* In reference to the "Editor's Notes" column, "Technical Data Rights: Finding Common Ground," in the August 2018 of National Defense, the article hit the nail on the head regarding intellectual property and the military. We have had 12 Small Business Innovation Research contracts so we understand the issues.
Let me briefly explain the depth of the problems we found as a small business working through a SBIR Phase II contract, which absolutely guarantees us data rights of our new technologies and designs.
We developed a replacement pallet for the Air Force 463L material handling system, which is the standard freight and equipment system used by the service around the world. The technology that we incorporated into this new composite 463L pallet was developed by us prior to this SBIR PII contract where we demonstrated the utility of our solutions.
As we entered into this contract we discovered data rights clauses inserted into the contract by the Air Force which are strictly forbidden in SBIR funded contracts. The engineering staff at Robins Air Force Base--not the contracting office--attempted to coerce us over a dozen times to give up our SBIR data rights, including, at the last minute, sending a Memorandum of Understanding, that was little more than a Faustian bargain to sign away our rights in exchange for a Phase III contract.
It took more than three years going between the Air Force SBIR Office, our contacts at Robins, and the Small Business Administration to finally get a modification to the contract with the appropriate SBIR data rights clauses. It is clear today that when we declined to sign the MOU the Air Force had no intentions to allow us to move forward with our data rights intact.
The current 463L pallet repair contract is $330 million for three to five years of maintenance all done by one facility in Michigan wherein they repair/replace an average of 35,000 pallets a year. Of the damaged pallets, the 22 tie-down rings surrounding the perimeter of each 463L pallet have the highest failure rates.
There are 240,000 tie-down rings called out for repair every single year, which averages to over 660 rings every single day. The tie-down rings alone account for over $50 million per year in repair. It is estimated that the repair of 463L pallets has cost taxpayers $2 billion to $4 billion over the 50-year life span of this same legacy design, according to documents we are sharing with National Defense to back up these facts.