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recommended in the report. Thus, when the conference report refers to the adoption of “entirely new patent provisions," it is in reference to the earlier draft of section 407 in H.R. 12575, and not in the rewrite of section 407 by the Natcher subcommittee. This is emphasized by the floor statements of Rep. Keating, which follow the report of the Natcher subcommittee rather closely in explaining the basis for new section 305.
5. 104 Congressional Record 13978 (1958) 6. House Rept. No. 2166, at 22.
7. On this point the report of the Natcher subcommittee (see note 4(h) above) states, by way of explanation of its redraft of section 407(a): “The new version is not designed to be applicable to inventors or others directly employed by the Agency as Government employees. The rights of Government employees in such matters are already set forth by Executive Order (E.O. 10096, Jan. 23, 1950).”
The report then continues with an explanation of subsection 407(b) by stating “This spells out two conditions under which the Administrator is entitled to claim ownership in invention.” The two conditions described are essentially the same as subparagraphs (1) and (2) of subsection 305(a), and are analogous to the basic policy set forth in paragraph 1. of E.O. 10096. Thus, there appears to be an intent to establish a relationship whereby, for the Administrator to be entitled to claim ownership to invention rights, the contractor employee is to be required to perform work for the Administration, indirectly through contract, in a manner analogous to the direct requirement for employees of the agency to perform such work.
8. 104 Congressional Record 13978 (1958) at 13986-13987. The provision dropped by floor amendment was section 303 (similar to section 407 in H.R. 12575) which was critized as being too much like the restrictive and arbitrary provisions of the Atomic Energy Act. Also, the statement that “—the stringent requirements in the Atomic Energy Act-are not fully applicable to the space field-” is one of the principal conclusions of the report of the Natcher subcommittee.
9. Supra, note 8, at 13987-13988. Rep. Keating's statements, like those of Rep. McCormack, are markedly consistent with, and supportive of, the conclusions and recommendations of the report of the Natcher subcommittee.
10. The Natcher subcommittee, for example, noted in its report (see note 4(h)) that the original section 407, as it stood, tended to be “arbitrary and restrictive" and might "stifle interest and private endeavors in the space research and development field.”
11. Testimony of John A. Johnson, General Counsel of NASA, during Hearing Before the Special Subcommittee on Patents and Scientific Inventions of the Committee on Science and Aeronautuics, U.S. House of Representatives, on H.R. 1934 and H.R. 6030, 87th Cong; 1st Sess., at page 17.
12. There is no question as to the binding effect of a statutory definition of a term. However, as observed by authorities on statutory construction, such as the treatise of Sutherland Statutory Construction, Sec. 4707 [Sands, 4th ed 1973] [hereinafter Southerland):
"Definitions are themselves * * * written in words whose meaning, whether viewed separately or in conjunction with the terms being defined and other language comprising their context, may be determinable only through further practice of the methods of interpretation.”
"* * * words of an act may be restricted by its subject in order to avoid repugnance with other parts of the act (cite omitted) * * * [and] [t]he application of the words of a single provision may be * * * restricted to bring the meaning of the clause in question into conformity with the intention of the legislature * * *."
13. The official interpretation reflected in the regulations and long standing practices of an administrative agency charged with the duty of enforcing a statue has great weight in determining the operation of a statute. Although not binding on a court, it is unlikely that such interpretation would be overturned unless found to be clearly erroneous. Southerland, Sec. 4905 (and cases cited therein); C.D. Stands, 4th ed. 1973; also 82 C.J.S. Statutes, Secs. 358, 359 (and cases cited therein).
14. The courts are particularly reluctant to overule a long-standing administrative interpretation of a statute where to do so would unsettle titles, or prejudice persons who have acquired contract or property rights in reliance on such construction. 82 C.J.S. Statutes, Sec. 359 (and the cases cited therein). Needless to say, a literal construction of subsection 305(a) and 305(1)(2) at this time would have the effect of unsettling a myriad of rights in any inventions that may have been made in those instances where NASA has exercised reasonable judgment in making practical interpretations consistent with the legislative purpose (e.g., as has been done regarding the preparation of proposals, supply contracts, reimbursable launch service agreements, and numerous joint endeavors).
15. The Assistant General Counsel for Patents memorandum dated June 23, 1959 to the General Counsel on The Applicability of the "Property Rights in Inventions" Sectior of the National Aeronautics and Space Act of 1958 (Section 305) to inventions made in the performance of research and development work, the cost of which is not charged to NASA.
Two significant points made in the memorandum are:
(a) “It is inconceivable that the Congress would have intended that NASA could establish a relationship with a party whereby all the inventions made by that party or its employees under the circumstances defined in Provisions (1) and (2) of subsection 305(a) would become the exclusive property of the Government merely by NASA proposing to such party that it do work for the Administration”; and
(b) “In order not to work a completely incongrous result, it is recommended that NASA interpret the terms 'proposed contract, as used in subsection 305(X2) in defining 'contracts, as relating back to work done upon an understanding that a contract would be awarded.”
16. That interpretation was made clear in the testimony of John A. Johnson, NASA General Counsel, during Hearings Before The Subcommittee on Patents and Scientific Inventions of the Committee on Science and Astronautics of the U.S. House of Representatives, on Public Law 85-568, 86th Cong. 1st Sess. In answer to a question by Rep. Fulton (pg 14) regarding the distinction between research and development contracts and supply contracts in the field of aeronautics and space, the General Counsel testified: "We did make that distinction. We have made it administratively-and we were without any published legislative history on this to help use--because we simply could not believe, in the context of this section, that every time we entered into a contract for the supply of some office supplies or something of that kind it was intended that this kind of patent clause should into it. We have confined our patent clause to—we have a rather elaborate formula in our regulations; but, to oversimplify it, it is basically a research and development type contract. We felt, after all, that this was the only reasonable intention we could read into this section of the law; but the language is so broad that some of the initial commentators on this section made it appear more horrible than it actually is in practice.”
In his response to the General Counsel's answer Rep. Fulton made the point that the “law is too broad” and went on to—"compliment the NASA, the Administrator, and the people who have been advising him on making the distinction as to the type of contract that the patent provisions apply to.”
17. The NASA Procurement Regulations (Chapter 18 of Title 41 of the Code of Federal Regulations) requires the use of a section 305 patent rights clause only in contracts which entail technical, scientific or engineering work of a kind performed in a contract having as one of its purposes (1) the conduct of basic or applied research, (2) the design or development, or manufacture for the first time, of any machine, article of manufacture, or composition of matter to satisfy NASA's specifications or special requirements, (3) any process or technique for attaining a NASA objective not readily attainable through the practice of a previously developed process or technique, or (4) the testing or practice of a previously developed process or technique to determine whether the same is suitable or could be made suitable for a NASA objective. This official interpretation was initially taken in 1959 (14 CFR 1201.101-2(a)), and is still followed (see NASA PR 9.107-4, revised Dec. 1976).
18. Statement of Mr. James B. Webb, Administrator, National Aeronautics and Space Administration, Before the Committee on Science and Astronautics, House of Representatives, August 10, 1961. (NASA News Release No. 61-173). This consideration is seen as reflected in the following language taken from Mr. Webb's statement: "The significance of the patent provisions agreed to by NASA and AT&T is that whatever form of organization may be determined to be in the public interest and approved by the Federal Communications Commission for providing communication to the public through satellite relays, that organization will be able to use inventions made by AT&T while in this cooperative relationship with NASA.”
The patent provisions of the NASA/AT&T agreement were unique in many respects: (1) inventions “conceived or first actually reduced to practice in the performance of work under or in anticipation of the Agreement on or after May 18, 1961 were, by specific agreements of the parties, to “be regarded as being made in the performance of work under a contract * ** within the meaning of section 305" of the Space Act; (2) title to such inventions was waived in advance to AT&T but in addition to the usual rights under section 305, NASA also retained the right to sublicense United States business throughout the world in the field of communications satellites; and (3) with respect to inventions made by AT&T during the period of the contract but unrelated to the contract save for being contemporaneously
made and of similar use, the Government was to receive a broad royalty-free license together with the right to require sublicenses. For a thorough analysis of the AT&T arrangement, which has not been followed in any other instance, see Allnutt, Patent Policy for Communications Satellites: A Unique Variation, 46 Marquette L. Rev. 63 (1962).
19. Assistant General Counsel for Patent Matters memorandum of February 3, 1964 to the General Counsel on Recommended Patent Clause for the Cooperative Agreement Between NASA and the Communications Satellite Corporation.
The memorandum notes that the position recommended therein for the Comsat agreement is quite different from that previously taken in the AT&T agreement. It points out, however, that the rather marked departure (taken in the NASA/AT&T agreement) from standard NASA patent practices was essentially prompted by two reasons neither of which is “effective today.”
As to the first reason, it was pointed out that the need to insure freedom of action in the communication satellite field pending a Congressional decision on a communications satellite system no longer existed in view of the establishment of the Communications Satellite Corporation under the Communication Satellite Act of 1962. 76 Stat. 421, 47 U.S.C. 721(b)(1062).
The second reason dealt with the practical difficulty of determining whether
or as a result of AT&T's independent research programs. To avoid this difficulty, the Government under the NASA/AT&T agreement acquired rights to all such inventions.
The memorandum took the position that NASA was not entitled to any rights to inventions made by Comsat or its contractors since “if Congress intended for NASA to attempt to acquire patent rights in inventions developed in the corporation funded research, either to insure royalty-free use of such inventions by the Government, or as a means of assuring effective competition among the corporation's suppliers, there is no doubt that such a prescription would have been included in the Act * * * The view that NASA is not entitled to demand such an interest in the cooperative agreement is reinforced by the fact that the FCC and not NASA is charged under the Act with the responsibility of insuring effective competition among the corporation's contractors.”
21. Agreement Between the National Aeronautics and Space Administration and Communications Satellite Corporation For Satellite Launching and Associated Services to Be Furnished By NAŠA In Connection With The Launching of Intelsat II and Certain Intelsat I Satellites, dated July 22, 1966, Article X-Property Rights in Inventions.
22. As a further clarification of this interpretation of section 305, ART II—Par. 1.C. of the NASA/Comsat Agreement (note 21) contained the following language:
"c. The Corporation represents that it proposes to do the following, which will not, however, constitute work performed under this Agreement.
(1) Provide for the design, development, and testing of all spacecraft. (2) Perform all spacecraft pre-launch tests at ETR.
(3) - - " 23. The most recent interpretation is found in paragraph 6(a) of NASA Management Instruction (NMI) 8610.8 of January 21, 1977 (14 CFR 1214.104(a)) entitled Reimbursement for Shuttle Services Provided to Non-U.S. Government Users:
“6. PATENT AND DATA RIGHTS
a. NASA will not acquire rights to inventions, patents or proprietary data privately funded by a user, or arising out of activities for which a user has reimbursed NASA under the policies set forth herein. However, in certain instances in which the NASA Administrator has determined that activities may have a significant impact on the public health, safety or welfare, NASA may obtain assurances from the user that the results will be made available to the public on terms and conditions reasonable under
the circumstances.” 24. Letter of April 6, 1959 from NASA General Counsel to Patent Counsel, General Electric Company, Cincinnati, Ohio.
26. This is not to say that NASA does not obtain rights to inventions which may result from joint activities under an endeavor. However, such rights are obtained by negotiation and agreement, and not by the imposition of subsection 305(a). Typically, when the resulting activities are of an inventive type, NASA acquires at least a royalty-free license to practice, for governmental purposes, any inventions arising from such results. On a case-by-case basis greater rights may be acquired to assure that the results of a joint endeavor are made available to the public upon reasonable circumstances.
27. For example, NASA's policy for the use of its installation research facilities by individual researchers is set forth in the NASA Supplement for the Federal Personnel Manual, Chapter B11, issued September 29, 1977, which provides: “Rights to any inventions conceived or first reduced to practice during, and resulting from use of Government facilities should be stated in the agreement.” Normally NASA should obtain a royalty free license for the U.S. Government to practice the invention for governmental purposes.
28. This policy is reflected, for example, in the Announcement of Opportunity for Materials Processing Investigations on Space Shuttle Missions (A.Q. No. QA-77-3, Feb. 8, 1977) seeking investigations comprising applied and basic research projects in branches of materials science where the weightlessness and ultra high vacuum obtainable in orbital flight can be exploited to unique advantage. It is stated, in paragraph V.2.: "For a Cooperative Project, NASA will obtain a royalty free license to practice for U.S. governmental purposes any inventions and patents resulting from the experiment and the right to use and disclose the resulting data for U.S. governmental purposes."
29. Typical arrangements where a significant NASA contribution is its satellite data are:
(a) “Agreement Between National Aeronautics and Space Administration and the GEOSAT Committee, Inc." for the purpose of demonstrating improved remote sensing techniques for mineral and petroleum exploration;
(b) “Cooperative Agreement Between the California Department of Water Resources and the National Aeronautics and Space Administration for an Application Systems Verification and Transfer (ASVT) Project involving Irrigated Land Assessment For Water Management,” to evaluate the utility of LANDSAT as a source of data for use as input to water management models and decisions;
(c) “Cooperative Agreement Between The Appalachian Regional Commission and The National Aeronautics and Space Administration For Appalachian Lineament Analysis" to conduct a joint project involving LANDSAT-derived information for certain land use purposes; and
(d) “Memorandum of Understanding Between NASA and the Agency (ESA) for LANDSAT ground stations" wherein NASA provided LANDSAT data and ESA established a system for the reception, pre-processing, archiving and dissemination of such data.
30. Thus for example, in a model “Cooperative Endeavor Agreement" under which NASA made certain of its scientific and technical data available under specified conditions and the recipient provided NASA with reports of the result of applying such data to commercial aircraft, the following patent provision was included:
(a) NASA, acting on behalf of the U.S. Government, has filed application for Letters Patent in the United States and certain foreign countries on an invention made by Richard T. Whitcomb and entitled, Airfoil Shape for Flight at Subsonic Speeds. The supercritical aerodynamic technology furnished by NASA to Lear Avia under this Agreement is based, in large part, upon the novel concepts, theories, formulae, and technology encompassed by this invention. In recognition of these contributions offered by the Government, Lear Avia agrees that should its application of such technology to commercial aircraft, as contemplated under this Agreement, result in patentable modifications or improvements to the supercritical aerodynamic technology, Lear Avia will provide NASA with the disclosure of such inventions and grant to the U.S. Government a nonexclusive, irrevocable, royalty-free license to practice such inventions throughout the world for govern
ment purposes. Such agreements have been entered into with Lear Avia, Cessna, Beech, and Gates Lear Jet.
31. Agreement of November 24, 1976, between McDonnell Douglas Corporation and NASA concerning the design, manufacture, test and delivery of a spin stabilized payload assist module for launching spacecraft.
32. Supra, note 31. Article IX-Termination for Default 33. Examples of arrangements of this type are:
(a) “Memorandum of Understanding Between The Federal Minister for Scientific Research of The Federal Republic of Germany and The United States National Aeronautics and Space Administration” for Project HELIOS, having the general objective to provide new understanding of fundamental solar processes and solar terrestrial relationships by the study of phenomena such as solar wind, magnetic and electric fields, cosmic rays, and cosmic dust.
(b) "Memorandum of Understanding Between The United States National Aeronautics and Space Administration and The Netherlands Agency for Aerospace Pro grams” for the Infrared Astronomical Satellite to perform an all-sky survey of extraplanetary, galactic and extragalactic infrared sources.
(c) “Memorandum of Understanding Between The United States National Aeronautics and Space Administration and The European Space Agency for The International Solar Polar/Out-Of-Ecliptic Mission” to conduct coordinated observations of the interplanetary medium and the Sun simultaneously in the northern and southern hemispheres of the solar system.
(d) Letter agreement between NASA and The Centre National d'Etudes Spartrales, France, selecting a proposal entitled “Multipurpose French Cooperative Environment Tests to be Conducted on NASA LDEF," for participation in the NASA Long Duration Exposure Facility (LDEF) Mission. The proposal was submitted in response to the NASA Announcement of Opportunity AO-OAST-76-1, and has as a scientific objective the investigation of the effect of long term space exposure on thin metal film and evaporated cathodes, optical coatings, holographic gratings, thermal coatings, structural materials, and fiber optics.
(e) Letter agreement between NASA and the University of Sydney, Australia, selecting a proposal entitled “Aggregation of Human Red Blood Cells,” in response to NASA Announcement of Opportunity AO-OA-77-3 (see note 28). The scientific objective of the proposed experiment is to observe the aggregation of human red blood cells under conditions approaching zero.gravity.
No patent provisions were included in examples (a)-c), but examples (d) and (e) included the following: “It is further understood that should any inventions and patents result from this project, NASA is granted a royalty-free license to practice such inventions and patents for U.S. Government purposes.
34. Representative examples of joint endeavors involving contributions of major hardware are:
(a) “Memorandum of Understanding Between The National Aeronautics and Space Administration and The European Space Research Organization for a Cooperative Programme Concerning Development, Procurement and Use of a Space Laboratory In Conjunction With the Space Shuttle," wherein ESA and its members developed the Spacelab (some of the subcontract research and development work performed by US companies) to be utilized with the NASA developed orbiter;
(b) “Memorandum of Understanding Between The National Aeronautics and Space Administration and The National Research Council of Canada For a Cooperative Program Concerning the Development and Procurement of a Space Shuttle Attached Remote Manipulator System (RMS)," wherein Canada developed the RMS to be employed on the NASA developed orbiter;
(c) “Memorandum of Understanding Between The European Space Agency and The United States National Aeronautics and Space Administration," under which ESA is to develop major hardware to be incorporated into the NASA developed telescope; and
(d) “Memorandum of Understanding Between The Department of Communications of Canada and The Centre National D'Etudes Spartrales of France and The National Aeronuatics and Space Administration of The United States of America," wherein Canada is to develop significant hardware (some to be produced in the U.S. under subcontract) to be used in and with a U.S. developed satellite.
No patent provisions were included in examples (a)-(d), above. 35. Supra, note 23.
Senator SCHMITT. Am I correct in my understanding that if NASA is merely providing a transportation capability or a capability to work in space, that section 305 of the Space Act would not apply.
Mr. MOSSINGHOFF. That's right, as long as there is a clear delineation on either side of the line on what we will provide and what the contractor will provide. And if that cooperator or contractor funds its own research and development that goes into the effort, we have concluded that technically section 305 does not apply. So we have a little more flexibility in fashioning a patent clause under the agreement that gets done what we want to get done.