gouv.qc.ca/fileadmin/contenu/publications/administratives/
strategies/sqri/sqri.pdf

ROBIC,ungrouped’avocatsetd’agentsdebrevetsetdemarquesdecommercevouédepuis1892à
laprotectionetàlavalorisationdelapropriétéintellectuelledanstouslesdomaines:brevets,dessins
industrielsetmodèlesutilitaires;marquesdecommerce,marquesdecertificationetappellations
d’origine;droitsd’auteur,propriétélittéraireetartistique,droitsvoisinsetdel’artisteinterprète;
informatique,logicielsetcircuitsintégrés;biotechnologies,pharmaceutiquesetobtentionsvégétales;
secretsdecommerce,know-howetconcurrence;licences,franchisesettransfertsdetechnologies;
commerceélectronique,distributionetdroitdesaffaires;marquage,publicitéetétiquetage;poursuite,
litigeetarbitrage;vérificationdiligenteetaudit.ROBIC,agroupoflawyersandofpatentand
trademarkagentsdedicatedsince1892totheprotectionandthevalorizationofallfieldsofintellectual
property:patents,industrialdesignsandutilitypatents;trademarks,certificationmarksandindications
oforigin;copyrightandentertainmentlaw,artistsandperformers,neighbouringrights;computer,
softwareandintegratedcircuits;biotechnologies,pharmaceuticalsandplantbreeders;tradesecrets,
know-how,competitionandanti-trust;licensing,franchisingandtechnologytransfers;e-commerce,

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