Tech Transfer Legal Landscape: Navigating Applicable Laws

Technology transfer is the process of disseminating technology from one person or organisation to another. It is a collaborative process that connects innovation stakeholders and moves inventions from creators to public and private users. Technology transfer agreements are important as they strengthen commercial ties, handle intellectual property, and help in accessing technology. Several laws and regulations govern technology transfer activities, depending on the jurisdiction. In the United States, for example, the Stevenson-Wydler Technology Innovation Act of 1980 was the first major technology transfer law, requiring federal laboratories to actively participate in technology transfer activities. The Bayh-Dole Act of 1980 addressed intellectual property rights stemming from government-funded research, and the Federal Technology Transfer Act of 1986 improved industry access to technologies from federal laboratories. In India, the Technology Transfer Regulations include the Indian Contract Act, the Foreign Exchange Management Act, the Patents Act, the Trademarks Act, and the Copyright Act. These laws and regulations provide a framework for the transfer of technology and intellectual property rights, promoting innovation and economic development.

Characteristics of laws that apply to tech transfer activities

The Stevenson-Wydler Technology Innovation Act of 1980

Technology transfer is the process by which technology is transferred from federal labs, universities, or other research institutions to industry, where it can be developed into a commercial product or service. The Stevenson-Wydler Technology Innovation Act of 1980 was the first major U.S. technology transfer law. It was signed into law by President Jimmy Carter on October 21, 1980.

The Stevenson-Wydler Act required federal laboratories to actively participate in and budget for technology transfer activities. It made it easier for federal laboratories to transfer technology to non-federal entities and provided outside organizations with a means of accessing federal laboratory technologies. The Act also established an Office of Research and Technology Applications (ORTA) in any laboratory with 200 or more scientific, engineering, or related technical positions. The primary focus of the Act was to disseminate information from the federal government to the public and to require federal laboratories to actively engage in the technology transfer process.

The Act authorized the Secretary to provide assistance for the establishment of Centers of Industrial Technology, which would be affiliated with a university or other nonprofit institution. These Centers would engage in activities such as research supportive of technological and industrial innovation, assistance to individuals and small businesses in generating and developing technological ideas, and curriculum development and training instruction in invention, entrepreneurship, and industrial innovation. The Centers had the option of acquiring title to any invention conceived under their auspices that was supported by Federal funds, provided certain conditions were met.

The Stevenson-Wydler Act also established the National Industrial Technology Board to review the activities of the Office of Industrial Technology and advise the Secretary of Commerce and the Director. Additionally, it mandated the establishment of an Office of Research and Technology Applications in each Federal laboratory to assess applications for Federal research and development projects and provide information and assistance to state and local governments and private industry.

The Act created the Technology Administration in the Commerce Department, which lasted until 2007. It was later amended by the Federal Technology Transfer Act of 1986 and the America COMPETES Acts.

The Bayh-Dole Act of 1980

Technology transfer is the process by which technology is transferred from federal labs, universities, or other research institutions to industry, where it can be developed into a commercial product or service. The U.S. government funds over $100 billion in research and development activity annually, which has led to a continuous pipeline of new inventions and technologies.

The Bayh-Dole Act, or Patent and Trademark Law Amendments Act, was passed in 1980 to incentivize and accelerate the commercial exploitation of federally funded research results. The Act, sponsored by senators Birch Bayh of Indiana and Bob Dole of Kansas, permits U.S. universities, small businesses, and non-profits to retain title to their inventions, with the government retaining a right to use the technology.

Prior to the Bayh-Dole Act, the Federal Procurement Regulation required federal contractors or their inventors to assign inventions made under contract to the federal government. The Act introduced a key change, allowing non-profit organizations and small business contractors to retain ownership of inventions made under contract, provided that each invention is timely disclosed and the contractor elects to retain ownership.

The Bayh-Dole Act also authorizes federal agencies to grant exclusive licenses to inventions owned by the federal government. This legislation grew out of Congress's efforts to respond to the economic malaise of the 1970s and manage inventions created with the more than $75 billion invested annually in government-sponsored research and development.

The Act has had a significant impact on university technology transfer, speeding up the commercialization process of federally funded university research and helping new industries to develop more quickly. For example, Stanford's Cohen-Boyer patent on basic gene-splicing tools and Columbia University's Axel patents on a new process for inserting genes into mammalian cells are both a result of the Bayh-Dole Act.

The Bayh-Dole Act has also led to the remarkable growth of patenting and licensing activity by U.S. universities and spurred the formation of numerous start-up companies to develop and commercialize federally funded technologies.

The Federal Technology Transfer Act of 1986

Technology transfer refers to the transfer of technology, knowledge, or facilities from one person, business, or organization to another. In the United States, technology transfer activities are governed by a series of laws enacted by Congress to promote and incentivize the transfer of federally funded technologies to the private sector for commercialization. One of the key pieces of legislation in this area is the Federal Technology Transfer Act (FTTA) of 1986.

The FTTA was enacted by Congress in 1986 as an amendment to the Stevenson-Wydler Technology Innovation Act of 1980. The primary goal of the FTTA is to improve industry access to technologies developed in federal laboratories and promote their commercialization. The Act established the Federal Laboratory Consortium for Technology Transfer, a nationwide network of federal laboratories, agencies, and research centers that facilitates the transfer of technologies from federal labs to the private sector.

One of the key provisions of the FTTA is that it allows government inventors to patent their technologies and receive a share of the royalties when these patents are licensed. This provides an incentive for inventors to commercialize their federally funded technologies and generates revenue for further research and development. The FTTA also enables federal laboratories to negotiate licenses for patented inventions made at the laboratory and to enter into Cooperative Research and Development Agreements (CRADAs) with non-federal entities.

Under the FTTA, federal agencies are required to make separate determinations of the missions of their laboratories for the purpose of cooperative research and development agreements. The Act sets forth the duties of the Consortium, which include assisting non-federal entities in establishing cooperative programs to stimulate research and encourage technology transfer. The Consortium is also responsible for providing information and technical assistance, but it is prohibited from directly transferring technology. Instead, federal laboratories or agencies are responsible for directly transferring technology to users or their representatives.

The FTTA also includes provisions for the distribution of royalties or other income received from the licensing or assignment of inventions under the Act. Federal agencies are required to submit annual summaries of the amount of royalties or other income received and expenditures made, including inventor awards. Additionally, the FTTA authorizes federal agencies to transfer rights of ownership of an invention to the employee inventor, subject to certain conditions.

The National Technology Transfer and Advancement Act of 1995

Technology transfer is the process by which technology is transferred from federal labs, universities, or other research institutions to industry, where it can be developed into a commercial product or service. Beginning with the Stevenson-Wydler Technology Innovation Act of 1980, the US Congress enacted a series of laws to promote and incentivize technology transfer.

The National Technology Transfer and Advancement Act (NTTAA) was signed into law on March 7, 1996. The Act amended several existing acts and mandated new directions for federal agencies with the purpose of:

• Bringing technology and industrial innovation to market more quickly
• Encouraging cooperative research and development between businesses and the federal government by providing access to federal laboratories
• Making it easier for businesses to obtain exclusive licenses to technology and inventions that result from cooperative research with the federal government

The Act made a direct impact on the development of new industrial and technology standards by requiring that all federal agencies use cooperatively developed standards, particularly those developed by standards-developing organizations.

The NTTAA states that federal agencies and departments shall:

• Use technical standards developed or adopted by voluntary consensus standards bodies if compliance would not be inconsistent with applicable law or otherwise impractical
• Consult with voluntary, private sector, consensus standards bodies and participate in the development of technical standards when such participation is in the public interest and is compatible with agency and departmental missions, authorities, priorities, and budget resources

The NTTAA was introduced by Rep. Connie Morella, R-MD, as H.R. 2196. It amended the Stevenson-Wydler Technology Innovation Act of 1980 with respect to inventions made under cooperative research and development agreements. The Act provides assurances to US companies that they will be granted sufficient intellectual property rights to justify the prompt commercialization of inventions arising from a Cooperative Research and Development Agreement (CRADA).

The Indian Contract Act of 1972

The Indian Contract Act of 1872 is the key regulating Indian contract law and is applicable to all the states of India. It determines the circumstances in which promises made by the parties to a contract are legally binding.

The Act defines a contract as an agreement enforceable by law. For a contract to be valid, it must be supported by a lawful consideration on both sides. The consideration must be real, competent, and having some value in the eyes of the law. It must be an act, abstinence, forbearance, or a returned promise. The consideration may be past, present, or future, and it need not be equal in value to the object of the contract.

The Act also outlines the requirements for competent parties to a contract. To be competent, a person must be of the age of majority (18 years in normal cases and 21 years if a guardian is appointed by the court), of sound mind, and not disqualified from contracting by any law to which they are subject.

The Act further addresses the issue of free consent, which is said to be absent in cases of coercion, undue influence, fraud, misrepresentation, or mistake. Coercion refers to committing or threatening to commit an act forbidden by the Indian Penal Code or unlawfully detaining or threatening to detain property. Undue influence occurs when one party is in a position to dominate the will of the other, such as when there is a fiduciary relationship or when the other party's mental capacity is affected. Fraud involves making misrepresentations or concealing material facts with the intent to deceive. Misrepresentation is causing a party to a contract to make a mistake, while a mistake of fact occurs when both parties are mistaken about a matter of fact essential to the agreement.

The Indian Contract Act also covers the enforcement of contracts, agency, and bailment. It is worth noting that India faces challenges in enforcing contracts, with a slow and litigious legal system.

Frequently asked questions