[Code of Federal Regulations]

[Title 37, Volume 1]

[Revised as of July 1, 2006]

From the U.S. Government Printing Office via GPO Access

[CITE: 37CFR401.5]



[Page 702-704]

 

              TITLE 37--PATENTS, TRADEMARKS, AND COPYRIGHTS

 

  CHAPTER IV--ASSISTANT SECRETARY FOR TECHNOLOGY POLICY, DEPARTMENT OF 

                                COMMERCE

 

PART 401_RIGHTS TO INVENTIONS MADE BY NONPROFIT ORGANIZATIONS AND SMALL 

BUSINESS FIRMS UNDER GOVERNMENT GRANTS, CONTRACTS, AND COOPERATIVE 

AGREEMENTS--Table of Contents

 

Sec.  401.5  Modification and tailoring of clauses.



    (a) Agencies should complete the blank in paragraph (g)(2) of the 

clauses at Sec.  401.14 in accordance with their own or applicable 

government-wide regulations such as the Federal Acquisition Regulation. 

In grants and cooperative agreements (and in contracts, if not 

inconsistent with the Federal Acquisition Regulation) agencies wishing 

to apply the same clause to all subcontractors as is applied to the 

contractor may delete paragraph (g)(2) of the clause and delete the 

words ``to be performed by a small business firm or domestic nonprofit 

organization'' from paragraph (g)(1). Also, if the funding agreement is 

a grant or cooperative agreement, paragraph (g)(3) may be deleted. When 

either paragraph (g)(2) or paragraphs (g) (2) and (3) are deleted, the 

remaining paragraph or paragraphs should be renumbered appropriately.

    (b) Agencies should complete paragraph (l), ``Communications'', at 

the end of the clauses at Sec.  401.14 by designating a central point of 

contact for communications on matters relating to the clause. Additional 

instructions on communications may also be included in paragraph (l).

    (c) Agencies may replace the italicized words and phrases in the 

clauses at Sec.  401.14 with those appropriate to the particular funding 

agreement. For example, ``contracts'' could be replaced by ``grant,'' 

``contractor'' by ``grantee,'' and ``contracting officer'' by ``grants 

officer.'' Depending on its use, ``Federal agency'' can be replaced 

either by the identification of the agency or by the specification of 

the particular office or official within the agency.

    (d) When the agency head or duly authorized designee determines at 

the time of contracting with a small business firm or nonprofit 

organization that it would be in the national interest to acquire the 

right to sublicense foreign governments or international organizations 

pursuant to any existing treaty or international agreement, a sentence 

may be added at the end of paragraph (b) of the clause at Sec.  401.14 

as follows:





[[Page 703]]





    This license will include the right of the government to sublicense 

foreign governments, their nationals, and international organizations, 

pursuant to the following treaties or international agreements:



----------------.





The blank above should be completed with the names of applicable 

existing treaties or international agreements, agreements of 

cooperation, memoranda of understanding, or similar arrangements, 

including military agreements relating to weapons development and 

production. The above language is not intended to apply to treaties or 

other agreements that are in effect on the date of the award but which 

are not listed. Alternatively, agencies may use substantially similar 

language relating the government's rights to specific treaties or other 

agreements identified elsewhere in the funding agreement. The language 

may also be modified to make clear that the rights granted to the 

foreign government, and its nationals or an international organization 

may be for additional rights beyond a license or sublicense if so 

required by the applicable treaty or international agreement. For 

example, in some exclusive licenses or even the assignment of title in 

the foreign country involved might be required. Agencies may also modify 

the language above to provide for the direct licensing by the contractor 

of the foreign government or international organization.

    (e) If the funding agreement involves performance over an extended 

period of time, such as the typical funding agreement for the operation 

of a government-owned facility, the following language may also be 

added:



    The agency reserves the right to unilaterally amend this funding 

agreement to identify specific treaties or international agreements 

entered into or to be entered into by the government after the effective 

date of this funding agreement and effectuate those license or other 

rights which are necessary for the government to meet its obligations to 

foreign governments, their nationals and international organizations 

under such treaties or international agreements with respect to subject 

inventions made after the date of the amendment.



    (f) Agencies may add additional subparagraphs to paragraph (f) of 

the clauses at Sec.  401.14 to require the contractor to do one or more 

of the following:

    (1) Provide a report prior to the close-out of a funding agreement 

listing all subject inventions or stating that there were none.

    (2) Provide, upon request, the filing date, patent application 

number and title; a copy of the patent application; and patent number 

and issue date for any subject invention in any country in which the 

contractor has applied for a patent.

    (3) Provide periodic (but no more frequently than annual) listings 

of all subject inventions which were disclosed to the agency during the 

period covered by the report.

    (g) If the contract is with a nonprofit organization and is for the 

operation of a government-owned, contractor-operated facility, the 

following will be substituted for paragraph (k)(3) of the clause at 

Sec.  401.14(a):



    (3) After payment of patenting costs, licensing costs, payments to 

inventors, and other expenses incidental to the administration of 

subject inventions, the balance of any royalties or income earned and 

retained by the contractor during any fiscal year on subject inventions 

under this or any successor contract containing the same requirement, up 

to any amount equal to five percent of the budget of the facility for 

that fiscal year, shall be used by the contractor for scientific 

research, development, and education consistent with the research and 

development mission and objectives of the facility, including activities 

that increase the licensing potential of other inventions of the 

facility. If the balance exceeds five percent, 75 percent of the excess 

above five percent shall be paid by the contractor to the Treasury of 

the United States and the remaining 25 percent shall be used by the 

contractor only for the same purposes as described above. To the extent 

it provides the most effective technology transfer, the licensing of 

subject inventions shall be administered by contractor employees on 

location at the facility.



    (h) If the contract is for the operation of a government-owned 

facility, agencies may add the following at the end of paragraph (f) of 

the clause at Sec.  401.14(a):



    (5) The contractor shall establish and maintain active and effective 

procedures to ensure that subject inventions are promptly identified and 

timely disclosed and shall submit a description of the procedures to the



[[Page 704]]



contracting officer so that the contracting officer may evaluate and 

determine their effectiveness.



[52 FR 8554, Mar. 18, 1987, as amended at 60 FR 41812, Aug. 14, 1995]