Rule Change Alert! The Bayh-Dole Act Has New Time and Reporting Requirements

On April 30, 2018, The National Institute of Standards and Technology (NIST) issued rule changes regarding the Bayh-Dole Act. The Bayh-Dole Act was enacted in 1980 as the Patent and Trademark Law Amendments Act (Pub. L. No. 96-517), amended in 1984 by the Trademark Clarification Act of 1984 (Title V of Pub. L. No. 98-620), and again in 2000 by the Technology Transfer Commercialization Act of 1999 (Pub. L. No. 106-404). The Bayh-Dole Act created a uniform policy that allows small businesses and nonprofit organizations the option to retain title to inventions made under government contracts, grants, or cooperative agreements that are for the performance of experimental, developmental, or research work. The implementing regulations are found at 37 C.F.R. Part 401 and Federal Acquisition Regulation (FAR) Subpart 27.3.

The April 30, 2018 revisions to the Bayh-Dole Act are categorized as follows:

  1. No time limit for government to request title. Since implementation, the government had 60 days within which it could request title to any inventions. The new rule removes the 60 day notice period.
  2. Quicker timeframe to prosecute patent applications. Previously, contractors and grant recipients had to notify the agency who granted them money of their intent to prosecute a patent application and maintain it and enter into reexamination or opposition proceedings not less than 30 days before the response period expired. The new rule shortens the time period industry has to decide whether to move forward with an application to no less than 60 days.
  3. Alternative access to inventions. NIST has enacted a regulation that permits the agencies involved in contracts to use alternative to the provisions to retain title to inventions, such as those found in patent applications. NIST indicated that this provision was enacted to address contractual situations where the contractor is not in a business model that leads toward commercialization or public availability of the invention.
  4. Direct Reporting Access to Funding Agency. Currently, in the event a small business suspects that a nonprofit organization is not allowing preferential access of inventions under Bayh-Dole to be presented to small business firms, it may report concerns to the Secretary of Commerce. The Rule has been amended to allow the small business to report their concerns directly to the funding agency.
  5. Government right to prosecute abandoned patents. The Rule now includes a provision that in the event a contractor or grant recipient elects not to continue prosecuting a non-provisional patent application, the government may take title in those patent applications. NIST instituted this change noting that after the America Invents Act (AIA) passed in 2012, more entities filed provisional patent applications. As part of the change, the decision not to pursue the non-provisional is to be communicated by the party to the agency who funded the work.

These rule changes will go into effect May 14, 2018. Small businesses and nonprofits receiving federal money should review NIST’s amendments carefully.

Gibbons will monitor further amendments and implementing regulations to the Bayh-Dole act and can answer any questions by contacting the authors directly.

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