Solicitation Clause Granting Government Broad Intellectual Property Rights Found to be Unduly Restrictive and Not Serving Any Legitimate Agency Need

Litigation-3In a rare victory for an offeror challenging a solicitation provision as unduly restrictive in violation of CICA, Judge Damich of the U.S. Court of Federal Claims ruled that clauses granting the government broad data rights were unduly restrictive and served no legitimate agency need in a solicitation calling for proposals to become online providers of OSHA’s Online Outreach Training Program.

The data rights clauses at issue granted the government a perpetual non-exclusive, royalty-free license to use, copy, distribute, and prepare derivative works from the training materials developed by the contractor.  The Court found that such a broad licensing clause served no legitimate need where the agency had no need to purchase IP rights and only sought to authorize contractors to become online providers of OSHA’s training requirements.  The Court also found that the agency improperly wholesale incorporated four FAR technical data rights clauses without tailoring those clauses to the services called for under the solicitation.  By contrast, the Court found that multiple other provisions, such as those requiring price realism and limiting the number of awardees, were not unduly restrictive and served legitimate purposes.  As a result, the Court directed the agency to correct and reissue the solicitation.

A copy of the Court’s opinion is available here.