accordance with the procedure and criteria of 41 CFR 1-9.109-6. A request for a determination of whether the Contractor or the employee-inventor is entitled to retain such greater rights must be submitted to the Contracting Officer at the time of first disclosure of the invention pursuant to paragraph (e)(2)(i) of this clause, or not later than 3 months thereafter or such longer period as may be authorized by the Contracting Officer for good cause shown in writing by the Contractor. The information to be submitted for a greater rights determination is specified in 41 CFR 1-9.109-6. Each determination of greater rights under this contract normally shall be subject to paragraph (c) of this clause and to the reservations and conditions deemed to be appropriate by the agency.

(d) License rights of States and municipal governments. (1) When the agency head or his duly authorized designee determines at the time of contracting that it would not be in the public interest to acquire a paid-up license in inventions made in the course of or under the contract for States and domestic municipal governments, paragraph (c)(1) of the Patent Rights clauses in § 1-9.107-5 shall be replaced with the following paragraph (c)(1):

(1) Hereby grants to the Government a nonexclusive, nontransferable, paid-up license to make, use, and sell each Subject Invention throughout the world by or on behalf of the Government of the United States (including any Government agency).

(2) When the agency head or his duly authorized designee decides to reserve the right to make the determination that it would not be in the public interest to acquire a paid-up license in a Subject Invention for States and domestic municipal governments until after the invention has been identified, paragraph (c)(1) of the Patent Rights clauses in § 1-9.107-5 shall be replaced with the following paragraph (c)(1):

(1) Hereby grants to the Government a nonexclusive, nontransferable, paid-up license to make, use, and sell each Subject Invention throughout the world by or on behalf of the Government of the United States (including any Government agency), States and domestic municipal governments, unless the agency head determines after the invention has been identified that it would not be in the public interest to acquire the license for States and domestic municipal governments.

(e) Right to sublicense foreign governments. (1) When the agency head or his duly authorized designee determines at the time of contracting that it would be in the national interest to acquire the right to sublicense foreign governments pursuant to any treaty or agreement, a sentence shall be added to the end of paragraph (c)(1) of the Patent Rights clauses in § 1-9.107-5 as follows:

This license shall include the right of the Government to sublicense foreign governments pursuant to any treaty or agreement with such foreign governments.

(2) When the agency head wishes to reserve the right to make the determination to sublicense foreign governments pursuant to any treaty or agreement until after the invention has been identified, a sentence shall be added to the end of paragraph (c)(1) of the Patent Rights clauses in § 19.107-5 as follows:

This license shall include the right of the Government to sublicense foreign governments pursuant to any treaty or agreement if the agency head determines after the invention has been identified that it would be in the national interest to acquire this right.

(f) Minimum rights to Contractor (upon request). When the agency determines that the contractor may reserve a revocable, nonexclusive, royalty-free license in inventions made in the course of or under the contract, only upon a request by the contractor for the retention of such a license, paragraph (d)(1) of the clauses in § 19.107-5 shall be replaced with the following paragraph (d)(1):

(d) Minimum rights to the Contractor. (1) The Contractor may reserve upon request a revocable, nonexclusive, royalty-free license in each patent application filed in any country on a Subject Invention and any resulting patent in which the Government acquires title. The license shall extend to the Contractor's domestic subsidiaries and affiliates, if any, within the corporate structure of which the Contractor is a part and shall include the right to grant sublicenses of the same scope to the extent the Contractor was legally obligated to do so at the time the contract was awarded. The license shall be assignable only with approval of the agency except to the successor of that part of the Contractor's business to which the invention pertains.

(g) Minimum rights to Contractor (irrevocable). When the agency determines that the contractor may reserve an irrevocable, nonexclusive, royaltyfree license in the inventions resulting from the contract, paragraph (d) of the Patent Rights clauses of § 1-9.1075 shall be replaced with the following paragraph (d):

(d) The Contractor reserves an irrevocable, nonexclusive, royalty-free license in each patent application filed in any country on a Subject Invention and any resulting patent in which the Government acquires title. The license shall extend to the Contractor's domestic subsidiaries and affiliates, if any, within the corporate structure of which the Contractor is a part and shall include the right to grant sublicenses of the same scope to the extent the Contractor was legally obligated to do so at the time the contract was awarded. This license shall be transferable only with approval of the agency, except when transferred to the successor of that part of the Contractor's business to which the invention pertains.

(h) Irrevocable license on Subject Inventions previously constructively reduced to practice. When an agency decides that the contractor may reserve an irrevocable, nonexclusive and royalty-free license for practice in this country of each invention first actually reduced to practice under a contract which was conceived and constructively reduced to practice by the contractor prior to the effective date of execution of the contract, the following paragraph (d)(4) shall be added to paragraph (d) of the Patents Rights clauses in § 1-9.107-5:

(4) In addition to the provisions of paragraph (d)(1) of this clause, the Contractor reserves an irrevocable, nonexclusive, royalty-free license in each patent application filed in any country and any resulting patent on each Subject Invention constructively reduced to practice by the Contractor prior to the effective date of this contract. The license shall extend to the Contractor's domestic subsidiaries and affiliates, if any, within the corporate structure of which the Contractor is a part and shall include the right to grant sublicenses of the same scope to the extent the Contractor was legally obligated to do so at the time the contract was awarded. The license shall be assignable only with approval by the agency except to the successor of that part of the Contractor's business to which the invention pertains.

(i) Publication of invention disclosures. (1) When the agency determines that it is in the best interest of the parties to withhold the release or publication of information in an invention disclosure so that the contractor may file foreign patent applications on the invention, the following sentence shall be added to paragraph (e)(4) of the Patent Rights clauses in § 1-9.107-5 and to paragraph (b)(2) of the Patent Rights clauses in § 1-9.107-6:

If the Contractor is to file a foreign patent application on a Subject Invention, the Government agrees, upon written request of the Contractor, to use its best efforts to withhold publication of such invention disclosures until a patent application is filed thereon, but in no event shall the Government or its employees be liable for any publication thereof.

(2) When the agency determines to restrict the contractor's publication of invention disclosures prior to the filing of patent applications, the following paragraph should be added as a consecutively numbered paragraph to paragraph (e) of the Patent Rights clauses in § 1-9.107-5 and to paragraph (b)(2) of the Patent Rights clauses in § 1-9.107-6:

() In order to protect the patent interest of the Government or the Contractor, the Contractor shall obtain the written approval of the Contracting Officer prior to the release or publication of the information in any Subject Invention disclosure by the Contractor or other parties acting on his behalf.

[40 FR 19817, May 7, 1975; 40 FR 28068, July 3, 1975]

§ 1-9.107-6 Clauses for domestic contracts (short form) and Institutional Patent Agreements.

(a) Patent Rights clause-Acquisition by the Government. The following clause may be used instead of the clause of § 1-9.107-5(a) in contracts for basic or applied research with nonprofit organizations other than for the operation of a Government-owned research or production facility.

PATENT RIGHTS-ACQUISITION BY THE
GOVERNMENT (Short FORM)

(a) Definitions. "Subject Invention" means any invention or discovery of the Contractor conceived or first actually reduced to practice in the course of or under

this contract, and includes any art, method, process, machine, manufacture, design, or composition of matter, or any new and useful improvement thereof, or any variety of plant which is or may be patentable under the Patent Laws of the United States of America or any foreign country.

(b) Invention disclosures and reports. (1) The Contractor shall furnish the Contracting Officer:

(i) A complete technical disclosure for each Subject Invention, within 6 months after conception or first actual reduction to practice, whichever occurs first in the course of or under the contract, but in any event prior to any on sale, public use, or publication of the invention known to the Contractor. The disclosure shall identify the contract and inventor, and shall be sufficiently complete in technical detail and appropriately illustrated by sketch or diagram to convey to one skilled in the art to which the invention pertains a clear understanding of the nature, purpose, operation, and to the extent known, the physical, chemical, biological, or electrical characteristics of the invention;

(ii) Interim reports at least every 12 months from the date of the contract listing Subject Inventions for the period and certifying that all Subject Inventions have been disclosed or that there are no such inventions and

(iii) An acceptable final report within 3 months after completion of the contract work, listing all Subject Inventions or certifying that there were no such inventions.

(2) The Contractor agrees that the Government may duplicate and disclose Subject Invention disclosures and all other reports and papers furnished or required to be furnished pursuant to this clause.

(c) Allocation of principal rights. (1) The Contractor agrees to assign to the Government the entire right, title, and interest throughout the world in and to each Subject Invention, except to the extent that rights are retained by the Contractor under paragraphs (c)(2) and (d) of this clause.

(2) The Contractor or the employee-inventor with authorization of the Contractor may retain greater rights than the nonexclusive license provided in paragraph (d) of this clause in accordance with the procedure and criteria of 41 CFR 1-9.109-6. A request for a determination of whether the Contractor or the employee-inventor is entitled to retain such greater rights must be submitted to the Contracting Officer at the time of the first disclosure of the invention pursuant to paragraph (b)(1) of this clause, or not later than 3 months thereafter or such longer period as may be authorized by the Contracting Officer for good cause shown in

'Agency may specify a form.

writing by the Contractor. The information to be submitted for a greater rights determination is specified in 41 CFR 1-9.109-6. Each determination of greater rights under this contract shall be subject to the provisions of paragraph (c) “Minimum rights acquired by the Government" of the clause in 41 CFR 1-9.107-5(a), and to the reservations and conditions deemed appropriate by the agency.

(d) Minimum rights to the Contractor. The Contractor reserves a revocable, nonexclusive, royalty-free license in each patent application filed in any country on a Subject Invention and any resulting patent in which the Government acquires title. Revocation shall be in accordance with the proIcedure of the clause in 41 CFR 1-9.107-5(d) (2) and (3).

(e) Employee and Subcontractor agreements. Unless otherwise authorized in writing by the Contracting Officer, the Contrac tor shall:

(1) Obtain patent agreements to effectuate the provisions of this clause from all persons who perform any part of the work under this contract except nontechnical personnel, such as clerical employees and manual laborers;

or

(2) Insert in each subcontract having experimental, developmental, research work as one of its purposes provisions making this clause applicable to the Subcontractor and his employees; and

(3) Promptly notify the Contracting Officer of the award of any such subcontract by providing him with a copy of the subcontract and any amendments thereto.

(b) Patent Rights clause-Deferred (short form). This clause may be used instead of the clause of § 1-9.107-5(c) in contracts for basic or applied research with nonprofit organizations. When the agency determines that a contract falls within § 1-9.107-3(c) and that a short form Patent Rights clause is to be used pursuant to § 1-9.1074(a)(5), the Patent Rights clause set forth in § 1-9.107-6(a) shall be included in the contract except that the name of the clause shall be changed to "Patent Rights-Deferred (short form)"; and paragraph (c)(1) of that clause shall be replaced by the following paragraph (c)(1):

(1) After a Subject Invention is identified, the Contractor agrees to assign to the Government the entire right, title, and interest therein throughout the world except to the extent that rights are retained by the Contractor under paragraphs (c)(2) and (d) of this clause.

an

(c) Patent Rights-Institutional Patent Agreement. (1) When an agency has determined in accordance with § 19.109-7 that a university or a nonprofit organization should receive agreement as authorized by § 1-9.1074(a)(6), an agreement substantially as set forth in paragraph (c)(2) of this § 1-9.107-6 shall be used. The agreement shall be appropriately completed as indicated in the numbered notes appearing at the end of the agreement. Changes may be made in the agreement but shall be limited to changes required by applicable statutes or by special administrative needs. However, agencies shall endeavor to insure that agreements continue to include at least the following features:

(i) A requirement for the prompt reporting of all inventions to the applicable agency along with an election of rights;

(ii) Reservation of all rights specified in § 1-9.107-3(e) through (h);

(iii) A requirement that the institution made such inventions available on a nonexclusive basis except where the desired practical or commercial application has not been achieved or is not likely to be expeditiously achieved through licensing;

(iv) A condition limiting any exclusive license to a period not substantially greater than necessary to provide the incentive for bringing the invention to the point of practical or commercial application and to permit the licensee to recoup its costs and a reasonable profit thereon;

(v) A restriction that royalty charges be limited to what is reasonable under the circumstances or reasonable within the industry involved;

(vi) A requirement that the institution's royalty receipts, after payment of administrative costs and payments to inventors, be utilized for educational or research purposes;

(vii) A provision permitting the agency to exclude individual contracts from the operation of the agreement; (viii) A requirement for progress reports after designated periods;

(ix) A prohibition against assignment of inventions without Government approval to persons or organizations, other than assignments to approved patent management organiza

tions subject to all the conditions of this paragraph (c)(1); and

(x) A provision permitting the agreement to be terminated by either party upon 30 days written notice.

(2) The Institutional Patent Agreement prescribed for use is as follows:

INSTITUTIONAL PATENT AGREEMENT

This Agreement is made and entered into by and between the United States of America as represented by the (1), hereinafter referred to as the "Agency," and hereinafter referred to as

the "Institution."

Whereas, in accordance with the President's Memorandum and Statement of Government Patent Policy dated August 23, 1971, and the provisions of 41 CFR 1-9.1074(a)(6), it has been determined that the Institution has a technology transfer program meeting the criteria of 41 CFR 1-9.109-7 in that the Institution's patent policy as set forth in (2), and its technology transfer practices have been reviewed and found acceptable; and

Whereas, the Institution is desirous of entering into an agreement whereby it may retain the entire right, title, and interest in and administer inventions made in the course of or under research supported by the Agency, subject to certain rights acquired by the Government:

Now, therefore, in consideration of the foregoing, the parties hereto agree as follows:

(a) Scope of Agreement. This Agreement defines the rights of the parties hereto regarding the allocation of rights in subject inventions made under contracts with the agency entered into after the execution of the Agreement except such contracts as may be specifically excluded by the Agency. (3)

(b) Definitions. (1) "Subject Invention" means any invention or discovery of the Institution or its contractors conceived or first actually reduced to practice in the course of or under a contract with the Agency, and includes any art, method, process, machine, manufacture, design, or composition of matter, or any new and useful improvement thereof, and any variety of plant, which is or may be patentable under the patent Laws of the United States of America or any foreign country.

(2) "Contract" means any contract (agreement, grant, or other arrangement) (4) or subcontract thereunder of the agency entered into with or for the benefit of the Government, where a purpose of the contract is the conduct of experimental, developmental, or research work.

(3) "States and domestic municipal governments" means the States of the United States, the District of Columbia, Puerto

Rico, the Virgin Islands, American Samoa, Guam, and the Trust Territory of the Pacific Islands, and any political subdivision and agencies thereof.

(4) "To bring to the point of practical application" means to manufacture in the case of a composition or product, to practice in the case of a process, or to operate in the case of a machine and under such conditions as to establish that the invention is being worked and that its benefits are reasonably accessible to the public.

(5) "Made," when used in relation to any invention or discovery, means the conception or first actual reduction to practice of such invention in the course of or under a contract.

(c) Allocation of principal rights. (1) The Institution may retain the entire right, title, and interest throughout the world or in any country thereof in and to each Subject Invention disclosed pursuant to paragraph (e), below, subject to the provisions of this Agreement. The Institution shall include with each Subject Invention disclosure an election whether it will retain the entire right, title, and interest in the invention throughout the world or in any country thereof subject to the rights acquired by the Government in paragraph (d) of the Agreement; Provided That the Institution may request an extension of the time for election.

(2) The Institution agrees to convey to the Government, upon request, the entire domestic right, title, and interest in any Subject Invention when the Institution:

(i) Does not elect under paragraph (c)(1) to retain such rights; or

(ii) Fails to have a United States Patent Application filed on the invention in accordance with paragraph (f)(1), or decides not to continue prosecution of such application; or (iii) At any time no longer desires to retain title.

(3) The Institution agrees to convey to the Government, upon request, the entire right, title, and interest in any Subject Invention when the Institution:

(i) Does not elect under paragraph (c)(1) to retain such rights in the country; or

(ii) Fails to have a patent application filed in the country on the invention in accordance with paragraph (f)(1) or decides not to continue prosecution of such application or to pay any maintenance fees covering the invention. To avoid forfeiture of the patent application or patent, the Institution shall notify the Agency not less than 60 days before the expiration period for any action required by the foreign patent office.

(4) A conveyance, requested pursuant to paragraphs (c)(2) or (3) of this Agreement, shall be made by delivering to the Agency duly executed instruments (prepared by the Agency) and such other papers as are deemed necessary to vest in the government

the entire right, title, and interest to enable the Government to apply for and prosecute patent applications covering the invention in this or the foreign country, respectively, or otherwise establish Government ownership of such invention.

(d) Minimum rights acquired by the Government. (1) With respect to each Subject Invention to which the Institution retains principal or exclusive rights, the Institution: (i) Hereby grants to the Government of the United States a nonexclusive, nontransferable, paid-up license to make, use, and sell each Subject Invention throughout the world by or on behalf of the Government of the United States (including any Government agency) and States and domestic municipal governments, unless the Agency determines after the invention has been identified that it would not be in the public interest to acquire the license for States and domestic municipal governments; and

(ii) Agrees, upon request of the Agency, to grant licenses to responsible applicants, on terms that are reasonable under the circumstances except;

(A) When the Institution, its licensee, or its assignee, demonstrates to the Government (1) that effective steps have been taken within three years after a patent issues on such invention to bring the invention to the point of practical application or (2) that the invention has been made available for licensing royalty-free or on terms that are reasonable in the circumstances, or can show cause why the principal or exclusive rights should be retained for a further period of time; or

(B) To the extent that the invention is required for public use by governmental regulations or as may be necessary to fulfill public health or safety needs, or for other public purposes stipulated in the applicable contract.

(2) Nothing contained in this paragraph (d) shall be deemed to grant to the Government any rights with respect to any invention other than a Subject Invention.

(e) Invention identification, disclosures, and reports. (1) The Institution shall furnish the Agency:

(i) A complete technical disclosure for each Subject Invention within 6 months after conception or first actual reduction to practice, whichever occurs first in the course of or under the contract, or within 6 months from the time a contractor of the Institution reports an invention to it pursuant to paragraph (h), but in any event prior to any on sale, public use, or publication of the invention known to the Institution. The disclosure shall identify the contract and inventor and shall be sufficiently complete in technical detail to convey to one skilled in the art to which the invention pertains a clear understanding of the nature, purpose, operation, and, to the extent known, the