New Law Means State May Finally Manage Its Intellectual Property

California may finally create a uniform statewide policy on how treats the millions of pieced of intellectual property it controls under legislation signed by Gov. Jerry Brown.

The measure – AB 744 by Assembly Speaker John Pérez, a Los Angeles Democrat – comes 12 years after the Bureau of State Audits scolded the state for not managing potentially moneymaking copyrights and trademarks on everything from photographs to inventions created with state funds.

“I introduced my bill to establish a framework for determining what intellectual property the state owns and to inform state agencies of their rights and ability to protect California’s intellectual property,” Pérez said in a statement after the bill became law. “We must be good stewards of tracking and enforcing our intellectual property and I believe we know have a solid framework to do so.”

Pérez’s bill requires the Department of General Services to create and disseminate to the rest of state government a policy for handling intellectual property, which mainly consists of copyrights, trademarks, patents and trade secrets. 

For example, the state Department of Parks and Recreation told the Auditor General in a 2011 follow-up report commissioned by Pérez it had 3,195,805 unregistered copyrights, 57 registered trademarks and 520 unregistered trademarks.

A department spokesman said the high number of unregistered copyrights, many of which are photos, comes from replication on the Internet.

The parks department and the Department of Public Health with 5.5 million unregistered copyrights represent 97 percent of the state’s intellectual property holdings.

“As technology continues to advance, state agencies without sufficient knowledge of how to protect intellectual property will become increasingly vulnerable to unauthorized use and inability to capitalize on reduced contract costs or increasing revenue to the state,” Pérez said in arguing for his bill.

The initial Bureau of State Audits assessment, published in November 2000, recommended an outreach program to inform state agencies of their rights and powers involving intellectual property and ways to protect it.

Pérez’s bill attempts to do that.

In the audit bureau’s 2011 follow-up, Auditor General Elaine Howle said:

“The state has not enacted a statutory framework nor has it implemented the recommendations made in the 2000 audit report or otherwise provided guidance to state agencies regarding the management and protection of intellectual property.

“More than half of the state agencies that responded to our survey about intellectual property indicated that the state should establish statewide guidance for managing and protecting intellectual property,” Howle wrote.

“Moreover, the four state agencies we visited had only limited written policies and instead generally relied on informal practices to manage and protect their intellectual property.”

Intellectual property held by the state can include the writings of employees or the results from research paid for with state grants.

Pérez says that some of the state’s intellectual property may not be of financial value. In other cases, providing material free to taxpayers might trump capitalizing on state-generated intellectual property.

Either way, lack of a policy is shortsighted, Pérez argues.

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