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Government Contractor Forfeits Patent for Failure to Disclose Invention to Army

November 10, 2004

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Last Month at the Federal Circuit - November/December 2004

Judges: Clevenger (author), Michel, and Dyk

In Campbell Plastics Engineering & Manufacturing, Inc. v. Brownlee, No. 03-1512 (Fed. Cir. Nov. 10, 2004), the Federal Circuit affirmed a ruling by the Armed Services Board of Contract Appeals (“Board”) upholding an Administrative Contracting Officer’s (“ACO”) demand for title to an invention developed pursuant to a contract between Campbell Plastics Engineering & Manufacturing, Inc. (“Campbell Plastics”) and the U.S. Army Chemical Research, Development, and Engineering Center (“Army”).

In 1992, Campbell Plastics entered into a contract with the Army to develop certain components of an aircrew protective mask. The contract included numerous clauses from the Federal Acquisition Regulations (“FAR”), including a patent retentionrights clause from 48 C.F.R. § 52.227-11 (“FAR 52.227-11”), which requires a contractor to disclose any subject invention developed pursuant to a government contract. The contract also includes 48 C.F.R. § 252.227-7039, which requires a contractor to disclose subject inventions in interim reports. The inventions were to be disclosed on DD Form 882.

In October 1992, Mr. Richard Campbell, president of Campbell Plastics, submitted to the Army a form wherein he stated that they had no inventions. He did the same in 1993 and 1994. Thereafter, Campbell Plastics did not submit another form concerning inventions. In October 1997, Campbell Plastics filed a patent application for a sonic-welded gas mask and process, which was the subject of Campbell Plastics’s contract with the Army. That application issued as U.S. Patent No. 5,895,537 (“the ‘537 patent”) and expressly reserved for the government a paid-up license. In April 1999, Campbell Plastics notified the Army in writing of the ‘537 patent. After an exchange of letters between the parties, an ACO ultimately concluded that Campbell Plastics had forfeited title to the patent by failing to comply with FAR 52.227- 11. Campbell Plastics argued that although it did not disclose this invention in the form of DD Form 882 as required by the contract, it disclosed all technical aspects of the invention to the Army, including an enabling disclosure, by June 1997. Thus, Campbell Plastics argued that its failure to disclose using the proper forms was simply a matter of form that should not result in the forfeiture of title to the subject invention. The Board agreed that Campbell Plastics had failed to satisfy its contractual obligation to inform the Army that it considered sonic welding to be an invention.

The Federal Circuit found the language of the controlling FARs to be clear and unambiguous in requiring the use of DD Form 882 for disclosing subject inventions. The Court found the contract requirement of a single, easily identified form on which to disclose any invention to be sound and needing strict enforcement, because, if not, the methods of disclosure would vary widely from case to case and the government could never be sure which communications were part of an overall invention disclosure.