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SPS PrimerNegotiations – A

Practical Review

Michael LenetskyKen Packman

Allen BovaErnie Davis

SPS Primer – Week 4

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SPS Primer

It is said that if you know others and know yourself you will not be imperiled in 100 battles. If you do not know others but know yourself, you win one and lose one. If you do not know others and do not know yourself you will be imperiled in every single battle.

“The Art of War”, Sun Tzu

Negotiations :A Practical Review

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SPS Primer

Purpose of this presentation

To understand issues in award negotiations Why does it take so long to sign an award? What issues are GCOs looking at in the award? Are other offices involved and how?

General framework: Briefly discuss role of various offices Examine some problematic contractual language

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SPS PrimerContract

A legally binding agreement involving two or more people or businesses (called parties) that sets forth what the parties will or will not do. The majority of contracts must be in writing to be enforceable. A contract is formed when competent parties -- usually adults of sound mind or the authorized representatives of business entities -- mutually agree to provide each other some benefit (called consideration), such as a promise to pay money in exchange for a promise to deliver specified goods or services or the actual delivery of those goods and services. A contract normally requires one party to make a reasonably detailed offer to do something -- including, typically, the price, time for performance and other essential terms and conditions -- and the other to accept without significant change.

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SPS Primer

Contracts include: Awards Requests for Proposals or Quotations (RFP and

RFQ) Research Agreements Material Transfer Agreements (MTA) Non-Disclosure Agreements (NDA)

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SPS PrimerNegotiation

To arrange for or bring about through conference, discussion and compromise.

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SPS Primer

Role of SPSand Grants Officers

Serve as contractual point of contact. Negotiate mutually acceptable agreement

in shortest possible time. Ensure interests of Cornell are observed. Maintain excellent relationship with

sponsor. Ensure Cornell can comply with terms and

conditions.

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SPS Primer

Cornell Center for Technology, Enterprise, & Commercialization

(CCTEC)

Intellectual Property Managementat Cornell

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SPS Primer

Office of IP Management & Licensing

Ithaca & Weill

Office of Economic Development

Cornell Research Foundation

The CCTEC Umbrella

•IP-owning shell corporation•License signatory•Patent enforcement

•IP management (e.g., contracts, patents, royalty distribution, Gov’t compliance)•Technology evaluation & marketing•Licensing•Venture creation•Assist corporate research contract negotiations•Provide IP expertise & advice•Educational outreach

•“town/gown” working group•Cornell ED clearinghouse•Technology outreach to local/regional companies•Assist in attracting companies to region•Support venture creation

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SPS PrimerObjectives

Intellectual Property Management & Licensing (IPM&L)

To provide professional advice and counsel to faculty and staff at Cornell University on intellectual property and related business matters in a timely and responsive manner.

To identify, protect, and transfer intellectual property developed at Cornell University for commercial development in the public interest.

To optimize the return of financial and related resources to Cornell, its inventors, its research enterprise.

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SPS PrimerCRF Organization

501(c)(2) organization Wholly owned by Cornell University Board of Directors appointed by Cornell -

faculty, administrators, alumni Ownership of intellectual property

developed at Cornell IPM&L is CRF’s agent

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SPS PrimerThe Bayh-Dole Act

Public Law 96-517Patent and Trademark Act of 1980

Intended to promote investment by the private sector in commercialization of federally funded research discoveries for the public good

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SPS Primer

Obligations of Bayh-Dole

Universities must file patents on inventions they elect to own

Encourage collaboration with industry to promote the utilization of inventions

Preference for small businesses Manufacturing in U.S.

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SPS Primer

Obligations of Bayh-Dole

Government retains non-exclusive license and march-in rights

Report patenting and utilization

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SPS PrimerCornell’s Patent Policy

Cornell owns inventions made in the course of Cornell work conducted by appointees

Not limited to grants or contracts from extramural agency

Inventions assigned to CRF, managed by IPM&L

Ownership tied to inventorship: - Sole and Joint

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SPS PrimerCopyright Policy

Traditional Works -books, manuscripts, artistic works

Encoded Works -software and other works that support the electronic capture, storage, retrieval, transformation and presentation of digital data.

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SPS PrimerCopyright Policy

Ownership vests with author except Subject to sponsored research agreements Work for hire Substantial use of university resources -grants

and awards from extramural sources Encoded works

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SPS PrimerUseful Web Sites

CCTEC.cornell.edu Patent and Trademark Office -uspto.gov Edison -iedison.gov COGR -cogr.edu AUTM -autm.net IBM patent data base -delphion.com

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SPS Primer

Risk Management and Insurance

Allen J. Bova

Director

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SPS PrimerInsurance

General Liability Property Employment practices (ELL) Patent Workers Compensation Professional liability Special

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SPS PrimerInsurance Issues

Licensed to do business in NY Rating requirements Additional insured versus additional named

insured versus endorsement Coverage for non-Cornell contractors No coverage for activities

Product liability Special coverage needed

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SPS PrimerInsurance Issues

Proof of coverage (certificates versus entire policy)

Waivers of subrogation Self insurance Project specific coverage (limits for this

project only) Primary issues Patent Insurance Issues (warranty)

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SPS PrimerIndemnification Issues

Sole negligence versus negligence Consequential damages (lost profits?) Inappropriate risk transfer

Risk Flow issues

Insurance matching

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SPS PrimerWarranty Issues

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SPS PrimerContracting Issues

Ken Packman

Sponsored Programs Systems

Michael Lenetsky

Population Medicine and Diagnostic Sciences

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SPS PrimerConfidentiality

The sharing of confidential or proprietary information may be necessary for the performance of the research project.

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SPS Primer

Publication and Publicity

As a university that receives public funds it is important to advise the community of the research projects that we conduct, including the name of the project, source and amount of funding.

The goal of most sponsored programs at Cornell is the publication of an article, thesis, dissertation or the presentation of a lecture.

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SPS PrimerTechnical Oversight

Retain basic freedom to conduct project. Red flag: “technical direction”. Sponsor must not have right to hire/fire

non-key personnel. Sponsor can have right to approve change

in PI. Keep reporting informal and infrequent. Define “acceptable”.

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SPS PrimerFinancial Issues

Ensure appropriate financial terms and conditions are incorporated

Minimize administrative burden: No routine submission of supporting documentation (receipts,

etc.) Use Cornell’s standard financial reporting format

Avoid reference to profits Audits Time and Materials Cash flow Re-Procurement

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SPS PrimerDiscussion

Sample Contract Language

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SPS Primer

Example Publication Clause

In the event that CORNELL wishes to publish any Study Results, CORNELL shall provide COMPANY with copies of any proposed presentation or publication at least 3 months in advance of the proposed presentation or publication.

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SPS Primer

Example Publication Clause

COMPANY shall have one month, after receipt of said copies, to object to such proposed presentation or publication.

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SPS Primer

Example Publication Clause

In the event that COMPANY makes such an objection, CORNELL shall edit the document into an acceptable version of the proposed presentation or publication.

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SPS Primer

Example Publication Clause

COMPANY may request CORNELL to delay publishing such proposed publication for a maximum of an additional one hundred twenty (120) days in order to protect the potential patentability of any invention described therein, or for an additional period as mutually agreed upon by the parties.

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SPS Primer

Acceptable Publication Clause

In the event that CORNELL wishes to publish any Study Results, CORNELL shall provide COMPANY with copies of any proposed presentation or publication at least thirty (30) days in advance of the proposed presentation or publication. COMPANY may request CORNELL to delay publishing such proposed publication for a maximum of an additional thirty (30) days in order to protect the potential patentability of any invention described therein, or for an additional period as mutually agreed upon by the parties. Nothing contained in this clause will have an effect on the filing, defense and publication of thesis or dissertation works.