1. AVOIDING CONFLICT IN FACULTY CONSULTING Judith L. Curry Associate General Counsel NC State University December 2, 2011

2. Board of Governors Policy Board of Governors Conflict of Interest/Commitment Policy: –“Participation of EPA employees in….consulting, is an important characteristic of academic employment that often leads to significant societal benefits, including economic development through technology transfer.”

3. Board of Governors Policy “However, such external professional activities for pay are to be undertaken only if they do not –Create a Conflict of commitment –Create a Conflict of interest –Involve inappropriate use or exploitation of University resources…”

4. NCSU Regulations and Policies NC State Conflicts of Interest and Commitment Regulation [REG01.25.01]REG01.25.01 Patent and Tangible Research Policy [POL10.00.01]POL10.00.01

5. Consulting Must be Reported and Approved In Advance Must be reported at least 10 days in advance [NOI] Department Head Approval May require update of COI report

6. Testing and Services Agreement Project Coordinator certifies: –No research component –NOT WORKING AS CONSULTANT –WILL NOT IN FUTURE CONSULT FOR PURPOSE OF ANALYZING DATA

7. Use of University Space and Equipment Generally not permitted Inappropriate use or exploitation of University resources means using any services, facilities, equipment, supplies or personnel which members of the general public may not freely use. BOG Policy 300.2.2 Conflict of Interest and Commitment BOG Policy 300.2.2 Conflict of Interest and Commitment

8. TSA or Lab Use Agreement TSA FORM ON SPARCS website LAB USE AGREEMENT OGC website Contract Library

9. Conflicts of Commitment Consulting which involves time commitment that interferes with employee’s accomplishing university duties

10. Conflicts of Interest An employee has a conflict of interest when: Personal interest Affects or appears to affect Objectivity in conduct of University duties

11. Example: Consulting for a company with regard to the same subject matter for which he/she acts as principal investigator under a research agreement sponsored by company Also may violate N.C.G.S. 14-234(a)(1) which prohibits public employees from deriving a direct benefit from public contracts

12. Consulting and the Copyright Policy Condition of Employment Copyright –Only Directed Works Must be Assigned –University Shop Right

13. Consulting and the Patent Policy Article 6, Patent and Tangible Research Policy Assignment to University –University administered funds –Scope of Employment –Substantial Use of University resources

14. Scope of Employment North Carolina Law: Employer may require assignment unless the invention does not relate to the employer’s business or actual or demonstrably anticipated research or development N.C.G.S. 66-57.1

15. Inventions Made with Substantial Use of University Resources Resources that would not be available to unaffiliated person Exceptions –Minimal office use –Library –Personal Computer

16. Key Terms in Industry Consulting Agreements Confidential Information/Data Protection Intellectual Property Ownership (Roche type language) Liability Indemnity Choice of Law/Forum Non-Compete

17. Stanford v Roche Board of Trustees of the Leland Stanford Junior University v Roche Molecular Systems, Inc., 131 S.Ct. 2188, 180 L.Ed.2d 1 (June 6, 2011)

18. How Can I Avoid Conflict Between My Consulting and University Policies? Report NOI/COI Provide copy of University Patent Policy to company Define narrowly and precisely the subject matter of consultancy

19. What Are The Legal Risks To Me Personally In Engaging In Consulting? Damages for Breach of Contract Liability for misappropriation of state property (intellectual property)

20. How Can I Minimize The Risk Of Liability For My Consulting? Spell out clearly your responsibilities to the University Consult personal legal counsel and obtain review of contract Obtain errors and omissions insurance Seek guidance from Office of General Counsel if questions about University policies