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Sunstrider

Sharing "Proprietary Information"

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Assume you are a PCO in DoD and have inherited a non-commercial service contract with Contractor A.

In managing this contract, you note:

  • No DFARS Part 227 clauses exist in the contract
  • The contract requires delivery of technical data
  • You recently received/accepted all technical data
  • All data is marked with "proprietary", as Contractor A insists they are a trade secret

Now, the Government must furnish the technical data to Contractor B to perform a follow-on non-commercial service contract.

You are not the PCO for Contractor B. However, Contractor A has advised you that the Government may not share this information to Contractor B.

You note:

  • Both Contractor A and Contractor B previously performed substantially the same respective effort
  • The Government previously provided substantially the same format of technical data, received/accepted contractually from Contractor A, to Contractor B
  • Prior to its furnishing under the previous follow-on, the Government had Contractor B sign a non-disclosure agreement (NDA) to not redistribute Contractor A's tech data
  • Contractor A was advised of this NDA
  • Contractor A took no exception, neither to the NDA nor to the manner in which the Government furnished the tech data to Contractor B

My questions:

  1. As currently written, what contractual obligations to protect/provide recourse for their IP rights does the Government have unto Contractor A?
  2. If the Government provides Contractor A's tech data to Contractor B, without requiring a new NDA, is this a violation of 18 U.S.C. § 1905?
  3. If the Government previously gained unlimited data rights to substantially similar tech data, specifically from Contractor A, is that a materially relevant fact to the situation at hand? If so, how?

 

 

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51 minutes ago, Sunstrider said:
  • 1. As currently written, what contractual obligations to protect/provide recourse for their IP rights does the Government have unto Contractor A?
  • 2. If the Government provides Contractor A's tech data to Contractor B, without requiring a new NDA, is this a violation of 18 U.S.C. § 1905?
  • 3.If the Government previously gained unlimited data rights to substantially similar tech data, specifically from Contractor A, is that a materially relevant fact to the situation at hand? If so, how?

I believe you should seek help from a government attorney.

For purposes of discussion, I offer the following, not in order:

2. An NDA signed by contractor B would not save you from potential violation of 18 U.S.C. 1905. The NDA is irrelevant if there is no Government right to disclose the data in the first place.

1. The Government may argue that the Christian doctrine applies to data rights clauses such as DFARS 252.227-7013. See, Alenia case http://www.asbca.mil/Decisions/2014/57935 Alenia North America, Inc. 8.7.14.pdf 

If so, suggest the Government notify Contractor A immediately and refrain from disclosure until resolved. It would help if the SOW included language that indicated the deliverable technical data was to be used to disclose to another contractor in furtherance of work.  Unauthorized disclosure may make the government liable to contractor A for damages in disclosing proprietary information if the Christian doctrine argument fails.

3. I would argue that it is irrelevant. Different contract. It may have been proprietary in the past and the contractor agreed to some limited license rights with protections. Doesn't mean that it is forever non-proprietary in the future.

 

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It seems that you bought data, but didn't buy any rights to the data.  This happens all the time -- a wedding couple may contract with a photographer for photos of the wedding, and the photographer may deliver the photos to the couple as agreed but with the photographer retaining copyright and so forth.

Do you agree or disagree with Contractor A's markings on the data?  If you agree, maybe you need to open a negotiation to purchase rights for the Government.  If you disagree, then you have a legal dispute (the contractor might sue the Government) if to try to exercise your asserted rights.

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I am not a lawyer.  Definitely seek guidance from your legal counsel.  That's why they get paid the big bucks. 

1.  Hard to say without reading the contract.  Please DO NOT post it though. 

2.  The original NDA between the government and B is worthless to A.  Who is A going to take to court?  B?  Nope.  B had no contractual obligation to A to keep A's data confidential.  The original NDA goes against the fundamental tenets of contract law. 

Regarding releasing proprietary data, an interesting case regarding FOIA was recently decided by SPOTUS.  https://www.jdsupra.com/legalnews/supreme-court-removes-substantial-91552/  This case was about data marked as proprietary being disclosed to a competitor via a FOIA request.  SPOTUS ruled "that those submitting confidential information to the government need not demonstrate a 'substantial competitive harm' to protect that information from disclosure under the Freedom of Information Act."  If the government does not have the rights to the data and the data is not subject to FOIA, then the data might not be able to be given to B. 

3.  Just because the government gained unlimited access doesn't mean it give access to a third party.  Seeing as how the information was previously shared with B and A knew about it, A might not be able to say much now.

Yeah, definitely talk with your legal counsel about it. 

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