When competing interests come together to research manufacturing solutions, who gets to claim intellectual property?

January 2015 - Great discoveries and improvements invariably involve the cooperation of many minds, inventor Alexander Graham Bell once said. “I may be given credit for having blazed the trail, but when I look at the subsequent developments I feel the credit is due to others rather than to myself.”

Deciding where credit is due is one challenge for the Digital Manufacturing and Design Innovation Institute, featured in our January cover story, to figure out.

Set to open this year on Chicago’s Goose Island, the DMDII will gather an amalgam of companies, manufacturers and academics to collaborate on manufacturing’s next generation of digital tools.

Before the resources of each group can be leveraged, industry partners—which include companies that would traditionally compete with each other in their fields like The Boeing Co. and Lockheed Martin Corp., Rolls Royce and General Electric, and Deere & Co. and Caterpillar Inc.—must determine which will claim intellectual property for the solutions the institute ultimately develops.

The institute has agreements from more than 40 companies, 30 academic, government and community groups, and about 500 other supporting companies to work together. Every member is tiered depending on their level of commitment in both years and dollars.

Because the United States leads the world in high-powered computing and information technology, “we should be able to make manufacturing much more competitive and beat those nations which are beating us today on the backs of low wages,” says Jacob Goodwin, DMDII’s director of membership engagement and communications.

Many of the projects expected to result from the institute’s research will create new digital manufacturing intellectual property. It’s no small feat to determine who gets what rights to IP when there are multi-party teams involved, all of whom have a stake in what they produce. Imagine if Major League Baseball had to decide which team gets the statistic if one of its representing players hits a home run during the All-Star Game. IP questions are the kind companies spend the most time answering, says Goodwin. “It’s very complicated.”

Under U.S. patent law, whoever invents a product or idea is the IP owner so long as they file a timely application. For research results coming out of the DMDII, financial commitment plays a role. When the federal government got behind Chicago’s proposal to create the institute, it backed it up with $70 million in funding over five years. Half the operating costs of a research project will be covered by federal government monies, while the research teams must pledge the other half.

Say, for instance, that Boeing, Microsoft and Purdue University team up to develop open-source software that will make all the equipment in a manufacturing plant talk to each other seamlessly. If the project costs $1 million, the DMDII covers half. It’s the responsibility of the research team to figure out how $500,000 will be divided, if at all. It’s possible, in this particular example, that Boeing will offer to put in 100 percent of the cost share, but wants the IP even if Microsoft and Purdue do all the legwork. 

“The question is who will own that IP to be able to exploit it commercially,” Goodwin explains. “In some cases, companies are looking at this research as, first, research that can help them do a better job in their factory, and second, intellectual property that they can own so they can use it.”

Within a 40-plus page membership agreement, the eight-page IP guideline is the longest section. Essentially, it protects the eventual owners of any IP with cooperative allowances for collaborators to use the final product or program for internal research purposes. These agreements will vary by project and level, or tier, of member commitment.

“We still have to deal with legal departments of some partners who are being cautious and reviewing our membership agreement but, one by one, we’re answering their questions and clarifying issues,” Goodwin says. “We expect all of our pledged companies and universities will become our partners. It just takes patience on all sides.”

IP hurdles notwithstanding, the situation is a win for both the public and research participants: The government and DMDII get to leverage their dollars by mandating that the researchers kick in the other half. And the companies get half of their research and development work paid for. FFJ