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Maryland Legislator Wants To Keep State University Patents Away From Trolls (eff.org)

The EFF's "Reclaim Invention" campaign provided the template for a patent troll-fighting bill recently introduced in the Maryland legislature to guide public universities. An anonymous reader writes: The bill would "void any agreement by the university to license or transfer a patent to a patent assertion entity (or patent troll)," according to the EFF, requiring universities to manage their patent portfolios in the public interest. James Love, the director of the nonprofit Knowledge Ecology International, argues this would prevent assigning patents to "organizations who are just suing people for infringement," which is especially important for publicly-funded colleges. "You don't want public sector patents to be used in a way that's a weapon against the public." Yarden Katz, a fellow at Harvard's Berkman Klein Center for Internet amd Society, says the Maryland legislation would "set an example for other states by adopting a framework for academic research that puts public interests front and center."
The EFF has created a web page where you can encourage your own legislators to pass similar bills, and to urge universities to pledge "not to knowingly license or sell the rights of inventions, research, or innovation...to patent assertion entities, or patent trolls."

52 comments

  1. Marlyand is too little by turkeydance · · Score: 1

    wait for California.

    1. Re:Marlyand is too little by gatkinso · · Score: 1

      It sets a legal precedent.

      --
      I am very small, utmostly microscopic.
    2. Re:Marlyand is too little by slew · · Score: 2

      It sets a legal precedent.

      Under the law, you can sell your patent to whomever you want. This proposed legislation in Maryland just prevents their state universities (which are effectively controlled/directed by a board chartered by the state) from directly selling University patents to trolls. It doesn't set legal precedence, it just directs the policy of an entity that is nominally under state government control.

      This law doesn't (and can't) prevent non-state universities in Maryland from doing so, or anyone else in the state for that matter. It even can't prevent the company that the University sold the patent to from later selling them to a patent troll (it only requires that the University research past practices of the entity that it licenses to, but as we know past performance doesn't guarantee future results).

      In fact, depending on how some universities' independent licencing entities are legally structured, they might practically be considered patent trolls themselves (i.e., patent assertion entities whose primary business model is to assert patents or obtain licensing fees). Depending on how this law is interpreted, it might prevent the cross assignment of a patent originally created by a joint partnership industry/research group of the university from transferring the patent to the university's own licencing arm, leaving the industrial partner the only entity in Maryland legally capable of licensing a patent from a joint partnership to others (and I suspect an industrial partner probably wouldn't be financially motivated to license to competitors). Now that would some accidental unintended consequence of this bill wouldn't it?

    3. Re:Marlyand is too little by Overzeetop · · Score: 1

      > Now that would some accidental unintended consequence of this bill wouldn't it?

      A for-profit licencing "arm" of the state university, set up primarily for the hand-picked members of said licensing firm to benefit handsomely off of the work of the state supported university. Hmmm, yes, that would be awful to see. /s

      --
      Is it just my observation, or are there way too many stupid people in the world?
  2. Why do state universities have patents at all? by Anonymous Coward · · Score: 0

    Why is a state university patenting anything? If taxpayers funded the research, shouldn't the taxpayers be free to use the research with no strings (or patent license fees) attached?

    1. Re:Why do state universities have patents at all? by HEbGb · · Score: 1

      This is a fair point. If you want to "own" the research, and the related IP, pay for it yourself.

    2. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      It's because a few years ago the US patent system was changed from "first to invent" to "first to file" which mean if the university doesn't patent it, then when they publish their work, some other company can patent it and charge royalties.

    3. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      But "first to file" only started in 2013, and state universities were still patenting their research prior to 2013. Why?

    4. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      Because that's where the big money is. At our university, it seems like the two things deemed most important is 1) faculty who can start up companies and then spin them off for significant dollars, and 2) faculty-developed patents, since they can be (and are) monetized.

      We have a rather large and well-funded group whose entire job is to help faculty with the two items I just listed - as do most other universities nowadays.

      I'm in full agreement with the top-level post, though - if the public is paying for it, the public should own it. But I'm just a staffer, so my opinion on this doesn't carry much weight.

    5. Re: Why do state universities have patents at all? by HEbGb · · Score: 1

      That's completely wrong. The publication becomes 'prior art' and no patent can ever be issued.

    6. Re:Why do state universities have patents at all? by gatkinso · · Score: 1

      Patents can be used to ensure that the invention remains open and free.

      --
      I am very small, utmostly microscopic.
    7. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      Patents can be used to ensure that the invention remains open and free.

      Sure, but are the state universities ensuring that the invention remains open and free? Or do they charge licensing fees to anyone wants to use "their" invention?

    8. Re: Why do state universities have patents at all? by Anonymous Coward · · Score: 1

      Incorrect.
      Patent can be issued.
      Then a *defendant* can find and demonstrate the prior art an attempt to get the patent invalidated.

      Note that the burden of proof here is shifted to the defendant, and note that patent examiners notoriously do not examine publications.

    9. Re:Why do state universities have patents at all? by TechyImmigrant · · Score: 1

      I thought the most important thing was to fund the wages of the next American football team manager.

      --
      I should use this sig to advertise my book ISBN-13 : 978-1501515132.
    10. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      Yeah, like that ever happens. All colleges are in it purely for the money.

    11. Re: Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      You're not wrong to wonder that, but at least in my field, funding is usually an issue, so patents help to further research. I do believe that public money should mean public good, but the reality of things is a bit more nuanced. If you don't like this (and you shouldn't), then before doing away with the parents we need to ensure that the parents are unnecessary by giving more funding to the research at your local state and land grant universities that benefits everyone.

    12. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      There are two reasons for this:

      1) Just because the university I work at is public it doesn't mean that my research funding is public tax dollars. I'm paid by "soft money" - money from an external agency that pays the university to effectively use me as a contractor. It pays overheads for the space and admin services I use, and my salary - no public funds are used for my employment.

      2) A major part of our funding comes from our IP (patents and books etc). Without this, we would not have enough money to continue research or teaching.

      I agree with the sentiment that taxpayer funded research should result in freely available outputs - it's the way I wish the system worked (I make all my papers freely available on arXiv for example). However, what's actually happening at the moment is that our other activities are really subsidizing the underpayment of state tuition: My salary is entirely paid by the grant, yet I teach for the department effectively for free. I don't mind doing this too much (sometimes teaching sucks, but if it's not overwhelming it's normally fulfilling) but it's certainly not what I'm paid for.

      Let's face it, public universities are viewed as an expense only. No-one on the state budget committee considers our economic contributions (educated workforce, patents, new tech, publications etc), so they cut and cut our funding as far as possible. Since our contributions aren't considered as part of the budget, we can't afford to give them away for free. In the present system, if we didn't sell any patents, there wouldn't be a university any more.

    13. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      1) Just because the university I work at is public it doesn't mean that my research funding is public tax dollars. I'm paid by "soft money" - money from an external agency that pays the university to effectively use me as a contractor. It pays overheads for the space and admin services I use, and my salary - no public funds are used for my employment.

      If you are employed by a taxpayer-funded university, then by definition your "overhead" is already paid out of the institutional budget.

      2) A major part of our funding comes from our IP (patents and books etc). Without this, we would not have enough money to continue research or teaching.

      You are paid by the university; you receive a salary. As for your research, you probably have a legion of graduate and doctoral students available.

      I agree with the sentiment that taxpayer funded research should result in freely available outputs - it's the way I wish the system worked (I make all my papers freely available on arXiv for example).

      As you should. Locking research papers behind paywalls is the antithesis of science and the advancement of society.

      However, what's actually happening at the moment is that our other activities are really subsidizing the underpayment of state tuition: My salary is entirely paid by the grant, yet I teach for the department effectively for free. I don't mind doing this too much (sometimes teaching sucks, but if it's not overwhelming it's normally fulfilling) but it's certainly not what I'm paid for.

      It is high time the taxpayers have a chat with the university and ask what is your job if not to teach. And if it is not primarily to teach then go work for a private company and get off the taxpayer-funded gravy train of academia.

      Let's face it, public universities are viewed as an expense only. No-one on the state budget committee considers our economic contributions (educated workforce, patents, new tech, publications etc), so they cut and cut our funding as far as possible.

      When a four-year degree only gets you the same jobs a high school diploma did year ago, the value of post-secondary education is clearly not in the interest of the students and taxpayers.

    14. Re: Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      Well, you thought wrong.

    15. Re: Why do state universities have patents at all? by TechyImmigrant · · Score: 1

      Well, you thought wrong.

      I googled "Highest Paid Employee by State"

      Highest paid public employee in each state
      Nick Saban, University of Alabama football coach, Alabama - $7.09 million.
      Jim Harbaugh, University of Michigan football coach, Michigan - $7 million.
      John Calipari, University of Kentucky basketball coach, Kentucky - $6.88 million.

      So universities value coaches over all other employees and football coaches over other coaches.

      --
      I should use this sig to advertise my book ISBN-13 : 978-1501515132.
    16. Re:Why do state universities have patents at all? by Theaetetus · · Score: 1

      It's because a few years ago the US patent system was changed from "first to invent" to "first to file" which mean if the university doesn't patent it, then when they publish their work, some other company can patent it and charge royalties.

      That's completely, entirely, 100% untrue. The change from first to invent to first to file simply removed interference proceedings, which is where two inventors file applications for the exact same invention, and the USPTO held a mini-trial to determine which one actually invented it first. Those are now replaced with a simple "who filed first?" rule. Big change? No. There were on average 20 interference proceedings a year, out of half a million applications.

    17. Re:Why do state universities have patents at all? by Anonymous Coward · · Score: 0

      "If you are employed by a taxpayer-funded university, then by definition your "overhead" is already paid out of the institutional budget."

      Wrong. Overhead is charged to the grant.

      "You are paid by the university; you receive a salary. As for your research, you probably have a legion of graduate and doctoral students available."

      Wrong. The grant pays my salary.

      "It is high time the taxpayers have a chat with the university and ask what is your job if not to teach. And if it is not primarily to teach then go work for a private company and get off the taxpayer-funded gravy train of academia."

      Wrong. My job is primarily to conduct research, I'm not tax-payer funded, and it's not a gravy train.

      Three strikes, you're out!

    18. Re: Why do state universities have patents at all? by ChrisMaple · · Score: 1

      The entity applying for a patent is required to cite relevant prior art - although failing to do so in a complete fashion is very rarely subject to any penalty. The patent examiner is supposed to be knowledgeable in the field and is expected to catch an application that isn't new. So it takes 2 failures (a probably malicious failure by the applicant and a probably incompetent failure by the examiner) for an invalid patent to be issued.

      --
      Contribute to civilization: ari.aynrand.org/donate
  3. Two things... by Anonymous Coward · · Score: 0

    Firstly, whats to stop the patents from being resold to a third-party who is a patent troll? This just adds a step requiring a practicing entity buy the patent and then resell to trolls. If this drops the value of those patents, it could cause a lucrative side-business buying up those patents cheaply and reselling them on for immediate profit (plus an exemption of perpetual license for the seller of course).

    Secondly, wouldn't it simply be better to declare inventions by these entities to be patent-free in the first place if any public funding was used for them? And define that down to paper bought using such funds, electricity bills paid for with them, etc, so that academic research arms either have to make due without public funds at all, or we the people providing these funds get the benefits of said research.

    Seriously EFF, this won't stop the practice, it'll just incentivise businesses using this system to buy patents and resell them for fast profit, rather than use them, and will do nothing to curb the patent abuse business at all.

    1. Re:Two things... by slashrio · · Score: 1

      Exactly this, it's a shit proposal if it doesn't prevent reselling at all.
      I would have modded you up 5 points if I could. :)

      --
      "Trump!!", the new Godwin.
  4. here's a better idea by ooloorie · · Score: 1

    The EFF has created a web page where you can encourage your own legislators to pass similar bills, and to urge universities to pledge "not to knowingly license or sell the rights of inventions, research, or innovation...to patent assertion entities, or patent trolls."

    How about publicly funded research simply end up in the public domain?

    1. Re:here's a better idea by Anonymous Coward · · Score: 0

      Except not all university research is publicly funded. Anyway this is stupid because what if the researchers form their own company, they eventually sell and the patents end up in the hands of a patent troll.

      Either IP patents can be bought and sold, or they cannot. There isn't any way to manage it better than that. Decide if a patent is only valid to the original patent holder for a set period of time, and not transferrable, or it can be.

    2. Re:here's a better idea by Anonymous Coward · · Score: 1

      How about publicly funded research simply end up in the public domain?

      Because in the US, Congress and the courts have a habit of allowing rights holders to take works out of the public domain and place them back under copyright.

      The public domain doesn't exist in the US, only an uncertainty as to whether or not you can use a work without being sued for copyright violation.

      As such, any law that puts something into the public domain is a pointless gesture in the US. At least until the law is fixed, so that putting something into the public domain is a permanent act that cannot be revoked.

    3. Re:here's a better idea by drinkypoo · · Score: 1

      How about publicly funded research simply end up in the public domain?

      How about naming "The People" on the patent when "The People" paid for part of the development of the technology? That would give "The People" the right to exploit the patent. Presumably this isn't permitted under current patent application processes, but this seems like something which could be fixed. Under, you know, some other administration.

      --
      "You're right," Fisheye says. "I should have set it on 'whip' or 'chop.'"
    4. Re:here's a better idea by ooloorie · · Score: 1

      Actually, most of "The People" didn't pay a dime for the development of the technology.

      In any case, placing this in the public domain would basically accomplish that.

  5. Because yeah.. Trolls should stay under the bridge by Anonymous Coward · · Score: 0

    Patent trolls are the bane of technology as they seek to reap benefits from the labors of others. I still remember the SCO group and their degradation from technology to trolldom. There is a reason that IBM and others gain patents at a harried rate. It is to prevent this kind of leaching-for-profit. I'd compare most patent trolls to vampires... except that makes vampires look bad and will get me down-voted for those that were on Team Edward.

    Peace out.

  6. What? This shall not stand in Trump's America! by Anonymous Coward · · Score: 0

    All this represents is GOVERNMENT, EVIL CROOKED GOVERNMENT, crushing individual free enterprise and entrepreneurship with anti-competitive behavior that tears at the very sinews of American Capitalism.

    Such unlawful tyranny shall be immediately banned, by authority of Herr Obergruppenfuhrer Trump, Emperor of the United States and Protector from Mexico.

    So save us all! #MAGA #releasethehounds

  7. Maryland has state universities? by Anonymous Coward · · Score: 0

    I thought they only had cosmetology schools?

  8. Probably unconstitutional by Anonymous Coward · · Score: 0

    The assigning of patent rights is a property right, and the state cannot simply void those without violating the "takings clause". If the State of Maryland wants to condemn those rights, pay the owner fair compensation and then void them, then it would be okay. I don't expect that will ever happen, because legislators will look after the taxpayers first; companies affected by trolls will be waaaaaay down on the list.

    1. Re: Probably unconstitutional by Anonymous Coward · · Score: 0

      State Universities are an agent of the state, this cannot violate the takings clause, as the state is free to act as its own agent.

  9. Selling copyrights by Anonymous Coward · · Score: 0

    ... a weapon against the public.

    I'm guessing Republicans do want this: It's what their paymasters demand. Expect another 'public good' bill to disappear for the benefit of small government and the 'free' market.

    Wasn't there an issue last year with US universities selling the copyright to their research? That needs to change too. I'm sure many "don't want public sector" publishing used "against the public".

    1. Re:Selling copyrights by Anonymous Coward · · Score: 0

      this article is about patents and you totally missed the fucking ball my friend.

  10. This would be childishly easy to work around by SlaveToTheGrind · · Score: 1

    From the bill:

    THE ASSIGNMENT OF A PATENT BY A PUBLIC SENIOR HIGHER EDUCATION INSTITUTION TO A PATENT ASSERTION ENTITY SHALL BE CONSIDERED VOID AND UNENFORCEABLE.

    So a middleman buys the patents, then turns around and assigns them to an assertion entity. This is often how the larger players do it anyway (so the original patent owner doesn't understand who it really is and thus jack up the price).

    1. Re:This would be childishly easy to work around by Anonymous Coward · · Score: 0

      Easy to fix -- instead of inventing this new useless concept "patent assertion entity", just forbid (and invalidate) sales to "non-practicing entities" (a term in use for many years).

      Since your "middleman" would themselves be a non-practicing entity, they wouldn't have anything to sell to a troll.

  11. Violating contracts is a dangerous idea by reemul · · Score: 2

    I strongly oppose patent trolls, but retroactively breaking valid contracts and nullifying sales of patents because you don't like who the patent was sold to is a truly horrible idea. If you don't want patent trolls to have university patents, don't sell them to them. And fire everyone at the university involved if they do sell them. Letting the university enter into a contract and then back out with no consequence because the purchaser is engaged in a vile but legal practice does damage to our legal system that far outweighs any possible benefit. This is just a bad idea generally. The EFF should spend their time trying to get patent trolling itself banned, not damaging the sanctity of contracts generally with cheap stunts because they like some of the short term outcomes.

    --
    You're just jealous 'cuz the voices talk to *me*
    1. Re:Violating contracts is a dangerous idea by Anonymous Coward · · Score: 0

      The EFF have been trying to get the patent system to be less crazy.

      But what you're saying is something like:
      Hey, we know that adding cyanide to water is bad, but, because we said before that it was OK, please go ahead. ... which would be totally stupid. When something is toxic, you get rid of it, and you don't give a crap about whether or not it was deemed to be 'ok' back then.
      Kinda like someone making a new drug, and then deciding to regulate it.
      The trolls should be screwed over every which way from Sunday, as that is what the toxic behavior they're exhibiting is doing to the rest of society.

    2. Re:Violating contracts is a dangerous idea by sjames · · Score: 1

      The problem is that the trolls don't tell you they're trolls when they buy the patent. They're good at hiding that until the deed is done. Being able to nullify after the fact is just compensating for the deceptive practice.

    3. Re:Violating contracts is a dangerous idea by Anonymous Coward · · Score: 0

      If the universities wanted to retain some form of ethical auditing, they could paper the agreements appropriately. Regardless, the logic that you should have any say in how property you relinquished title to in exchange for consideration is flawed.

    4. Re:Violating contracts is a dangerous idea by sjames · · Score: 1

      This legislation papers the deal in advance and saves a lot of boiler plate replication. Beyond that, since they are publicly funded, they don't get to choose.

      It's hardly the first law that can void a signed contract.

      As for your final point, get back to me when DRM is banned.

  12. Universities themselves are patent trolls by Anonymous Coward · · Score: 0

    And they steal patents from the students that invent them.

  13. Universities rarely patent by Anonymous Coward · · Score: 0

    Been there, done that. Generated new designs for at least 3 electronic patents involving the world's highest frequency neural stimulators, capable of focusing signals *between* the electrodes, when I was doing medical research, and the lab refused to patent them or allow me to pay for the legal research to get the patent out of my own pocket. I wanted them on my resume, and to protect the designs from commercial proprietization. The excuse given by the lawyer I spoke with was not to get them was "they would be public domain anyway due to government funding". Thing is, I *wanted* them in the public domain to protect them for public use, but wasn't in a good position to force it.

    The result is that the designs were available for patenting by anyone who failed to report the results of a search for prior art. And that is *very, very common*.

  14. Universities should have no patents by WCMI92 · · Score: 1

    Because anything they produce is a WORK FORE HIRE paid for by the TAXPAYERS.

    --
    Corporatism != Free Market
    1. Re:Universities should have no patents by Anonymous Coward · · Score: 0

      This does not make sense, and, regardless, the assets are still titled to the state-run university. Any monetization of those assets thus necessarily directly benefits the state. If universities are not entitled to IP protection does that not just enable other more litigious players?

    2. Re:Universities should have no patents by Anonymous Coward · · Score: 0

      Because anything they produce is a WORK FORE HIRE paid for by the TAXPAYERS.

      Except when it's a work-for-hire paid by a private grant or fellowship.

      Or work done by a student who is being paid for other work (like teaching classes) but not directly paid for the dissertation research.

  15. bad precident by Anonymous Coward · · Score: 0

    there should not be state law dictating the types of entities entitled to purchase intellectual property rights

  16. Follow the money by Anonymous Coward · · Score: 0

    Put yourself in the shoes of the taxpayer:

    1) Business X is legally compelled to pay tax that funds State supported colleges and universities.
    2) State sponsored University Y uses those funds to develop a breakthrough technology/method and patents it.
    3) University Y assigns the patent to Business Z.
    4) Business Z sues Business X for using anything even remotely similar to the patented technology/method.
    5) University Y receives part of the settlement/judgment against Business X.

    Business X just got screwed. They were compelled to pay for research that they were then sued for.
    University Y is double dipping. They accepted both taxes and settlement/judgment money from Business X. This is a gross conflict of interest.

    If a college or university accepts taxpayer money, including Federal Student Aid, any innovations developed by that institution should be patented and assigned to the public domain. If a college wants to monetize its research, they don't need to accept taxpayer funds.