Friday, December 7, 2012

A Green Tech Intellectual Property Conundrum

Last Friday, November 30th, the Department of Energy (DOE) made another announcement on taxpayer funding of development of advanced batteries for the electric vehicle market.  According to the announcement, 

 "...a multi-partner team led by Argonne National Laboratory has been selected for an award of up to $120 million over five years to establish a new Batteries and Energy Storage Hub. The Hub, to be known as the Joint Center for Energy Storage Research (JCESR), will combine the R&D firepower of five DOE national laboratories, five universities, and four private firms in an effort aimed at achieving revolutionary advances in battery performance."

In addition to the $120M that the Feds are throwing in, the State of Illinois is  adding $5 million through his Illinois Jobs Now! capital construction plan to help build the state-of-the-art JCESR facility, which will be located on the Argonne National Laboratory campus in suburban Chicago.  Another $30M is being sought for construction from the Illinois legislature (which means they don't have it yet.)  A nice little start-up fund.

The announcement has a bit of  wheel reinvention feel to it given some of the considerable work being done by other university and corporate battery research programs.  Recent technical setbacks in the manufacturing and implementation methods might be a good place to look for new inventions.

The players in this endeavor include:

National Labs
University partners include: 
  • Northwestern University 
  • University of Chicago 
  • University of Illinois-Chicago
  • University of Illinois-Urbana Champaign 
  • University of Michigan 
Four industrial partners: 
  • Dow Chemical Company
  • Applied Materials, Inc.
  • Johnson Controls, Inc. (Looking at the A123 assets)
  • Clean Energy Trust (a technology transfer organization that seeks to commercialize "green tech" developed in the Midwest.)
The program announced that is has "affiliates" including GM which given the amount of federal funding going to GM's electric vehicle efforts for the Volt and the issues of cost and performance on the Volt battery, a GM affiliation isn't surprising.  There is probably a bigger Volt agenda here but we'll have to wait and see.

Let's skip the "picking winners and losers" rhetoric or discussions on why there is government lab participation versus funding commercial entities already in the space and raise a more IP centric issue.  

Who will own the intellectual property generated as a result of the Joint Center for Energy Storage Research (JCESR) endeavor? 

All of the entities involved in this endeavor produce new science, or at least we hope they do given the amount of money being thrown around.  How will the IP be shared, licensed, rolled out, commercialized? 

How will the considerable IP owned by the various battery companies that have filed for bankruptcy but who were the beneficiaries of considerable taxpayer research funding be leveraged to accelerate the advanced battery development goals of the new Joint Center for Energy Storage Research (JCESR)?  Will JCESR be granted licenses to this technology? Even if some of the firms who received the funding are sold to companies owned by US or foreign entities?

Will the government exercise its march in rights to insure that taxpayers benefit from their previous investments in research and development and facilities and building labs by insuring that JCESR has the right to use the technologies already patented and where there is a government interest but the companies have filed for bankruptcy and won't be able to repay the considerable public investment in their advanced storage adventures?  (Probably not.)

Will all of their research be published in open journals so that the taxpayer (and other researchers who are also taxpayers) have access to the results of this research rather than having it show up in expensive commercial peer-reviewed journals?

Why We Ask

When Way Better Patents undertook the work of analyzing the Green Technology Pilot Program one of the first things we noticed is that the large number of federal grants focused on Green Technology and other advanced science grant programs were largely absent from the patents granted under the program.  We noticed this trend among green technology/clean technology patents in our patentECO Index in general.  Lots of grants and federal funding not a lot of government interest statements and no security interest liens on the patents and patent applications when the government made loans or loan guarantees to green tech companies.

Take A123 Systems.  With the exception of patents that had assignee data indicating joint ownership by A123 Systems and Massachusetts Institute of Technology (MIT), most of their patents didn't contain government interest statements in the patent section itself.  A deeper dive into the data showed that DOE and the US Air Force have made notification of their licenses in the USPTO Assignee Database for some of the patents even when their interest doesn't appear in the body of the patent.  Last week the Department of Justice went to bankruptcy court to assert its interest in the A123 intellectual property.  This seems to be largely the result of the potential sale of the firm to Wanxiang.

In one A123 Systems case, US Patent 8,236,441 - "Battery cell design and methods of its construction" , the application as filed in July of 2008 based on a provisional filed in 2007 and granted on August 7, 2012 - five years later with no government interest statements in any of the documents.  On August 16, 2012, Wanxiang America Corporation's  Security Assignment lien appeared in the USPTO Assignee Database.  The Department of Energy's notice of License Conveyance was executed on August 17, 2012.

By the way, the Department of Energy's intellectual property people are located at next to the Argonne National Lab so getting information on what patents the government has an interest in should be a short walk away. 

There is a similar pattern when you review the patents held by firms in solar and wind that have had financial problems or are in bankruptcy.  Enthusiastic announcements of government interest and public-private partnerships when the funds were being awarded.  No notice of taxpayer funding via government interest statements, or license conveyance on the patents and even less when the bankruptcy takes place (or if it's taking place it is like much of the activity in the patentsphere, it's taking place outside of the view of the public.)

As the government continues to fund these projects, it's time for a new more aggressive and focused approach on identifying, managing and protecting taxpayer funded IP development in this the knowledge economy.