Distribution of Income Derived from Intellectual Property Procedure
Effective Date: March 5, 2019
The distribution of royalty and equity revenue from licenses and related Intellectual Property (IP) transactions is intended to incentivize faculty, staff, departmental, and college-level participation in the commercialization of WMU IP, and to ensure the continued success of intellectual property operations within WMU via OVPR Technology and Innovation Advancement (TIA).
1. “Net Revenue” from royalties, license agreements, equity interests, sale of intellectual property and similar revenue generating intellectual property agreements shall be distributed as follows:
1.1. 50% to Inventor, if there is more than one inventor it will be distributed in a proportionate manner based on the relative contributions of each inventor (this portion is the amount provided for in the AAUP contract).
1.2. 25% to Office of Research and Innovation
1.3. 10% to the central administration of WMU
1.4. 7.5% to the Inventor’s Department, or divided between the Departments of all co‑inventors in proportion to the number of inventors from each Department. If there is more than one inventor from different Departments it will be distributed in a proportionate manner. For example, if there were two co-inventors from the Chemistry Department and one co-inventor from the Biological Sciences Department, net revenue would be distributed such that the Chemistry Department received 2/3’s of the 7.5% Departmental portion and Biological Sciences Department received 1/3 of the 7.5% Departmental portion.
1.5. 7.5% to the Inventor’s College, or divided equally between the Colleges of all co- inventors in proportion to the number of inventors from each College. If there is more than one inventor from different Colleges, it will be distributed in a proportionate manner as indicated above for the Departments. For inventors from Departments, Centers, or Institutes that are not part of an academic college, the 7.5% College portion of net revenues as outlined above will go to that Inventor’s Department, Center, or Institute as appropriate. If there is more than one Inventor, the 7.5% College portion will be divided between the Department(s), Center(s), Institute(s) and/or College(s) of the co-inventors in proportion to the number of inventors from each as described above for the Departmental portion of net revenue.
1.6. In those instances when several patents are out-licensed as a package, or income is gained from a combination of more than one patent, the inventor’s portion of the net revenue will be divided among all inventors in proportion to their relative contributions. For example, if inventor A and inventor B are co-inventors on two patents and inventor B is also the sole inventor on a third patent, and all three patents are out-licensed as a package, then inventor A receives 1/3 of the 50% inventors’ portion of net revenue and inventor B receives 2/3 of the 50% inventors’ portion of net revenue. This scenario assumes that inventors A and B have contributed equally to the patents and that each patent contributes equally to the income received. The assumption that each patent contributes equally to the income received is the standard assumption. Relative contributions of inventors are to be recorded at the time of initial disclosure on the Intellectual Property disclosure form.
1.7. In some cases, distribution of royalties to individuals will be impractical or inappropriate; for example, where the material was developed as a laboratory project or where the authors/inventors are not easily identifiable. The Vice President for Research and/or the Director, TIA, in consultation with the principal investigator (or laboratory director/department chair if not under a sponsored agreement) will review the circumstances of development when such situations have been identified. Generally, in such cases, royalties will be split equally between the department, Center, Institute, or laboratory, and the College or Unit. In any situation when royalty distribution to individuals is not recommended, distribution of Net Revenue is subject to the approval of the Vice President for Research. Inventors entitled to receive royalties shall receive such royalty distribution even if they have left WMU, and royalties will be distributed to their estate, or an estate, individual, or organization of their choosing, in the event of death.
1.8. In exceptional cases, in order to benefit WMU, the Vice President of Research and Innovation may make modifications to the royalty distribution plan and shall record a description of the exceptional circumstances and justification.