[Federal Register Volume 77, Number 21 (Wednesday, February 1, 2012)]
[Rules and Regulations]
[Pages 4887-4890]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-2162]


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DEPARTMENT OF ENERGY

10 CFR Part 781

RIN 1990-AA41


DOE Patent Licensing Regulations

AGENCY: Office of the General Counsel, Department of Energy.

ACTION: Final rule.

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SUMMARY: The Department of Energy (DOE) is amending its patent 
licensing regulations to remove outdated sections and provide for the 
creation of a new appeal authority to serve as the Invention Licensing 
Appeal Board. Under the new regulations, the DOE Deputy General Counsel 
for Technology Transfer and Procurement shall hear and decide appeals 
relating to licensing of federally-owned inventions; and to copyright 
licenses granted in works created under management and operating (M & 
O) contracts with DOE, but not including M & O contracts administered 
by the National Nuclear Security Administration (NNSA) for NNSA 
facilities. The NNSA Deputy General Counsel for Procurement shall hear 
and decide appeals under management and operating contracts 
administered by NNSA for NNSA facilities.

[[Page 4888]]


DATES: Effective Date: This final rule is effective February 1, 2012.

FOR FURTHER INFORMATION CONTACT: John T. Lucas, Office of the Assistant 
General Counsel for Technology Transfer and Intellectual Property, U.S. 
Department of Energy, Forrestal Building, Room 6F-067, 1000 
Independence Avenue SW., Washington, DC 20585; Telephone: (202) 586-
2802.

SUPPLEMENTARY INFORMATION:

I. Discussion
II. Final Action
III. Regulatory Review

I. Discussion

    The DOE regulations at 10 CFR part 781 were promulgated to 
establish the procedures, terms, and conditions upon which licenses may 
be granted in inventions covered by patents or patent applications 
vested in the United States of America, as represented by or in the 
custody of DOE. Pursuant to the authority of 35 U.S.C. 206, the 
Department of Commerce since issued regulations on licensing of 
government-owned inventions, which are codified at 37 CFR part 404. 
Those regulations currently supersede, to the extent inconsistent, the 
DOE regulations at 10 CFR part 781 and similarly prescribe the terms, 
conditions, and procedures upon which a federally-owned invention may 
be licensed. 10 CFR part 781 has served to supplement 37 CFR part 404 
to include, among other things, provisions for appeals, referencing 
procedures of the DOE Board of Contract Appeals. The DOE Board of 
Contract Appeals has since been terminated. That board served as the 
Invention Licensing Appeal Board under the current DOE regulations at 
10 CFR part 781. Accordingly, several sections of part 781 contain 
language that has become outdated since the codification of the DOE 
patent licensing regulations.
    Also, since the original codification of the patent licensing 
regulations at 10 CFR part 781, DOE has promulgated the regulations at 
48 CFR part 970, which govern its M & O contracts. Those regulations 
provide that M & O contractors may with agency permission assert 
copyright in works first produced in performance of their contracts. 
However, where the contractor has not made a satisfactory demonstration 
that it or any of its licensees is pursuing commercialization, DOE may 
require that licenses be granted to other responsible applicants. 
Pursuant to 48 CFR 970.5227-2(e)(3)(vi), M & O contractors may appeal 
such decisions to the Invention Licensing Appeal Board.
    DOE takes this opportunity to amend its regulations at 10 CFR part 
781 to remove outdated sections and provide for the creation of a new 
appeal authority to serve as the Invention Licensing Appeal Board. 
Under the new regulations, the DOE Deputy General Counsel for 
Technology Transfer and Procurement shall hear and decide appeals 
arising under: (1) 37 CFR 404.11, relating to licensing of federally-
owned inventions; and (2) 48 CFR 970-5227-2(e)(3)(vi), relating to 
copyright licenses granted in works created under M & O contracts with 
DOE, but not including M & O contracts administered by NNSA for NNSA 
facilities. The NNSA Deputy General Counsel for Procurement shall hear 
and decide appeals under 48 CFR 970-5227-2(e)(3)(vi) arising under M & 
O contracts administered by NNSA for NNSA facilities.

II. Final Action

    DOE is publishing this final rule without prior notice and 
opportunity for public comment, and is making the rule effective upon 
publication in the Federal Register, because the Administrative 
Procedure Act exempts rules of procedure from its notice and comment 
and delayed effective date requirements (5 U.S.C. 553(b)(3)(A) and 
(d)).

III. Regulatory Review

A. Review Under Executive Order 12866

    This regulatory action has been determined not to be a 
``significant regulatory action'' under Executive Order 12866, 
``Regulatory Planning and Review'' (58 FR 51735, October 4, 1993). 
Accordingly, this final rule was not subject to review under the 
Executive Order by the Office of Information and Regulatory Affairs 
within the Office of Management and Budget (OMB).

B. Review Under the Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis for any rule 
that by law must be proposed for public comment, unless the agency 
certifies that the rule, if promulgated, will not have a significant 
economic impact on a substantial number of small entities. Because a 
general notice of proposed rulemaking is not required by any law, the 
analytical provisions of the Regulatory Flexibility Act do not apply, 
and DOE has not prepared a regulatory flexibility analysis for this 
rulemaking.

C. Review Under the National Environmental Policy Act

    Pursuant to the Council on Environmental Quality Regulations (40 
CFR parts 1500-08), DOE has established regulations for its compliance 
with the National Environmental Policy Act of 1969 (42 U.S.C. 4321 et 
seq.). Pursuant to Appendix A of Subpart D of 10 CFR part 1021, DOE has 
determined that today's regulatory action is strictly procedural 
(Categorical Exclusion A6). Accordingly, neither an environmental 
impact statement nor an environmental assessment is required.

D. Review Under the Paperwork Reduction Act

    This final rule contains no new collection of information requiring 
OMB approval under the Paperwork Reduction Act (44 U.S.C. 3501 et 
seq.).

E. Review Under Executive Order 12988

    With respect to the review of existing regulations and the 
promulgation of new regulations, section 3(a) of E.O. 12988, ``Civil 
Justice Reform'' (61 FR 4729, February 7, 1996), imposes on executive 
agencies the general duty to adhere to the following requirements: (1) 
Eliminate drafting errors and ambiguity; (2) write regulations to 
minimize litigation; and (3) provide a clear legal standard for 
affected conduct rather than a general standard and promote 
simplification and burden reduction. Section 3(b) of E.O. 12988 
specifically requires that executive agencies make every reasonable 
effort to ensure that the regulation: (1) Clearly specifies the 
preemptive effect, if any; (2) clearly specifies any effect on existing 
Federal law or regulation; (3) provides a clear legal standard for 
affected conduct while promoting simplification and burden reduction; 
(4) specifies the retroactive effect, if any; (5) adequately defines 
key terms; and (6) addresses other important issues affecting clarity 
and general draftsmanship under any guidelines issued by the United 
States Attorney General. Section 3(c) of E.O. 12988 requires executive 
agencies to review regulations in light of applicable standards in 
section 3(a) and section 3(b) to determine whether they are met or it 
is unreasonable to meet one or more of them. DOE has completed the 
required review and determined that, to the extent permitted by law, 
this final rule meets the relevant standards of E.O. 12988.

F. Review Under Executive Order 13132

    Executive Order 13132, ``Federalism'' (64 FR 43255, August 4, 1999) 
imposes

[[Page 4889]]

certain requirements on agencies formulating and implementing policies 
or regulations that preempt state law or that have federalism 
implications. Agencies are required to examine the constitutional and 
statutory authority supporting any action that would limit the 
policymaking discretion of the states and carefully assess the 
necessity for such actions. DOE has examined today's rule and has 
determined that it does not preempt state law and does not have a 
substantial direct effect on the states, on the relationship between 
the national government and the states, or on the distribution of power 
and responsibilities among the various levels of government. No further 
action is required by E.O. 13132.

G. Review Under the Unfunded Mandates Reform Act of 1995

    The Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires a 
Federal agency to perform a detailed assessment of costs and benefits 
of any rule imposing a Federal mandate with costs to state, local or 
tribal governments, or to the private sector. This rulemaking does not 
impose a Federal mandate on state, local or tribal governments or on 
the private sector.

H. Review Under the Treasury and General Government Appropriations Act, 
1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277), requires Federal agencies to issue a 
Family Policymaking Assessment for any rule or policy that may affect 
family well being. This rule will have no impact on family, the 
autonomy or integrity of the family as an institution. Accordingly, DOE 
has concluded that it is not necessary to prepare a Family Policy 
Assessment.

I. Review Under the Treasury and General Government Appropriations Act, 
2001

    The Treasury and General Government Appropriations Act, 2001 (44 
U.S.C. 3516 note) provides for agencies to review most disseminations 
of information to the public under guidelines established by each 
agency pursuant to general guidelines issued by OMB. OMB's guidelines 
were published at 67 FR 8452 (February 22, 2002), and DOE's guidelines 
were published at 67 FR 62446 (October 7, 2002). DOE has reviewed 
today's rule under the OMB and DOE guidelines and has concluded that it 
is consistent with applicable policies in those guidelines.

J. Review Under Executive Order 13211

    Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 
28355, May 22, 2001) requires Federal agencies to prepare and submit to 
the Office of Information and Regulatory Affairs (OIRA), OMB, a 
Statement of Energy Effects for any significant energy action. A 
``significant energy action'' is defined as any action by an agency 
that promulgates or is expected to lead to promulgation of a final 
rule, and that: (1) Is a significant regulatory action under E.O. 
12866, or any successor order; and (2) is likely to have a significant 
adverse effect on the supply, distribution, or use of energy, or (3) is 
designated by the Administrator of OIRA as a significant energy action. 
For any significant energy action, the agency must give a detailed 
statement of any adverse effects on energy supply, distribution, or use 
should the proposal be implemented, and of reasonable alternatives to 
the action and their expected benefits on energy supply, distribution, 
and use. Today's rule is not a significant energy action. Accordingly, 
DOE has not prepared a Statement of Energy Effects.

K. Congressional Notification

    As required by 5 U.S.C. 801, DOE will report to Congress 
promulgation of this rule prior to its effective date. The report will 
state that it has been determined that the rule is not a ``major rule'' 
as defined by 5 U.S.C. 804(2).

L. Approval by the Office of the Secretary of Energy

    The Office of the Secretary of Energy has approved issuance of this 
final rule.

List of Subjects in 10 CFR Part 781

    Administrative practice and procedure, Inventions and patents.

    Issued in Washington, DC, on December 23, 2011.
Daniel B. Poneman,
Deputy Secretary of Energy.

    For the reasons set forth in the preamble, DOE amends Chapter III 
of Title 10 of the Code of Federal Regulations as set forth below:

PART 781--DOE PATENT LICENSING REGULATIONS

0
1. The authority citation for Part 781 is revised to read as follows:

    Authority:  42 U.S.C. 2186, 42 U.S.C. 2201(g), and 35 U.S.C. 
207-209.


0
2. Section 781.1 is revised to read as follows:


Sec.  781.1  Scope.

    The regulations of this part supplement the U.S. Department of 
Commerce regulations, entitled LICENSING OF GOVERNMENT OWNED 
INVENTIONS, at 37 CFR Part 404.


0
3. Section 781.2 is revised to read as follows:


Sec.  781.2  Policy.

    (a) It is the policy of this regulation to use the patent system to 
promote the utilization of inventions arising from Department of Energy 
supported research and development.
    (b) Decisions as to grants or denials of any license application 
will, in the discretion of the Secretary of Energy, be based on the 
Department of Energy's view of what is in the best interests of the 
United States and the general public under the provisions of these 
regulations. Decisions of the Department of Energy under these 
regulations may be made on the Secretary of Energy's behalf by the 
Assistant General Counsel for Technology Transfer and Intellectual 
Property, except where otherwise delegated.


Sec.  781.3  [Removed and Reserved]


0
4. Remove and reserve Sec.  781.3.
0
5. Section 781.4 is revised to read as follows:


Sec.  781.4  Communications.

    All communications concerning the regulations in this part, 
including applications for licenses, should be addressed or delivered 
to the General Counsel, Attention: Assistant General Counsel for 
Technology Transfer and Intellectual Property, U.S. Department of 
Energy, 1000 Independence Avenue SW., Washington, DC 20585.


Sec. Sec.  781.51 and 781.52  [Removed and Reserved]


0
6. Remove and reserve Sec. Sec.  781.51 and 781.52.
0
7. Section 781.53 is revised to read as follows:


Sec.  781.53  Additional licenses.

    Subject to any outstanding licenses, nothing in this part shall 
preclude the Department of Energy from granting additional 
nonexclusive, or exclusive, or partially exclusive licenses for 
inventions covered by this part when the Department of Energy 
determines that to do so would provide for an equitable exchange of 
patent rights. The following circumstances are examples in which such 
licenses may be granted:
    (a) In consideration of the settlement of interferences or other 
administrative

[[Page 4890]]

proceedings before the U.S. Patent and Trademark Office;
    (b) In consideration of a release of any claims;
    (c) In exchange for or as a part of the consideration for a license 
under adversely held patents;
    (d) As necessary for meeting obligations of the U.S. under any 
treaty, international agreement arrangement or cooperation, memorandum 
of understanding or similar arrangement; or
    (e) In consideration for the settlement or resolution of any 
proceeding under the Department of Energy Organization Act or other 
law.


Sec. Sec.  781.61, 781.62, 781.63, and 781.64  [Removed and Reserved]


0
8. Remove and reserve Sec. Sec.  781.61, 781.62, 781.63, and 781.64.
0
9. Section 781.65 is revised to read as follows:


Sec.  781.65  Appeals.

    (a) Standing. The following parties have the right to appeal under 
this part:
    (1) Pursuant to 37 CFR 404.11:
    (i) A person whose application for a license has been denied;
    (ii) A licensee whose license has been modified or terminated, in 
whole or in part;
    (iii) A person who timely filed a written objection in response to 
the notice required by 37 CFR 404.7(a)(1)(i) or (b)(1)(i) and who can 
demonstrate to the satisfaction of the Federal agency that such person 
may be damaged by the agency action; or
    (2) A management and operating contractor appealing an agency 
decision to grant a copyright license to a third party pursuant to the 
Rights in Data-Technology Transfer clause for DOE management and 
operating contracts per 48 CFR part 970.
    (b) Notice of Appeal. Appeal under paragraph (a) of this section 
shall be initiated by filing a Notice of Appeal with the Secretary, 
ATTN: Deputy General Counsel for Technology Transfer and Procurement 
(``Deputy General Counsel''), within thirty (30) days from the date of 
receipt of a written notice by the Department of Energy of an action 
set forth in paragraph (a) of this section. The Notice of Appeal shall 
specify the portion of the decision from which the appeal is taken. A 
statement of fact and argument in the form of a brief in support of the 
appeal shall be submitted with the Notice of Appeal or within thirty 
(30) days thereafter.
    (c) Procedure. Appeals under this section shall be conducted 
pursuant to rules of procedure provided by the Deputy General Counsel.
    (d) Within sixty (60) days of receiving appellant's brief pursuant 
to paragraph (b) of this section or such other time period set by the 
Deputy General Counsel, the Office of the Assistant General Counsel for 
Technology Transfer and Intellectual Property shall submit to the 
Deputy General Counsel a response brief and shall timely serve a copy 
of the response brief to appellant.
    (e) The Deputy General Counsel shall consider the facts and 
arguments submitted in appellant's brief submitted under paragraph (b) 
of this section, as well as those presented by the Assistant General 
Counsel for Technology Transfer and Intellectual Property. An appeal by 
a licensee under paragraph (a)(1)(ii) of this section may include a 
hearing, upon request of the licensee, to address a dispute over any 
relevant fact. Such request for a hearing must be received by the 
Deputy General Counsel within thirty (30) days of appellant's receipt 
of the response brief.
    (f) The Deputy General Counsel shall issue a written decision, 
which shall constitute the final action of the Department on the 
matter.
    (g) The parties may agree to Alternate Dispute Resolution in lieu 
of an appeal.
    (h) Appeals Arising Under National Nuclear Security Administration 
(NNSA) Management and Operating Contracts. For appeals pursuant to 
paragraph (a)(2) of this section arising under management and operating 
contracts administered by NNSA for NNSA facilities, the NNSA Deputy 
General Counsel for Procurement shall be designated as the appeal 
authority (Deputy General Counsel) pursuant to paragraphs (b) through 
(f) of this section.


Sec. Sec.  781.66, 781.71, and 781.81  [Removed and Reserved]


0
10. Remove and reserve Sec. Sec.  781.66, 781.71 and 781.81.

[FR Doc. 2012-2162 Filed 1-31-12; 8:45 am]
BILLING CODE 6450-01-P