University challenged?

A careful collaboration between a business and university can deliver huge benefits to both parties says Stevens & Bolton

Charlotte Tillett and Olivia Perrott, members of the Intellectual Property team at Stevens & Bolton LLP, provide guidance on the crucial issues of protection and ownership of intellectual property rights (IPR).

A carefully planned and well-managed collaboration between a business and a university can deliver huge benefits to both parties – enabling important research and financial gain. However, the parties can have very different objectives and priorities, so it is important to set off on the right footing with a solid collaboration agreement. This encourages the parties to be clear and open about their objectives from the start and can avoid problems further down the line.

Patent protection

One of the first things that should be considered is the IPR that may arise from the collaborative project. Key objectives for a university will be publishing its findings for the benefit of its reputation as a research institution, the careers of its research staff and for public benefit; whilst the corporate partner may prioritise keeping any innovative developments confidential to maximise their commercial value and to preserve the opportunity to obtain patent protection.

For a patent to be granted for an innovation it must be novel, which means that it has not been publicly disclosed at all before the application for the patent has been filed. So if, for example, the innovation is described in a scientific paper or press, or is described orally in the course of a lecture or seminar, then patent protection will in almost all circumstances no longer be available, and the ability to protect and commercialise the invention may also be lost. The emergence of social media has increased the risk of disclosing important details of an invention, since information can be disseminated rapidly with no control over who will see it.

With this in mind, corporate parties will generally insist on a university (and often individual researchers) being subject to strict confidentiality obligations, and will want to review all proposed publications relating to the project and have the right to prevent their publication if they include a description of the invention. A middle ground can be for the corporate party to have the right to request a delay to the publication for a fixed period of time (six months is usually reasonable) to allow the company to prepare and file a patent application.

Ownership of IPR

Patents will not be the only IPR to consider. Copyright may subsist in the project documents and results, design right in the appearance of any products which are created, and techniques which are not disclosed publicly may be exploited as confidential knowhow.

New IPR

Ownership of IPR can be another difficult issue that should be addressed before the project starts. As the corporate party will be keen to exploit and commercialise the arising IPR it will usually expect to own them, but there can be scope for the university to negotiate a licence to use the rights for further research or in some cases to commercialise the rights themselves.

As both parties will be contributing expertise and resources to the collaboration it can seem like a simple solution to agree that the parties will co-own the arising IPR. This is often unworkable in practice though, because where the rights are jointly owned the consent of both owners is required for almost all exploitation of the rights (including licensing). It is also tempting to agree to decide which party should own the arising IPR on a case by case basis as and when the rights arise. This can be dangerous because if the parties are unable to agree and reach deadlock, they could end up in a position where neither party can exploit the IPR, when time and resources have already been invested in the project. Note that if there is no agreement then the default position will be joint ownership of arising IPR.

Existing IPR

A key element of any collaboration will be sharing established expertise and “background” IPR with the other party. Parties should be very clear about what they are prepared to share and the purposes for which the other party is permitted to use it. If, for example, any resultant product or technique that is commercialised by the corporate partner comprises or requires use of university background IPR, then it is usually fair that the university should receive a royalty or some other form of compensation for that. If this is not provided for in the agreement the corporate partner may argue that the university has no entitlement to further compensation.

Consider:

  • IPR – establish who will own, control, use, commercialise, receive royalties and sub-licence
  • Who will pay for and protect patents?
  • Internal university IPR policies
  • Guidance in the Government’s ‘Lambert Toolkit’ for university collaborative research

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