FACULTY CONSULTING: CONFLICTS OF INTEREST AND BEYOND
CONFLICTS OF INTEREST AND
Karen A. Mullin, JD, LLM
Chief General Counsel/Director of Technology Development
The Forsyth Institute
ORAU Annual Meeting
March 8, 2017
Overview of Presentation –
What Will Be Covered
• Establish what consulting relationships are
• The role of the institution (if any) in review of
faculty consulting agreements;
• Conflicts of interest arising from faculty consulting;
• Intellectual property issues arising from faculty
What is Faculty Consulting?
• Faculty consulting can generally be considered to
be any activity that:
– is not included within a faculty member’s employment
– is performed for any entity other than the faculty
– is undertaken for compensation; and
– is based upon the professional knowledge, experience
and expertise of the faculty member.
Four Key Questions
In order for an institution to effectively evaluate
whether a consulting arrangement is appropriate, four
key questions need to be answered:
–What type of consulting is contemplated?
–When will the consulting occur?
–Where will the consulting occur?
–Will it be paid, and if so, to whom?
Institutional Concerns with Faculty
• Compliance with institutional policies
(particularly IP policies and COI policies);
• Potential liability of institution;
• Use of institution’s name;
• Publicity arising from faculty consulting
• Tax reporting consequences.
Faculty Consulting Agreements:
To Review or Not to Review
Three strategies adopted by academic
1. Do not review at all (“Ostrich
2. Review only to ensure compliance with
institutional policies; and
3. Review and negotiate in full.
No Review of Faculty Consulting
Agreements by Institution
• This approach clearly separates the academic institution
from its faculty members’ consulting arrangements.
• There can be no inference that the academic institution was
involved in the consulting relationship.
• Institutions do advise their faculty to retain personal
counsel to review consulting agreements.
• Institution has absolutely no knowledge or control over
what obligations have been agreed to by its employee.
Institutional Review of Faculty Consulting
Agreements ONLY to Ensure Compliance with
•This is a “compromise approach” focused on addressing
institutional concern re. compliance with policies.
•Focus of institution’s counsel is solely to ensure that faculty
member is not violating any institutional policies.
•Challenge for institutional counsel to refrain from advising on
•Faculty member often less likely to retain personal counsel to
review other provisions of the agreement.
•This approach provides maximum control & protection for the
•Creates potential risks for institution: (1) exposure to liability
arising from the consulting work; (2) inference that faculty member
is consulting in his capacity as an employee of institution; and (3)
faculty member may hold institution responsible for any contractual
issues arising between company and faculty member.
•Cost to institution for compensating legal counsel for review of
consulting agreements can be significant.
Full Review & Negotiation of Faculty Consulting
Agreements by Institution’s Counsel
Faculty Consulting and Conflicts of
• Consulting does not necessarily create a financial conflict
• Is there a secondary relationship as part of the faculty
member’s institutional responsibilities? For example:
– being a researcher studying the entity’s products,
technology or services;
– being funded by the entity to do research;
– making purchasing decisions involving the entity’s
– being the recipient of a directed donation from the entity.
Evaluating Conflicts of Interest
Arising From Faculty Consulting
Who decides? Committee or Institutional
Different Types of Conflicts:
Faculty Conflict of Interest Management
• Honoring the student/ trainee experience;
• Avoiding inappropriate influence, even bias; and
• Protecting the credibility of the faculty member’s
• Management Plans
–Independent Review of Data
–Change in Roles
• Alternative Options for Trainees
• Alternative Administrative Routing
Tools for Effective Conflict of Interest
Management by Institutions
Intellectual Property Issues Arising from
• Ownership of “deliverables” or “work product” generated
by faculty member in the consulting work is critical to the
company and always addressed in the consulting
• Although the faculty member is performing the consulting
work outside of his/her employment, he/she must still
adhere to institution’s IP policies.
• A faculty member cannot grant a company rights to
inventions/discoveries that are covered by his/her
institution’s IP policy and owned by the institution.
Bayh-Dole Act Considerations
• Bayh-Dole Act applies to inventions conceived or first
reduced to practice in the performance of work funded by
the federal government.
• Faculty members who conduct federally funded research
and perform external consulting work need to be informed
of the obligations owed to the federal government under the
Bayh-Dole Act, and ensure that they are not using
inventions developed with federal funding in their
consulting work and that they are not granting the
companies retaining them any rights to such inventions.
Use of Institution’s Intellectual Property
in Faculty Consulting
• Faculty members must ensure that they do not use in their
consulting work any IP that they developed in their
capacity as an employee of their institutions.
• Neither academic institutions nor companies retaining
consultants want faculty consultants using the institutions’
IP in consulting work.
• Academic institutions need to ensure that their faculty are
informed of such limitations as at times it can be
challenging to segregate the IP, or if an institution’s IP is to
be used, an appropriate agreement is in place with the