Patrick Hogan

Vice President and Associate General Counsel

Intellectual Property & Technology Law

L Seminar on R&D Commercial

Practices and Government Contracts

April 22, 2002

US Government is Lockheed Martin’s Primary Customer

R&D Work

Source of Funding:

US Gov’t ContractResearch & Development

(“CRAD”)

Regulations: FAR DFARS NASA FAR SUP

Government’sRights:

MixedFunding

Private Funding(IRAD, B&P, etc.)

Unlimited Rights

Gov’t Purpose Rights

Limited/RestrictedRights

Develop a Corporate Internal Process that Maps to Regulations and Associates R&D

IP Deliverables* with the Source of Funding of the IP Deliverables

If Process determines that Private Funded or Mixed Funded IP will be delivered to Government then

Notify and Mark

the Gov’t prior to contract award(usually in proposal) that IP

will be delivered with other than unlimited rights

the delivered IP with appropriate restrictive legend

* But see Deferred Ordering Clause

Lockheed Martin Subprocess:Invention Disclosure Reporting System

CRADInventions

Mixed FundedInventions

Private FundedInventions

InventIt™(Lockheed Martin’s online Invention Disclosure System)

Subject Invention?

Invention Review Board Decision Factors: Any Gov’t Rights (Subject Invention)? Protects Key Technologies? Commercialization Applications? Meets Offset Requirements?

Patent Trade Secret Publish

Problem Areas in Protecting IP in Government Contracts

Failure to follow our own process (e.g. forget to mark)

Definition of “Subject Invention” includes first reduction to practice

Subcontractors refuse to accept FAR/DFARS IP flowdown clauses (give Prime authority to

negotiate with Sub?) Multiple IP Regulations (DOD vs. Civilian

Agencies) Negotiating custom IP rights with Contracting

Officers in mixed-funding situations (IP Guide helps)

Is There a Need to Price IP Separately in a Government Contract?

Lockheed Martin typically does not price IP separately

In mixed funding situations we might negotiate non-standard rights at the same price

If US or Foreign Governmentwants option for Competitive Data Packages we will price separately