Distinction between Sections C and H in UCF

[Vern Edwards]

Interesting article in the December 7, 2022 issue of The Government Contractor: "Unrecognized And Overt Pressure On Contractors’ Data And Software Rights: The Risks Posed By H Clauses, Innocuous Acronyms (IPT, IDE, SaaS, DAL), And The Cloud." An excerpt:

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H Clause Developments—Another trend these days is contracting activities using more aggressive and burdensome “Section H” clauses. There are variations, but generally the ones posing the most practical difficulties for contractors are those that (1) tend to blur distinctions between what is deliverable vs. rights regarding Operation, Maintenance, Installation, & Training (OMIT) data; (2) seek unlimited rights in “use cases”; (3) define data rights by deliverables; and (4) require commercial software vendors (at all tiers) to agree to unique modifications of their license agreements.

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The Use Case Variation—In this H clause, offerors are required to identify Government rights by subsystem/subassembly, with “Unlimited” rights assumed if no restriction is asserted in the proposal. This means, of course, that contractors and subcontractors must assiduously understand and assert their limited, restricted, specially negotiated, and Government purpose rights (GPR) at the lowest component level.

 

[Voyager]

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DFARS 227.7202-3 Rights in commercial computer software or commercial computer software documentation.

(a) The Government shall have only the rights specified in the license under which the commercial computer software or commercial computer software documentation was obtained.

(b) If the Government has a need for rights not conveyed under the license customarily provided to the public, the Government must negotiate with the contractor to determine if there are acceptable terms for transferring such rights. The specific rights granted to the Government shall be enumerated in the contract license agreement or an addendum thereto.

DFARS 227.7202-4 Contract clause.

A specific contract clause governing the Government's rights in commercial computer software or commercial computer software documentation is not prescribed. As required by 227.7202-3, the Government's rights to use, modify, reproduce, release, perform, display, or disclose computer software or computer software documentation shall be identified in a license agreement.

Now you're talking commercial contracts, where UCF does not apply (so no order of precedence), and standard practices vary.  I wonder what the courts would do if a dispute came up over these bid-or-go-home H clauses, given the above "must" and "shall" in the DFARS I show in bold.  I don't think the H clauses would hold up since they aren't part of a license agreement.

Agencies do have to decide if they trust a standard user agreement to meet the Government's requirements.  I have read a little about the law around standard user agreements, enough to know the basics that the general public can sign them without reading them, trusting that anything a court determines unreasonable in them should be granted to the user as relief.  I doubt that's good enough for some requirements owners, if it even applies to federal commercial buys.

[Krimz]

For certain contracts, such as construction or services, I place in Section H "general" requirements of my locality (state, county, etc).  In Section C, I place the requirements of the particular service(s) being performed. 

For example, fire protection requirements, which are issued by the state, go in Section H.  The statement of work/specifications go in Section C.

 

Section H is fairly boilerplate for my office.

[FAR-flung 1102]

1 hour ago, Voyager said:

Agencies do have to decide if they trust a standard user agreement to meet the Government's requirements.  I have read a little about the law around standard user agreements, enough to know the basics that the general public can sign them without reading them, trusting that anything a court determines unreasonable in them should be granted to the user as relief.  I doubt that's good enough for some requirements owners, if it even applies to federal commercial buys.

GSA created their own order of precedence see MV-15-03 Supplement #1 (sorry, I could not get their link to copy).

[WifWaf]

Data rights matter.