For ten years, through the 1990s, I worked as a professor of law in the University of Hull in Northern England. Every so often I would be present at the kind of conversation where people mused on missed opportunities, and one of the recurring topics under that heading was why the university had not become super-duper rich from the proceeds of its best known invention, liquid crystal displays (LCD). This technology was developed in the 1960s by a research team in Hull led by Professor George William Gray. However in 1970 a patent for LCD was filed by the Swiss company Hoffmann-LaRoche, and in the end the University of Hull never benefited materially beyond getting recognition for this work in some scholarly articles. The big question always was, what went wrong, and why did Hull not protect its discovery?
The issue remains a live one, and partly because universities want to maximise the payback from discoveries most now maintain full-time patent officers and, sometimes, whole legal teams. The issues are complex and involve the following considerations:
• Most (but not all) major university discoveries have been funded by the taxpayer, and it is thought to be unacceptable if the profits from this flow largely or entirely into private or corporate pockets.
• Universities often expect academics who discover something that can be commercialised to recognise that the output is university property, as it was developed on their time and with their resources.
• On the other hand, universities also want to incentivise staff to work on such discoveries.
• Companies want to work with universities where the latter can support them to develop products or processes that have commercial potential, and will fund university work, but expect to be able to secure as their property any resulting discoveries.
All these different interests can compete with each other in securing intellectual property and gaining profits from it. One recent example of the disputes that may arise is a case that just this week has gone to the US Supreme Court, involving a new method to detect HIV developed at Stanford University. The case involves the conflicting interests of the university, the researcher who developed the process and the company now commercialising it – ironically Roche (as Hoffmann-LaRoche is now called). The question for the Court is whether the academic in question was entitled to assign the intellectual property to the company, or whether it was Stanford’s property.
What are we to conclude? First, there needs to be legal certainty that serves all the various interests but in particular protects the public interest – which must be that research should be encouraged and that it should be translated into use as effectively as possible., but also in a way that supports commercial involvement. Secondly, universities need to have clear agreements with their employees as to the distribution of rights and interests. Thirdly, universities need to be good at recognising which pieces of intellectual property are worth protecting and which are not. Registering a patent costs money, but much more importantly defending it can cost a fortune. If the end product isn’t worth much, then the registration isn’t worth the effort and cost either.
On the whole universities need support in this, and certainly should pool their resources. But all sides should take this topic very seriously. University-based research is likely to be a major contributor to economic activity in the future.