Intellectual Property (IP) and Technical Data

Lesson Objectives Assess and evaluate the technical capabilities of your customer/partner Contrast the differences between patents, trademarks, and trade secrets in relation to DoD international programs Analyze the intricacies of foreign patent laws, as well as copyright and trademark treaties Infer the correct application of technical data rights

Types of IP Protection Patents and Copyrights Trademarks Trade Secrets Protect ownership rights in products created through intellectual effort (inventions, writings) Trademarks Protect business goodwill embodied in marks used “in commerce” to identify source Trade Secrets Protect guarded information which, if publicly disclosed, would cause the owner economic harm

How Are IP Rights Created or Recognized? Federal Statute Ex: Patents, Copyrights, Trademarks (R) State Statute or Common (Case) Law Ex: Trademarks (TM), Trade Secrets International Agreement Ex: Berne Convention (Copyright)

Balancing of Interests IP Laws Balance… Private owner’s right to enjoy exclusive economic benefits Public’s interest in technological advancement and right to information Impact of IP Protection… Too little: No incentive to innovate/create? Too much: No “prior art” to inspire new works?

Patents U.S. Patent - Title 35 of the U.S. Code Grants right to exclude others from making, using, or selling in U.S. for 20 years Must disclose specifications and drawings that make it obvious how to build the item Government has rights in invention(s) conceived and/or reduced to practice using government funding Government receives a nonexclusive, royalty-free, worldwide license to practice invention Contractor must disclose invention & elect whether to retain title

Foreign Patent Laws U.S. patents only protect within U.S.! In most foreign countries… Publication before application bars right to patent Maintenance fees are required Invention must be manufactured in-country within certain period after patent (3 years) Invention may be subject to grant of compulsory license to anyone who applies for a license

Patent Treaties Paris Convention Patent Cooperation Treaty 168 countries, including U.S. Affords citizens of member countries the same patent/trademark rights as each country grants its own citizens “Priority rights” for patents and trademarks Patent Cooperation Treaty 124 countries, including U.S. Centralized filing procedures Standardized application format

Copyright Copyright rights automatically attach upon completion Provides owner the right to control duplication, distribution, use, & modification of the work Permission is required from the copyright owner Marking provides notice of this right Includes ©, owner name, and year completed Owner has an absolute right to include a © marking BUT, Government – by FAR and DFARS – has license rights in any copyrighted material that is brought into a government contract or that is developed using government funding

Copyright Treaties Berne Convention 90 countries, including U.S. No copyright notice required for protection Trade-Related Aspects of Intellectual Property Rights under General Agreement on Tariffs & Trade (GATT) Universal Copyright Convention (UCC) © symbol must be used All apply “National Treatment” principle

Trademarks Word, name, symbol, smell, sound or device used in commerce as a brand name Identifies and distinguishes goods of one manufacturer or seller from others Ex: Kleenex (trademark), Roto-Rooter (service mark) Right to exclude others from using a confusingly similar mark or name

Trademark Treaties Paris Convention Trade-Related Aspects of Intellectual Property Rights Agreement Part of the General Agreement on Tariffs and Trade (GATT) Madrid Protocol

Trade Secrets Information of almost any type in almost any form which: the owner has taken reasonable measures to keep secret; and derives independent economic value from not being generally known to, or reasonably ascertainable by, the public Protection: Physically safeguard Always mark as Proprietary Information – Not for Public Release Never disclose without a nondisclosure agreement

Trade Secret Crimes 18 U.S.C. 1831, 1832, & 1905 Up to 1 year imprisonment, $1000 fine, and removal from office for unlawful release of trade secrets, processes, operations, apparatus or other proprietary information Up to 10 years imprisonment and $5M (corporate) fine for knowingly stealing/receiving trade secrets with “intent to convert” for the economic advantage of someone other than owner If benefactor is a foreign government and/or industry, then it is 15 years imprisonment and $10M fine

Technical Data Recorded data of a technical or scientific nature regardless of form Examples: research data, engineering data, repair manuals, operating manuals, installation instructions, inspection and testing data DFARS 252.227-7013 governs Govt. rights in noncommercial tech data delivered under DoD contracts Combination of copyright and trade secret law

Technical Data Rights “Follow the Funds” UNLIMITED RIGHTS: Government funded - License to use for any purpose by Government LIMITED/RESTRICTED RIGHTS: Contractor funded - License to use for contract purposes only No disclosure outside of Government Limited Rights for tech data; Restricted Rights for S/W GOVERNMENT PURPOSE RIGHTS: Partially Government funded License to use for Government purposes Includes future procurements and FMS No commercial disclosure or use

Technical Data Rights Contractor must identify technical data to be delivered with other than Unlimited Rights in its proposal May be updated after award Must deliver with Unlimited Rights if not listed Must mark with DFARS legend No protection if not properly marked

Data Rights Myths & Facts Government must “own” the technical data in order to use it Contractor “said” data was proprietary & too expensive Data must be proprietary because it was stamped as such on every page Government does not own data, but merely takes a license that allows certain use and release rights Contractor must assert and justify ‘protected’ data prior to each contract award – and has burden of proving all assertions Legends like “Proprietary” or “Company Confidential” are nonconforming and should be ordered removed

Data Rights Myths & Facts Technical data “access” is sufficient Government should only “buy” rights to technical data it has a current defined need for Mere access does not confirm rights – Formal delivery via CDRL is required to confirm Government rights Government should always aggressively pursue its automatic and default rights to technical data, as well as other rights to which it is entitled at no additional cost

Proprietary Rights Everything is “proprietary” today!! In the private arena, proprietary information derives value from not being known outside the company Others can derive value from improper disclosure/use Includes any closely held information and some public information Technical data, software docs, manuals, formulas, business data, patents, copyrights, licenses, trade secrets, IRAD technology Information is controlled by a company to safeguard its competitive edge

Proprietary Rights (cont.) Physical protection Training, access, and marking Contractual protection Confidentiality, non-disclosure, non-competition, etc. Everything gets marked “proprietary” Government/DFARS does distinguish IP from other types of business/confidential information Requires different markings for each Technical data is IP, not “proprietary” Hence, the problem! Bottom Line – “push back’ on “proprietary”!

Rely on IP Legal Counsel!! IP rights may be protected by patents, trademarks, copyrights, as trade secrets, etc. IP rights may be governed by Federal law, State law, common law, or even foreign treaty IP rights may be conveyed to the Government, by Federal data rights clauses, by standard license agreements, by negotiated contract, etc. IP-related contractual instruments (licenses, data rights clauses, NDAs, etc.) must be drafted by an IP expert