It is not enough that data and software qualify for protection. Such protection is forfeited and the government obtains unlimited rights if prescribed procedures are not followed:

1. Offerors must identify all technical data and software to be delivered with less than unlimited rights. Contractors should prove their subcontractors and vendors comply.

2. Postaward identification of restrictions are permitted when (a) based on new information or (b) earlier failure to assert restrictions was inadvertent and the omission did not materially affect the source selection decision.

3. To obtain protection, the contractor must ensure every copy of data, software or documentation claiming less than unlimited rights contain a prescribed legend. The legends for technical data and software are identified in DFARS 252.227-7013 and 7014, respectively.

Commercial Software and Data Rights

When the data rights qualify as commercial, they are exempt from data rights regulations. The claim of commercial software and data gives the contractor exclusivity in the government and commercial marketplace and the government’s rights are limited to those customarily granted to the public. Commercial software is now defined as software developed or regularly used which has been, is offered to be or will be sold, leased or licensed to the public by the time of delivery or would meet such criteria after minor modifications

Contractors may make minor modifications to commercial software at government expense and it will still be considered commercial. If the modifications are other than minor the software may still meet the definition of commercial if the modified software is offered for sale to the general public and it is still customarily used for nongovernmental purposes.

Contractors always have the right to commercialize military software that was developed under a government contract by virtue of the fact that the original authors are by default the owners of their work under copyright law. Contractors should be aware that they are not permitted to resell it to the government again, even to a different agency or department. Hence software developed at government expense or with mixed funding may only be resold in the commercial market.

As for commercial technical data, the new rules created a new separate clause (DFARS 252.227-7015). Similar to software, commercial technical date includes any item, other than software or real property that is customarily used by the public for nongovernmental purposes and that has been sold or offered for sale, lease or license to the public. The new clause grants the government only limited rights on commercial technical data.

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