Contractor further recognizes that it is the policy of the Government not to pay in connection with its contracts, or to allow to be paid in connection with contracts made with funds derived through the Military Assistance Program or otherwise through the United States Government, charges for use of patents in which the Government holds a royalty-free license. In recognition of this policy, the Contractor agrees to participate in and make appropriate arrangements for the exclusion of such charges for such contracts or for the refund of amounts received by the Contractor with respect to any such charges not so excluded.

If it is

(c) Contract clause (title). The clause set forth below shall be included in contracts in which its use in place of the clause set forth in paragraph (b) of this section has been authorized in accordance with § 9.107-1(d). so directed by higher authority, paragraph (c) of the clause set forth below, relating to subcontracts, may be replaced, or supplemented in regard to particular subcontracts, by provisions substantially similar to those provided in paragraph (b) of this section, or other provisions acquiring from the subcontractor for the benefit of the Government patent rights at least equivalent to those provided in paragraph (b) of this section. If paragraph (c) is not so replaced, and during the course of contract performance the contractor notifies the contracting officer that a subcontractor refuses to accept a clause containing the provisions of the clause set forth below, the contracting officer may, if he determines that Government acquisition of title under the particular subcontract is not essential for the purposes of the prime contract, authorize the contractor to insert in the particular subcontract, in lieu of the paragraph set forth below, provisions equivalent to those provided in paragraph (b) of this section. Optional paragraph (g) may be used if directed by higher authority to apply to specific inventions disclosed in a patent application filed prior to the award of the contract.

PATENT RIGHTS (TITLE) (JAN. 1961)

(a) The Contractor agrees to grant the Government all right, title, and interest in and to any invention conceived or first actually reduced to practice either:

(1) In the performance of the experimental, developmental, or research work called for or required under this contract;

or

(11) In the performance of any experimental, developmental, or research work re

lating to the subject matter of this contract which was done upon an understanding in writing that a contract would be awarded;

by any employee of the Contractor who, by reason of the nature of his duties in connection with the performance of this contract, would reasonably be expected to make inventions.

(b) With respect to inventions referred to in (a) above, the Contractor shall furnish to the Contracting Officer the following information and reports:

(1) A written disclosure promptly after conception or first actual reduction to practice of each such invention;

(11) Interim reports at least every twelve months, commencing with the date of this contract, each listing all such inventions conceived or first actually reduced to practice more than three months prior to the date of the report, and not listed on a prior interim report, or certifying that there are no such unreported inventions;

(iii) Prior to final settlement of this contract, a final report listing all such inventions including all those previously listed in interim reports; and

(iv) At the earliest practicable date, information concerning publication of each such invention made by or known to the Contractor or, where applicable, of any contemplated publication by the Contractor, stating the date and identity of such publication or contemplated publication.

(c) The Contractor shall, unless otherwise authorized by the Contracting Officer, include a patent rights clause containing all of the provisions of this Patent Rights clause (including this paragraph (c)) in each subcontract hereunder of three thousand dollars ($3,000) or more having experimental, developmental, or research work as one of its purposes.

(d) The Contractor shall obtain the execution of and deliver to the Contracting Officer any documents relating to inventions referred to in (a) above as the Contracting Officer may require to enable the Government to file and prosecute patent applications therefor in any country.

(e) In the event that the Government determines not to file a patent application on any invention referred to in (a) above in any particular foreign country or fails to take such action (1) within six months of the filing of an application for the United States patent on the invention, or (ii) within six months of the declassification of the invention if under a security classification, or (iii) within six months after disclosure of the invention to the Government pursuant to (b) (1) above, whichever is later, the Contracting Officer may authorize the Contractor to file a patent application in such foreign country and retain ownership thereof, subject to an irrevocable, nonexclusive, royalty-free license to the Government in any patent which may issue thereon in such foreign country, including the power to issue

sublicenses for use in behalf of the Government and in furtherance of the foreign policies of the Government, including the right to grant nonexclusive, nontransferable, royalty-free licenses to United States citizens and to United States corporations when seventy-five percent (75%) or more of the voting interest is owned by United States citizens.

(f) If the Contractor fails to deliver to the Contracting Officer the interim reports required by (b) (ii) above, or fails to furnish the written disclosures for all inventions required by (b) (1) above shown to be due in accordance with any interim report delivered under (b) (11) or otherwise known to be unreported, there shall be withheld from payment until the Contractor shall have corrected such failures either ten percent (10%) of the amount of this contract, as from time to time amended, or five thousand dollars ($5,000), whichever is less, After payment of eighty percent (80%) of the amount of this contract, as from time to time amended, payment shall be withheld until a reserve of either ten percent (10%) of such amount, or five thousand dollars ($5,000), whichever is less, shall have been set aside, such reserve or balance thereof to be retained until the Contractor shall have furnished to the Contracting Officer.

(1) The final report required by (b) (111) above; and

(11) Written disclosures for all inventions required by (b)(i) above which are shown to be due in accordance with interim reports delivered under (b) (ii) above, or in accordance with such final reports, or are otherwise known to be unreported.

The maximum amount which may be withheld under this paragraph (f) shall not exceed ten percent (10%) of the amount of this contract or five thousand dollars ($5,000), whichever is less, and no amount shall be withheld under this paragraph (f) when the amount specified by this paragraph (f) is being withheld under other provisions of this contract. The withholding of any amount or subsequent payment thereof to the Contractor shall not be construed as a waiver of any rights accruing to the Government under this contract. This paragraph (f) shall not be construed as requiring the Contractor to withhold any amounts from a subcontractor to enforce compliance with the patent provisions of a subcontract.

(a)

(g) (1) Paragraph of this Patent Rights clause shall not be applicable to the inventions covered in [Insert serial numbers and filing dates of patent applications], but the Contractor agrees to grant to the Government an irrevocable, nonexclusive, nontransferable, and royalty-free license to practice, and cause to be practiced by or for the United States Government, throughout the world, such inventions in the manufacture, use, and disposition according to law, of any article or material, and in the use of any

method, or in the performance of any service acquired by or for the Government or with funds derived through the Mutual Security Program of the Government or otherwise through the Government. No license granted in accordance with this paragraph (g) shall convey any right to the Government to manufacture, have manufactured, or use any such inventions for the purpose of providing services or supplies to the general public in competition with the Contractor or the Contractor's commercial licensees in the licensed field, but provided, however, that the restriction of this sentence shall not be applicable in respect to any services or supplies which the Government has heretofore or may hereafter provide as a governmental function pertaining to the general public health, safety, or welfare.

(2) The Contractor, or those other than the Government deriving rights from the Contractor, shall as between the parties hereto, have the exclusive right to file applications on inventions identified in paragraph (g) (1) above in each foreign country within:

(1) nine months from the date a corresponding United States application is filed; (ii) six months from the date permission is granted to file foreign applications where such filing has been prohibited for security reasons; or

(iii) such longer period as may be approved by the Contracting officer. The Contractor shall, upon written request of the Contracting Officer convey to the Government the Contractor's entire right, title, and interest in each such invention in each foreign country in which an application has not been filed within the time above specified, subject to the reservation of a nonexclusive and royalty-free license to the Contractor together with the right of the Contractor to grant sublicenses, which 11cense and right shall be assignable to the successor of that part of the Contractor's business to which the invention pertains.

(3) The Contractor recognizes that the Government, or a foreign government with funds derived through the Mutual Security Program or otherwise through the United States Government, may contract for property or services with respect to which the vendor may be liable to the Contractor for royalties for the use of an invention identified in paragraph (g) (1) above on account of such a contract. The Contractor further recognizes that it is the policy of the Government not to pay in connection with its contracts, or to allow to be paid in connection with contracts made with funds derived through the Mutual Security Program or otherwise through the United States Government, charges for use of patents in which the Government holds a royalty-free license. In recognition of this policy, the Contractor agrees to participate in and make appropriate arrangements for the exclusion of such charges from such contracts or for the refund of amounts received by the Contractor with respect to any such charges not so excluded.

manufacture, use, and disposition according to law, of any article or material, and in the use of any method. Such license:

(i) shall be nontransferable, except that the Government shall have

(A) the right to grant sublicenses to any foreign government or international organization specifically for use in programs established by International Agreements for research, development, or production of weapons or equipment for mutual defense; and

(B) the right to grant sublicenses to others to practice each Subject Invention in the manufacture, use, and sale of any article or in the use of any method for the purpose of providing supplies or services to the general public in the furtherance of the nation's civil defense; and

(ii) shall include the practice of any Subject Invention in the manufacture, use, and disposition of any article or material, in the use of any method, or in the performance of any service acquired by or for the Government or with funds derived through the Military Assistance Program of the Government or otherwise through the Government. (Aug. 1963)

[28 F.R. 12571, Nov. 23, 1963]

§ 9.107-6 Patent license rights under product_improvement programs or independent research programs.

Where a military department under its established procedures provides substantial financial support to a contractor's:

(a) Specific product program, or

improvement

(b) Specific projects within his independent research program, the military department may obtain for the Government patent license rights to inventions, improvements, or discoveries conceived or first actually reduced to practice during or as a result of such support; provided the obtaining of such rights and the contractual arrangements for such rights are approved in the Army, the Navy, and the Defense Supply Agency by the Head of the Procuring Activity concerned; and in the Air Force by the Director or the Deputy Director, Air Force Logistics Command, or by the Director of Procurement, Headquarters, Air Force Systems Command.

[27 F.R. 11660, Nov. 27, 1962]

§ 9.107-8 Contracts relating to space.

In order that inventions arising out of Department of Defense sponsored space research and development may be available for use for the benefit of the general public in communications satellite

systems, whether such systems are operated by or for the Government or by private enterprise for the transmission of commercial or Government traffic, the paragraph set forth below, in lieu of paragraph (b)(1) of the Patent Rights clause prescribed in § 9.107-2(b) shall be inserted, except as provided in § 9.107-7, in any contract having as one of its purposes the performance of research and development work under a space program, project, or task:

(b) (1) The Contractor agrees to and does hereby grant to the Government an irrevocable, nonexclusive, and royalty-free license to practice, and cause to be practiced by or for the United States Government, throughout the world, each Subject Invention in the manufacture, use, and disposition according to law, of any article or material, and in the use of any method. Such license (i) shall be nontransferable, except that the Government shall have (a) the right to grant sublicenses to any foreign government or international organization specifically for use in programs established by International Agreements for research, development or production of weapons or equipment for mutual defense and (b) the right to grant sublicenses to others, under such terms and conditions as may be prescribed, for the practice of any Subject Invention throughout the world in the design, development, manufacture, operation, maintenance and testing of communications satellite systems, and of equipment, components, and ground tracking, transmitting and receiving facilities therefor, and (ii) shall include the practice of Subject Invention in the manufacture, use, and disposition of any article or material, in the use of any method or in the performance of any service acquired by or for the Government or with funds deriveu through the Military Assistance Program of the Government or otherwise through the

Government.

[27 F.R. 6136, June 29, 1962]

§ 9.110 Reporting of royalties.

(a) (1) The Government has acquired license and other rights under a large number of inventions as the result of Government-sponsored research and development and in other ways. In order that the Government may determine whether the charging of royalties to the Government is inconsistent with the rights which the Government has acquired or is otherwise improper, and in order that negotiation for the reduction of excessive royalties may be undertaken, the Department should be informed of royalties charged or to be charged in connection with the performance of Government contracts. Royalty infor

mation generally should not be required in formally advertised procurements.

(2) (i) Where it is expected that the work may be performed in the United States, its possessions, or Puerto Rico, any solicitations which may result in a negotiated contract estimated to exceed $10,000 shall contain a special provision substantially as follows:

ROYALTY INFORMATION (AUG. 1961)

When the response to this solicitation contains costs or charges for royalties totaling more than $250, the following information shall be furnished with the offer, proposal, or quotation on each separate item of royalty or license fee:

(1) Name and address of licensor;
(11) Date of license agreement;

(111) Patent numbers, patent application serial numbers or other basis on which the royalty is payable;

(iv) Brief description, including any part or model numbers of each contract item or component on which the royalty is payable; (v) Percentage or dollar rate of royalty per unit:

(vi) Unit price of contract items;
(vii) Number of units; and

(viii) Total dollar amount of royalties.
DD Form 783, Royalty Report, is approved
for use in furnishing the above information.
In addition, if specifically requested by the
contracting officer prior to execution of the
contract, a copy of the current license agree-
ment and identification of applicable claims
of specific patents shall be furnished.
[Subparagraph (1) and (2) (1) amended, 26
FR. 9639, Oct. 12, 1961]

Subpart B-Data and Copyrights

§ 9.202-5 Copyrights.

It is the Department of Defense policy that the Contractor shall not, without the written approval of the Contracting Officer, include copyrighted matter in data furnished to the Government unless the contractor provides the Government with the written permission of the copyright owner to use such matter in the manner provided in the contract. As to data first produced or composed under a contract, the contractor may secure a copyright except that the Government shall receive the right to duplicate, use and disclose such data for any purpose whatsoever and to have others so do. However, for certain data produced or composed for the Department, such as (a) motion pictures and works relating thereto, and (b) histories and other works relating to operation of the Department of Defense, the Government

(b) The Contractor agrees to and does hereby grant to the Government, and to its officers, agents, and employees acting within the scope of their official duties, a royaltyfree, nonexclusive and irrevocable license throughout the world for Government purposes to publish, translate, reproduce, deliver, perform, dispose of, and to authorize others so to do, all Subject Data now or hereafter covered by copyright.

(c) The Contractor shall not include in the Subject Data any copyrighted matter, without written approval of the Contracting Officer, unless he provides the Government with the written permission of the copyright owner for the Government to use such copyrighted matter in the manner provided in paragraph (b) above.

(f) Unless otherwise limited below, the Government may duplicate, use, and disclose in any manner and for any purpose whatsoever, and have others so do, all Subject Data delivered under this contract.

CODIFICATION: In § 9.203-1, the clause heading and clause paragraphs (b), (c), and (f) were amended, 27 F.R. 3452, Apr. 11, 1962. § 9.207 Data-Withholding of payment. [27 F.R. 6136, June 29, 1962]

§ 9.207-1 General.

Timely delivery of required data is particularly important for competitive procurement of follow-on quantities of the contract items and of items broken out from an assembly or equipment. The clauses set forth in § 9.207-2 are de-' signed to insure timely delivery of complete and current data. The clauses provide for a withholding of ten percent (10%) of the contract price, but the contracting officer may specify a lesser amount in the schedule if circumstances warrant. To insure effective enforcement of the clause, a case-by-case determination shall be made by the contracting officer after considering all pertinent factors, including whether the failure to make timely delivery, in accordance with the delivery schedule as originally provided or as modified, arises out of causes beyond the control and without the fault or negligence of the contractor.

[27 F.R. 6136, June 29, 1962]