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WHAT YOU NEED TO KNOW AND DO

Process for Conflict of Interest Review for Licensing at Berkeley Lab

The Lawrence Berkeley National Laboratory manages the intellectual property created by its employees in support of its research and technology transfer goals.  The transfer of technology can include the licensing1 of inventions and other intellectual property, and constitutes a business decision on the part of the University.  The Lab manages conflict of interest and the appearance of conflict of interest in licensing per California law2 and the Operating Contract for the Lab 3.  The Laboratory employs a review process for every license which reviews for many attributes including conflict of interest, and hence meets the requirement for a Licensing Decision Review. The following describes the Lab process to manage potential conflicts of interest in licensing:

A.  Notice to Inventors

Upon receipt of a record of invention form or other invention disclosure, the Technology Transfer and Intellectual Property Management Department will send an acknowledgment letter to each inventor which will incorporate a notice to inventors of the requirements of the Laboratory and for disclosure of economic interest, "What Inventors Need to Know about Conflict-of-Interest in Licensing."   The notice will explain briefly the Lab’s policies and procedures for disclosing economic interests and managing any potential conflicts of interest.

B.    Licensing Professional Disqualification

Berkeley Lab Licensing Professionals (LPs) who determine that they have a disqualifying personal financial interest in licensing decisions for a case that has been assigned to them will disqualify themselves from case management responsibilities by notifying their supervisor of the situation. The supervisor will re-assign the case for management to another LP who does not have a disqualifying personal financial interest in the licensing decisions.

C.  Economic Disclosure by Inventors

Licensing Professionals at Berkeley Lab will typically consult with one or more of the inventors of a technology during various points in the management of the case.  Technical explanation of the specific invention, the underlying science, the background or existing state of the art, etc. are not generally interpreted as influencing a business decision.  Other discussions regarding analysis, evaluation, or suggestion of additional work or investment required to commercialize a technology, the licensing terms, the qualifications of the company employees to further the technology, etc., could be considered as participating in the decision by using judgement that seeks to influence the LP.  The LP will consider the appropriate level of inventor involvement in licensing decision-making for a particular invention.  In general, the role of the inventor in the Berkeley Lab licensing decision-making process will be kept to the minimum necessary to successfully achieve the University’s objectives in marketing and licensing inventions.   

Because of the Conflict of Interest requirements for the Laboratory, an economic disclosure by the inventors will be required once the LP begins negotiation of a license with a company.  This disclosure will be provided using form TT 100-LBNL .

The economic disclosure will not be required in the cases of multiple non-exclusive licenses offered on identical terms to all licensees.  A typical example of this would be software licensed under a standard agreement to anyone or any company.

D.  Review of Licenses Based on Economic Disclosure

Depending on the level of economic interest the licensing arrangement will be reviewed as follows:

• If there is no positive disclosure of economic interest, the disclosure statements so showing will be enclosed in the review package that goes to the reviewers and approvers of the license within Berkeley Lab ⁴.
• If there is a positive disclosure of economic interest in that one or more employee inventors is a principal in the company entering into an exclusive license or option for an exclusive license, the decision to enter into such a license must be approved by the DOE contracting officer as well as the normal Lab approvers.  The LP will request the DOE approval.
• If there is a positive disclosure of economic interest of some other sort (as called out on form TT 100-LBNL) the LP will so indicate on the Licensing Review checklist, and the reviewers of the license will take this into account.  To aid in the review and approval process the LP will typically prepare a short memo documenting the involvement (if any) by any inventors, the basis for the business terms, and the efforts undertaken by the Lab to ensure fairness of opportunity in selecting a licensee.

Notes:

1 Licensing is used to represent any contracts for university owned intellectual property: e.g., licenses, options, bailments.

2 The State of California Political Reform Act of 1974 (the Act).  The Act requires public officials to “perform their duties in an impartial manner, free from bias caused by their own financial interests or the financial interests of persons who have supported them.”  (Gov. Code, § 81001, subd. (b).) 

3 Contract DE-AC02-05CH111231 (Contract 31) under which UC operates the Berkeley Lab for DOE requires the Lab “have implementing procedures that seek to avoid employee and organizational conflicts of interest, or the appearance of conflicts of interest, in the conduct of its technology transfer activities" I.92 (d).

4 Each license is reviewed and approved by the following at Berkeley Lab:  Licensing Manager, Patent group Head, Technology Transfer Department Head, Laboratory Counsel, and Laboratory Deputy Director.