ETSU now has a research foundation to help the university do business with the community and to assist in faculty research.
The ETSU Research Foundation is a non-profit corporation to be used as a legal entity to make it easier to negotiate contracts with private business, handle intellectual property developed at ETSU and better manage research conducted at the university.
ETSU is the first school in the TBR system to create such a corporation, but nearly 100 universities throughout the country have similar foundations.
Michael Woodruff, vice provost for research and executive director of the ETSU Research Foundation, said the foundation creates two benefits for the university, one being that it is a new way of trying to increase research support for ETSU faculty by making it easier to quickly secure contracts from private industry.
The other way the Research Foundation is beneficial is by increasing the economic development of the region.
“The first part is to help extend our research capabilities by making it easier to do business with industry,” Woodruff said. “The second is to assist us in our efforts to partner with the community for economic development, and the big example of that is the Innovation Laboratory that we started in the old Marine Corps facility.”
To make the Innovation Laboratory work, the university needed a way to execute lease agreements with the incubating companies. “To do that through the university is exceedingly difficult, we’re just not set up to act as a landlord for private companies, that’s not what we’re really supposed to be doing .,” Woodruff said.
To handle the problem ETSU arranged with the Research Foundation to lease space in the Innovation Laboratory, the Research Foundation then leased space to two companies and now collects rent from them for the university, Woodruff said.
The companies started in the Innovation Laboratory are usually begun by students and professors that either obtained a patent from another company through the university to finish developing and marketing of the patent, or by a student or professor that has an idea they would like to develop, ETSU professors act as consultants.
Woodruff said that it would not have been possible to begin these companies without the Research Foundation.
As a state institution, ETSU is limited in the type of language that it can allow in contracts when doing business with anyone, Woodruff said.
He said also that in a typical contract both parties will agree to grant each other indemnity, which is legal exemption from liabilities, and ETSU can not do that when entering contract agreements since the state controls the university.
“States don’t permit that because they view it, and not just the state of Tennessee, but they view it as an infringement on state sovereignty,” Woodruff said. “So if the state of Tennessee indemnifies somebody they are basically saying that ‘We have no grounds to blame you, we’re giving up our sovereignty’ and they won’t do that.”
Another problem with state law is the requirement that before accepting donations of patents or software for use or development the company providing the donation must guarantee that the product being donated will work as it is supposed to. Usually, Woodruff said, companies will not provide that guarantee.
“Where we have occasionally had a problem with that is software,” Woodruff said. “Some-times software companies will not provide full warranty that the software will work. If the company refuses to warranty to the extent of state laws, we can’t do business with them.”
Another similar situation is one where the university will be accepting the donation of patents from a company that would like to see them developed.
Woodruff said that just because a patent has been issued for a product, it does not mean that that product, which is usually still only an idea, will do everything the inventor or company claims it would.
The patent office has only said that it is reasonable that it will, however, the state must have assurance that the patents will do all they should. “We have the opportunity to get these patents, we have a faculty member who is very interested in developing them, and he and some of the students intend to start a company with these as a basis,” Woodruff said. “The state said we had to have the company warranty that these are going to work or they wouldn’t do the donation.”
The only way to do that was through the Research Found-ation, Woodruff said.
“So, to accept a software gift, to accept a donation of a patent, we needed a vehicle where we wouldn’t have to abide by this particular state requirement,” he said.
Woodruff said that he would like to see more student-started companies at ETSU because it is an invaluable resource.
It allows students to get a business started in a less hostile environment, where the have a mechanism that provides business and technical support.
“Students typically don’t have the kind of experience, nobody does coming out, to start a company, but they really have the motivation, the fire in the belly to do it,” Woodruff said. “The incubator allows them a relatively low risk, nurturing environment to get them started.
One of our goals is to provide this opportunity if students have ideas based on what they’ve done here at the university.”
Woodruff said that he hopes the flexibility the Research Foundation allows the university will be attractive to potential professors.
It has already been noticed by Arun Goyal, a professor of biological sciences, who has been conducting research in rapid-growth poplar trees for use as a possible energy source.
“He’s very interested in one of the potential spin-offs this could bring,” Woodruff said. “Many of his students that come through his laboratory end up with these skills in molecular biology that make them highly marketable to go to work for industry.”
Woodruff said both students and the community would benefit by working with people like Goyal.
“First of all, it’s good for the students that are coming through because what they want is a job and they’re going to have some highly marketable skills,” he said. “Secondly, it’s good for our area because we have been in the process of developing the idea of a Med-Tech park now for a decade.

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