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University Of California’s Latest Plan: Privatize Knowledge, Take Out Lots Of Patents — Profit!

July 2, 2013

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At the end of last year, we wrote about an extraordinary attempt by the University of California (UC) to resuscitate the infamous “Eolas” patents that were thrown out earlier by a jury in East Texas. Clearly, the University of California likes patents, and the way that they can be used to extract money from people with very little effort. In fact, it likes them so much it is trying to privatize research produced by taxpayer-funded laboratories so that even more patents can be taken out on the work, and even more money obtained through licensing them. The background to this new approach, implemented via a new entity provisionally entitled “Newco”, is described in a fantastic feature by Darwin BondGraham that appears in East Bay Express:

The purpose of Newco is to completely revamp how scientific discoveries made in UC laboratories — from new treatments for cancer to apps for smartphones — come to be used by the public. Traditionally, UC campuses have used their own technology transfer offices to make these decisions. But under Newco, decisions about the fate of academic research will be taken away from university employees and faculty, and put in the hands of a powerful board of businesspeople who will be separate from the university. This nonprofit board will decide which UC inventions to patent and how to structure licensing deals with private industry. It also will have control over how to spend public funds on these activities.

Newco’s proponents contend that the 501(c) 3 entity will bring much-needed private-sector experience to the task of commercializing university inventions. Ultimately, it will generate more patents, and thus bigger revenues for UC through licensing deals and equity stakes in startups, they claim. UC administrators also say they have established sufficient safeguards for Newco and that UCLA’s chancellor and the regents will have oversight over the entity.

As that makes clear, at the heart of this approach is a belief that taking out more patents on publicly-funded research is a good thing. But as Techdirt reported five years ago, the legislation that started universities down this road, the Bayh-Dole Act of 1980, did not cause more research to be conducted in the academic world, contrary to what advocates of this law claimed would happen. Another article the same year noted that more patents actually led to much less collaboration, much greater secrecy and much higher costs to innovation.
The East Bay Express feature has a great comment from Gerald Barnett, who ran tech transfer operations at the University of Washington and at UC Santa Cruz, and therefore has some experience in this field. He explains why more patents are bad for the public that is paying for the research that generates them, and bad for the US economy:

“The problem is that you’re taking out of circulation a vast amount of public domain knowledge and other stuff, and holding it hostage, making it less likely that any of these inventions will make money because you’re focusing on exclusive licenses,” he said.

What’s better for the public and the broader economy, said Barnett, is a system in which most university inventions and knowledge quickly flows into the public domain, or is swiftly made available through non-commercial means. A relatively small number of university inventions that benefit from patent positions might be licensed out, Barnett said. But he’s skeptical of the obsession with exclusive patent agreements with corporations.

The article goes on to explore the ways in which the worlds of UC academia and business are becoming deeply intertwined, and how this raises questions about potential conflicts of interest when decisions concerning the commercialization of discoveries are being made. It’s an important piece that chronicles the University of California’s shift away from the pursuit and sharing of knowledge for the benefit of all humanity, to the monopolization of ideas and maximization of profits for a few privileged investors.

[Source]: TechDirt.com

Last modified: July 9, 2013

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