UC Policy on Inventions, Patents, and Innovation Transfer: Frequently Asked Questions

The FAQs below provide clarifying information on the University of California's Policy on Inventions, Patents, and Innovation (PDF) (effective July 1, 2024).

  1. How will proceeds from equity be distributed?

Equity received from licenses will be distributed in accordance with the formula in Section IIIC* of the Policy and Article 8 of the Policy on Accepting Equity When Licensing University Technology (PDF). If a UC Location has an equity management plan under Delegation of Authority 2650 (PDF), equity received by that UC Location will be distributed in accordance with such plan.

  1. How do previous versions of the policy affect income distribution?

Inventors hired before April 16, 1990, make a one-time, irrevocable decision that affects distributions from all inventions disclosed after 10/1/97 for that inventor. More information on income distribution is available here.

  1. Does Policy require the "15% of licensing income allocated for research-related purposes" be shared with the inventors' individual laboratory?

In previous versions of this Policy, "Laboratory" refers to University managed Department of Energy Laboratories, not an inventor’s individual laboratory. Each UC Location may decide how to spend the 15% research allocation, including funding to individual laboratories.   

  1. When will inventors be paid?

Inventors are generally paid in November from income received during the previous fiscal year ending June 30th.

  1. How is income shared with inventors when a license agreement includes multiple inventions?

Net Commercialization Income is divided equally among each licensed property (e.g. Invention) in an agreement, unless the licensing office determines a different distribution is appropriate. After each invention is assigned a distribution, it is further divided amongst inventors according to this Policy.* 

  1. How is licensing income shared when a license agreement includes patent rights and other property rights (copyright, research materials)?

Each licensed property (e.g. Invention or other type of University IP) is assigned a distribution in accordance with FAQ5. Then, each allocation is further divided: Inventors of licensed patent rights will receive 35% according to this Policy*; the creators/authors of other types of University IP will receive the percentage determined by local policies and practices.

  1. What "payments to third parties and related costs" are deducted when calculating Net Commercialization Income?

The University may owe payments to third parties who sponsored research funds for the invention, to co-owners of an invention, or others. One University of California location may also owe payments to another University of California location involved in the development of the invention. These payments are contractually required and may incur transaction costs such as banking fees.

  1. What will be the impact of transferring decision-making authority for exemptions and exceptions from UCOP to campuses?

In the past, campus administrators and leadership routed intellectual property related policy exception requests to UCOP after conducting due diligence and justifying their support for the policy exception. Transferring decision making authority locally will reduce administrative time and resources to approve policy exceptions.

  1. Under what circumstances have UCOP approved exemptions and exceptions?

In the past, UCOP has approved exemptions and exceptions for:

  • Use of approved recharge facilities under an approved external user fee/agreement
  • Clinical appointees not compensated by the University
  • Short-term lecturers
  • Employees on sabbaticals or with dual appointments
  • Visiting researchers
  • Sponsor initiated clinical trial agreements meeting pre-defined criteria
  1. Does the obligation to report and fully disclose all inventions to the University include inventions that inventors believe are clearly or probably not University IP?

Yes, the obligation to report and fully disclose all inventions to the University includes inventions that inventors believe are clearly or probably not University IP. The disclosure allows the University to assess whether the invention is University IP and avoid future disputes over ownership. If disclosing a specific invention is problematic due to extenuating circumstances, please contact your local authorized licensing office to discuss.

  1. Does the University own intellectual property resulting from permissible consulting activities?

Guidance on intellectual property resulting from consulting activities (PDF) continues to apply.  Intellectual property resulting from permissible consulting activities is not owned by the University if it is wholly created outside the course and scope of University employment, without using University Research Facilities, and without using gifts, grants, or contracts received by or through the University.

  1. Does the University own intellectual property created while on sabbatical and when the University hosts visiting researchers on their sabbaticals?

Yes. In some circumstances an alternative arrangement is possible by seeking a policy exception. Campus Chancellors, the Vice President, Agriculture and Natural Resources, Laboratory Director and their delegates may authorize exceptions in accordance with other University policies, applicable laws, and third-party obligations.

  1. Are subawardees receiving University gift, grant, or contract funding subject to the Policy?

Subawardees are subject to the terms of the subaward and are only subject to the Policy/portions of the Policy if explicitly stated in the subaward terms.

  1. What happens to an Invention if the University decides not to patent and not to pursue commercialization?

In almost all cases, the University has contractually agreed to provide research sponsors with rights to pursue commercialization and would first fulfill its contractual obligations to research sponsor(s).  Thereafter, if there is an opportunity for the Inventor(s) to request rights to the Invention, each campus has practices or policies to address the request.  For example, UCLA’s policy is available here.  Please contact your local authorized licensing office for details.

  1. How will I know that the University does not own intellectual property I’ve created?

If the answer to all three of these questions is “no”, then the University does not own intellectual property you have created:

  • Question 1: Did I use University funds to create the intellectual property?
  • Question 2: Did I use University facilities or resources to create the intellectual property?
  • Question 3: Did I create the intellectual property within the course and scope of my employment?

If you are unsure or need legal verification, please contact your local authorized licensing office for a determination of ownership.  Please see FAQ 10 for reporting obligations.

Example: I am a creative biologist who invented a new lawnmower blade last Saturday while mowing my lawn.

  • Question 1: I have several grants from the National Institutes of Health, but none of them fund my weekend lawnmowing endeavors. The answer is no.
  • Question 2: I invented the blade in my backyard while mowing my lawn, so the answer is no.
  • Question 3: My department chair and I both agree that lawnmowing is outside my scope of employment, so the answer is no.

In this example, the University does not own the lawnmower blade. Examples of University owned intellectual property are available in UC Technology Commercialization Reports. In the examples listed, the intellectual property was created while performing University research.

  1. Why expand the Patent Policy to include other types of intellectual property?

Both commercial licensees and research sponsors have become interested in multiple types of intellectual property and are requesting that the University sign legally binding agreements relating to a broad range of intellectual property. To accept the intellectual property obligations in these agreements, the University must own the intellectual property. Expanding the Policy to include other types of intellectual property facilitates University compliance and administration of sponsored research and license agreements.

  1. Why is income distribution determined by each UC Location for licenses and options that do not involve patent rights?

The University has been licensing/optioning intellectual property that is not patented for several decades. In the absence of a systemwide standard, each UC Location implemented its own practices. A systemwide consensus on income distribution was not possible because local practices diverged decades ago and changing those practices would be disruptive.

 

* Inventors hired before April 16, 1990 will receive a percentage based on their policy election (see FAQ2).