Rights in Technical Data & Software Guide for Government Contractors
Understand intellectual property rights in government contracts. Learn about technical data rights, software licensing, DFARS requirements, and strategies to protect your proprietary information.
Quick Answer
Rights in technical data and computer software determine who can use, modify, and distribute the intellectual property created or delivered under a government contract. The government's rights depend on whether development was funded by the government, the contractor, or a mix—ranging from unlimited rights to restricted/limited rights. DFARS 252.227 governs these rights for DoD contracts.
Understanding Data Rights
When you perform work for the government, the question of who owns the resulting intellectual property—and who can use it—is critical. Data rights govern the government's license to use technical data and computer software you deliver or create.
The fundamental principle is that funding source determines rights. Work developed exclusively at government expense gives the government unlimited rights. Work developed exclusively at private expense gives the government only limited or restricted rights. Mixed funding falls somewhere in between.
Key Terminology
- Technical Data: Recorded information needed to produce, operate, maintain, or support an item or system
- Computer Software: Programs, source code, object code, databases, and documentation
- License: Government's right to use data (not ownership—contractor typically retains ownership)
- Legend: Notice placed on data indicating rights restrictions
Data Rights Categories
The government's rights fall into distinct categories based on funding source.
Unlimited Rights
The government can use, modify, reproduce, release, perform, display, or disclose data in any manner and for any purpose, including giving it to third parties.
When it applies: Data developed exclusively with government funds, form/fit/function data, operations & maintenance manuals, or data necessary for installation, operation, maintenance, or training.
Government Purpose Rights (GPR)
The government can use data for internal purposes and disclose to contractors for government purposes, but cannot release to commercial entities for commercial use.
When it applies: Data developed with mixed funding (government and private). GPR converts to unlimited rights after 5 years unless negotiated otherwise.
Limited Rights (Technical Data) / Restricted Rights (Software)
The government can use data only for internal evaluation and cannot release to third parties without contractor permission (with limited exceptions).
When it applies: Data developed exclusively at private expense. The contractor maintains strong control over distribution and commercial use.
Technical Data Rights
Technical data includes drawings, specifications, standards, process sheets, manuals, and other information needed to design, manufacture, or support an item.
DFARS Technical Data Rights Structure
| Funding Source | Rights | Government Can |
|---|---|---|
| 100% Government | Unlimited | Use, release, disclose anywhere |
| Mixed Funding | Government Purpose | Use internally, give to gov't contractors |
| 100% Private | Limited | Internal evaluation only |
Exception: Deferred Ordering
Even for limited rights data, the government can require delivery of technical data with limited rights at any time during contract performance or within 3 years of acceptance of the last item. Plan accordingly.
Computer Software Rights
Computer software and software documentation have their own rights framework, similar to but distinct from technical data rights.
Software Rights Categories
- Unlimited: Government-funded development
- Government Purpose: Mixed funding (5-year limit)
- Restricted: Private expense development
- Specially Negotiated: Custom license terms
Commercial Software
- • Standard commercial license terms may apply
- • Government must use software per commercial license
- • GSA Schedule contracts often reference commercial terms
- • FAR 52.227-19 governs commercial software
Source Code vs. Object Code
Contractors often try to deliver only object code (compiled, non-readable) while retaining source code as trade secret. Government may require source code for maintenance purposes—negotiate this carefully in your proposal. If you deliver source code, ensure proper marking and escrow arrangements.
Marking Requirements
Proper marking (legends) on deliverables is essential to preserve your data rights. Failure to mark properly can result in loss of protection.
Required Legends
Limited Rights Legend (Technical Data)
LIMITED RIGHTS
Contract No. [contract number]
Contractor Name: [your company]
Contractor Address: [your address]
[Prescribed restrictive statement]
Restricted Rights Legend (Software)
RESTRICTED RIGHTS
Contract No. [contract number]
Contractor Name: [your company]
[Prescribed restrictive statement]
Marking Best Practices
- ✓ Mark every page containing restricted data
- ✓ Use DFARS-prescribed language exactly
- ✓ List specific data items in assertions table
- ✓ Mark electronic files properly
- ✓ Keep records of all assertions made
Marking Failures
- ✗ Unmarked data presumed unlimited rights
- ✗ Untimely assertions may be rejected
- ✗ Non-conforming legends may be stripped
- ✗ Over-marking can delay approval
- ✗ False assertions are CDA violations
Protecting Your IP
Pre-Existing IP
Document all IP developed before the contract. This establishes your limited/restricted rights basis and prevents later disputes.
Assertions Table
Submit a complete assertions table with your proposal listing all data items and the rights you're asserting.
Private Expense Documentation
Keep detailed records of internal R&D spending. You may need to prove private funding to support limited rights claims.
Trade Secret Protection
Maintain internal confidentiality measures. Trade secret status supports claims that data was developed at private expense.
Challenge Rights
The government can challenge your data rights assertions within 3 years of final payment. Be prepared to provide evidence supporting your asserted rights. Burden of proof is on the contractor.
Negotiating Data Rights
Identify Your IP Early
Before submitting a proposal, catalog all pre-existing IP, IR&D investments, and commercial products that may be used.
Assert Rights in Proposal
Include data rights assertions with your proposal. Don't wait until after award—it's harder to negotiate then.
Negotiate GPR Duration
The 5-year GPR period is a default—you can negotiate longer protection for particularly valuable IP.
Consider Special License Agreements
DFARS allows specially negotiated license rights. Propose alternatives if standard categories don't fit your situation.
Document Everything
Keep records of all negotiations, assertions, and agreements. You'll need them if rights are challenged.
Frequently Asked Questions
Does the government own my IP?
Generally no. The government receives a license to use the data, not ownership. You retain ownership and can commercialize your IP (subject to any security restrictions). The license scope depends on funding source.
What if I use commercial software in my solution?
Commercial software is typically licensed under its standard commercial terms. FAR 52.227-19 requires the government to use it consistent with the commercial license. Keep your commercial software separate from custom development.
Can I use SBIR-funded developments in commercial products?
Yes. SBIR/STTR provide enhanced data rights protection for small businesses. You retain full rights to commercialize SBIR-developed technology, and the government receives only limited rights (except for certain government purposes).
What happens if I fail to mark data properly?
Improperly marked or unmarked data may be treated as if the government has unlimited rights. You have limited opportunity to correct marking errors after delivery. Establish proper marking procedures before contract performance begins.
How do data rights affect recompetes?
Data rights can provide competitive advantage on recompetes. If you delivered data with limited rights, competitors may lack information needed to compete. However, the government can order delivery of limited rights data for recompete purposes in some cases.
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