On August 8, 2025, the U.S. Department of Commerce sent a letter to Harvard University—also shared publicly on the social media platform X—alleging that the university failed to comply with several provisions of the Bayh-Dole Act. The letter raised concerns about the handling of obligations tied to federally funded research. Specifically, the Department outlined the following concerns:
- Failures to comply with the requirements for timely disclosure and election of title under 37 C.F.R. § 401.14(d)(1)(i);
- Failures to comply with the preference for United States industry as required by 37 C.F.R. § 401.14(i); and
- Failures to take effective steps to achieve practical application of subject inventions as required by 37 C.F.R. § 401.14(j)(1).
In its letter, the Department announced its intent to initiate the march-in rights process, which could result in compulsory licensing of certain patents. It also indicated plans to take title to inventions in cases where timely disclosure or election of title has not occurred. Additionally, Harvard was directed to submit, by September 5, 2025, a detailed report of all patents arising from federally funded research, including disclosure and title election dates, commercialization status, and licensing terms.
Reading Between the Lines of the Letter
While the letter signals serious intent, it remains to be seen whether this action may be more symbolic or political than substantive. The Department is requesting detailed patent and licensing information that universities already report through iEdison, the federal interagency system for Bayh-Dole compliance. Universities routinely disclose invention details, dates of disclosure to the funding agency, dates of election to retain title, and utilization reports through this platform. This raises questions about whether the request is intended less as a procedural necessity and more as a maneuver designed to exert pressure or create administrative burdens. If the requested data is already available to the federal agencies through existing reporting systems, the letter may function more as a public signal of enforcement posture.
Who Decides? The Mechanics of March-In Rights
In the nearly 45 years since the Bayh-Dole Act was enacted, the federal government has never exercised its march-in rights. In light of the position taken in the letter, however, it is worth revisiting the legal framework governing the exercise of march-in rights.
Under 35 U.S.C. § 203, “the Federal agency under whose funding agreement the subject invention was made shall have the right” to initiate march-in proceedings. The process for initiating a march-in proceeding is outlined in 37 CFR § 401.6:
- Agency Notification and Informal Consultation
When a funding agency receives information that may warrant the exercise of march-in rights, it must first notify the contractor in writing and request informal consultation. The contractor has 30 days to respond. If the contractor does not respond to the request for informal consultation within 30 days, the agency may proceed with formal march-in procedures at its discretion.
- Agency Decision Post-Consultation
Within 120 days of a consultation with the contractor, the funding agency must either initiate formal proceedings or notify the contractor that it will not proceed.
- Agency Written Notice of March-In Proceeding
To initiate a march-in proceeding, the agency issues a written notice detailing the basis and scope of the proposed action.
- Contractor Response and Fact-Finding Process
The contractor may respond to the written notice and request a hearing. If material facts are disputed, a fact-finding process is conducted.
- Agency Final Determination
The funding agency head or its designee makes the final decision “on the facts found, together with any other information and written or oral arguments submitted by the contractor.” 37 C.F.R. § 401.6(a)(6). The final decision is appealable under 35 U.S.C. § 203(b).
Key Takeaways for Universities
In light of the Department’s letter and the broader regulatory posture toward federally funded research, university technology transfer offices and general counsel should take proactive steps to reinforce compliance and prepare for potential scrutiny. The following takeaways highlight practical actions institutions can take now to mitigate risk and ensure alignment with Bayh-Dole obligations:
- Continue Robust iEdison Compliance
Ensure all federally funded inventions are properly disclosed, title elections are timely, and utilization reports are complete.
- Review Exclusive Licensing Agreements for U.S. Manufacturing Clauses
Confirm that exclusive licenses include substantial U.S. manufacturing obligations where applicable, or that waivers have been granted by the funding agency where substantial U.S. manufacturing by the licensee is not commercially feasible.
- Document Commercialization Efforts
Maintain clear records of efforts to bring inventions to practical application, including development milestones, manufacturing plans, licensing activities, and utilization reports. Review licensing agreements for licensee compliance with development plans to bring licensed inventions to practical application.
- Engage Counsel for Strategic Review
Consider a proactive audit of your Bayh-Dole compliance processes and licensing practices.
Conclusion
The Department of Commerce’s letter to Harvard may be aimed at creating public pressure, or it may signal a renewed push for stricter enforcement of the Bayh-Dole Act. Although only funding agencies can initiate march-in proceedings—and none appear to have done so yet—the public nature of the warning suggests the potential for increased regulatory action. Universities should take this moment to reaffirm compliance with Bayh-Dole regulations and continue monitoring the situation closely as it evolves.
