Wednesday, 20 July 2016

Redistribution of Wealth Through Giving and the Bayh-Dole Act

A couple of years or so ago, I wrote a post on philanthropy and its impact on the creation of intellectual property.  This appears to be an under-researched area and deserves some additional review. 

The Bayh-Dole Act (and general U.S. federal policy) operates to redistribute wealth from tax payers to universities, non-profits and companies through their ability to take title to government funded inventions.  Essentially, tax payers pay money to the government.  Instead of that money getting redistributed through social programs or other means, the money is distributed in the form of grants for research to universities, non-profits and companies.  The Bayh-Dole Act then allows those entities to take title to any inventions developed from that money.  Part of the rationale for the Bayh-Dole Act, along with the incentive to commercialize theory, is to ensure that private industry has the incentive to bring government funded technology to market--to cross the so-called "valley of death".  As the story goes, prior to passage of the Bayh-Dole Act, many government funded inventions "languished" on the shelf of the government. Many believe the Bayh-Dole Act is an inspired piece of legislation.  Indeed, many countries around the world have passed similar laws to harness the power of government funded invention. 

Interestingly, the Association of University Technology Managers (AUTM) pointed to a potential silver lining, of sorts, in the Great Recession.  Universities continued to spin out companies (and apparently create good paying jobs) based on university developed technology during the Great Recession.  If not for the Bayh-Dole Act, the Great Recession might have been much worse for the United States. 

I was listening to National Public Radio (NPR) the other day and noticed that the Lemelson Foundation was supporting NPR.  The Lemelson Foundation was started by Dorothy Lemelson, the famous inventor Jerry Lemelson's wife.  The Foundation supports invention and commercialization efforts primarily through education in the United States and in other countries.  Specifically, the Foundation appears to focus on college-aged possible inventors and addressing the needs of the poor through invention.  The Foundation reached its 20th anniversary this year and there is an interesting list of its achievements and activities, here

Notably, Jerry Lemelson was well-known for his patenting/invention activity--over 600 patents.  He was also well-known for his assertion of patents (submarine patents as they were known) against practicing companies, particularly for his "scanner" technology.  Interestingly, Wikipedia notes that he extracted about $1.3 billion in licenses from companies.  When examining the merits of a particular practice--let's say so-called patent trolling, perhaps we should also look to the uses that some monies made from that activity are used, including voluntary redistribution. 

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