Does Technology Developed with a DARPA SBIR Grant Belong to DARPA?

The short answer is no. Technologies developed by a company under an SBIR (Small Business Innovation Research) contract or grant belong to the company, regardless of whether those technologies are patented or not. This is a fundamental principle of the SBIR program.

Understanding SBIR Data Rights

When a company delivers technology or results to DARPA (Defense Advanced Research Projects Agency) through an SBIR contract, they retain ownership of the technology. What the government obtains is known as SBIR Data Rights. This means the government can use the delivered technology for government purposes, including publication and public release, but with certain limitations. However, these rights are only effective for five years following the end of the contract, including any Phase II or III extensions.

Corporate Title and Patent Ownership

As demonstrated by David Maier, the SBIR awardee retains the title to the technology and any patents that arise from it. The government receives a royalty-free license to use the technology. For example, if the government wants to produce widgets based on your technology, they can subcontract the work to a company like Raytheon without having to pay royalties for those widgets, theoretically. However, Raytheon cannot profit by commercially selling such widgets.

Government's March-In Rights

The government has what is called 'march-in rights.' This allows the government to take over the technology if certain conditions are met. These conditions are severe and include situations where the invention is not subject to reasonable commercial exploitation or where the government's interests would be served by providing more effectively the public with the results of the research. Despite these provisions, march-in rights have never been exercised to date.

Automatic Contract Extensions for Improvement

One unique feature of SBIR contracts is that if a company successfully wins a Phase II SBIR grant, the government is required by law to offer additional contracts to improve the technology as a sole-source provider. This is a special provision exclusive to SBIR/STTR (Small Business Technology Transfer) contracts.

Potential Loss of Patent Rights

It is crucial to report any subject inventions properly to avoid losing patent rights. According to the Bayh-Dole Act, small businesses, non-profits, and universities can patent inventions made with government support to encourage commercialization. Failure to report an invention properly can indeed result in the government gaining rights to the patent.

DoD and Classified Research

Finally, it is important to note that SBIR awards are not suitable for supporting classified research. The Department of Defense (DoD) cannot use SBIR contracts to control developments that are classified. This ensures that the SBIR program remains open to qualified companies and supports unclassified technology innovation.