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8.2 Acquisition of Rights

8.2.1 General

8.2.1.a The Postal Service acquires patent rights, rights in data, and rights in software to the degree necessary to protect the Postal Service's interests. Those rights can include:

1. Postal Service title to patents.

2. Less than Postal Service title to patents, such as nonexclusive licenses.

3. Unlimited rights or title to technical data and software.

4. Limited rights to technical data and restricted rights in software. These rights may be exclusive or nonexclusive.

8.2.1.b Because the Postal Service is charged with behaving in a businesslike manner, it is appropriate for it to consider acquiring these rights in manners consistent with its business purpose. Determinations in this regard are made by the contracting officer, with the advice of the requiring activity and assigned counsel, giving full consideration to the costs and benefits of the chosen approach. Thus, for example, decisions to acquire Postal Service title to patents or unlimited rights to technical data developed by the supplier at private expense must take into account the impact on the cost of the contract and the extent to which prospective offerors may not wish to part with such rights. Conversely, determinations to take only lesser rights must consider the effect on the Postal Service of the exploitation of those rights by the supplier or others.

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8.2.2 Acquisition of Patent Rights

8.2.2.a Covered Contracts. This part applies to all contracts and subcontracts for research, experimental, developmental, or engineering work or for initial production of products or equipment developed under a Postal Service contract.

8.2.2.b Postal Service Title. Postal Service title must be acquired to subject inventions under a covered contract unless the contracting officer, after consultation with the purchase team and the patent counsel, determines that an alternate arrangement is in the best interests of the Postal Service. The determination concerning alternate arrangements may be made at the time of solicitation.

8.2.2.c Less Than Postal Service Title. When appropriate, the Postal Service may acquire less than title to subject inventions under covered contracts. However, in no case may the Postal Service acquire less than a nonexclusive royalty-free license to make, use and sell each subject invention throughout the world on behalf of the Postal Service. If the Postal Service takes less than title, it may allow the supplier to retain title to all subject inventions, or may allow the supplier to elect whether to retain title on an invention-by-invention basis. When suppliers are allowed to retain title, the contract must provide adequate provisions allowing the Postal Service to control the supplier's sale of the invention to competitors of the Postal Service. As an alternative, the contracting officer may consider providing for a sharing of revenue for all commercial sales of the invention, subject to a requirement that any sale of a subject invention to an organization which provides postal or parcel delivery services in competition with the Postal Service requires the advance written approval of the contracting officer. Any such alternative must be coordinated with the patent counsel.

8.2.2.d Alternate Proposals

1. The contracting officer may consider any alternate proposal giving a supplier greater rights in an invention made in the performance of a contract than the solicitation contemplates if it will yield a net benefit to the Postal Service.

2. Provision 8-1, Alternate Intellectual Property Rights Proposals, may be included in all solicitations for covered contracts, and alternate proposals may be considered as part of the evaluation process.

8.2.2.e Alternate Agreements After Award. An alternate agreement on patent rights for inventions developed at supplier expense but intended for delivery under a covered contract may be negotiated after award when in the interest of the Postal Service. Before initiating negotiations, the contracting officer must seek the advice of patent counsel.

8.2.2.f Other Contracts. The contracting officer may provide for Postal Service acquisition of patent rights or may solicit alternate agreements for contracts not covered by this part with the concurrence of patent counsel. Particular consideration should be given to including such provisions in non-covered contracts if it appears likely that the supplier will make an invention in performing the contract.

8.2.2.g Clauses. Clause 8-1, Patent Rights, must be included in contracts in which the Postal Service will take title to inventions. Clause 8-15, Patent Rights Supplier Retention, must be included in contracts providing for the supplier's election to retain invention rights. If an alternate patent proposal is accepted, the clause must be appropriately modified, with the concurrence of counsel, to reflect the specific rights in subject inventions that will be acquired by the Postal Service. The modified clause must clearly state that all other Postal Service rights in subject inventions remain in effect with full force. When Clause 8-15 is included in contracts, Clause 8-16, Postal Service Title in Technical Data and Computer Software, must also be included.

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8.2.3 Use of Private Patents

8.2.3.a Authorization and Consent

1. When the government has authorized or consented to the manufacture or use of an invention described in and covered by a U.S. patent, suit for recovery of the reasonable and entire compensation for the manufacture or use of the invention by or for the United States by a supplier (including a subcontractor at any tier) can be maintained only against the government in the United States Court of Federal Claims and not against the supplier or subcontractor (28 U.S.C. 1498). To ensure that work by a supplier or subcontractor under a Postal Service contract may not be enjoined by reason of patent infringement, the Postal Service provides its authorization and consent to the use of private patents by its suppliers and subcontractors in certain situations. Broad authorization and consent is provided in the conduct of research and development activities so that the supplier or subcontractor need not avoid or invent around particular technology areas. In contracts for supplies or construction, a more limited authorization and consent is provided.

2. The liability of the Postal Service for damages in a suit of the nature described in subparagraph a.1 against it may ultimately be borne by the supplier or subcontractor in accordance with the terms of any patent indemnity clause included in the contract, and an authorization and consent clause does not detract from any patent indemnification commitment by the supplier or subcontractor. Therefore, both a patent indemnity clause and an authorization and consent clause may be included in the same contract.

3. Clause 8-2, Authorization and Consent, must be included in all covered contracts except those performed outside the United States.

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8.2.3.b Notice and Assistance

1. Clause 8-3, Notice and Assistance Regarding Patent and Copyright Infringement, must be included in all covered contracts except those performed outside the United States.

2. If the contracting officer receives notice of an infringement claim, patent counsel must be notified immediately.

8.2.4 Patent Indemnification

8.2.4.a Indemnification by Postal Service. The contracting officer may not use any contract clause providing for indemnification by the Postal Service for patent infringement by a supplier or subcontractor.

8.2.4.b Indemnification by Supplier

1. The Postal Service acquires indemnification for the use, by or on behalf of the Postal Service, of private patents without the authorization or consent of the patentee, when the use relates to supplies or services that the supplier offers or provides to the commercial open market.

2. Except as provided in 8.2.4.c, paragraph h of Clause 4-1, General Terms and Conditions, or Clause 8-4, Patent Indemnity, must be included in all contracts. The clause may be used in other contracts if patent infringement is likely.

8.2.4.c Waiver or Modification of Patent Indemnity

1. If it is in the interest of the Postal Service to do so, the contracting officer may waive or modify the right to patent indemnification, with the prior approval of patent counsel. If the waiver or modification to the right to patent indemnification is for research or development, Clause 8-5, Waiver of Indemnity, must be used, and the contract must be modified as applicable patents are identified.

2. If patent indemnification will be waived completely, paragraph h of Clause 4-1 or Clause 8-4 may not be used.

3. Clause 8-5 must be used if the waiver applies only to specific patents. Those patents to which the waiver applies must be listed in the clause.

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