Conflicts of Interest, Licensing, and UNL Policies
Generally, University employees must report their conflicts of interest (COIs) and conflicts of commitment (COCs) with their direct supervisor(s) and obtain pre-approval via the university’s COI/COC disclosure forms as part of that process.
Continue reading to learn more about COI and COC matters as they can relate to or be affected by UNL IP Policies, Licensing, and Resources.
Disclaimer: this page is not all-inclusive. Please visit the links below under “Questions” for more information. It is important that you go straight to the source and consult Research Compliance Services regarding all COI and COC issues.
What Is a Conflict of Interest and a Conflict of Commitment?
A COI refers to a situation in which a primary interest has the potential to be inappropriately influenced by a secondary interest and can involve non-financial and financial interests.
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A COC occurs when the time devoted to external activities adversely affects, or has the appearance of adversely affecting, an employee’s capacity to meet University responsibilities.
​​The NU Board of Regents policies and by-laws place limitations on the amount of time one can devote to an outside activity; any outside activities are required to have pre-approval prior to engaging in them.
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Outside activities (COCs) are limited to 2 days/month and/or no greater than a 2-year commitment. Requests to exceed these limits must be approved by the regents prior to the activity occurring.
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If you are unsure whether an activity is part of your institutional responsibilities, speak to your supervisor prior to completing the disclosure.
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A Conflict of interest is a situation, not a behavior, and therefore, having a COI is not an accusation of misconduct.
COI: What You Should Know
Intention
The university's COI staff in the office of Research Compliance Services (RCS) are part of your UNL support team during your startup journey; they are here to help you.
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The UNL’s COI policy is informed by University of Nebraska policies and by-laws and federal regulations and seeks to always implement and follow industry best practices, including those of our Big Ten peer institutions. All cases are treated equally with the goal of protecting both employees and the university from perceived and actual conflicts.
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Timeline
RCS recommends getting in contact with the COI staff early and often. However, you may want to have a basic business model and business plan drafted to maximize the advice and/or guidance COI staff can provide. Drafting your business plan and conducting the idea validation process before contacting the COI staff for an official COI meeting may expedite conversations.
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Connecting with the COI staff if you have a business plan but aren't ready to officially create your startup may give you extra time to sort logistics and make informed decisions. Once you begin acting on behalf of your company, you have 30 days to report it to the university.
Per the UNL COI policy, “the creation of a new startup company” constitutes a change that must be reported within 30 days. Startup companies must be disclosed because they meet the following criteria for a review:
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Financial interest: any ownership/equity interest must be reported regardless of amount.
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Outside activities: any activities that are completed outside of your UNL responsibilities but have the possibility of overlapping or conflicting with them must be reported.
PurposeÂ
The UNL Conflict of Interest (COI) program was developed to protect researchers and the university. Annual COI reporting is completed by submitting a COI/COC Annual Disclosure Form via NuRamp. By encouraging transparent disclosure, the university can manage any perceived or actual conflicts before they become a concern.
Questions?
The UNL COI Program provides a wealth of information on its web pages, including a guidance document on startups.
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UNL COI A-Z Guidance (see “Start-ups & Other Small Ventures”)
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If you have questions about COIs/COCs or the role of the COI office in your startup process before you are prepared to launch your startup, we still encourage you to ask questions and connect with the COI staff, as they are a great resource and part of your support team at UNL. Please contact (402)472-6965 or unlcoi@unl.edu.
The University of Nebraska Board of Regents Bylaw and Policies on Intellectual Property is written to encourage innovative research at the University of Nebraska that has a commercial impact. As employees of the university, faculty, staff, and students are obliged to disclose and assign inventions or discoveries to the university as part of their employment contract. In exchange for this assignment of IP rights, the university spends time and resources in the commercialization of the IP, including providing funds for IP protection, and shares any revenue derived from the IP with the inventors and creators directly.
Bylaws and Policies governing intellectual property include:
Board of Regents (BOR) Bylaw 3.10
Establishes university ownership of inventions. When the Board of Regents established policy 3.10, the intent was to encourage the commercialization of inventions and discoveries arising from research activities of the university, and when appropriate, the pursuit of patents or other IP protection.
Board of Regents Policy 4.4.1
Establishes the copyright policies for the various copyright works and development scenarios that can occur on campus.
Board of Regents Policy 4.4.2
The patent and technology transfer policy governs invention disclosure, IP protection, and licensing. This policy outlines the steps that the university can take to protect its IP and how you, the innovator, can also benefit.
Licensing the Technology
A license to UNL intellectual property is a contract between NUtech Ventures and a company. The contract grants certain technology rights to a company in return for payment and a commitment to develop the technology. Most startups seek an exclusive license because it is typically required to raise funding.
If you would like to license university technologies for use in your startup, you will be asked to demonstrate commitment by providing a written technology and business development plan or business model canvas. This plan should include but is not limited to; a description of the technologies to be licensed, the resulting product or service, market analysis, a product development timeline, and the company resources committed to development. Further, if the founders have participated in a customer discovery cohort, the results of the team’s findings are valuable information to convey to future investors and partners.
Standstill option agreements are often used to reserve rights in an invention while university founders evaluate the technology, explore the market and funding opportunities, or raise the capital needed to fully license the rights in question. Startup companies usually prefer this route and NUtech Ventures may grant a standstill option agreement for three to six months in duration, but no more than one year. After that point, the license negotiation usually begins.
What is a License?
What are the requirements for a startup license?
Unsure if you're ready for a full license for your startup?
License Negotiations
The licensing process starts by developing a term sheet summarizing the essential business terms of the agreement. Below are the types of business terms generally addressed.
Scope of License Rights
License Rights – such as exclusive, nonexclusive, field-of-use limitations, and territory limitations – are established to be commensurate with the licensee’s product development plans and the market. The university’s licensing objective is to obtain widespread use of its technologies through a robust commercialization plan.
Upfront License Fee/Equity Consideration
An initial fee based on the scope of license rights and the university's investment in the intellectual property may be negotiated. Alternatively, in lieu of an initial licensing fee, the parties may agree upon an equity stake to the university.
Royalties Â
Your company will be expected to pay royalties when products or services that require use of the technology are sold or transferred. Royalties can be expressed as a percentage of net sales or a fee per selling unit. Royalty rates vary according to the industry and the contribution of the invention to the product or service. Royalty payments may be structured in different ways such as one-time or recurring fees.
Sublicensing Â
Exclusive licenses usually allow the right to sublicense, or authorize others to make, use, and sell the university’s technology to facilitate widespread use. Royalties and other revenues you receive from sublicenses are also shared with the University.
Minimum Royalties Â
Minimum royalty payments are established to encourage diligence in developing and selling products or services based on the technology.
Patent Reimbursement Â
Recovery of the costs incurred by the university of protecting the technology in the U.S. and other countries is part of the license. Typically, NUtech Ventures will delay the reimbursement obligations for the U.S. patents(s); however, reimbursement of any international filings directed by the company will be due when incurred.
Performance MilestonesÂ
University technologies often require significant additional development before they are ready for the market. You will be asked to provide periodic reports and meet specific milestones in order to retain an exclusive license. Milestones are usually industry specific.
License Compliance
After you license UNL technology, NUtech Ventures will manage the license to ensure all terms and conditions are adhered to, so the technology can reach its full potential. If the terms and conditions are not met, the license may be terminated or revised, in which case the invention may become available for licensing in another company.
Patent Ownership & Future Intellectual Property Ownership
NUtech Ventures does not typically assign or transfer IP ownership. When appropriate, NUtech may grant an exclusive license upon deciding that the startup is the best candidate to commercialize the invention.
Typically, NUtech Ventures will have filed the initial patent application that is exclusively licensed; the exclusive licensee provides input for the prosecution of this original patent. Follow-on inventions conceived by the licensee, without the university’s involvement, usually are owned by the licensee. Follow-on inventions based on work at UNL will be owned by NUtech Ventures, and the licensing of the new invention will be handled by NUtech as if it were a new disclosure. In other words, the existing licensee will not be automatically granted a license to the follow-on invention.
Joint Inventions
If there are inventors from other institutions that contributed to the patented invention (i.e., in collaboration with faculty from another university), NUtech will enter into an Inter-Institutional Agreement whereby one of the institutions will take the lead. This way, a company can negotiate a single agreement with an exclusive license to IP rights owned by both parties.
Research License to UNL
UNL and NUtech Ventures reserve the right to practice their own inventions for research purposes under licenses they grant. However, researchers are not permitted to continue to develop technology at UNL for the benefit of a startup in which the research has a financial interest. Please refer to the conflict of interest guidelines.
Student IP & Startups
Undergraduate students may use NUtech as a resource, but the expectations are different than for faculty and graduate students. In general, undergraduate students own their own intellectual property. If an undergraduate student is employed by the university in a research position and an invention is developed based upon that work, then their IP will likely be university-owned. If in doubt, please contact NUtech Ventures.