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patent applications or until one year has passed since the final disposition of rights under this Title, whichever is earlier.

(b) If the responsible agency determines that the employee-inventor unreasonably has failed to file a report as required by subsection (a) of this section, the employee may be deprived of any or all of the rights he otherwise would have under the Title.

CRITERIA FOR ALLOCATION OF RIGHTS

Sec. 303. The responsible agency will determine the rights of the Government and of Federal employee-inventors in any inventions made by employee-inventors through the use of the following criteria:

(1) If the invention bears a direct relation to the duties of the employee-inventor or was made in consequence of his employment, the Government will acquire all rights in the invention.

(2) If the invention neither bears a direct relation to the duties of the employeeinventor or was made in consequence of his employment, but was made with a contribution from Federal funds, facilities, equipment, materials, or information not generally available to the public, or from services of other Federal employees on official duty, the employee-inventor will receive all rights in the invention, except as provided in paragraph (4) of this section. However, these rights will be subject to a nonexclusive, royalty-free, worldwide license to the Government to practice the invention or have it practiced for the Government.

(3) If the agency finds insufficient interest in an invention to justify exercising its rights under paragraph (1) of this section, it may permit the employee-inventor to receive any or all of those rights, subject to the Government's rights as described in paragraph (2) of this section. However, nothing in this paragraph will prevent the agency from publishing the invention or otherwise dedicating it to the public. (4) If the agency determines that national security might be impaired if the employee-inventor were to receive rights in an invention under paragraph (2) or (3) of this section, the Government will acquire all rights in the invention.

(5) The Government will claim no rights under this Act in any employee-invention not covered by paragraphs (1) or (2) of this section.

(6) Notwithstanding paragraph (1) of this section, an agency may enter into agreements providing for appropriate allocation of rights in inventions that result from research or development to which other parties have substantially contributed.

PRESCRIPTIONS

Sec. 304. (a) There will be a rebuttable presumption that an employee invention falls within the criteria of section 303(1) if it was made by a Federal employee who is employed or assigned to

(1) Invent, improve, or perfect any art, machine, manufacture, or composition of matter;

(2) Conduct or perform research or development work;

(3) Supervise, direct, coordinate, or review federally sponsored or supported research or development work; or

(4) Act as liaison among agencies or individuals engaged in the work specified in paragraphs (1), (2), or (3) of this subsection.

(b) There will be a rebuttable presumption that an invention falls within the criteria of section 303(2) if it was made by any other Federal employee.

REVIEW OF AGENCY DETERMINATIONS

Sec. 305. Agency determinations under sections 302 and 303 will be reviewed whenever

(1) The agency determines not to acquire all rights in an invention, or (2) An aggrieved employee-inventor requests a review. Standards and procedures for this review will be prescribed in the regulations issued under section 309.

REASSIGNMENT OF RIGHTS

Sec. 306. If an agency finds on the basis of new evidence that it has acquired rights in an invention greater than those to which the Government was entitled under the criteria of section 303, it will grant the employee-inventor such rights as may be necessary to correct the error.

INCENTIVE AWARDS PROGRAM

Sec. 307. (a) Agencies may monetarily reward and otherwise recognize employeeinventors as an incentive to promote employee inventions and the production and disclosure of employee inventions. For this purpose agencies may make awards under the Federal incentive awards system (5 U.S.C. Ch. 45, 10 U.S.C. Ch. 57, and implementing regulations), as modified by this section.

(b) The amount of an award for an invention will be based on

(1) The extent to which the invention advances the state of the art;

(2) The scope of application of the invention;

(3) The value of the invention to the Government or the public; and

(4) The extent to which the invention has come into public use.

(c) Awards for an invention of up to $10,000 may be made by the head of an agency.

(d) Awards of over $10,000 but less than $35,000 may be made by the head of an agency to-

(1) Civilian employees, with the approval of the Office of Personnel Management; (2) Members of the Armed Forces, with the approval of the Secretary of Defense; (3) Members of the United States Coast Guard when not operating as a service in the Navy, with the approval of the Secretary of Transportation;

(4) Members of the Commissioned Corps of the United States Public Health Service, with the approval of the Secretary of Health and Human Services; and (5) Members of the Commissioned Corps of the National Oceanic and Atmospheric Administration, with the approval of the Secretary of Commerce.

(e) Awards of more than $35,000 may be made to employee-inventors by the President upon recommendation of the head of an agency.

(f) Acceptance of a cash award under this section constitutes an agreement that any Government use of an invention for which the award is made forms no basis for further claims against the Governmetn by the recipient, his heirs, or his assigns. (g) Any cash award or expense for honorary recognition of an employee-inventor will be paid from the fund or appropriation of the agency receiving the invention's primary benefit.

INCOME SHARING FROM PATENT LICENSES

Sec. 308. In addition to awards as provided in section 307, an agency may share income received from any patent license with the employee-inventor.

REGULATIONS

Sec. 309. (a) The Secretary of Commerce shall issue regulations to implement this Title.

(b) Any determination of an appointing official under subsection 208(b) of title 18, United States Code, that relates to promotion of an employee invention by the employee-inventor will be subject to regulations prescribed by the Secretary of Commerce with concurrence of the Office of Government Ethics and the Attorney General.

TITLE IV-LICENSING OF FEDERALLY-OWNED INVENTIONS

COVERED INVENTIONS

Sec. 401. This Title applies to the licensing of all federally-owned patent rights, including licenses or sublicenses granted or required to be granted by the Government under section 206. However, it does not apply to licenses established by the other sections of Title II of this Act.

EXCLUSIVE OR PARTIALLY EXCLUSIVE LICENSES

Sec. 402. (a) An agency may grant exclusive or partially exclusive domestic licenses under federally-owned patent rights not automatically licensed under section 203 only if, after public notice and opportunity for filing written objections, it determines that

(1) The desired practical application is not likely to be achieved under a nonexclusive license; and

(2) The scope of proposed exclusivity is not greater than reasonably necessary. (b) An agency may grant exclusive or partially exclusive foreign licenses under federally-owned patent rights after public notice and opportunity for filing written objections and after determining whether the interests of the Government or of United States industry in foreign commerce will be enhanced.

(c) An agency will not grant any license under this section if it determines that such a grant would violate the antitrust laws if the licensee's receipt of such a license were deemed an acquisition of assets of another corporation.

(d) Agencies will maintain periodically updated records of determinations to grant exclusive or partially exclusive licenses. These records will be publicly available.

MINIMUM GOVERNMENT RIGHTS

Sec. 403. Each license granted under section 402 will contain such terms and conditions as the agency finds appropriate to protect the interests of the Government and the public, including provisions reserving to the Government:

(1) The right to require from the licensee written reports on the use of the invention,

(2) A royalty-free, worldwide right to practice the invention or have it practiced for the Government, and

(3) The right to license State, local, or foreign governments to practice the invention or have it practiced for them if the agency determines that reservation of this right would serve the national interest.

MARCH-IN RIGHTS

Sec. 404. (a) The Government will have the right to terminate any license granted under section 402 in whole or in part, but only

(1) If the licensee has not taken and is not expected to take timely and effective action to achieve practical application of the invention in each of the fields of use affected;

(2) If necessary to protect national security;

(3) If necessary to meet requirements for public use specified by Federal regulation;

(4) If the licensee's rights in the invention violate the antitrust laws if the licensee's original receipt of those rights were deemed an acquisition of assets of another corporation; or

(5) If the licensee has failed to comply with the terms of the license.

(b) These march-in rights may be exercised by the responsible agency on its own initiative or on a petition from an interested person justifying such action.

REGULATIONS

Sec. 405. The Office of Federal Procurement Policy will direct the issuance of regulations specifying the terms and conditions upon which federally-owned patent rights may be licensed. An agency may deviate from such regulations on a class basis unless prohibited by the Office of Federal Procurement Policy.

TITLE V-MISCELLANEOUS

PATENT ENFORCEMENT SUITS AND RIGHT OF INTERVENTION

Sec. 501. Any exclusive licensee under this Act may enforce rights under the license by bringing suit without joining the United States as a party. However, the licensee will give prompt notice of the suit to the Attorney General and to the agency that granted the license, and all parties will serve copies of papers on the Attorney General and the responsible agency as though they were parties to the suit.

BACKGROUND RIGHTS

Sec. 502. Nothing contained in this Act will be construed to deprive the owner of any background patent of rights under such a patent.

NOTICE, HEARING, AND JUDICIAL REVIEW

Sec. 503. (a) Agency determinations under sections 201, 206(a), and 206(c), and 404 will be made after public notice and opportunity for a hearing in which the United States, any agency, or any interested person may participate, and will include written reasons for the determination.

(b) The United States or any participant that may be adversely affected by an agency determination covered by subsection (a) of this section may appeal the determination to the United States Court of Claims within sixty days after the determination is issued. That Court will have exclusive jurisdiction to determine the matter de novo and to affirm, reverse of modify the agency determination.

RELATIONSHIP TO OTHER LAWS

Sec. 504. Nothing in this Act creates any immunities or defenses to actions under the antitrust laws.

AUTHORITY OF FEDERAL AGENCIES

Sec. 505. (a) Agencies may apply for, obtain, maintain, and protect patent rights in the United States and in foreign countries on any invention in which the Government has an interest in order to promote the use of inventions having significant commercial potential or otherwise advance the national interest;

(b) Agencies may license federally-owned patent rights on terms and conditions consistent with Title V;

(c) Agencies may transfer patent rights to other agencies and accept them from other agencies, in whole or in part, without regard to the Federal Property and Administrative Services Act of 1949 (40 U.S.C. 471);

(d) Agencies may withhold publication or release of information disclosing any invention long enough for patent applications to be filed;

(e) Agencies may promote licensing of federally-owned patent rights by making market surveys, acquiring technical information, or otherwise enhancing the marketability of the inventions; and

(f) Agencies may enter into contracts necessary and appropriate to accomplish the purposes of this section.

RESPONSIBILITIES OF THE SECRETARY OF COMMERCE

Sec. 506. (a) The Secretary of Commerce will

(1) Consult with other agencies about areas of science and technology with potential for commercial development.

(2) Coordinate a program to help agencies in exercising the authority given by section 505;

(3) Evaluate intentions referred by agencies to identify those with the greatest commercial potential and to promote their agencies.

(4) Help agencies seek and maintain patents in the United States and in foreign countries by paying fees and costs and by other means;

(5) Develop and manage a Government-wide program, with appropriate private sector participation, to stimulate transfer to the private sector of potentially valuable federally-owned technology through dissemination of information about the technology; and

(6) Publish notice of all federally-owned patent rights that are available for licensing;

(b) There is authorized to be appropriated to the Secretary of Commerce such sums as may be necessary to enable the Secretary to carry out responsiblities under this section.

Sec. 507. As used in this Act

DEFINITIONS

(1) Agency" means an "executive agency" of the Federal Government, as defined by section 105 of title 5, United States Code, and the military departments defined by section 102 of title 5, United States Code. "Responsible agency" means the agency which is party to a contract for the performance of research or development, has received patent rights from another agency, or has administrative jurisdiction over an employee-inventor.

(2) "Antitrust laws" means the laws included within the definition of the term "Antitrust laws" in section 1 of the Clayton Act (15 U.S.C. 12), as amended, and the Federal Trade Commission Act (15 U.S.Č. 41 et seq.), as amended.

(3) "Contract" means any Federal contract, cooperative agreement, or grant that provides for performance of research or development substantially funded by the Government. It covers any assignment, substitution of parties, or subcontract of the same type under such a contract. It does not cover Federal price or purchase supports, or Federal loans or loan guarantees.

(4) "Contractor" means any person other than an agency that is a party to a

contract.

(5) "Federal employee" means any civil service employee as defined in section 2105 of title 5, United States Code, and any member of the uniformed services. (6) "Invention" means any invention that is or may be patentable under the laws of the United States. "Contract invention" is defined by section 201. "Employee invention" is defined by section 301.

(7) "Made" when used in relation to any invention means conceived or first actually reduced to practice.

(8) "Nonprofit organization" means universities and other institutions of higher education or an organization of the type described in section 501(c)(3) of the Internal Revenue Code of 1954 (26 U.S.C. 501(c)) and exempt from taxation under section 501(a) of the Internal Revenue Code (26 U.S.C. 501(a)).

(9) "Patent rights" means patents and patent licenses and sublicenses.

(10) "Practical application" means manufacture of a machine, composition, or product, or practice of a process or system, under conditions which establish that the invention is being worked and its benefits are available to the public on reasonable terms.

(11) "Small business" means a small business concern, as defined in section 2 of Public Law 85-536 (15 U.S.C. 632) and implementing regulations of the Administrator of the Small Business Administration.

(13) "State" means a State or territory of the United States, the District of Columbia, or the Commonwealth of Puerto Rico. "Local" refers to any domestic county, municipality, or other governmental entity.

(14) "Will", except as the context otherwise requires, has the same meaning as "shall".

AMENDMENTS TO OTHER ACTS

Sec. 508. (a) Section 10(a) of the Act of June 29, 1935, as added by title 1 of the Act of August 14, 1946 (7 U.S.C. 427i(a); 60 Stat. 1085) is amended by striking out the following: "Any contracts made pursuant to this authority shall contain requirements making the results of research and investigations available to the public through dedication, assignment to the Government, or such other means as the Secretry shall determine.

(b) Section 205(a) of the Act of August 14, 1946 (7 U.S.C. 1624(a); 60 Stat. 1090) is amended by striking out the following: "Any contract made pursuant to this section shall contain_requirements making the result of such research and investigations available to the public by such means as the Secretary of Agriculture shall determine.".

(c) Section 501(c) of the Federal Coal Mine Health and Safety Act of 1969 (30 U.S.C. 951(c); 83 Stat. 742) is amended by striking out the following: "No research, demonstrations, or experiments shall be carried out, contracted for, sponsored, cosponsored, or authorized under authority of this Act, unless all information, uses, products, processes, patents, and other developments resulting from such research, demonstration, or experiments will (with such exception and limitation, if any, as the Secretary or the Secretary of health, Education, and Welfare may find to be necessary in the public interest) be available to the general public.".

(d) Section 106(c) of the National Traffic and Motor Vehicle Safety Act of 1966 (15 U.S.C. 1395(c); 80 Stat. 721) is repealed.

(e) Section 12 of the National Science Foundation Act of 1950 (42 U.S.C. 1871; 64 Stat. 149, 154) is repealed.

(f) Section 152 of the Atomic Energy Act of 1954 (42 U.S.C. 2182; 68 Stat. 943) is repealed.

(g) The National Aeronautics and Space Act of 1958 (72 Stat. 426) is amended(1) By repealing section 305 (42 U.S.C. 2457). However, subsections (c), (d), and (e) of section 305 shall continue to be effective with respect to any application for patents in which the written statement referred to in subsection (c) of such section has been filed or requested to be filed by the Commissioner of Patents and Trademarks before the effective date of this Act;

(2) By striking out, in section 306(a) (42 U.S.C. 2458(a), "(as defined by section 305)"; and by striking out "the Inventions and Contributions Board, established under section 305 of this Act" and inserting instead: "an Inventions and Contributions Board which shall be established by the Administrator within the Administration";

(3) By inserting at the end of section 203(c) (42 U.S.C. 2478(c)) the following new paragraph:

"(14) To provide effective contractual provisions for reporting the results of the activities of the Administration, including full and complete technical reporting of any innovation made in the course of or under any contract of the Administration."; (4) By inserting at the end of section 203 (42 U.S.C. 2478) the following new subsection,"

"(d) For the purposes of chapter 17 of title 35 of the United States Code the Administration shall be considered a defense agency of the United States." and (5) By striking out the following in such section:

"(Including patents and rights thereunder)".

(h) Section 6 of the Coal Research and Development Act of 1960 (30 U.S.C. 666; 74 Stat. 337) is repealed.

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