The main types of funded agreements the Office of Sponsored Programs (OSP) receives are grants, cooperative agreements, and contracts. For grants and cooperative agreements, both of which are types of assistance awards, the awardee is generally aware of the agreement terms and conditions prior to award.

With a grant, there is often little to negotiate. Only when the scope of work, project duration, key personnel or budget change between the time of proposal and award is there any “negotiating” to be done. The same holds true for cooperative agreements, though the terms of a cooperative agreement may require more consideration and negotiation, as compared with a grant.

Contracts, on the other hand, may require considerable negotiation depending on the who (the parties to the agreement), the what (the scope of work), the when (the period of performance), the where (where are activities taking place), and the why (the reason for the contract). Understanding the who, what, when, where, and why provides perspective for understanding the contract terms.

CSU enters into contracts with other universities, with the federal government, with state and local governments, and with foundations, non-profits, and industry. The funded contracts seen in the OSP are typically for research, instruction, service, or clinical trials. In order to adequately review and efficiently negotiate a contract, the following questions need to be considered:

• Who will be a party to the agreement/contract?
• What is the scope of work (research, instruction, service)?
• Who will take part in the work (investigators, students, etc.)?
• Where is the project taking place (on- or off-campus; in another state/country)?
• What is the project/contract duration?
• How much will the work cost?
• What are the billing/financial reporting requirements?
• Will there be regulatory compliance issues (e.g., human participants, animal subjects, export controls, etc.)?

Troublesome Clauses

Tricky negotiations or troublesome clauses arise when the perspectives of the contractual parties are misaligned. For instance, a for-profit industry might want to own the outcomes of the work they sponsor. If the work being sponsored is purely service or work for hire, it might make sense for the industry to own the outcomes. However, if the work being sponsored is fundamental research, then the University may need to negotiate joint ownership of the outcomes.

Below are areas where the University often has to negotiate due to misaligned perspectives.

Ownership of Intellectual Property (IP)

Ownership of IP is one of the largest areas CSU has to negotiate. At times, the contracting party wants to not only own everything that is produced as a result of the work but also any IP that existed prior to the agreement and/or going forward.

The University’s perspective is: If we invent it, we own it. The University will give the funder the first right to negotiate an exclusive or non-exclusive license to use CSU generated IP ensuring CSU recuperates any associated costs. For IP that is jointly developed, CSU will work to negotiate joint ownership with the Sponsor.

Rights in data and Publication

The ability to publish is vitally important for many of our faculty to get promotion and tenure, and to our students in the academic realm. Because of this, the University cannot accept contract language that restricts the ability to publish. In doing so, we violate the academic freedoms upon which we are based.

Often the University will agree to language stating the sponsor can review and comment on potential publications, or delay publication to give time to file a provisional patent, however we cannot agree to language that mandates “approval” or “prior written consent” by the Sponsor.

Disclaimer of Warranty

Contractually warranty is a promise or guarantee of certain outcomes. When conducting research, the researchers cannot guarantee their hypothesis will be supported, therefore we cannot guarantee the outcome of R&D.

Liability and Indemnification

As an Institution, we can accept the responsibility of our employees’ actions and the associated liability. We cannot, however, agree to be legally liable, or to “hold another party harmless” for someone else’s actions, which we are being asked to do when we indemnify another party.

Choice of Law/ Venue

As an entity of the State of Colorado we are limited in our ability to accept another state or country’s laws in governing an agreement. If the work is being performed here at CSU it should fall under our state’s laws.

Perspective

In short, the amount, type, and duration of negotiations that need to happen when CSU receives an agreement depends upon the type of agreement, the purpose of the agreement, and the terms and conditions set forth in the agreement.

Often with federal contracts, there is little to negotiate. Foundations may not be willing to negotiate simply due to cost, whereas industrial contracts are generally negotiable, which may translate into needing additional time to negotiate.

Fortunately, the staff in the OSP are well-versed in award review and contractual terms and conditions. Contact your OSP representative accordingly.