The DFARS Approach to Data Rights

We have discussed data rights in the general federal government context, now it is finally time to look at the DFARS’ approach to this area of intellectual property. One thing: The DFARS (Defense Acquisition Regulation Systems) does not replace the FAR. It is a supplement, not a completely different set of rules. That said, there are certain nuances that the contractor needs to be aware of in order to navigate the DoD’s requirements.

In General

As the DFARS is simply a supplement to the FAR, the FAR rules we discussed generally in earlier posts apply all the same to DoD contracts. The rules we discussed in our previous posts on this matter—unlimited data rights, limited data rights, and computer software rights—must be remembered when considering these contracts. However, there are nuances that need to be considered when working with the military and other agencies that make up the DoD.

Technical Data

 One major specification that the DFARS adds concerns “technical data.” DFARS 252.227-7013 defines “technical data” as “recorded information, regardless of the form or method of the recording, of a scientific or technical nature (including computer software documentation). This term does not include computer software or data incidental to contract administration, such as financial and/or management information.” This isn’t a very exact definition, but, basically, this is probably what people picture when you say “data”: scientific and engineering data come to mind.

For noncommercial items (those items generally not for sale to the public), unlimited data rights (basically the right for the government to do as it wishes with said rights) apply almost the same as they do in the FAR, but it is worthwhile to note that the government still gets unlimited rights in technical data from studies and tests done for a contract even if the government isn’t the exclusive funder. DFARS § 252.227-7013.

For commercial items, the government gets the “unrestricted right to use, modify, reproduce, release, perform, display, or disclose technical data, and to permit others to do so, that” have been provided to the government or others without restrictions on use; are form/fit/function data; are a correction to technical data furnished; are necessary for operation/maintenance/installation/training; or have been provided with similar rights to the government under a prior contract or licensing agreement. DFARS § 252.227-7015.  We’ll explore this more in depth below.

Government Purpose Rights – Noncommercial items

Where the DFARS differs from FAR most notably is with the concept of government purpose rights. Government purpose rights means the rights to “use, modify, reproduce, release, perform, display, or disclose technical data within the Government without restriction; and release or disclose technical data outside the Government and authorize persons to whom release or disclosure has been made to use, modify, reproduce, release, perform, display, or disclose that data for United States government purposes.” DFARS § 252.227-7013. The key distinction here from unlimited rights is that government purpose rights “do not include the rights to use, modify, reproduce, release, perform, display, or disclose technical data for commercial purposes or authorize others to do so.” Outside of the government, any usage or exchange of the technical data must be for government purposes. These include “cooperative agreements with international or multi-national defense organizations, or sales or transfers by the United State Government to foreign governments or international organizations.” It also includes use in government procurements. This form of rights is specific to DoD solicitations, and has its own marking that is required on any data delivered under said rights in DFARS § 252.227-7013.

Limited Rights – Noncommercial items

Limited rights are applied differently under the DFARS than the FAR. It applies in circumstances similar to the FAR (technical data developed at private expense), but the contractor does not have the option of withholding it. Instead, the contractor must provide it with the markings provided by DFARS § 252.227-7013. Limited rights mean the government cannot release or disclose the data outside the government without the contractor’s permission. There are exceptions for emergencies, contractor support, and certain situations with foreign governments where the data is needed for certain agreements.

Special License Rights – Noncommercial Items

There is a further form, special license rights, which are basically negotiated data rights. The government can’t receive less than limited rights, in any event, and data with these rights also require specific markings in DFARS § 252.227-7013.

Commercial Items

For technical data regarding commercial items, things are simplified a bit. The government has unrestricted rights to use and disclose the data if the technical data are

provided to the Government or others without restrictions on use, modification, reproduction, release, or further disclosure other than a release or disclosure resulting from the sale, transfer, or other assignment of interest

form, fit, and function data;

a correction or change to technical data furnished to the Contractor by the Government;

necessary for operation, maintenance, installation, or training (other than detailed manufacturing or process data); or

have been provided to the Government under a prior contract or licensing agreement through which the Government has acquired the rights to use, modify, reproduce, release, perform, display, or disclose the data without restrictions

Otherwise, “the Government may use, modify, reproduce, release, perform, display, or disclose technical data within the Government only.” DFARS § 252.227-7015. That said, the government can ask for additional rights, to be negotiated with the Contractor.

As you can see, there is nuance when it comes to data rights and the DoD thanks to the DFARS. Most importantly, there are additional categories of rights that the contractor needs to consider whenever dealing with the DoD, particularly when they see mention of “government purpose rights.” Next, we will look at computer software, as it too has different rules.

Questions about this post or your own 8(a) Program eligibility? Or need help with a government contracting legal issue? Email us or give us a call at 785-200-8919.

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