How to View IP in Government Contracts
I like to think of IP rights as a bundle of sticks.
You can hold the whole bundle. Or you can hand certain sticks to others such as the right to use, the right to reproduce, the right to disclose, while keeping the rest for yourself.
When your company does business with the Department of War, that's exactly what's happening with your intellectual property. The Government doesn't take your bundle. It takes only the sticks it needs.
At least, that's how it's supposed to work.
DoW's current IP Guidebook puts this principle front and center. The Government should acquire only those IP deliverables and license rights necessary to accomplish its mission strategy, bearing in mind the long-term effect on cost, competition, and affordability.
Not the whole bundle. Just the sticks the mission actually requires.
This matters more than most contractors realize, for two reasons.
First, the Government getting too many sticks creates its own problems. When DoW over-acquires IP rights without a clear mission need, it drives up program costs, discourages innovative companies from entering the defense market, and can actually undermine competition by eliminating the IP-based incentives that attract new entrants in the first place. The Guidebook calls this "vendor lock" in reverse: poor IP planning early leads to a less competitive, more expensive defense industrial base later.
Second, the Government getting too few sticks is equally damaging. When DoW fails to secure the rights it genuinely needs upfront such as the right to maintain a system, to reprocure spare parts competitively, to share technical data with a support contractor, it ends up locked into sole-source relationships for decades, paying non-competitive prices with few ways out.
The answer, according to the Guidebook, is neither a grab nor a giveaway. It's a disciplined, mission-driven analysis of which sticks the Government actually needs, conducted early, before the contract is signed.
DFARS 207.106 implements 10 U.S.C. 3774 and mandates that acquisition plans for major weapon systems and subsystems must:
Assess long-term technical data and computer software needs.
Establish acquisition strategies that provide for the technical data, computer software deliverables, and associated license rights needed to sustain the systems over their entire life cycle.
For contractors, understanding this framework is a competitive advantage, not just a compliance exercise.
Your bundle of sticks is protected by law. If your company privately funded the development of technical data or software, you are generally entitled to assert limited or restricted rights, meaning the Government gets only specific sticks, not the whole bundle. But those protections require action on your part:
✅ Know which IP in your proposal was privately funded
✅ Identify restricted IP explicitly in your offer. Don't assume it's protected by default
✅ Mark your deliverables correctly or risk losing the protection entirely
✅ Get IP counsel involved before the proposal goes out, not after award
Know your IP bundle. Know which sticks you're handing over and which ones you're keeping.