Transcript Slide 1
2009 Presentation to
Federal Laboratory Consortium MidAtlantic Region Annual Meeting
DOE Laboratory Operating Contracts
Paul Gottlieb
Assistant General Counsel
for Tech. Transfer & IP
Department of Energy
202-586-3439 (fax 2805)
[email protected]
DOE has been blessed: Laboratory Technology
Transfer Laws
• Stevenson-Wydler Technology Innovation Act of 1980
• Trademark Clarification Act of 1984 (amended BayhDole)
• Federal Technology Transfer Act of 1986 (amended
Stevenson-Wydler)
• National Competitiveness Technology Transfer Act of
1989 (amended Stevenson-Wydler)
• National Defense Authorization Act for Fiscal Year 1994
(amended Stevenson-Wydler)
• Technology Transfer Commercialization Act of 2000
• National Defense Authorization Act of 2000 (amended
Stevenson-Wydler)
• EPACT 2005
• Executive Order 12591
M&O contract: Patents
• Bayh-Dole Act amended in 1984 to
mandate application to GOCO labs run by
Universities, non profits and SB
– Naval reactors excluded and weapons funded
inventions at weapons labs excluded
– Royalty sharing with inventors required but
amount not specified
– Uses of royalties specified but not location of
use
M&O contract: Patents
• E.O. 12591 in 1987: empower lab
directors to be in charge of tech transfer
• NCTTA of 1989: authorized contractor
operated labs to do CRADAs, made TT
mission of DOE labs. DOE directed to
issue new contract clauses to implement
the TT mission.
The lab M&O contract 48 CFR
970.5227-3 Tech Transfer Mission
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Authorized Activities
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Protecting IP
Licensing IP
Negotiating Agreements
Enter into Non-Federal Work for Others (WFO)
Enter into CRADAs
Enter into User Agreements
Allowable Costs:
– “costs in any fiscal year shall not exceed an amount equal to 0.5 percent of the
operating funds included in the Federal research and development budget
(including Work For Others) of the Laboratory for that fiscal year without
written approval of the contracting officer.”
– The Contractor's participation in litigation to enforce or defend Intellectual
Property claims incurred in its technology transfer efforts shall be as provided in
the clause entitled "Insurance-Litigation and Claims" of this contract.
The lab M&O contract 48 CFR
970.5227-3 Tech Transfer Mission
• Conflicts of Interest plan approved by DOE
• Fairness of Opportunity: Widespread Notice of
availability of technologies suited for transfer
• U.S Industrial Competitiveness must be addressed in
Licenses and CRADAs
• Product Liability clause required
• Disposition of Income
– Inventor’s royalty share
– Use of remainder at lab
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Transfer of IP to successor contractor
Records maintained
WFO and User agreements subject to class waivers
Ombuds required
Lab Patent clause
• Bayh-Dole clause
• 5 year or more contract:
• Unilateral right to amend contract to be
subject to treaties and international
agreements
• Unilateral right to amend contract to be
subject to exceptional circumstances
– Uranium enrichment
– Next Generation Lighting
Licensing
• Technology license
– not subject to Federal Licensing regulations, same
freedom as university to license
– No DOE approval of licenses except in conflict
situations: affiliates, lab employees
– Entrepreneurial leave OK
– What can be licensed:
• Patents
• Copyrights in software (restrictive and open source),
biological materials thru bailments,
• trademarks
• classified technology (inorganic membrane)
Licensing
• Subject to fairness of opportunity (Recent IG report
questioned the interpretation of this clause)
• Subject to Government License, march-in rights.
• Subject to US competitiveness and U.S. Preference
• Conflicts and fairness review by DOE if license to
employee, ex employee or affiliate
• Product liability indemnity
• Choice of exclusive or non exclusive left to lab
• Equity may be obtained in lieu of royalties: Export control
notice
• Licenses exempt from FOIA: not government owned
record at lab.
Licensing: Equity in lieu of royalty is
allowed
• e.g. Bioenergy Research Centers.
– Virtual lab
– IP management plan
– 60% of royalties returned to virtual lab
• UC rules
– No more than 10%
– No members of board
– Time of sale of equity predetermined
Licensing
• No licensing of “know how”
• Shouldn’t warrant validity of patent or that it
won’t infringe
• Liabilities come out of overhead or royalties
• Can sue for infringement
• Inventor receiving royalties COI: manage not
eliminate
• No license to future inventions or grant back
except software updates to be used by lab or
govt.
Technology Transfer Partnering
Transactions with DOE Laboratories
• Work For others: access to unique capability, private
sponsor pays full cost and owns new IP, DOE Order
& Manual 481.1, class waiver determines title to IP,
DOE approves
• CRADA: Collaborative Research of benefit to DOE
mission DOE Order & Manual 483.1, statute
determines title to IP, IP negotiable, lab may not
provide funds to sponsor,, Guarantees partner option
to negotiate an exclusive license in lab inventions,
protected data, DOE approves
• User Agreements
WFO
• Statutory basis: See Economy Act of 1932, as amended, 31 U.S.C.
1535; see also sections 31-33 of the Atomic Energy Act of 1954, as
amended, 42 U.S.C. 2051-2053.
• § 2053. Research for others; charges
Where the Commission finds private facilities or laboratories are
inadequate for the purpose, it is authorized to conduct for other persons,
through its own facilities, such of those activities and studies of the
types specified in section 2051 of this title as it deems appropriate to the
development of energy. To the extent the Commission determines that
private facilities or laboratories are inadequate for the purpose, and that
the Commission’s facilities, or scientific or technical resources have the
potential of lending significant assistance to other persons in the fields
of protection of public health and safety, the Commission may also
assist other persons in these fields by conducting for such persons,
through the Commission’s own facilities, research and development or
training activities and studies. The Commission is authorized to
determine and make such charges as in its discretion may be desirable
for the conduct of the activities and studies referred to in this section.
WFO
• M&O contract: Even though work is being performed by
lab employees, rights to IP determined by DOE class
waiver not Bayh-Dole.
• Class waiver issued in 1982: sponsor gets title to lab
employee inventions if
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Work not subject to international agreement or Govt. award
Not enough interest to DOE to justify DOE providing funds
Full cost recovery
Exceptions: Research tool, Foreign sponsor get’s special
attention, field of use limitation to maximize use of lab
– No exception where there has been substantial prior investment
by Government and Background portfolio
WFO
• May not respond to solicitations of other agencies that
involve head to head competition, BAAs OK
• is consistent with or complementary to missions of
DOE/NNSA and the facility to which the work is to be
assigned,
• will not adversely impact programs assigned to the
facility,
• will not place the facility in direct competition with the
domestic private sector, and
• will not create a detrimental future burden on DOE/NNSA
resources.
WFO Agreements requirements
• Advance payments: 90 days, shorter for small business
– Some labs have their own revolving funds from royalties or fees
– DOE tried to get statutory approval to have a revolving fund.
• Overhead charged including LDRD and added factor
• Standard of performance is best efforts
• Indemnity: General, IP infringement (no authorization
and consent) and Product liability. All to the extent
permitted by state law for State agencies
• Class waiver ? title to inventions addressed
• Data: Lab may offer that data produced by lab may be
proprietary to sponsor.
Cooperative Research and Development
Agreement (CRADA)
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Technology transfer statutes authorize federal laboratories to enter
into research and development agreements with other federal
agencies, state or local government entities, foundations, universities
and for-profit corporate entities with flexible intellectual property
rights. 15 U.S.C. 3710a.
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The federal laboratory does not compensate the collaborating party
with funds, but instead provides licenses, assignments, or options in
any intellectual property owned by or assigned to the laboratory. 15
U.S.C. § 3710a(a)(2).
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The private party can provide funds, personnel, services, and property
in the CRADA. 15 U.S.C. § 3710a(b)(1).
CRADA Agreements requirements
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If funds in: Advance payments: 90 days, shorter for small business
If DOE is funding, lab performance must have approval of the DOE program
– Block funding
– Advanced approval in funding authorization
Standard of performance is best efforts
Indemnity: Product liability to the extent permitted by state law for State agencies
Title to inventions: each party owns their own inventions
– Sponsor guaranteed the option to obtain through negotiation an exclusive license
in field of use for royalties where appropriate
Data: Lab may offer that data produced by lab may be protected from public release
for up to 5 years. Software may be protected through copyright
Costs of obtaining IP protection
March-in rights
U.S competitiveness must be addressed up front as part of CRADA not as part
future license. U.S manufacture for world wide sales or net benefit to US
economy
Background IP licensed required to be negotiated separately
Special attention to foreign sponsors: Consult with USTR per Executive Order
12591.
100% funds in CRADAS vs. WFO
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Statutory disposition of IP rights
Lab owns title to own
inventions
Participant has option to obtain an
exclusive license in a field of use
to lab inventions at a royalty.
License would have business plan
US comp.
Max 5 year data protection
NO requirement that lab not
competing
No General Indemnity or patent
indemnity
Advanced payments
Must notify partner of options
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Policy decides IP rights
Sponsor owns title or exclusive
rights in field of use to lab
inventions
Normally no US comp.,
exception is Freedom CAR
Max data protection is lab data
proprietary to sponsor
Lab must not compete
General Indemnity and patent
indemnity
Advanced payments
Most universities retain title when
doing reimbursable work
37 CFR 401.1(g) recognizes that
WFO is not subject to Bayh-Dole
Must notify partner of options
Non-Proprietary User Agreements
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General scope of work directed toward precompetitive research that
advances the state of the art in the user’s area of interest, rather than
toward producing a specific commercial end result (e.g., a marketable
product);
Use of unique equipment or collaborative research.
Intend to publish their research results in the open scientific literature;
Do not require the data protection available in a CRADA, Work for
Others Agreement, or Proprietary User Agreement.
The converse of each of the above factors factors would be indicia
that the work to be performed is beyond the preliminary research
stage and would be more appropriately covered under a CRADA,
WFOA or Proprietary User Agreement.
User pays for its own costs; DOE funds DOE machine and scientists’
time.
This agreement is complementary to a WFO or CRADA, which are
more complex, more difficult to negotiate and require DOE approval.
Non-Proprietary User
Agreements
• Any changes to Standardized User Agreement require
DOE approval
– Streamlines negotiations
– Promotes uniformity
– Nature of these agreements makes this approach acceptable to
virtually all users
• Allocation of Intellectual Property Rights:
– Lab may elect title to its Subject Inventions per the M&O contract
– USER may elect title to its Subject Inventions subject to:
• Government Use License
• March In Rights and US Preference apply
• no US Competitiveness provision
– No restriction on publication of Technical Data that is produced
Class Waiver for Proprietary User
Agreements
• Scope of Class Waiver covers User who
fully funds DOE’s costs for machine time
and its own costs.
• Research is that of the sponsor not DOE
• No research collaboration with Lab
personnel
• Lab personnel may need to assist in
operating the Lab equipment
Proprietary User Agreements
• Allocation of Intellectual Property Rights:
– There should be no lab inventions. If there are, Lab may elect
title to its Subject Inventions per the M&O contract
– USER may elect title to its Subject Inventions subject to no
government rights:
• No Government Use License
• No March In Rights and No US Preference apply
• no US Competitiveness provision
– Technical Data that is produced may be treated as the proprietary
data of the sponsor.
Transactions with DOE Laboratories (all labs)
Type of
Agreement
2008
Active WFO
2611
revenue
Active
CRADAS
revenue
$231m.
689
$69m
Active Tech
licenses
1604
Lic. income
$43m.
Comparison of GOGO and GOCO Technology Transfer
Activities
Gov’t Operated
Contractor
Operated
Exclusive Licensing
Only after publication
No publication
required
Software Licensing
Not permitted (by law)
Permitted
Royalties
1st $2000, 15% of Rest,
Capped @ $150k/yr/
invention
No-cap – follow
contractor’s policy
(universities as high
as 50%)
CRADA Selection
Preference to
small businesses;
U.S. firms for
U.S. mfg.
Same
Royalties
Lab R&D and
Licensing expenses
Same
Secretarial Policy Statement
• Guiding Principles
– Direct involvement of Lab, rely primarily on lab implementation
– Fairness of opportunity, promote domestic economy, prevent
inappropriate competition, and protect national security
– Involve partners with substantial business plans
– Leverage resources
– Royalties are not the measure of success; incentive
– Promote access by small business including entrepreneurs
– Absent mission objectives, there should be consistency and
transactions should be done in timely way
– Lessons learned forums
Policy Statement
• Responsibilities
– Coordinator and Board develop framework, execution
plan, performance measures and program guidance
– Research funders shall have a tt plan
– Cognizant Secretarial Official responsible for
overseeing and evaluating tt efforts at facility. TT
should be addressed in performance plans.
– Each Under Secretary shall approve tt performance
plans for their facilities before submittal to the
Coordinator.
– All programs should encourage dual use of
technology
JUNE 2009 GAO Report on DOE
labs Tech transfer
• Clearer priorities needed
• Does definition of tt include work for other
federal agencies?