52.227-13
Patent Rights-Ownership by the Government
Contractors must assign patent rights for inventions made under government contracts to the Government, follow strict disclosure and reporting procedures, and ensure compliance throughout their organization and subcontracts.
Overview
FAR 52.227-13, "Patent Rights—Ownership by the Government," establishes the rules for ownership, disclosure, and management of inventions made under government contracts where the Government retains title to subject inventions. The clause details the procedures for assignment of rights, reporting requirements, minimum rights retained by both the Government and contractor, and obligations regarding subcontracts. It also addresses the Government’s ability to withhold payment for noncompliance and sets forth requirements for U.S. industry preference and record examination.
Key Rules
- Assignment of Patent Rights
- Contractors must assign worldwide title to subject inventions to the Government, with limited exceptions for greater rights determinations.
- Disclosure and Reporting
- Contractors must promptly identify, document, and disclose subject inventions, submit interim and final reports, and maintain effective internal procedures.
- Government and Contractor Rights
- The Government receives a nonexclusive, irrevocable license to practice the invention; contractors may retain a revocable, nonexclusive license under certain conditions.
- Subcontractor Flowdown
- Contractors must include equivalent patent rights clauses in all subcontracts for experimental, developmental, or research work and report subcontract awards to the Contracting Officer.
- Withholding of Payment
- The Government may withhold payments if the contractor fails to comply with invention disclosure and reporting requirements.
- Preference for U.S. Industry
- Exclusive licenses for subject inventions in the U.S. must require substantial domestic manufacture unless waived by the agency.
Responsibilities
- Contracting Officers: Ensure inclusion of the clause, monitor compliance, review disclosures, and manage payment withholdings.
- Contractors: Assign patent rights, establish and follow invention identification procedures, disclose inventions, submit required reports, flow down clauses to subcontracts, and comply with U.S. manufacturing preference.
- Agencies: Oversee contractor compliance, review requests for greater rights, and enforce reporting and payment provisions.
Practical Implications
- This clause ensures the Government secures ownership of inventions developed under its contracts, protecting public interest and enabling broad use. Contractors must implement robust internal processes for invention management and reporting, or risk payment delays and loss of rights. Failure to flow down requirements to subcontracts or to comply with reporting can result in significant contractual and financial consequences.