I
103D CONGRESS
1ST SESSION
H. R. 3590
To amend the Stevenson-Wydler Technology Innovation Act of 1980.
IN THE HOUSE OF REPRESENTATIVES
NOVEMBER 20, 1993
Mrs. MORELLA introduced the following bill; which was referred jointly to the
Committees on Science, Space, and Technology and the Judiciary
A BILL
To amend the Stevenson-Wydler Technology Innovation Act
of 1980.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ‘‘Technology Transfer
Improvements Act of 1993’’.
SEC. 2. FINDINGS.
The Congress finds and declares the following:
(1) The commercialization of technology and in-
dustrial innovation are central to the economic, envi-
ronmental, and social well-being of citizens of the
United States.
(2) The Government can help United States
business to speed the development of new products
and processes by entering into Cooperative Research
and Development Agreements which make available
the assistance of the Federal laboratories to the pri-
vate sector, but the commercialization of technology
and industrial innovation in the United States de-
pends largely upon actions by business.
(3) Government action to claim a right of own-
ership to any invention or other intellectual property
developed under a Cooperative Research and Devel-
opment Agreement can inhibit the establishment of
such agreements with business and can prevent the
commercialization of technology and industrial inno-
vation by business.
(4) The commercialization of technology and in-
dustrial innovation in the United States will be en-
hanced if the ownership of any invention or other in-
tellectual property developed under a Cooperative
Research and Development Agreement belongs to a
company or companies incorporated in the United
States.
SEC. 3. TITLE TO INTELLECTUAL PROPERTY ARISING
FROM COOPERATIVE RESEARCH AND DEVEL-
OPMENT AGREEMENTS.
Section 12 of the Stevenson-Wydler Technology Inno-
vation Act of 1980 (15 U.S.C. 3710a) is amended as
follows:
(1) In the text of subsection (b) immediately
preceding paragraph (1), strike ‘‘Government-oper-
ated Federal laboratory, and to the extent provided
in an agency-approved joint work statement, a Gov-
ernment-owned contractor-operated laboratory, may’’
and insert ‘‘Federal laboratory shall ensure that title
to any intellectual property arising from the agree-
ment, except intellectual property developed in whole
by a laboratory employee, is assigned to the collabo-
rating party or parties to the agreement in exchange
for reasonable compensation to the laboratory, and
may’’.
(2) In subsection (b)(2), strike ‘‘or in part’’.
(3) Amend subsection (b)(3) to read as follows:
‘‘(3) retain a nonexclusive, nontransferable, ir-
revocable, paid-up license from the collaborating
party or parties for any intellectual property arising
from the agreement, and have such license practiced
throughout the world by or on behalf of the Govern-
ment, but shall not, in the exercise of such license,
publicly disclose proprietary information related to
the license;’’.
(4) Amend subsection (b)(4) to read as follows:
‘‘(4) retain the right, in accordance with proce-
dures provided in regulations promulgated under
this section, to require a collaborating party to grant
to 
a 
responsible 
applicant 
or 
applicants 
a
nonexclusive, partially exclusive, or exclusive license
to use the subject intellectual property in any field
of use, on terms that are reasonable under the cir-
cumstances, or if the collaborating party fails to
grant such a license, to grant the license itself if the
laboratory finds that—
‘‘(A) the collaborating party has not taken,
and is not expected to take within a reasonable
time, effective steps to achieve practical applica-
tion of the subject intellectual property in the
field of use;
‘‘(B) such action is necessary to meet
health or safety needs that are not reasonably
satisfied by the collaborating party;
‘‘(C) such action is necessary to meet re-
quirements for public use specified by Federal
regulations and such requirements are not rea-
sonably satisfied by the collaborating party; or
‘‘(D) the collaborating party has not en-
tered into or is in breach of an agreement made
pursuant to subsection (c)(4)(B).’’.
(5) In subsection (d)(2), strike ‘‘and’’ at the
end;
(6) In subsection (d)(3), strike the period at the
end and insert ‘‘; and’’.
(7) At the end of subsection (d), insert the fol-
lowing new paragraph:
‘‘(4) the term ‘intellectual property rights’
means—
‘‘(A) in the case of government-owned,
government-operated Federal laboratories, pat-
ents; and
‘‘(B) in the case of government-owned,
contractor-operated Federal laboratories, pat-
ents, copyrights, and computer chip mask work
registrations.’’.
SEC. 4. DISTRIBUTION OF INCOME FROM INTELLECTUAL
PROPERTY RECEIVED BY FEDERAL LABORA-
TORIES.
Section 14 of the Stevenson-Wydler Technology Inno-
vation Act of 1980 (15 U.S.C. 3710c) is amended to read
as follows:
‘‘SEC. 14. DISTRIBUTION OF INCOME FROM INTELLECTUAL
PROPERTY RECEIVED BY FEDERAL AGEN-
CIES OR LABORATORIES.
‘‘(a) IN GENERAL.—
‘‘(1) Except as provided in paragraphs (2) and
(4), any income received by a Federal agency or lab-
oratory from the licensing or assignment of intellec-
tual property under agreements entered into by Fed-
eral laboratories under section 12, and intellectual
property of Federal agencies or laboratories licensed
under section 207 of title 35, United States Code,
or under any other provision of law, shall be re-
tained by the agency or laboratory and shall be dis-
posed of as follows:
‘‘(A)(i) The head of the agency or labora-
tory or his designee shall pay to the laboratory
employee or employees who have assigned their
rights in the intellectual property to the United
States, to the laboratory operator, or to a col-
laborating party or parties to a research agree-
ment an amount equal to the sum of—
‘‘(I) the first $10,000 received by the
agency or laboratory from the intellectual
property; and
‘‘(II) 15 percent of any income re-
ceived by the agency or laboratory from
the intellectual property in excess of the
sum of the amount paid pursuant to item
(I) and the value of unreimbursed research
and development resources provided by the
laboratory under the terms of the agree-
ment.
‘‘(ii) An agency or laboratory may provide
appropriate incentives from royalties to labora-
tory employees who contribute substantially to
the technical development of licensed or as-
signed intellectual property between the time
that the intellectual property rights are legally
asserted and the time of the licensing or assign-
ing of the intellectual property rights.
‘‘(iii) The agency or laboratory shall retain
the income received from intellectual property
until the agency or laboratory makes payments
to laboratory employees under clause (i) or (ii).
‘‘(B) The balance of the income shall be
transferred to the agency’s laboratories, with
the majority share of the royalties or other in-
come going to the laboratory where the intellec-
tual property originated, and the income so
transferred to any such laboratory may be used
or obligated by that laboratory during the fiscal
year in which it is received or during the suc-
ceeding fiscal year—
‘‘(i) for payment of not more than 15
percent of such income for expenses inci-
dental to the administration and licensing
of intellectual property by the agency or
laboratory with respect to intellectual prop-
erty which originated at that laboratory,
including the fees or other costs for the
services of other agencies, persons, or or-
ganizations for intellectual property man-
agement and licensing services;
‘‘(ii) to reward scientific, engineering,
and technical employees of the laboratory,
including developers of sensitive or classi-
fied technology, regardless of whether the
technology has commercial applications;
‘‘(iii) to further scientific exchange
among the laboratories of the agency; or
‘‘(iv) for education and training of
employees consistent with the research and
development mission and objectives of the
agency or laboratory, and for other activi-
ties that increase the potential for transfer
of the technology of the laboratories of the
agency.
All income retained by the agency or laboratory
after payments have been made pursuant to sub-
paragraphs (A) and (B) that is unobligated and un-
expended at the end of the fiscal year succeeding the
fiscal year in which the income was received shall be
paid into the United States Treasury.
‘‘(2) If, after payments to employees under
paragraph (1), the intellectual property income re-
ceived by an agency and its laboratories in any fiscal
year exceeds 5 percent of the budget of the labora-
tories of the agency for that year, 75 percent of such
excess shall be paid to the United States Treasury
and the remaining 25 percent may be used or obli-
gated for the purposes described in clauses (i)
through (iv) of paragraph (1)(B) during that fiscal
year or the succeeding fiscal year. Any income not
so used or obligated shall be paid into the United
States Treasury.
‘‘(3) Any payment made to an employee under
this section shall be in addition to the regular pay
of the employee and to any other awards made to
the employee, and shall not affect the entitlement of
the employee to any regular pay, annuity, or award
to which the employee is otherwise entitled or for
which the employee is otherwise eligible, or limit the
amount thereof. Any payment made under this sec-
tion to any employee shall continue after the em-
ployee leaves the employment of the laboratory or
agency.
‘‘(4) A Federal agency receiving income as a re-
sult of intellectual property management services
performed for another Federal agency or laboratory
under section 207 of title 35, United States Code,
may retain such income to the extent required to
offset the payment of income from intellectual prop-
erty under paragraph (1)(A)(i), and costs and ex-
penses incurred under paragraph (1)(B)(i), includ-
ing the cost of foreign protection of the intellectual
property of the other agency. All income remaining
after payment of the income, costs, and expenses de-
scribed in the preceding sentence shall be trans-
ferred to the agency for which the services were per-
formed, for distribution in accordance with clauses
(i) through (iv) of paragraph (1)(B).
‘‘(b) CERTAIN ASSIGNMENTS.—If the intellectual
property from which the income is derived was assigned
to the Federal agency—
‘‘(1) by a contractor, grantee, or participant in
a cooperative agreement with the agency; or
‘‘(2) by an employee of the agency who was not
working in the laboratory at the time the intellectual
property was originated;
‘‘the agency unit that was involved in such assignment
shall be considered to be a laboratory for purposes of this
section.
‘‘(c) REPORTS.—
‘‘(1) In making its annual submission to the
Congress, each Federal agency shall submit, to the
appropriate authorization and appropriations com-
mittee of both Houses of the Congress, a summary
of the amount of income received from intellectual
property and expenditures made (including employee
awards) under this section.
‘‘(2) Not later than October 1, 1996, the Comp-
troller General shall review the effectiveness of the
various income-sharing programs established under
this section and report to the appropriate commit-
tees of the House of Representatives and the Senate,
in a timely manner, the Comptroller General’s find-
ings, conclusions, and recommendations for improve-
ments in such programs.’’.
SEC. 5. AMENDMENT TO BAYH-DOLE ACT.
Section 210(e) of title 35, United States Code, is
amended by inserting ‘‘and the Technology Commer-
cialization Act of 1993’’ after ‘‘Federal Technology Trans-
fer Act of 1986’’.
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