27.201-1 General
Source: FAR 27.201-1 on acquisition.gov
Contractors performing authorized work for the Government are shielded from direct infringement lawsuits but must comply with notice, assistance, and potential indemnification requirements specified in contract clauses.
Overview
FAR 27.201-1 outlines the Government's approach to patent and copyright infringement liability in federal contracts. It clarifies that, under 28 U.S.C. 1498, the exclusive remedy for infringement by or on behalf of the Government is a suit for monetary damages against the Government in the Court of Federal Claims—injunctive relief is not available, and contractors are shielded from direct lawsuits when acting with Government authorization. The section also details when and how the Government may authorize and consent to the use of patented inventions, require contractor assistance in infringement claims, and seek indemnification for certain commercial contracts. Specific FAR clauses (52.227-1, 52.227-2, and 52.227-3) are referenced for inclusion in contracts to address these issues.
Key Rules
- Exclusive Remedy for Infringement
- Only monetary damages against the Government are allowed for patent or copyright infringement; no injunctions or direct contractor liability if acting under Government consent.
- Authorization and Consent Clause
- The Government may authorize contractor use of patented inventions by including FAR 52.227-1 in contracts.
- Notice and Assistance Requirement
- Contractors must provide notice and assistance regarding infringement claims via FAR 52.227-2.
- Patent Indemnity for Commercial Items
- The Government may require contractors to indemnify it for patent infringement in commercial product/service contracts by including FAR 52.227-3.
Responsibilities
- Contracting Officers: Must include appropriate clauses (52.227-1, 52.227-2, 52.227-3) in contracts as applicable.
- Contractors: Must comply with notice, assistance, and indemnification requirements as specified in contract clauses.
- Agencies: Oversee compliance and manage infringement claims in accordance with 28 U.S.C. 1498.
Practical Implications
- This section protects contractors from direct infringement lawsuits when acting under Government authorization, but requires them to support the Government in managing claims and, in some cases, indemnify the Government. Contractors must be vigilant about the clauses included in their contracts and understand their obligations regarding intellectual property issues.
(a) Pursuant to http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title28-section1498&num=0&edition=prelim" target="_blank">28 U.S.C. 1498, the exclusive remedy for patent or copyright infringement by or on behalf of the Government is a suit for monetary damages against the Government in the Court of Federal Claims. There is no injunctive relief available, and there is no direct cause of action against a contractor that is infringing a patent or copyright with the authorization or consent of the Government (e.g., while performing a contract).
(b) The Government may expressly authorize and consent to a contractor’s use or manufacture of inventions covered by U.S. patents by inserting the clause at 52.227-1, Authorization and Consent.
(c) Because of the exclusive remedies granted in http://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title28-section1498&num=0&edition=prelim" target="_blank">28 U.S.C. 1498, the Government requires notice and assistance from its contractors regarding any claims for patent or copyright infringement by inserting the clause at 52.227-2, Notice and Assistance, Regarding Patent and Copyright Infringement.
(d) The Government may require a contractor to reimburse it for liability for patent infringement arising out of a contract for commercial products or commercial services by inserting the clause at 52.227-3, Patent Indemnity.