Friday, March 2, 2012


How many times has someone in the government told you that when it gets unlimited rights to data, it owns the data and has exclusive rights to use it?  If the government paid directly (as a direct cost under a contract) for the development of the data, it gets unlimited rights to use the data.  But these rights are not exclusive.  The contractor retains the capability to license the data or software to others.  The unlimited rights the government gets in technical data or software gives the government the ability to do just about anything it wants with the data.  But unlimited rights do not transfer ownership.  The contractor can still license to others.

But, you ask, can I really get another contractor to pay for the license.  The answer is yes.  However, the other contractor cannot charge the government for the use of the data since the government has already paid for its unlimited rights.

Do you still have a trade secret after you give the government unlimited rights?  Maybe.  Giving the government unlimited rights does not extinguish your trade secret claim.  The government must actually get and use the information or software.  The fact the government gets the rights does not mean your trade secret claim goes away.

While we are on the subject of trade secrets, we remind you of other blogs we've written about protection of your trade secrets.  Marking with proprietary legends does not make the data a trade secret.  Marking is necessary but not enough.  You also must protect the data as if it were a trade secret.  That means, of course, controlling access to it.  Treat it as if it were a top secret military document.  Limit access on a need to know basis and go out of your way to keep it close.  Release it only under a carefully worded nondisclosure agreement.

Finally, remember the rules on unlimited government rights.  Developed at private expense includes not only your direct funding but also indirect funding by the government through a properly allocated overhead account to which the government contributes by paying your overhead.

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