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7 Intellectual Property “Intellectual Property (IP) is a central issue in international research collaborations. What is the balance between the facilitation of research and the protection of IP? The members of the IP track will discuss and outline the major issues, challenges, and successes of IP on the international level. This will include such topics as background intellectual property (BIP), the connection between IP and export control, the management of IP at the university, industry, and govern- mental levels, and emerging issues in the coming years (such as manag- ing IP given the increasing transportation of large data sets and research across national borders). The IP team will pay particular attention to practices and models of IP used in individual countries, for inclusion in project deliverables.” (Workshop Agenda) 7.1 IP TRENDS FROM A U.S. UNIVERSITY PERSPECTIVE1 Brian Warshawsky, Senior Contracting Officer at Northwestern University, began his talk by outlining several trends that he has seen. On the one hand, international collaborations are more frequent. On the other hand, agreement negotiations are increasingly bogged down due to a lack of understanding on the part of industry about what collaborations In this section and other sections summarizing presentations, views and opinions are 1 attributed to the presenter unless stated otherwise. 49

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50 CORE ELEMENTS OF INTERNATIONAL RESEARCH COLLABORATION universities can and cannot engage in. This is the case for U.S.-focused col- laborations as well as for international agreements, and comes after years of sustained effort to raise awareness. Mr. Warshawsky attributes some of these problems to the downturn in the economy, combined with a trend for industry managers with experience in working with universities to retire and be replaced with managers who are more comfortable in a commercial procurement context. This is happening in negotiations with companies that have master agreements or set contract templates in place with Northwestern. It is important to remember that the university’s core mission is to educate, both through classroom teaching and through the publication of research. Working with industry and with international partners is worth- while if it advances this mission. Potential partners, and even faculty and departments heads eager to secure funding, may lose sight of this. One issue that has caused difficulties lately is background intellectual property (BIP). BIP is a term used to define IP that exists before the devel- opment of an invention. In one recent negotiation, an international col- laborator wanted assurances regarding BIP. The university has no capacity to check BIP at the time of an agreement or to provide such assurances. The most that happens is the faculty member provides a list of publications. The larger issue is that the university is performing research, not selling IP. The research does not come with any warranty that the result can be commercialized. Of course, the university wants to provide sponsors with opportunities to license the outputs, but cannot guarantee that there will be no bumps in the road due to background IP. The role of the central administration is to balance the various interests at stake, to protect the integrity of the institution and the faculty, and to ensure that the university can comply with the agreements that it signs. In a recent case, an international collaborator from the Middle East was inter- ested in supporting the development of course software. Mr. Warshawsky had to point out to a faculty member that if the sponsor was given the broad rights that it asked for, future research in that area might infringe on the copyright, raising the danger that the faculty member could be shut out of working in this area again. In another case, a U.S. corporation refused to sign a letter of support for a faculty member seeking an NSF early career award until the university agreed to IP terms. As part of a much larger project, the faculty member and a student would be going into the company to study workflow issues, without receiving any IP or confidential disclosures from the company, with

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51 INTELLECTUAL PROPERTY just a small amount of funding in return. The company wanted a piece of any IP that might be generated by the much larger project. The longstand- ing master agreement with the company covered IP from work funded exclusively by the company. The faculty member was caught in the middle. The issue was ultimately resolved, but with some acrimony along the way. In yet another case, a major corporation with an international focus was seeking to support research by a young faculty member, with most of the support funding a student. The research was very early stage, but the company retained outside patent counsel to aggressively pursue rights to BIP. This made no sense. Northwestern looked at its own portfolio, and suspects that the company might have been seeking to snag non-exclusive rights to an obscure patent going back ten years arising from the work of a faculty member no longer at the institution. The company could have simply licensed the technology. In the current difficult environment, are there best practices to keep in mind? Mr. Warshawsky suggests that universities avoid artificial deadlines when dealing with companies. Universities should also be wary of master terms that could go beyond the contract that is being negotiated. Univer- sities should understand the possible impact of agreements on unrelated research and unrelated researchers. In a perfect world, every contract will reflect the statement of work behind it. 7.2 INTERNATIONAL COOPERATION IN IP ISSUES Brian Fitzgerald, Professor in the Faculty of Law at Queensland University of Technology in Brisbane, Australia, discussed several issues related to international collaboration in IP. He began by covering several trends in collaboration between national patent offices. He reminded the audience that it is important to remember that patents are granted by national patent offices. There is no such thing as an “international patent.” Over time several major agreements have established a framework aimed at facilitating the ability of inventors to apply for patents in multiple jurisdictions while reducing the amount of redundant work on the part of applicants and patent offices. For example, the Paris Convention of 1883 grants an inventor the priority date established in their original ap- plication for applications made within a year in other convention-member jurisdictions. The Patent Cooperation Treaty of 1970 established an inter- national application, allowing an inventor to do an international search to discover the jurisdictions in which it would be advantageous to file while

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52 CORE ELEMENTS OF INTERNATIONAL RESEARCH COLLABORATION keeping the priority date from the original application for 30 months. Most jurisdictions publish applications 18 months after filing. The European Patent Office was established in 1973, and allows inventors to file in one place for patents in all EU countries. When granted, the patents would take effect as national patents. Despite this progress, there are still barriers to international patenting. For example, there are millions of applications in a backlog awaiting assess- ment. There is still considerable duplication of effort across national offices in the application, examination, and grant processes. And patent laws are not harmonized. Professor Fitzgerald reviewed several initiatives ongoing to address these barriers. One that has become prominent recently is the patent prosecu- tion highway (PPH) concept. A PPH is a bilateral agreement between two national offices that allows an applicant to request accelerated consideration of an application from one office if at least one of its claims has been found to be patentable by the other. The “big three” largest patent offices (United States, Europe and Japan) are involved in this process, with Japan providing much of the impetus. Another initiative is the Vancouver Group Mutual Exploitation Principles. This is a recent agreement between Canada, Australia, and the United Kingdom aimed at eliminating duplication of effort. This is achieved by the Vancouver Group countries agreeing to rely on each others’ examination reports where possible. Another area of effort is substantive and procedural reform. The Direc- tor General of the World Intellectual Property Organization (WIPO) has identified several priority areas, including adoption of a uniform patent classification model, particularly among the “big three” (Quinn, 2010). This sort of harmonization would facilitate the work-sharing arrangements discussed above. In addition to efforts at expanding collaboration between national patent offices, there is the potential for expanded engagement between patent offices and the community. One obvious trend is the emergence of patent infor- matics and the ability to source technological information from patent data- bases. This is not especially relevant to this discussion but is important in the broad IP scene. A second trend is Peer-to-Patent, which is basically crowd sourcing prior art (information relevant to the patent’s claim of novelty and inven- tiveness). The idea is that the knowledge of citizen experts could be har- nessed through technology to help examiners determine whether a patent

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53 INTELLECTUAL PROPERTY should be granted over an invention. Several pilot projects to test the concept have been run in the United States, and others have been launched in Australia, Japan, and Korea as well. In the U.S. pilots, there were over one thousand registered peer reviewers and 197 patent applications. The applicant could voluntarily make their application available for peer review. About 10 percent of the claims were affected by the prior art forwarded by the peer reviewers. According to Professor Fitzgerald, potential benefits to the public of peer-to-patent include improved patent quality and a clearer patent land- scape. Applicants would benefit from the resulting patent being more robust and less likely to be disputed or litigated. The identification of weak claims early in the process also allows the inventor to save resources that might have been used to pursue an application that would ultimately be rejected. 7.3 SAMPLE PERSPECTIVES FROM THE BREAKOUT SESSION ON INTELLECTUAL PROPERTY2 The group began by reviewing the plenary session presentations and identifying those that were particularly relevant to intellectual property issues. Important aspects of the current context for research include stresses on the global and U.S. economies, and impacts on universities and industry. Individual participants made a number of points during the discussion. This is a non-exhaustive list, and is not intended to represent consensus views of the workshop or the breakout session: · Intellectual Property (IP) Metrics. IP metrics were not a part of the American Reinvestment and Recovery Act (ARRA). They are part of the STAR Metrics program (Science and Technology for America’s Reinvestment: Measuring the Effect of Research on Inno- vation, Competitiveness and Science), a U.S. multi-agency effort launched in 2010. · IP-Related Barriers to Collaboration, Tensions and Pressure Points. The continued slowdown in the global and U.S. economies can create friction. Cross-cultural misunderstandings can raise barriers. Understanding of patent models in various countries is While unable to attend the workshop, Dr. Ma Jun, Director, Overseas R&D Manage- 2 ment Office, Tsinghua University, Beijing, China, provided written responses to the breakout session questions.

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54 CORE ELEMENTS OF INTERNATIONAL RESEARCH COLLABORATION often limited. There are differences of efficiency between national patent offices. University administrative structures are under stress. Differences in technology (all technologies have unique quirks to them that impact IP) and asymmetries in IP negotiating strength (one party generally has more power than the other) can also cause problems. · Possible Solutions and Workarounds. Trust and personal relation- ships appear to be keys to success. Partnership strategies are devel- oped over time, although one-time, ad hoc relationships are still common. Agreeing on a common language or terminology can help ensure success. The Patent Protection Highway discussed by Brian Fitzgerald and other non-U.S. strategies appears to be worth exploring. Professional development is critical to building inter- national collaboration—this can be accomplished through more intensive faculty/staff communication, exchanges, conferences, and workshops. · Opportunities for IP to Facilitate International Collaborations. International exploration of methods of managing IP, such as the iBridge Network developed by the Kaufmann Foundation, could be helpful. Understanding the nuances in IP negotiations, such as differences in perspective between public universities and private, large and small entities, and so forth, can help ensure success. There might be a role for technology specialists, that is, consultants to serve as intermediaries between inventors and companies. · Key Short- and Long-Term Issues for IP and International Re- search Collaborations. Short-term issues include improving the compatibility, efficiency, and quality of output (patents) in various national systems. Harmonization is a highly desired long term goal. The status of the global economy is an uncertainty that has short- term and long-term impacts. Issues related to students and export controls, and the implications for IP are issues for the future. · Possible U.S. Government Actions. Ideas include building a U.S. Innovation Strategic Policy, convening an IP forum similar to the Federal Demonstration Partnership (FDP), and steps to facilitate commercialization of government-created IP. · Possible Actions by U.S. Educational Institutions. Improving pri- mary and secondary schools and providing role models, such as pro- fessionals in the science, technology, engineering, and mathematics (STEM) disciplines, could be helpful. Expanding undergraduate

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55 INTELLECTUAL PROPERTY study abroad opportunities for U.S. students as suggested by Kathie Olsen in her keynote talk might also be worthwhile. Establishing some level of “innovation literacy,” and understanding that inno- vation literacy includes technical and non-technical elements, are other goals to consider. · Possible Industry Actions. Companies could benefit by becoming more “university literate,” i.e., understanding better the operating context of universities. Companies also could better define what is “precompetitive” for IP purposes; this will allow for better opportu- nities to collaborate early in the research process. · Possible Actions by Government, Universities, and Industry Together. Better understanding among the three sectors could be helpful. This includes a shared understanding that IP is part of the commercialization pipeline and is a means, not an end. REFERENCE Gene Quinn. 2010. An Exclusive Interview with Francis Gurry, WIPO Director General. IP Watchdog. May 4. Available at: http://ipwatchdog.com/2010/05/04/interview-francis- gurry-wipo/id=10393/

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