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Joseph Petrillo posted a blog entry in Patterns of ProcurementContracts with the Federal Government represent big bucks for technology companies. According to ITDashboard.gov, government agencies spent a whopping $82.8 billion on information technology investments in FY2016, a number that’s poised to grow in the next two years. It’s no wonder, then, that technology companies take government contracts seriously. So when tech giant Palantir Technologies could not get the Army to consider its commercial IT system, they protested. And ultimately, the Court of Federal Claims decided in their favor. View the full article here.
My company produces a commercial item that it will supply to the DoD through its Prime Contractor as a first tier sub. As, we will make slight modifications to our item for the purposes of integration into the Prime's product for sale to the government, the Prime Contractor wants to negotiate rights to technical data, specifically asking for exclusivity "on behalf of the government" that we will not further market the item. I have asked the Prime if the government has specifically requested exclusivity. I didn't get a straight answer (a we want to protect the govts rights) but I assume as I did when the request was made that the answer is no. Prime confirmed that the modification is being funded under the USG contract and not by their own R&D. It seems to me that the push for exclusivity is coming from the Prime and not from the government. Either way I have a few questions: 1. If I'm understanding things correctly, we can grant to the government standard commercial rights under DFARS 252.227-7015 for our existing IP and government purpose rights under 252.227-7013. Is my assumption correct? 2. I believe that as the modification is minor, does not significantly alter the nongovernmental function or essential physical characteristic of the item or change the purpose of the process and therefore does not affect the commerciality of our product? 3. If commerciality is in tact can I assert -7015 rights for the entire product? (I don't think so. But if we can...) 4. We will grant the prime a limited use license for fulfillment of the requirements under the existing government contract. Any suggestions on language for this clause? 5. Are we required to assert data rights for our commercial IP? I'm not finding a requirement to do so but think it may be a good idea to eliminate confusion. Thoughts?
I am helping a colleague put together a solicitation for a commercial IDIQ solicitation. Specifically, I have been tasked with putting together the clauses and provisions for the solicitation. FAR Subpart 12.3 is somewhat misleading (or, I am not reading it correctly, which is entirely possible) on the subject of using clauses and provisions other than the five 52.212 clauses/provisions. I am fully aware that clauses such as 52.216-19 and -22 can and should apply; however, I'm fuzzy on the other clauses that could apply (that is, "required when applicable") in an IDIQ situation. If this topic has been addressed somewhere other than this designated forum, please feel free to post the link and delete this topic. Thank you!
1. Background: Government issues ID/IQ MAC contract for fixed price COTS equipment. The government specifies by performance criteria the types, quantities of equipment, and incidental support services, if any. Equipment descriptions are in terms of performance based specifications, brand name or equal, or brand name only requirements. The contract does not contain an OCI clause. · Deal Registration. Based on an Industry practice called “deal registration,” awardees on this ID/IQ MAC can "lock in" lowest pricing with a vendor before RFQ release as/if they gain knowledge of the requirement. The registration by its nature is very specific and is registered pre-RFQ. It guarantees the lowest price for that RFQ regardless of any existing agreement (e.g., reseller agreement). Information on the internet abounds on this industry practice. Provided below is one general description found at: http://searchitchannel.techtarget.com/definition/deal-registration "Deal registration is a feature of some vendors' channel programs in which a channel partner, often a VAR (value-added reseller) or SI (systems integrator), informs the vendor about a lead and is given priority for it. Once a lead is registered with a vendor, the partner usually has a set period of time to close the deal. During this time other channel members, or even the vendor's own sales team, are not allowed to negotiate a similar deal with that lead. Not all vendors offer deal registration, and some vendors offer it only to certain channel partners. Deal registration is usually put in place to lower the chance of channel conflict -- a situation in which channel partners have to compete against one another or the vendor's internal sales department. With a deal registration program in place, partners can work with a client without having to worry about another company trying to offer the same product at a lower price. Some vendors also offer to help partners in the selling cycle, and deal registration lowers the chance of the vendor stealing the lead once the partner has brought them into the discussion." Dell’s published deal registration criteria includes the following: "Deal Registration criteria for Dell includes the following: The deal is not the subject of an RFP, or similar tender process, that has been published; provided, however, that before such RFP, or similar tender process, has been published, the Partner shall be eligible to register the deal." http://partnerdirect.dell.com/sites/channel/Documents/DealRegistrationOfficialGuidelines.pdf · Scenario 1. Government issues RFQ for 100 quantities of Dell Laptop Model XX. MSRP is $2000 each. There are 5 MAC awardees. Company ABC registers the deal for 100 quantities of Dell Laptop Model XX and therefore locks in guaranteed lowest pricing from the OEM. RFQ is released. Dell’s quote to Company ABC is $1000/laptop; Dell’s response to the other 4 MAC offerers is that the deal has been registered and therefore will not offer a quote. · Scenario 2. Same as Scenario 1. The 4 offerers (who have various reseller agreements) request a quote from Dell. Dell does not inform the 4 offerors that the deal has been registered with Company ABC and provides quotes consistent with those agreements, which will at all times be higher than Company ABC's registered price of $1000. · Scenario 3. Same as Scenario 1. Because the deal is registered, Dell does not bother with the paperwork and does not offer quote. No explanations provided. 2. Issue: Although the contract does not contain an OCI clause, the Contracting Officer has cautioned awardees with regard to OCI issues given the competitive nature of this under an ID/IQ MAC. These deal registrations defeats the intent of a MAC. The very nature of deal registration means a prime must somehow have prior pre-RFQ knowledge of the specifics, which calls into question potential procurement integrity and OCI issues. Further, when only one bid is received, the RFQ is re-released and any subsequent rounds of competition is likely to generate either no bids or higher bids, leaving the Government with a false sense of competition. The Government ultimately receives lowest pricing regardless, but it was based on an offeror having an unfair competitive advantage. In order to afford fair opportunity, the government would have to prohibit deal registration, which would be a challnege to enforce since it is an industry practice. 3. Question: We plan to discuss this with the Contracting Officer, but wanted to get the experts to weigh in with any comments. In particular, does anyone believe this is an acceptable practice that should be allowed to continue, possibly in recognition of the fact that pohibition of this industry practice would be diffcult to enforce?