Office of Technology Commercialization

IV. Guidelines for Interactions between MSU and Start-up companies

When the university engages in activities with university-employee-owned companies (e.g. MURA company), a conflict of interest is inherent in these relationships. Oversight of research relationships with such companies comes under the Mississippi Universities Research Authority and is subject to specific requirements. Companies formed under the MURA law have rigorous reporting requirements to allow the Authority to monitor the inherent conflict of interest. In addition, the President or Chancellor of the University is responsible for assuring that the university is not injured by the relationship between the company and the university. In order to more carefully monitor this relationship, the university is providing certain guidelines and procedures.

The university encourages interested employees to engage in entrepreneurial activities as a way of contributing to the economic development of Mississippi. A MURA company has an intrinsic research relationship with the university and its employees. The university works with such companies on the same basis as work done with companies not owned by university employees. To ensure that such relationships do not harm either the university or its employees, special oversight is required.
Research relationships with MSU employee-owned companies can take several forms:

1. University research is sponsored by the MURA company, including personnel with equity in the company
2. Company services or goods are purchased by the university, possibly for personnel with equity in the company
3. The company, in exchange for a fee, uses university facilities and/or equipment
4. The company employs individuals who are simultaneously university graduate students
5. The employee with equity in the MURA company is spending a significant portion of their time on company business, to the extent that it constitutes a conflict of time commitment.

General guidelines

  1. There shall be an initial meeting and then annual meetings between the faculty/staff with a MURA company, their unit head/director, dean, if appropriate, the Director of the Office of Technology Management, the University Ethics Officer, if available, and Vice President for Research and Economic Development or his/her designee (the MURA review committee). These meetings will review all interactions between the MURA company and the University. At the initial meeting, a modus operandi will be established with approval required by all parties. Approval will not be unreasonably withheld. Special meetings of the MURA review committee can also be held as needed.
  2. For individual joint projects or programs between MSU and the company, each activity should be carried out based on an agreement through the Office of Sponsored Programs Administration and with the approval of the Vice President for Research and Economic Development, following advice from University Counsel. These projects can include grants, contracts, or memoranda of agreement. In each case, the activity should be specified in the agreement. In addition, the following safeguards will be used for the issues listed above:

Issue 1. University research is sponsored by the MURA company, including personnel with equity in the company.

The P.I. shall not be someone with a 2% equity interest or be a principal in the MURA company. There will be an annual review of such research by the P.I.'s supervisors up through the level of Dean/Director and the University Ethics Officer reporting to the results/recommendations of the review to the Vice President for Research and Economic Development. This will ensure the integrity of the research and that performance metrics have been achieved. This review will be carried out on an annual basis as part of the MURA review, or as requested either by the company, the P.I. or his/her supervisors.

Issue 2. Purchase of company services or goods by the university, possibly for personnel with equity in the company.

Purchases/contracts by Mississippi State University from a MURA company cannot be initiated or executed by a person with equity in that company. Any single-source purchases must be reviewed prior to completion.

Issue 3. Lease of university laboratory and other space and/or equipment by a MURA company.

Appropriate leases will be recommended by the unit head/director responsible for space and/or equipment to the Vice President for Research and Economic Development with sign off by deans, if appropriate. Fees/contracts will be in line with those charged for use by companies not involving MSU employees. The university counsel will review all contracts.

50% of the lease income will accrue to the unit with 50% going to the University E & G budget.

Issue 4. Company employment of individuals who are simultaneously university graduate students.

The Program of Study committee and/or a committee named to oversee research shall be notified of the potential conflict and the student's work for the dissertation or thesis shall be monitored to assure that the quality of the student's research and graduate experience is not compromised by the connection to the company. Generally, it is inadvisable for the student's advisor to be the student's employer or supervisor in the employee-owned company, but exceptions can be sought from the department head.

Issue 5. Time commitment by employee with equity in the MURA company.

The initial and annual review meetings will consider the projected level of time commitment of an employee with equity in the MURA company. If there is an apparent conflict of time commitment, the employee will be required to reduce his/her involvement in the company or reduce his/her percent commitment to the university. In the case of the latter, the leave of absence or partial leave of absence will be reviewed annually until the conflict is resolved. In addition, if there are changes in the time commitments to the MURA company, changes can be made immediately following a special meeting of the MURA review committee.

Remedies

At any point in the process of reviewing disclosures, the Ethics Officer or the unit head or the faculty/staff member with the equity interest in the MURA company can request review by the CICRC. The CICRC may advise that remedial steps should be taken to protect the interests of all parties involved and to limit the negative impact of any unavoidable conflicts of interest.

Sanctions

Disclosure is the responsibility of the faculty or staff member who becomes involved in activities that may be in conflict. Failure to disclose those relationships is a serious matter, and illegal under state law.

Guidelines for the use of university facilities/equipment by companies/external entities

  • Rental income from external companies using university facilities/equipment should be based on the market rate1.
  • Leases2of facilities should be by standard form agreements3 provided by MSU General Counsel.
  • All contracts for the lease of research space, facilities and/or equipment to private bodies must be approved by the Vice President for Research and Economic Development.
  • Use of facilities by commercial enterprises requires IHL Board approval which will be requested by the Vice President for Research and Economic Development.
  • The company/external entity will provide liability insurance for any damage to the research space, facilities and/or equipment and to university personnel and return the space as was.
  • The company/external entity will hold the university harmless for damage to its equipment and/or personnel.
  • Leases will be for a calendar year or portion there of.
  • Leases can be renewed annually and normally for a maximum of 3 years.
  • For units for which E&G pays utilities, the rental income should be split using a formula analogous to the distribution as F&A recovery (based on real costs):
    • 40% E&G,
    • 60% Office of Research (The bulk of these funds will be held4 for initiatives involving the department/college/center/institute)
  • For units (Departments/Centers) for which E&G does not pay utilities, the rental income should be split in the following manner:
    • 20% E&G,
    • 40% Department/Center
    • 40% Office of Research (The bulk of these funds will be held4 for initiatives involving the department/college/center/institute)
  • For equipment purchased by and maintained by units, the income should be split in the following manner:
    • 20% E&G,
    • 70% Department/Center
    • 10% Office of Research

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1State law does not allow the use of State resources for private groups without reasonable compensation. A good faith effort for a market rate triple exempt lease rate (the company leasing space would pay property tax if applicable, insurance and utilities) is required including where possible separate metering of utilities.
2Leases may be exclusive or non-exclusive access fees.
3Lease documents may be modified to meet the specific needs of units.
4Subject to negotiation