COOPERATIVE RESEARCH AND
Cooperative R&D with a University. If you
enter a cooperative research agreement with a university, the law may not
protect your right to file a patent application. This is an area of the
law that can trap you and the university. Either party to a cooperative
research agreement should include in that agreement specific provisions to
ensure that cooperative work will not invalidate any patent that either
party may apply for sometime in the future.
Rejection of Patent Applications. Non-public
information may be used as prior art to disqualify
an application under certain circumstances. This is based on the legal
prohibition that one may not obtain a patent on that which is obtained
from someone else. This includes information developed by others
cooperating in research.
Legal Requirements. The good news is that the Cooperative
Research and Technology Enhancement Act (CREATE Act) of 2004 was
signed into law on December 10, 2004 to help you overcome the perils of
rejection of an application by prior art created by the researchers
involved to a cooperative agreement. The law applies to any type of
cooperative research agreement or grant. However, the cooperative
agreement and the patent application must have certain provisions and the
agreement must be in existence before the inventions in order to gain the
protection of the law. Generally, these provisions relate to common
ownership and disclosure in the patent application of the identities of
the parties to the joint research agreement.
Regulations. The Patent and Trademark Office
issued final regulations on these on September 14, 2005 and they apply to
patents granted after December 9, 2005. Essentially, the
regulations: (1) Advise applicants on how to amend an application to name
the parties to a joint research agreement; (2) permit a terminal
disclaimer by a party who does not also own the application or patent
forming the basis of a double patenting rejection; and (3) provide for the
recordation of a joint research agreement in the Office’s assignment
Re-filing & Amendments. Pending patent
applications filed prior to November 29, 1999 should consider re-filing
the application if there is a possibility of rejection based on the work
of others in a cooperative arrangement. Amendments to other
applications to invoke the provisions of the CREATE Act should also be
Infringement by the University and its Cooperative
Partner. Universities once had a broad "experimental use"
exemption from liability for patent infringement. Not any more. In 2002
the Court of Appeals of the Federal Circuit (Madey v Duke University,
307 F.3d 1351) narrowed the exemption to research solely for
"amusement . . . to satisfy idle curiosity . . . [or a] strictly
philosophical inquiry" and excluded completely, research for business
objectives, which includes licensing and development of research
activities, and even attracting students, faculty and grants. The
Supreme Court decided on June 13, 2005 in Merck v Integra, No.
03-1237, 545 U. S. ____ (2005), 125 S. Ct. 2372, 162 L. Ed. 2d 160 that
the statutory exemption for drug related research [35 U. S. C.
§271(e)(1)] provides a wide berth for the use of patented drugs in
activities related to the federal regulatory process, including uses
reasonably related to the development and submission of any information
under the Federal Food, Drug, and Cosmetic Act. However, beyond drug
research, what is left of the exemption is not clear, but any company
involved in such cooperation must be very careful because it could be the
deep pockets sought for patent infringement.
Agreement Provisions and Review of Liability Potential.
Your cooperative agreement may need to include provisions to ensure that
partner liability potential is minimized. The Law Firm of Louis Ventre,
Jr. can include an independent assessment of potential infringement of
patents for work to be undertaken in the cooperative agreement.
Why Retain a Patent Attorney? Three reasons:
(1) As discussed above, you will greatly increase the potential that what
you cooperatively develop can be patented by you.
(2) It is important to remember that use of a patented product or process,
may also infringe more than one patent, and one may not be able to
practice the invention protected by an improvement patent unless one is
authorized under the basic patent. This is a vital point to consider in
any cooperative research and development agreement as the fruits of the
investment may be entirely dependent upon licensability of other patents.
Full knowledge of the patent landscape in advance of a cooperative
agreement is essential because it weighs on the decision to enter the
(3) The results of a costly investment in research and development could
be devalued by an unexpected need to make royalty payments to a
third-party patent owner, by treble damages for willful infringement, or
even an injunction against commercially utilizing the improvement
resulting from the research.
Conclusion. It all comes down to prudence. Your
potential cooperative research and development activities could be a very
large investment. Due diligence will help ensure that you are making an
investment that has the potential to culminate in the value you
anticipate. You can obtain services on an hourly basis. Or, if you need
more certitude on costs, ask for a fixed price quote for specified work.
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This file last modified 07/09/11.
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