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The invention identified above is a “Sub- of the Government in or under any Ject Invention" under Patent Rights Clause,

patents or applications for patents to the ASPR 9(-------- --) in

Commissioner of Patents for recording in (Identify clause) (date)

accordance with Executive Order No. cluded in Contract No.

which (does) (does not) include Communication

9424 of February 18, 1944. Satellite paragraph of ASPR 9-107.9 (32 F.R. 530, Jan. 18, 1967) (---

.-). This document is con(date)

§ 9.110 Reporting of royalties—antici. firmatory of all rights granted to the Govern

pated or paid. ment under such clause.

(a) (1) The term "royalties," as used The contractor agrees that the Govern

in this subpart, refers to any costs or ment is not estopped at any time to contest

charges in the nature of royalties, license the enforceability, validity, or scope of or title to the patent application identified

fees, patent or license amortization above or any patent resulting therefrom.

costs, or the like, for the use of or for It is understood and agreed that this docu- rights in patents or patent applications. ment does not preclude the Government

(2) To determine whether royalties from asserting rights under the provisions of anticipated or actually paid under Govsaid contract or of any other agreement be- proper, or inconsistent with rights which tween the Government and the Contractor, or

ernment contracts are excessive, imany other rights of the Government with re- the Government may possess in parspect to each of the above-identified inven

ticular inventions, patents, or patent aptions. Signed this day of

19...

plications, the Departments shall re(SEAL)

quire royalty information and reports as (Contractor)

prescribed below. See $ 9.112 for action

to be taken to reduce or eliminate excesAttest: By

sive or improper royalties.

(3) Royalty information should not (Business Address)

be required in formally advertised con(c) A contractor disclosing a Subject tracts. When it is expected that work Invention pursuant to paragraph (c) (1) may be performed in the United States, (i) of the clause in $ 9.107–5(a) may, un- its possessions, or Puerto Rico, any der paragraph (h) of said clause (or solicitation which may result in a negothe alternate paragraph (h) in $ 9.107– tiated contract for which royalty infor:5(c)), not later than three months after mation is desired, or for which cost or making such a disclosure, request greater pricing data are obtained under $ 3.807– rights than the license reserved to the 3 of this chapter, shall contain a special contractor in paragraph (b) of said provision substantially as follows: clause. Therefore, in the administration

ROYALTY INFORMATION (1961 AUGUST) of these clauses the contractor shall not be required to execute an assignment un

When the response to this solicitation til this three-month period has expired,

contains costs or charges for royalties totaland then usually only if the Government

ing more than $250, the following informa

tion shall be furnished with the offer, prointends to file a patent application. posal, or quotation on each separate item 132 F.R. 529, Jan. 18, 1967, as amended at of royalty or license fee: 35 F.R. 6833, Apr. 30, 1970]

(1) Name and address of licensor;

(ii) Date of license agreement; § 9.109–5 Register of Government

(111) Patent numbers, patent application rights in inventions.

serial numbers or other basis on which the (a) Licenses, assignments, or other

royalty is payable; documents evidencing any rights of the

(iv) Brief description, including any part

or model numbers of each contract item or Government in inventions shall be re

component on which the royalty is payable; viewed by the Departments to assure that (v) Percentage or dollar rate of royalty each such document fully confirms the

per unit; rights to which the Government is en- (vi) Unit price or contract Item; titled.

(vii) Number of units; and

(vill) Total dollar amount of royalties. (b) The original and a copy of each such document shall be forwarded to the

DD Form 783, Royalty Report, is approved activity designated by Departmental reg

for use in furnishing the above information.

In addition, if specifically requested by the ulations for receiving such documents.

contracting officer prior to execution of the This latter activity shall forward the

contract, a copy of the current license agreeoriginals of all licenses, assignments, or ment and identification of applicable claims other documents evidencing any rights of specific patents shall be furnished.

(b) If the work is to be performed in the United States, its possessions or Puerto Rico, then upon receipt of an offer, proposal, or quotation which includes a charge for royalties, the contracting officer shall, prior to award of the contract, forward the information called for by paragraph (a) of this section to the office having cognizance of patent matters for the procuring activity concerned. The cognizant ofice shall promptly advise the contracting oficer of appropriate action. The contracting oficer shall then take action with respect to such royalties, with due regard to all pertinent factors relating to the proposed procurement.

(c) Where subcontract work is to be performed in the United States, its possessions, or Puerto Rico, the contracting oficer, when considering approval of a subcontract, shall require the same information and take the same action with respect to such subcontracts in relation to royalties as required for prime contracts under paragraph (b) of this section. However, approval need not be withheld pending receipt of advice in regard to such royalties from the office having cognizance of patent matters.

(d) (1) In negotiated contracts to be performed outside the United States, its possessions and Puerto Rico, regardless of the place of delivery, the clause set forth below shall be included. See $ 16.806 for an approved form for optional use by contractors in submitting the required report. REPORTING OF ROYALTIES (FOREIGN) (OCTOBER

1966) (a) If this contract is in an amount which exceeds fifty thousand U.S. dollars ($50,000), the Contractor shall report in writing to the Contracting Officer during the performance of this contract the amount of royalties paid or to be paid by the Contractor directly to others in the performance of this contract. The Contractor shall also (1) furnish in writing any additional information relating to such royalties as may be requested by the Contracting Officer, and (11) insert a provla sion similar to this clause in any subcontract hereunder which involves an amount in excess of the equivalent of fifty thousand U.S. dollars ($50,000).

(b) The term "royalties" as used herein refers to any costs or charges in the nature of royalties, license fees, patent or license amortization costs, or the like for the use of or for rights in patents or patent applications.

(2) The contracting officer shall forward a copy of each positive royalty re

port received in accordance with the clause in subparagraph (1) of this paragraph to the office having cognizance of patent matters for the procuring activity concerned. (32 F.R. 530, Jan. 18 ,1967, as amended at; 34 F.R. 9278, June 12, 1969] § 9.111 Refund of royalties.

When a fixed-price-type contract is negotiated under circumstances which make it questionable whether or not substantial amounts of royalties will have to be paid by the contractor or his subcontractors, such royalties may be included in the target or contract price, with provision made in the contract that the Government will be reimbursed the amount of such royalties if they are not paid. Such circumstances might include, for example, either a pending antitrust action by the Government or pending or prospective litigation challenging the validity of a patent or patents or the enforceability of an agreement upon which the contractor or subcontractor bases the asserted obligation to pay the royalties to be included in the target or contract price. In the event the contracting officer determines that a refund of royalties clause should be included, the following clause shall be used in firm fixed-price contracts. It shall be appropriately modified for use in incentive contracts.

REFUND OF ROYALTIES (FEBRUARY 1968)

(a) The contract price includes certain amounts for royalties payable by the Contractor or subcontractor or both, which amounts have been reported to the Contracting Officer.

(b) The term “royalties" as used in this clause refers to any costs or charges in the nature of royalties, license fees, patent or license amortization costs, or the like, for the use or for rights in patents and patent applications in connection with the performance of this contract or any subcontract bereunder.

(c) The Contractor shall furnish to the Contracting Officer, before inal payment under this contract, a statement of royalties paid or required to be paid in connection with the performance of this contract and subcontracts hereunder together with the reasons therefor.

(d) The Contractor will be compensated for royalties reported under (c) above only to the extent that such royalties were included in the contract price and are determined by the Contracting Officer to be properly chargeable to the Government and allocable to the contract. Therefore, to the extent that any royalties which are included

in the contract price are not in fact paid by Subpart B-Data and Copyrights the Contractor or are determined by the Contracting Officer not to he properly charge- § 9.200 Scope of subpart. able to the Government and allocable to the contract, the contract price shall be re

This subpart sets forth the Departduced. Repayment or credit to the Govern

ment of Defense policy, implementing ment shall be made as the Contracting instructions, and contract clauses with Officer directs.

respect to acquisition of rights in techni(e) If, at any time within three (3) years cal and other data and copyrights. It subsequent to final payment under this con

relates only to the acquisition of rights tract, the Contractor for any reason is relieved in whole or in part from the payment

in data and does not establish requireof the royalties included in the final con

ments for data. tract price as adjusted pursuant to paragraph

(30 F.R. 6968, May 25, 1965) (d) above, the Contractor shall promptly notify the Contracting Officer of that fact

$9.201 Definitions. and shall reimburse the Government in a For the purposes of this subpart the corresponding amount.

following terms have the meanings set (f) The substance of this clause, including

forth below: this paragraph (f), shall be included in any subcontract in which the amount of royalties

(a) “Data" means writings, sound rereported during negotiation of the subcon

cordings, pictorial reproductions, drawtract exceeds two hundred and fifty dollars ings, or other graphic representations ($250).

and works of similar nature, whether or [32 F.R. 530, Jan. 18, 1967, as amended at not copyrighted. The term does not in33 F.R. 7400, May 18, 1968]

clude financial reports, cost analyses, and

other information incidental to contract & 9.112 Adjustment of royalties.

administration. (a) If at any time the contracting (b) "Limited rights" means rights to oficer has reason to believe that any use, duplicate, or disclose technical data, royalties paid, or to be paid, under an in whole or in part, by or for the Governexisting or prospective contract or sub- ment, with the express limitation that contract are inconsistent with Govern- such technical data shall not, without ment rights, excessive, or otherwise im- the written permission of the party furproper, he shall promptly report the

nishing such technical data, be released facts to the office having cognizance

or disclosed in whole or in part outside of patent matters for the procuring ac

the Government, used in whole or in tivity concerned. The cognizant office shall review the royalties thus reported

part by the Government for manufacand such royalties as are reported under

ture, or used by a party other than the $8 9.110 and 9.111. In coordination with

Government, except for: the contracting officer, the cognizant

(1) Emergency repair or overhaul work office shall:

only, by or for the Government, where (1) Take prompt action to protect the the item or process concerned is not Government against payment of royal

otherwise reasonably available to enable ties on supplies or services (i) with re- timely performance of the work: Prospect to which the Government has a vided, That the release or disclosure royalty-free license, or (ii) at a rate in thereof outside the Government shall be excess of the rate at which the Govern- made subject to a prohibition against ment is licensed, or (iii) when the royal- further use, release or disclosure; or ties in whole or in part otherwise consti- (2) Release to a foreign government, tute an improper charge; and

as the interest of the United States may (2) In appropriate cases obtain a re- require, only for information or evaluafund pursuant to a “Refund of Royal- tion within such government or for emerties" clause or enter into negotiation for

gency repair or overhaul work by or for a reduction of royalties.

such government under the conditions (b) For guidance in evaluating infor- of subparagraph (1) of this paragraph. mation furnished pursuant to $ 9.110 and (c) “Unlimited rights” means rights paragraph (a) of this section, see to use, duplicate, or disclose technical $ $ 15.205–36 and 15.309–33 of this chap- data in whole or in part, in any manner ter. Also see $ 15.107 of this chapter

and for any purpose whatsoever, and to regarding advance understandings on have or permit others to do so. particular cost items, including royalties.

(30 F.R. 6969, May 25, 1965, as amended at (32 F.R. 531, Jan. 18, 1967)

34 F.R. 17897, Nov. 5, 1969)

8 9.202 Acquisition of rights in techni. technical data to cases of actual need. cal data.

Certainly the Government must not be (30 FR. 6969, May 25, 1965)

barred from bargaining and contracting

to obtain such technical data as it needs, 9.202–1 Background.

even though that data may normally not (a) Government's interest in technical be disclosed in commercial practice. data. The Government has extensive Moreover, when the Government pays needs for many kinds of technical data. for research and development work Its needs may well exceed those of pri- which produces new knowledge, products vate commercial customers. For defense or processes, it has an obligation to foster purposes millions of separate equipment technological progress through wide disand supply items, ranging from standard semination of the new and useful inforto unique types, must be acquired, op- mation derived from such work and erated, and maintained, often at points where practicable to provide competitive remote from the source of supply. Func- opportunities for supplying the new tions requiring varied kinds of technical products and utilizing the new processes. data include training of personnel, over- At the same time, acquiring, maintainhaul and repair, cataloging, standardiza- ing, storing, retrieving, and distributing tion, inspection and quality control, technical data in the vast quantities packaging, and logistics operations. generated by modern technology is costly Data resulting from research and devel- and burdensome for the Government. opment contracts must be obtained, or- For this reason alone, it would be necesganized and disseminated to many dif- sary to control closely the extent and ferent users. Finally, the Government nature of data procurement. Such conmust make technical data widely avail- trol is also necessary to insure Goverable in the form of contract specifications ment respect for its contractors' ecoin order to obtain competition among its nomic interest in technical data relating suppliers, and thus further economy in to their privately developed items. The Government procurement.

policies and procedures of this subpart (b) Contractors' interest in technical are framed in the light of these condata. Commercial organizations have a siderations. valid economic interest in data they have (30 F.R. 6969, May 25, 1965, as amended at developed at their own expense for com- 33 F.R. 7400, May 18, 1968) petitive purposes. Such data, particu

$ 9.202–2 Policy. larly technical data which discloses details of design or manufacture, is often (a) General. It is the policy of the closely held because its disclosure to Department of Defense to acquire only competitors could jeopardize the com

such data and rights therein as are petitive advantage was developed to

essential to meet Government needs. provide. Public disclosure of such tech- (b) Unlimited rights. Technical data nical data can cause serious economic in the following categories, when specihardship to the originating company.

fied in any contract as being required for (c) The balancing of interests. It is

delivery, or subject to order under the apparent that there is no necessary cor

contract, shall be acquired with unrelation between the Government's need limited rights: for technical data and its contractors' (1) Technical data resulting directly economic interests therein. However, in from performance of experimental, debalancing the Government's require- velopmental, or research work which was ments for technical data against the con

specified as an element of performance in tractor's interest in protecting his data,

a Government contract or subcontract; it should be recognized that there may

(2) Technical data necessary to enbe a considerable identity of interest.

able others to manufacture end-items, This is particularly true in the case of innovative contractors who can best be

components and modifications, or to enencouraged to develop at private expense

able them to perform processes, when the items of military usefulness where their

end-items, components, modifications or rights in such items are scrupulously pro- processes have been, or are being, detected. It is equally important that the veloped under Government contracts or Government foster successful contractual subcontracts in which experimental, derelationships and encourage a ready velopmental or research work was speciflow of data essential to Government fied as an element of contract performneeds by confining its acquisitions of ance, except technical data pertaining to items, components or processes de- procedure should apply only to that data veloped at private expense;

for which rights may practicably be (3) Technical data constituting cor

identified. Although the agreement may rections or changes to Government-furn- also cover data to be delivered with unished data;

limited rights, in no case shall the pro(4) Technical data pertaining to end

cedure be used to require the contractor items, components or processes which

to furnish, with unlimited rights, data was prepared for the purpose of identify

which he is entitled to furnish with ing sources, size, configuration, mating

limited rights under the policy in paraand attachment characteristics, func

graph (c) of this section. The contracttional characteristics, and performance

ing officer shall consult his counsel as requirements (“form, fit and function" fully as possible in determining whether data, e.g., specification control drawings,

to use the procedure and in connection catalog sheets, envelope drawings, etc.);

with the various steps of the procedure. (5) Manuals or instructional mate

(2) Any agreements reached shall be rials prepared for installation, operation,

incorporated in the Schedule of the conmaintenance or training purposes; and

tract directly or by reference and shall (6) Other technical data which has

describe specifically the data which may been, or is normally furnished without

be furnished with limited rights purrestriction by a contractor or subcon

suant to paragraph (c) of this section. tractor.

The contracting officer may, however, re(c) Limited rights. Except as pro

view the data asserted to be limited

rights data to determine whether to invided in paragraph (b) of this section, technical data pertaining to items, com

voke the procedures of paragraph (g) of

this section to negotiate to purchase unponents or processes developed at private

limited rights in any of the data, or expense will be acquired with limited rights if ordered.

adopt some alternative such as to:

(i) Delete or modify the requirement (It should be clearly understood that the for the data in which the Government above statement of policy is a recital of rights would need unlimited rights if it were to be acquired in certain categories of data 11

ordered, or the data is called for under the contract. Neither the foregoing statement of data

(ii) Modify the specifications so as not rights policy, nor its implementing paragraph

to require or permit the use of the item, (b) (1) and (2) of the Basic Data clause in component or process covered by the $ 9.203(b), establishes data requirements for limited rights data, or a particular contract. It should also be (iii) Include a contractual option to noted that data pertaining to items, com- acquire unlimited rights. ponents or processes developed at private ex

(3) When the predetermination of pense may be called for, required, or otherwise furnished under paragraph (b) (1),

rights in data procedure is to be used, (3), (4), (5) and (6) of this section and, as

include the following provision in the such, it will be acquired with unlimited Request for Proposals. rights. Contract clauses and the schedule

PREDETERMINATION OF RIGHTS IN DATA establish the form and type of data to be

(AUGUST 1969) furnished; the categories into which such delivered data fall, determine the rights to (a) The offeror is requested to identify in be obtained by the Government to use or his proposal which of the below listed data publish such data.)

(including those to be furnished in whole or

in part by a subcontractor) when delivered, (d) Predetermination of rights in data. may be marked with a restrictive legend of (1) (i) When the Government needs the kind quoted in paragraph (b) of the data with unlimited rights, any data

"Rights in Technical Data" clause of this which the offeror intends to deliver with

Solicitation. This identification need not be limited rights pursuant to paragraph (c)

made as to data which relate to standard

commercial items which are manufactured of this section should be identified prior

by more than one source of supply. to contrct award, if feasible, and an (The Solicitation should list here that data agreement with respect thereto shall be

or portions thereof with respect to which the incorporated in the contract. This pro- Government proposes use of the predetercedure is called predetermination of mination procedure. Data which clearly rights in data.

comes within paragraph (b) (1) of the (ii) The procedure may be initiated

"Rights in Technical Data" clause and

would therefore be acquired with unlimited by the contracting officer or an offeror

rights should not be listed.) during the negotiation of a negotiated (b) Limited rights data may be identified contract. In order to be productive, the as such, pursuant to (a) above only if it

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