BILL ANALYSIS Ó
AB 744
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Date of Hearing: April 12, 2011
ASSEMBLY COMMITTEE ON BUSINESS, PROFESSIONS AND CONSUMER
PROTECTION
Mary Hayashi, Chair
AB 744 (John A. Pérez) - As Introduced: February 17, 2011
SUBJECT : Office of Intellectual Property.
SUMMARY : Creates the Office of Intellectual Property (OIP) for
purposes of identifying and providing policy guidance for state
agency management of intellectual property (IP) developed by
state employees or with state funds. Specifically, this bill :
1)Establishes the OIP in the Business, Transportation and
Housing (BTH) Agency.
2)Requires OIP to IP generated by state employees and
state-funded research.
3)Requires OIP to develop the following:
a) A database to track IP using specified categories;
b) A sample maintenance plan of an IP inventory;
c) Factors that state agencies should consider when
deciding whether to sell IP or license it to others;
d) An outreach campaign informing state agencies of their
rights and abilities concerning IP created by their
employees;
e) Sample invention assignment agreements that state
agencies can consider to secure rights to patentable items
created by their employees; and,
f) Sample language for licenses or terms-of-use agreements
that state agencies can use.
4)Authorizes state agencies and departments, upon request, to
share records and information related to IP generated by state
employees and state-funded research.
5)Prohibits current and former OIP employees from divulging IP
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information not expressly allowed or public.
6)Exempts University of California (UC) IP, except when
contracted and funded by a state agency.
7)Exempts IP governed by the California Stem Cell Research and
Cures Bond Act.
8)Creates the following definitions:
a) "Agency" to mean BTH;
b) "Intellectual property" to mean tangible assets subject
to statutory protection under applicable patent, copyright,
and trademark law. IP includes, but is not limited to,
inventions, industrial designs, identifying marks and
symbols, electronic publications, trade secrets, and
literary, musical, artistic, photographic, and film works;
and,
c) "Office" to mean OIP.
9)Makes legislative findings and declarations.
EXISTING LAW permits various state agencies to enter into
contracts and agreements, create liabilities, and develop, own,
and control the use of IP developed by the state.
FISCAL EFFECT : Unknown
COMMENTS :
Purpose of this bill . According to the author's office, "To
date there is no clear accounting of what IP the state owns or
the types of agreements state agencies have entered into. Three
reports on the issue have expressed the need to establish a
centralized IP tracking system. This disjointed system
ultimately costs the state more money. As technology continues
to advance, state agencies without sufficient knowledge of how
to protect IP will become increasingly vulnerable to
unauthorized use and inability to capitalize on reduced
contracts costs or increasing revenue to the state. AB 744 sets
up the framework to determine what IP the state owns and informs
state agencies of their rights and abilities to protect the
state's IP."
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Background . IP typically consists of copyrights, trademarks,
patents, and trade secrets. In November 2000, the Bureau of
State Audits (BSA) published the report, "State-Owned IP," which
found that many state agencies have insufficient knowledge about
IP they own and incomplete written policies on managing IP.
This could result in state agencies failing to act against
individuals and entities that inappropriately use the state's IP
by profiting from products developed at state expense,
unauthorized use of trademarks, and state patents. BSA
recommendations include developing an outreach campaign
informing state agencies of their rights and abilities
concerning IP and establishing guidelines for state agencies to
administer their IP. The BSA report identified more than
113,000 items of state-owned IP across 125 state agencies, but
estimated that there were more.
State owned IP and IP developed with state funds have been the
subject of numerous bills, legislative hearings, ballot
initiatives, studies, audits, and reports that discuss IP policy
from a broad, nonspecific perspective down to very specific IP,
such as IP that may be produced by the stem cell research
projects the state will pay for under the recently enacted
Proposition 71. Further, this bill can be characterized as
advancing the public policy goal of the state simply knowing
what IP it has developed and begin to make a coordinated effort
to manage it effectively for the public benefit. Under this
bill, OIP would be required to identify state IP, and establish
and periodically update guidelines for state agencies to
appropriately administer their IP. These guidelines would
include policies about when products should be considered IP,
when products should be placed in the public domain, and when
agencies should sell or license their IP. OIP would also be
required to develop an outreach campaign to help state agencies
understand their rights with respect to their IP and to develop
sample agreements to effectuate the state's rights to IP
developed by state employees.
Previous Legislation . AB 819 (Calderon), Chapter 351, Statutes
of 2010, doubled the fines in existing law for violations
related to piracy or counterfeiting of specified marks
registered with the Secretary of State or registered on the
Principal Register of the United States Patent and Trademark
Office.
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AB 479 (DeVore) of 2007, would have required the Little Hoover
Commission to study whether third-party review is necessary to
ensure proper assignment of IP rights in connection with
state-funded research conducted by universities, private
companies and other entities. This bill was held in the
Assembly Judiciary Committee.
AB 1456 (Mullin) of 2007, would have created the OIP for
purposes of identifying and providing policy guidance for state
agency management of IP developed by state employees or with
state funds. This bill was amended to address an unrelated
issue.
AB 2721 (Mullin) of 2006, would have created the OIP to track
state-funded inventions and establish policies for state-funded
IP. This bill was held in the Senate Governmental Organization
Committee.
ACR 252 (Mullin), Chapter 190, Resolutions of 2004, asked the
California Council on Science and Technology (CCST) to create a
special study group to develop recommendations on how the state
should treat IP made under state contracts, grants and
agreements. The scope of the study was expanded in 2005, under
ACR 24 (Mullin), Chapter 111, Resolutions of 2005, to include
contracts, grants and agreements developed under the stem cell
initiative (Proposition 71) to ask CCST to report on how the
commercialization of technology developed with the investment of
taxpayer dollars could generate some public benefit, and to
request that CCST establish a review group to review and comment
on the study.
AB 1616 (Montanez) of 2003, would have created the California
Intellectual Property Rights Act to encourage innovation in the
sciences, creativity in the arts, and free and open government
by providing that no state agency shall have the right to
protect, assert, or exploit state-owned trade secrets,
patentable inventions or patented inventions. This bill also
would have provided that all copyrights in works made for hire
by state employees or contractors were to be dedicated to the
public domain. This bill was held in the Senate Judiciary
Committee.
SB 875 (Escutia) of 1999, which originally would have
established OIP in the Trade and Commerce Agency to inventory,
market and protect the state's IP, was amended to instead
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require the Director of General Services to create a special
advisory committee to develop recommendations concerning how the
state should organize and manage the cataloging, marketing,
licensing, and legal protection of all IP owned or controlled by
the state. This bill was held in the Assembly Appropriations
Committee.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Joanna Gin / B.,P. & C.P. / (916)
319-3301