Key Takeaway
Notices from government funding agencies about noncompliance with iEdison reporting obligations should be taken seriously — failure to comply can put patent ownership at risk. However, a good-faith effort to remediate reporting deficiencies is likely to resolve the situation.
Introduction
Government-funded inventions trigger reporting requirements by which government contractors must keep funding agencies up to date on inventions and patent filings, typically via an online reporting platform called iEdison. Noncompliance with those reporting obligations can lead to worrisome notices from the government.
Although commentators widely observe that the U.S. government has never exercised its “march-in rights” under the Bayh-Dole Act, noncompliance with reporting requirements potentially opens a different door to loss of title to inventions — one which has, at least in one public incident, resulted in a contractor assigning title in a patent to the U.S. government.[1] Any notices or letters on this topic should therefore be taken seriously.
We received a notice indicating we failed to elect title or properly submit information on government-funded inventions to iEdison. What should we do?
A good-faith effort to remediate the reporting deficiencies is very likely to appease the demands of funding agencies.
These letters can be threatening on their face; for example, stating that the agency requests that a company convey title to the government. However, such a letter is much more likely to be tied to agency staff tasked with clearing notifications in iEdison than to a political or other higher-level decision to take a company’s patents.
Steps to remediate iEdison reporting omissions include:
- Access iEdison and review the invention records, patent records, and notifications in the system
- Cross-check that data with patent filings and any grant-related documentation to confirm what information may have been omitted from iEdison
- Enter any missing information and documents into iEdison
- If a letter was received from an agency, respond to agency staff confirming the steps taken to resolve the issues raised in their letter
How do we access our iEdison account?
If an organization is not aware of having an iEdison account, the government may have created one for the organization without giving access to any individuals. For example, when the Department of Energy began using the iEdison platform, it imported its existing invention data into iEdison and created accounts for corresponding companies without — in the instances we are aware of — giving access to those accounts to anyone at the companies.
Access can be gained by contacting the iEdison Help Desk. The Help Desk asks for proof of access to nonpublic data reflected in the company’s iEdison account, such as invention titles, docket numbers, inventor names, and the like. The trick, of course, is that you are trying to get access to see that same data; however, patent counsel should be able to aggregate sufficient data to pass the test and gain access.
What common fixes are needed in iEdison reporting remediation efforts?
iEdison populates a variety of notices based on what information is missing from the records. A few common ones are:
(1) Failure to Elect Title. iEdison invention records include a drop-down menu to indicate whether the contractor elects to retain title. A notification will populate if no selection is made. Even if the regulatory deadline to elect title has long passed (as in the scenario of a remediation effort), the system will allow the user to change the election to “Retain Title.”
(2) Patent Data. If an invention was reported into iEdison but patent data was not entered, a notification is generated indicating that a patent application must be filed. Resolving this will typically require entering the relevant patent numbers and related bibliographic data. All patent applications in the relevant families should be reported into iEdison.
(3) Government Support Clauses. iEdison checks whether reported patents include government support clauses (i.e., statements in the patents themselves indicating that the invention was made with government funding such that the government retains certain rights in the invention). In some instances, this may simply require uploading a copy of the patent showing the statement was already included. However, in handling these types of projects we have found situations where the statements are missing from patents, in which case they should be added by filing certificates of correction with the patent office (see discussion below).
(4) Confirmatory Licenses. The government automatically has license rights in patents for government-funded inventions due to the terms of the underlying grant agreements. iEdison requires that a license confirming the government’s license rights be signed and uploaded for each patent family. iEdison will auto-generate the form license, so this can be resolved by downloading the agreements, signing them, and uploading the signed versions.
(5) Utilization Reports. Utilization reports relate to annually providing information to the funding agency about commercialization of government-funded inventions. Information required may differ by funding agency.
What should we do if our patents were reported in iEdison but do not include government funding statements?
U.S. patents or patent applications for government-funded inventions are required by 35 U.S.C. § 202(c)(6) to include a statement that the government has rights in the invention (see also MPEP 310 and 37 C.F.R. § 1.77(b)(3)).
By cross-checking data in an iEdison account against patent publications, it may be discovered that certain patents were reported to the government as being directed to government-funded inventions but lacking the required government funding statement.
The statement can be added to granted patents by certificate of correction (and via amendment in pending applications). One study found thousands of such corrections in USPTO data.
Because this is a statutory requirement for the patents themselves, we recommend prioritizing this aspect of any remediation effort.
How complex is this task?
Interacting with iEdison itself is largely a data-entry task. However, collecting and understanding the notices, relevant patent data, and other context can be complicated and requires experience with patents and information on a company’s patent portfolio. The scale of any remediation project will of course vary with the size of the government-funded patent portfolio and the extent of the reporting gaps.
Other considerations?
In the scenarios contemplated above, reporting deadlines set in the Bayh-Dole regulations will have long passed. It is impossible to go back and achieve perfect compliance after the fact. The goal here is to show a good faith effort toward compliance so that agency staff turns its attention elsewhere. Continued compliance will also be needed following a remediation effort.
Additionally, beyond the nuts and bolts of proper reporting, complex strategic considerations should be considered when building an IP portfolio for a business with government funding — for example, considering how government funding can be deployed without creating a scenario where the government’s license rights become a material drag on the value of the company’s intellectual property. Assessing and understanding the practical impact of government funding on a company’s intellectual property portfolio, for example, in the context of due diligence. More on that next time.
[1] Campbell Plastics Engineering & Mfg., Inc. v. Brownlee, 389 F.3d 1243 (Fed. Cir. 2004)
