ee, consideration shall be given to the capabilities of the prospective licensee to further the technical and market > development of the invention, his plan to undertake the development, the ! projected impact on competition, and the benefit to the Government and the public. Consideration shall be given also assisting small business and minority business enterprises, as well as economically depressed, low income, and labor surplus areas, and whether each or any applicant is a U.S. citizen or corporation. Where there is more than one applicant for an exclusive license, that applicant shall be selected who is determined to be most capable of satisfying the criteria and achieving the goals set forth in this subpart.

(d) Subject to the following: (1) Specific statutes governing the utilization of patent rights of certain Government agencies, or (2) any existing or future treaty or agreement between the United States and any foreign government or intergovernmental organization, or (3) licenses under or other rights to inventions made or conceived in the course of or under Government research and development contracts where such licenses or other rights to such inventions are granted to or provided for in the contract and acquired by the party contracting with the Government agency, no license shall be granted or implied in a Government-owned invention except as pro: vided for in this subpart.

(e) No grant of a license under this subpart shall be construed to confer upon any licensee any immunity from the antitrust laws or from a charge of patent misuse, and the acquisition and use of rights pursuant to this subpart I shall not be immunized from the oper=ation of State or Federal law by reason of the source of the grant.

§ 101-4.102 Definitions.

(a) "Government invention" means an invention covered by a domestic patent or patent application that is vested in the United States and is designated by the Government agency having custody of the invention as appropriate for the grant of an express nonexclusive or exclusive license.

(b) "To the point of practical application" means to manufacture in the case of a composition or product, to practice in the case of a process, or to operate in the case of a machine under such conditions as to establish that the invention is being worked and that its benefits are reasonably accessible to the public.

(c) "Government agency" means any executive department, independent commission, board, office, agency, administration, authority, wholly owned corporation, or other independent establishment of the executive branch of the Government of the United States of America.

(d) "The head of the Government agency" means the head of the agency or his designee.

§ 101-4.103 Types of licenses and conditions for licensing.

§ 101-4.103-1 Government inventions available for licensing.

Government inventions normally will be made available for the granting of express nonexclusive or limited exclusive licenses to responsible applicants according to the factors and conditions set forth in §§ 101-4.103-2 and 101-4.103-3, subject to the applicable procedures of § 101-4.104.

§ 101-4.103-2 Nonexclusive license.

(a) Availability of licenses. Each Government invention normally shall be made available for the granting of nonexclusive revocable licenses, subject to the provisions of any other licenses, including those under § 1014.103-4.

(b) Terms of grant. (1) The duration of the license shall be for a period as specified in the license agreement, provided that the licensee complies with all the terms of the license.

(2) The license shall require the licensee to bring the invention to the point of practical application within a period specified in the license, or such extended period as may be agreed upon, and to continue to make the benefits of the invention reasonably accessible to the public.

(3) The license may be granted for all or less than all fields of use of the

30 111 0—79—1

invention, and throughout the United States of America, its territories and possessions, the Commonwealth of Puerto Rico, and the District of Columbia, or in any lesser geographic portion thereof.

(4) After termination of a period specified in the license agreement, the Government agency may restrict the license to the fields of use and/or geographic areas in which the licensee has brought the invention to the point of practical application and continues to make the benefits of the invention reasonably accessible to the public.

(5) The license may extend to subsidiaries and affiliates of the licensee but shall be nonassignable without approval of the Government agency, except to the successor of that part of the licensee's business to which the invention pertains.

§ 101-4.103-3 Limited exclusive license.

(a) Availability of licenses. Each Government invention may be made available for the granting of a limited exclusive license provided that:

(1) The invention has been published as available for licensing pursuant to § 101-4.104-1 for a period of at least 6 months;

(2) The head of the Government agency has determined that (i) the invention may be brought to the point of practical application in certain fields of use and/or in certain geographical locations by exclusive licensing, (ii) the desired practical application has not been achieved under any nonexclusive license granted on the invention, and (iii) the desired practical application is not likely to be achieved expeditiously in the public interest under a nonexclusive license or as a result of further Government-funded research or development;

(3) The notice of the prospective licensee has been published, pursuant to § 101-4.104-4(a) for at least 60 days; and

(4) After termination of the period set forth in § 101-4.103-3(a)(3), the Government agency has determined that no applicant for a nonexclusive license has brought or will bring, within a reasonable period, the invention to the point of practical application as

specified in the exclusive license, and that to grant the exclusive license would be in the public interest.

(b) Selection of exclusive licensee. An exclusive licensee shall be selected on bases consistent with the policy set forth in § 101-4.101 and in accordance with the procedures set forth in § 1014.104.

(c) Terms of grant. (1) The license may be granted for all or less than all fields of use of the Government inven tion and throughout the United States of America, its territories and possessions, the Commonwealth of Puerto Rico, and the District of Columbia, or in any lesser geographic portion there of.

(2) Subject to the rights reserved to the Government in §§ 101-4.103-3(c)(6) and 101-4.103-3(c)(7), the licensee shall be granted the exclusive right to practice the invention in accordance with the terms and conditions specified in the license.

(3) The duration of the license shall be negotiated but shall be for a period less than the terminal portion of the patent, the period remaining being sufficient to make the invention rea sonably available for the grant of a nonexclusive license; and such period of exclusivity shall not exceed 5 years unless the head of the Government agency determines on the basis of a written submission supported by a fac tual showing that a longer period is reasonably necessary to permit the licensee to enter the market and recoup his reasonable costs in so doing.

(4) The license shall require the licensee to bring the invention to the point of practical application within a period specified in the license, or within a longer period as approved by the Government agency, and to continue to make the benefits of the invention reasonably accessible to the public.

(5) The license shall require the licensee to expend a specified minimum amount of money and/or to take other specified actions, within a specified period of time after the effective date of the license, in an effort to bring the invention to the point of practical application.

(6) The license shall be subject to the irrevocable royalty-free right of the Government of the United States to practice and have practiced the invention by or on behalf of the Government of the United States and on behalf of any foreign government or intergovernmental organization pursuant to any existing or future treaty or agreement with the United States.

(7) The license shall reserve to the Government agency the right to require the licensee to grant sublicenses to responsible applicants on terms that are reasonable in the circumstances (i) to the extent that the invention is required for public use by Government regulations, or (ii) as may be necessary to fulfill health or safety needs, or (iii) for other public purposes stipulated in the license.

(8) The license may extend to subsidiaries and affiliates of the licensee but shall be nonassignable without approval of the Government agency, except to successors of that part of the licensee's business to which the invention pertains.

(9) An exclusive licensee may grant sublicenses under his license, subject to the approval of the Government agency. Each sublicense granted by an exclusive licensee shall make reference to the exclusive license, including the rights retained by the Government under the exclusive license, and a copy of such sublicense shall be furnished to the Government agency.

(10) The license may be subject to such other terms as may be in the public interest.

[38 FR 3328, Feb. 5, 1973, as amended at 38 FR 15509, June 13, 1973]

§ 101-4.103-4 Additional licenses.

Subject to any outstanding licenses, nothing in this subpart shall preclude a Government agency from granting additional nonexclusive or limited exclusive licenses for Government-owned inventions when the Government agency determines that to do so would provide for an equitable exchange of patent rights. The following exemplify circumstances wherein such licenses may be granted:

(a) In consideration of the settlement of an interference;

(b) In consideration of a release of a claim of infringement; or

(c) In exchange for or as part of the consideration for a license under adversely held patents.

§ 101-4.103-5 Royalties.

(a) Normally, royalties shall not be charged under nonexclusive licenses granted to U.S. citizens and U.S. corporations on Government inventions; however, the Government agency may require other considerations.

(b) A limited exclusive license on a Government invention shall contain a royalty provision and/or other consideration flowing to the Government.

[38 FR 3328, Feb. 5, 1973, as amended at 39 FR 28288, Aug. 6, 1974]

§ 101-4.103-6 Reports.

A license shall require the licensee to submit periodic reports on his efforts to achieve practical application of the invention. The reports shall contain information within his knowledge, or which he may acquire under normal business practices, pertaining to the commercial use being made of the invention and other information which the Government agency may determine is pertinent to its licensing activities and is specified in the li

cense.

§ 101-4.104 Procedures.

§ 101-4.104-1 Government agency publication requirements.

Government

Each agency shall cause to be published in the FEDERAL REGISTER, the Official Gazette of the U.S. Patent Office, and at least one other publication that the Government agency deems would best serve the public interest, a list of the Government inventions in its custody available for licensing under the conditions specified in § 101-4.103. The list shall be revised periodically to include directly, or by reference to a previously published list, all inventions currently available for licensing. Other publications on inventions available for licensing are encouraged and may include abstracts, when appropriate, as well as information on the design,

§ 101-4.104-2 Contents of a nonexclusive license application.

An application for a nonexclusive license under a Government invention should be addressed to the head of the Government agency having custody of the invention, and shall include:

(a) Identification of invention for which license is desired, including the patent application serial number or patent number, title and date, if known, and any other identification of invention;

(b) Name and address of the person, company, or organization applying for license and whether the applicant is a U.S. citizen or a U.S. corporation;

(c) Name and address of representative of applicant to whom correspondence should be sent;

(d) Nature and type of applicant's business;

(e) Source of information concerning the availability of a license on this invention;

(f) Purpose for which license is desired and a brief description of applicant's plan to achieve that purpose;

(g) A statement of the fields of use for which applicant intends to practice the invention; and

(h) A statement as to the geographic areas in which the applicant would practice the invention.

§ 101-4.104-3 Contents of an exclusive license application.

In addition to the information indicated in § 101-4.104-2, an application for an exclusive license shall include:

(a) Applicant's status, if any, in any one or more of the following categories: (1) Small business firm, (2) minority business enterprise, (3) location in a surplus labor area, (4) location in a low-income area, and (5) location in an economically depressed area;

(b) A statement of applicant's capability to undertake the development and marketing required to achieve the practical application of the invention;

(c) A statement describing the time, expenditure, and other acts which the applicant considers necessary to achieve practical application of the in

vention and the applicant's offer to invest that sum to perform such acts if the license is granted;

(d) A statement that contains the applicant's best knowledge of the extent to which the Government invention is being practiced by private industry and the Government; and

(e) Any other facts which the applicant believes are evidence that it is in the public interest for the Government agency to grant an exclusive license rather than a nonexclusive license and that such exclusive license should be granted to the applicant.

§ 101-4.104-4 Published notices.

(a) A notice that a prospective exclusive licensee has been selected shall be published in the FEDERAL REGISTER, and a copy of the notice shall be sent to the Attorney General. The notice shall include:

(1) Identification of the invention;

(2) Identification of the selected licensee;

(3) Duration and scope of the contemplated license; and

(4) A statement to the effect that the license will be granted unless:

(i) An application for a nonexclusive license, submitted by a responsible applicant pursuant to § 101-4.104-2, is received by the Government agency having custody of the invention within 60 days from the publication of the notice in the FEDERAL REGISTER, and the Government agency determines in accordance with its prescribed procedures under which procedures the Government agency shall record and make available for public inspection all decisions made pursuant thereto and the basis therefor, that the applicant has established that he has already achieved or is likely to bring the invention to the point of practical application within a reasonable period under a nonexclusive license; or

(ii) The Government agency determines that a third party has presented evidence and argument which has es tablished that it would not be in the public interest to grant the exclusive license.

(b) If an exclusive license has been granted pursuant to this Subpart 1014.1, notice thereof shall be published

in the FEDERAL REGISTER. Such notice shall include:

(1) Identification of the invention; (2) Identification of the licensee; and (3) Duration and scope of the li

cense.

(c) If an exclusive license has been modified or revoked pursuant to § 1014.104-5, notice thereof shall be published in the FEDERAL REGISTER. Such notice shall include:

(1) Identification of the invention;

(2) Identification of the licensee; and (3) Effective date of the modification or revocation.

§ 101-4.104-5 Modification or revocation.

(a) Any license granted pursuant to this Subpart 101-4.1 may be modified or revoked by the Government agency granting the license if the licensee at any time defaults in making any report required by the license or commits any breach of any convenant or agreement therein contained.

(b) A license may also be revoked by the Government agency granting the license if the licensee willfully makes a false statement of a material fact or willfully omics a material fact in the license application or any report required in the license agreement.

(c) Before modifying or revoking any license granted pursuant to this subpart for any cause, the Government agency shall furnish the licensee and any sublicensee of record a written notice of intention to modify or revoke the license and the licensee and any sublicensee shall be allowed 30 days after such notice to remedy any breach of any covenant or agreement as referred to in paragraph (a) of this section or to show cause why the license should not be modified or revoked.

§ 101-4.104-6 Appeals.

An applicant for a license, a licensee, or such other third party who has participated under § 101-4.104-4(a)(4)(ii) shall have the right to appeal, in accordance with procedures prescribed by the Government agency, any decision concerning the granting, denial, interpretation, modification, or revocation of a license.

§ 101-4.105 Litigation.

The property interest in a patent is the right to exclude. It is not the intent of the Government to transfer the property right in a patent when a license is issued pursuant to this subpart. Accordingly, the right to sue for infringement shall be retained with respect to all licenses so issued by the Government.

(Sec. 205(c), 63 Stat. 390; (40 U.S.C. 486(c)); sec. 2, President's Statement of Government Patent Policy, August 23, 1971)