The Army’s top acquisition official said the government has a lot of work to do when it comes to how it treats vendors’ intellectual property. Among his top concerns: The Army needs to find new ways to conduct fair and open competitions without forcing companies to expose their best ideas to potential competitors, and ensure that it’s clear which IP is owned by whom.
On the latter point, Bruce Jette, who was sworn in as the new assistant secretary of the Army for acquisition, logistics and technology just last month, said both the government and industry have become “sloppy” in recent years.
He described a typical interaction over intellectual property rights this way:
“A vendor comes in and says, ‘You need to pick me for this project because I’m going to bring this intellectual property to the table that I paid to develop. And what [the government] will do is develop another piece, and then we got to integrate it,’” Jette said. “And then the next thing you know, we’re both locked together, and it’s messy. The government starts using your IP, you start using the government’s IP, and we cannot get extricated. And then we began having unpleasant conversations.”
Going forward, Jette said he wants to move the Army toward what he called a “more commercial” model in which each side of the negotiation has a clear understanding of who will own what before and after a contract is signed. It would include clear lines of demarcation between the portions of technology that have been paid for by the government and those over which the vendor will continue to hold exclusive rights.
“Show me the box. That’s your IP,” he said, describing the negotiation process. “Put that in the bid, show me what the limits of that is, and show me the functionality. I don’t want to know what’s in the box: that’s yours. So tell me what you want to do for licensing. Do you maintain it? Do you want me to maintain it? Then, I’m going to design the box that goes next to it and interfaces with it. If I pay for it, I own it. If you pay for it, you own it.”
Two can play the IP game
But by the same token, those licensing arrangements can work in both directions, Jette said.
If the vendor discovers profitable commercial applications coming from the combination of its underlying technology and the government-funded integration work, the Army may be willing to license the IP behind its portion of the project.
“Most people don’t realize it, but the government can get paid for their intellectual property,” he said. “So I want to make sure that we both treat each other honestly and fairly.”
For the government’s part, Jette said he had begun discussions with the Army’s acquisition workforce on the need to respect industry’s IP – something he argued the government often does not do well during the acquisition process. He said private discussions in which vendors share their ideas and capabilities with the Army too often result in publicly-released bid solicitations that incorporate those same ideas, even when the vendor considers them to be proprietary.
Likewise, he said the government needs to improve the request for information (RFI) process by offering more discreet ways for vendors to ask questions and provide information.
“Right now, if you ask me a question after I put an RFI out, I take your question, publish it, and publish the answer,” he said. “I give away your insight, everybody else now sees what you saw. I’m working to try and find a way to fix that so that you can ask questions in a private manner and get answers, and it’s not seen as some sort of corruption of the acquisition process.”