Featured Publications

House Judiciary Committee Announces Retention of Holland & Knight's Alan Baron to Lead Inquiry into Possible Impeachment of Judge G. Thomas Porteous

WASHINGTON, D.C. – Alan I. Baron, co-chair of Holland & Knight's Congressional Investigations Team, was named by House Judiciary Committee Chairman John Conyers, Jr., to serve as Special Counsel in the impeachment inquiry into the conduct of U.S. District Court Judge G. Thomas Porteous.

More

Environment: Alert - January 7, 2009

On December 16, 2008, the U.S. Fish and Wildlife Ser­vice and the National Marine Fisheries Service published a final rule (Section 7 Rule) in the Federal Reg­ister that makes significant changes to certain provisions of the consultation requirements under Sec­tion 7 of the Federal Endangered Species Act (ESA). In one of the final actions of the Bush Administration’s environmental agenda, these actions set the stage for the Obama Administra­tion to wrestle with the scope of the ESA, and in particular, the interplay of climate change and its impact on endangered species.

More

Search Our Library

Search

  • Printer friendly
  • Email this page to a friend
  • Generate a PDF version of this page
Government Contracts
Newsletter - March 2001
 
In this Issue...
How Restrictive Are "Restricted" Rights?
 
 March 20, 2001
 

If a federal government contractor delivers computer software, developed at its own expense, the government should obtain only certain narrowly defined rights to use that software. If it is commercial software, the government should receive only those rights conveyed in the contractor’s standard commercial license, unless the parties agree otherwise. For non-commercial computer software developed at private expense, the Federal Acquisition Regulation (FAR) and the Defense FAR Supplement (DFARS) describe the “Restricted Rights” that the government minimally should be granted.

The Restricted Rights definitions set out in the FAR and in the DFARS differ somewhat, but basically they allow the government to use the software on the computer(s) for which it was acquired, to make archival or backup copies, to transfer the software to another computer (even a computer in a different agency), and to “modify” the software and to combine it with other software. The government may also disclose the software to support contractors, subject to the same restrictions set forth in the government’s agreement with the software contractor.

A recent case before the Armed Services Board of Contract Appeals, Ship Analytics International, Inc., ASBCA No. 50914, presented the Board with the question of just how far the government could take its Restricted Rights. The contractor delivered to the Navy a computer-based training simulator for teaching ship handling. The software used had been developed by the contractor at its own expense. In addition to an earlier (pre-1995) version of the standard Restricted Rights clause, the Navy added another provision allowing it to disclose the software to a third party for the purpose of “perform[ing] services for the Government on or with the software.”

After the simulator had run for a number of years, the Navy turned over the source code to another contractor that modified the source code, combined it with software it had developed, and installed it on upgraded hardware to manufacture and deliver a trainer different than and superior to the one furnished by the original contractor. Ship Analytics cried foul and charged the Navy with breach of contract. The Navy claimed, among other things, that it had only allowed a third party to use the software to perform services on its behalf, as it was entitled to do under its contract.

While the acceptable services were not explicitly defined in the agreement, the contractor was fortunate that there was enough documentation to show its understanding that any third-party “services” related to its software would be to maintain and support the trainer, not to manufacture an upgraded replacement. While the Board questioned whether it had the power to order the Navy to cease and desist from using the software, it did find that Ship Analytics was entitled to a license fee for the use of its software in the new trainer.

This case raises an interesting issue about how far the government can go in modifying or adapting Restricted-Rights software. There is a strong argument that the current Restricted-Rights language in the FAR and DFARS would not allow the overreaching attempted by the Navy in Ship Analytics. However, if the parties negotiate modifications to the standard language, it could open the door to unexpected consequences. A contractor must understand exactly what rights it is granting to the government both when it agrees to the standard data-rights clauses, and especially when it agrees to modifications to those clauses.