Big Tech Research Awards

While request for proposals (RFPs) with proposal or award terms and conditions (T&Cs) vary, below are some terms that University of California finds problematic. Many of these can be deal breakers.

Intellectual Property (IP) Rights

IP rights in the proposal itself

Problem: The company wants rights in your proposal whether or not you received the award. The company has not paid for the right to use your content.

Feedback on company products and services.

Problem: The company wants rights in any feedback you provided in your proposal, whether or not you receive the award, and any that you may provide later under an award. At the proposal stage, the company has not paid for the right to use your content. Even if the company provides an award, new inventions can often be passed along in feedback. The university provides rights in feedback only subject to the university’s intellectual property rights. We don’t give away inventions for free.

Use of the university's name and trademark is presently granted.

Problem: The university’s brand is highly valued. We don’t give it away for free. We don’t let anyone use it in any way they wish. Uses require review and approval. Uses also require consideration, usually payment.

Use of Researcher Identity (i.e., name, image, and likeness of the researcher).

Problem: The company seeks the use of your identity to promote its own program, even if it never grants the award. The company wants to use your identity in any way it wants without contractual constraints or safeguards.

Indirect Cost and Research Administration Fee.

Problem: Direct costs alone are not the full cost of research. Indirect cost recovery supports critical functions at the university that support the research enterprise. Research doesn’t exist in a vacuum. Pursuant to findings and guidance from the California Auditor General, the University must not subsidize private or profit-motivated entities by waiving or reducing IDC charges or by giving these entities free use of UC researchers’ time. Instead, the University must ensure that all costs of research for private and/or profit-motivated entities will be borne by the sponsor. The University must also ensure that private or profit-motivated research projects are not improperly classified as gifts. Similarly, gifts accepted for research are assessed a 13% Research Administrative Fee (RAF) which also operates to provide support for indirect costs. The University does not, generally, waive the RAF. However, since the RAF can be lower than IDC, per UC policy it is improper to attempt to misclassify funding as gift-related.

Indemnification

Indemnification Beyond the Scope of UC Policy.

Problem: As a state of California institution, the University of California requires specific indemnification terms found in Regents Standing Order 100.4.dd(9). If a company T&C requires another set of indemnification terms that would violate the Regents Standing Order, the university will not be able to submit the proposal or receive the award.

Unfavorable Risk Terms

Liability cap.

Problem: Many T&Cs unfairly push all or most liabilities to the university. If a company creates liabilities but takes no responsibility for them, the university ends up covering the liabilities. This effectively means the cost of receiving the grant carries a higher risk burden for the university.

Requires the university to assume greater risks than we usually accept.

Problem: Many T&Cs can shift the burden of risks from the company to the university. This is not in the spirit of partnership or collaboration. Responsibility for risks is usually allocated between the parties evenly or according to who will likely create more risk.

Unacceptable Warranties.

Problem: A warranty is a promise. To make a promise, we have to know the facts and to guarantee what is warranted. While some warranties are acceptable, many T&Cs ask the university to promise things we don’t know about or promise things we can’t promise. Some T&Cs ask us to make promises that violate university policy.

Warranty of IP Noninfringement (includes proposal materials).

Problem: This is a promise that no intellectual property (IP) in your proposal or in your later work under an award will infringe any other party’s IP rights. The university does not conduct IP due diligence, whether for inventions, deliverables, or proposals. This is the company’s responsibility. Universities are in the business of publishing, including publishing IP. To conduct IP due diligence on every university publication would require extraordinary cost. Here, the company seeks a warranty of IP noninfringement even for a proposal–whether or not the company even uses the proposal. Universities simply don’t do this. Not for awards. Certainly not for proposals.

These rights are often already granted for each proposal upon proposal submission under the award T&C. These T&C then apply to all proposals submitted, regardless of whether an award is made.