About 10 years ago, our prime contractor awarded us subcontract under FAR Part 12 terms to provide a modified commercial product. The subcontract included a boilerplate provision that says that any designs that are developed under the contract and fully funded by the prime will be owned by the prime. The prime is now asserting that, on the basis of that provision, it owns the designs associated with those modifications (as well as all subsequently developed derivatives). Since the mods were clearly funded with U.S. Govt money that was awarded under the prime contract, we feel that the pirme made no investment in the mods and we are therefore disputing the prime's claim to ownership. Are we correct in this stance?

I know that here are good words in the DFAR non-commercial data rights clause that prohibit a prime from exploiting a subcontractor in this way, but I've not found any FAR passage or guidance document that addresses this issue in commerical item contracts.

Can you share the clause? Typically the USG and prime contractors only request a license - not ownership.

Garth, I have seen several subcontracts in which the prime contractor included a clause regqiring the sub to assigne all rights to IP developed under the subcontract to the prime. Thus, that is not an infrequent event.

As for Hoosier's question, the answer will largely depend on what the parties intended when the subcontract was awarded.

IP rights are complicated. It's really not a good idea to find a solution on a message board. You need to contact law firm that deals with IP rights, preferably one with a lot of Government contracting experience.

Especially if you believe your company developed something that can be sold to other companies and/or agencies.