DoD must explain why it needs IP rights.

• Author: Erwin, Sandra I.
• Position: Defense Watch

It's a question that contractors must answer before they compete for Pentagon work: Do I want to risk losing control of my intellectual property?

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The battle over "rights in technical data" in defense contracts has been unfolding over many years and all parties are now stuck in a regulatory quagmire. The Pentagon has been blasted by tech executives for demanding unreasonable rights to IP that companies fear will get into their competitors' hands. Defense officials argue that, in order to have competition in the market, they need to be able to build and modify weapons systems without being legally bound to a specific vendor.

Amid the back-and-forth over IP rights, executives and Pentagon officials have pleaded their cases on Capitol Hill, asking Congress to legislate a way out of the impasse. The result has been a succession of IP provisions almost in every one of the past five National Defense Authorization Acts. Some call on DoD to be respectful of private sector rights to data and compensate vendors appropriately, especially as it seeks innovative suppliers to help modernize outdated defense systems. Other provisions seek to protect the government from being fleeced by companies that demand to be paid for intellectual property every time a piece of software is updated.

Nobody knows where things go from here. For now, defense contractors continue to hire more IP attorneys, and the Pentagon continues to rewrite procurement regulations in an effort to keep up with the onslaught of NDAA dictums.

To bring some sanity to the IP debate, the 2016 NDAA directed the defense secretary to convene a group of government and industry experts--including traditional defense contractors and commercial firms--to "review existing laws regarding rights in technical data."

The 16-member group, led by former Pentagon acquisition official Richard Ginman, has to examine current technical data rights law--U.S. Code Title 10, sections 2320 and 2321 --that serves as the legal basis for deciding whether the Pentagon is entitled to technical rights to products that it is buying for military use. One immediate problem with the current law is that it was written more than 20 years ago--when software was an afterthought in military systems. Many, if not most, defense IP disputes today stem from rights to software code.

The panel also has to examine the Pentagon's own regulations for the acquisition of technical data and the rights to use, modify or...