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Guide and Term Sheet for Negotiating with ORSP

This quick reference guide and term sheet are designed to help external sponsors of research understand the University of Michigan’s standard positions on frequently negotiated terms in research agreements. By level-setting these expectations early, the Office of Research and Sponsored Projects (ORSP) aims to streamline the contracting process and accelerate the start of research projects at the University.

Principles Guiding Negotiations

The following principles guide contract negotiations for research agreements with ORSP:

  • Mission-driven research: As a public, non-profit academic institution, U-M is dedicated to generating and disseminating knowledge for the public good.
  • Constitutional limitations: As a constitutional entity of the State of Michigan, U-M is subject to specific legal restrictions regarding indemnification and "lending the credit of the State."
  • Transparency: U-M is committed to transparency. The University is subject to the State of Michigan’s Freedom of Information Act (FOIA), as well as Regents’ Policy, which requires that we retain the right to disclose the existence of agreements and the identity of our sponsors.

Sponsor Quick Reference Terms Sheet

Agreement terms:

Indemnification

U-M position: Each party is responsible for its own negligent acts or omissions. Any statements of indemnification must be prefaced with "To the extent permitted by law" and U-M will not agree to provide any warranties.

Rationale/context: The Michigan Constitution prohibits U-M from "lending the credit of the State," which restricts our ability to provide broad indemnification or warranties to third parties.

Intellectual Property (IP) Ownership

U-M position: Ownership follows inventorship: U-M owns IP created by its employees. Sponsors own IP created by their employees. Jointly developed inventions are owned jointly.

Rationale/context: This ensures compliance with University policy and federal regulations. Ownership follows inventorship under U.S. Patent Law. 

IP Rights: Internal Research and Development Non-Exclusive

U-M position: Sponsor receives a non-exclusive, royalty-free license for internal research and development purposes to IP generated in the performance of a sponsored research project during its term.

Rationale/context: This allows sponsors to immediately utilize project results for internal research and development in exchange for funding the research project.

IP Rights: Non-Exclusive or Exclusive Commercial Option

U-M position: Sponsor is granted an option to negotiate for either a non-exclusive or an exclusive commercial license to IP generated in the performance of a sponsored research project during its term. Typically, the sponsor has 45 days after disclosure of the IP to exercise its option and up to three (3) months after the exercise to negotiate a license agreement.

Rationale/context: As a benefit of sponsoring the research, Sponsors receive the first option to obtain rights to commercialize and/or to become the exclusive partner for licensing intellectual property generated in the performance of a sponsored research project during its term.

Alternative approaches: In response to industry and researcher feedback that new models would catalyze research partnerships, Innovation Partnerships created the Certainty at Michigan Program, which offers a menu of potential upfront IP terms. Visit the webpage for more information.

IP Rights: Background IP

U-M position: Both U-M and the Sponsor retain ownership of their own Background IP, and Background IP should be narrowly defined to include only the Background IP used in the Project. U-M does not grant rights to Background IP in research agreements.

Rationale/Context: Background IP is frequently connected with broader university innovations and obligations that reach beyond internal use to the extent necessary to perform the activities in a single research project. Keeping Background IP separate is often necessary to preserve U-M’s ability to support ongoing research. If a sponsor needs specific Background IP to use the project results, U-M will evaluate and license it separately on appropriate terms.

Publication

U-M position: U-M retains the right to publish results, subject to:

  • 30-Day Review: U-M provides sponsors at least 30 days  to review any proposed publication to identify:
    • Confidential information: U-M will remove a sponsor’s confidential information provided during the study prior to publication.
    • Patentable subject matter: If a sponsor identifies patentable IP, U-M can delay publication for an additional 60-90 days to ensure filings are made.

Rationale/context: U-M is a powerhouse of fundamental research. Disseminating knowledge is a cornerstone of the University’s mission. To protect U-M faculty and sponsor interests, U-M follows a "Review, Not Approve" model.

  • Why this helps sponsors, too: This process maintains the Fundamental Research Exclusion, which simplifies export control compliance for both parties.

Confidentiality

U-M position: Information must be marked "Confidential" and is protected for a period of five years. 

Data must not be included in the definition of confidentiality except to the extent they are limited to data which are provided to U-M by the sponsor. 

Results of the research cannot be treated as confidential (see Publications).

Rationale/context: As a state agency, U-M is subject to FOIA. Proper marking allows U-M to use the Confidential Research and Investment Information Act (CRIIA) to protect your data.

Publicity / Use of Name

U-M position: Neither party may use the other’s name or logo for promotional purposes without prior written consent.

Rationale/context: The University is subject to both federal and State of Michigan freedom of information statutes. In addition, Regents’ Policy requires that U-M be able to disclose the sponsor's identity as a matter of fact.

Dispute Resolution

U-M position: Each party retains the right to resolve disputes in a court of law. 

Rationale/context: Silent agreements preserve the legal rights of both parties. U-M prefers the agreement to be silent on Alternative Dispute Resolution (ADR). 

Export Controls

U-M position: Prior to providing export-controlled data or items, the sponsor must provide prior written notice with the appropriate designation or classification based on export control regulations and obtain U-M’s consent prior to transfer. 

Rationale/context: U-M must know in advance when it would be receiving export-controlled data or items from a sponsor so that U-M can assess whether it wants to accept the data/item and/or whether it would need to put appropriate protections in place to manage the project.

Insurance

U-M position: U-M has adequate liability insurance applicable to officers, employees and agents while acting within the scope of their employment by U-M. U-M liability insurance policies do not extend protection to any other person.  

Rationale/context: U-M has its own program of self-insurance which only covers U-M activities or those of persons or organizations it legally controls. 

Posted on: Wednesday, May 20, 2026 - 09:28