10 U.S. Code § 2321 - Validation of proprietary data restrictions

(a) Contracts Covered by Section.— This section applies to any contract for supplies or services entered into by the Department of Defense that includes provisions for the delivery of technical data.
(b) Contractor Justification for Restrictions.— A contract subject to this section shall provide that a contractor under the contract and any subcontractor under the contract at any tier shall be prepared to furnish to the contracting officer a written justification for any use or release restriction (as defined in subsection (i)) asserted by the contractor or subcontractor.
(c) Review of Restrictions.—
(1) The Secretary of Defense shall ensure that there is a thorough review of the appropriateness of any use or release restriction asserted with respect to technical data by a contractor or subcontractor at any tier under a contract subject to this section.
(2) The review of an asserted use or release restriction under paragraph (1) shall be conducted before the end of the three-year period beginning on the later of—
(A) the date on which final payment is made on the contract under which the technical data is required to be delivered; or
(B) the date on which the technical data is delivered under the contract.
(d) Challenges to Restrictions.—
(1) The Secretary of Defense may challenge a use or release restriction asserted with respect to technical data by a contractor or subcontractor at any tier under a contract subject to this section if the Secretary finds that—
(A) reasonable grounds exist to question the current validity of the asserted restriction; and
(B) the continued adherence by the United States to the asserted restriction would make it impracticable to procure the item to which the technical data pertain competitively at a later time.
(2)
(A) A challenge to a use or release restriction asserted by the contractor in accordance with applicable regulations may not be made under paragraph (1) after the end of the six-year period described in subparagraph (B) unless the technical data involved—
(i) are publicly available;
(ii) have been furnished to the United States without restriction;
(iii) have been otherwise made available without restriction; or
(iv) are the subject of a fraudulently asserted use or release restriction.
(B) The six-year period referred to in subparagraph (A) is the six-year period beginning on the later of—
(i) the date on which final payment is made on the contract under which the technical data are required to be delivered; or
(ii) the date on which the technical data are delivered under the contract.
(3) If the Secretary challenges an asserted use or release restriction under paragraph (1), the Secretary shall provide written notice of the challenge to the contractor or subcontractor asserting the restriction. Any such notice shall—
(A) state the specific grounds for challenging the asserted restriction;
(B) require a response within 60 days justifying the current validity of the asserted restriction; and
(C) state that evidence of a justification described in paragraph (4) may be submitted.
(4) It is a justification of an asserted use or release restriction challenged under paragraph (1) that, within the three-year period preceding the challenge to the restriction, the Department of Defense validated a restriction identical to the asserted restriction if—
(A) such validation occurred after a challenge to the validated restriction under this subsection; and
(B) the validated restriction was asserted by the same contractor or subcontractor (or a licensee of such contractor or subcontractor).
(e) Time for Contractors to Submit Justifications.— If a contractor or subcontractor asserting a use or release restriction submits to the contracting officer a written request, showing the need for additional time to comply with the requirement to justify the current validity of the asserted restriction, additional time to adequately permit the submission of such justification shall be provided by the contracting officer as appropriate. If a party asserting a restriction receives notices of challenges to restrictions on technical data from more than one contracting officer, and notifies each contracting officer of the existence of more than one challenge, the contracting officer initiating the first in time challenge, after consultation with the party asserting the restriction and the other contracting officers, shall formulate a schedule of responses to each of the challenges that will afford the party asserting the restriction with an equitable opportunity to respond to each such challenge.
(f) Presumption of Development Exclusively at Private Expense.—
(1) Except as provided in paragraph (2), in the case of a challenge to a use or release restriction that is asserted with respect to technical data of a contractor or subcontractor under a contract for commercial items, the contracting officer shall presume that the contractor or subcontractor has justified the restriction on the basis that the item was developed exclusively at private expense, whether or not the contractor or subcontractor submits a justification in response to the notice provided pursuant to subsection (d)(3). In such a case, the challenge to the use or release restriction may be sustained only if information provided by the Department of Defense demonstrates that the item was not developed exclusively at private expense.
(2) In the case of a challenge to a use or release restriction that is asserted with respect to technical data of a contractor or subcontractor (other than technical data for a commercially available off-the-shelf item as defined in section 35(c)  [1] of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c))) for a major system or a subsystem or component thereof on the basis that the major system, subsystem or component was developed exclusively at private expense, the challenge to the use or release restriction shall be sustained unless information provided by the contractor or subcontractor demonstrates that the item was developed exclusively at private expense.
(g) Decision by Contracting Officer.—
(1) Upon a failure by the contractor or subcontractor to submit any response under subsection (d)(3), the contracting officer shall issue a decision pertaining to the validity of the asserted restriction.
(2) After review of any justification submitted in response to the notice provided pursuant to subsection (d)(3), the contracting officer shall, within 60 days of receipt of any justification submitted, issue a decision or notify the party asserting the restriction of the time within which a decision will be issued.
(h) Claims.— If a claim pertaining to the validity of the asserted restriction is submitted in writing to a contracting officer by a contractor or subcontractor at any tier, such claim shall be considered a claim within the meaning of chapter 71 of title 41.
(i) Rights and Liability Upon Final Disposition.—
(1) If, upon final disposition, the contracting officer’s challenge to the use or release restriction is sustained—
(A) the restriction shall be cancelled; and
(B) if the asserted restriction is found not to be substantially justified, the contractor or subcontractor asserting the restriction shall be liable to the United States for payment of the cost to the United States of reviewing the asserted restriction and the fees and other expenses (as defined in section 2412 (d)(2)(A) of title 28) incurred by the United States in challenging the asserted restriction, unless special circumstances would make such payment unjust.
(2) If, upon final disposition, the contracting officer’s challenge to the use or release restriction is not sustained—
(A) the United States shall continue to be bound by the restriction; and
(B) the United States shall be liable for payment to the party asserting the restriction for fees and other expenses (as defined in section 2412 (d)(2)(A) of title 28) incurred by the party asserting the restriction in defending the asserted restriction if the challenge by the United States is found not to be made in good faith.
(j) Use or Release Restriction Defined.— In this section, the term “use or release restriction”, with respect to technical data delivered to the United States under a contract subject to this section, means a restriction by the contractor or subcontractor on the right of the United States—
(1) to use such technical data; or
(2) to release or disclose such technical data to persons outside the Government or permit the use of such technical data by persons outside the Government.


[1]  See References in Text note below.

Source

(Added Pub. L. 98–525, title XII, § 1216(a),Oct. 19, 1984, 98 Stat. 2597; amended Pub. L. 99–500§ 101(c) [title X, § 953(b)], Oct. 18, 1986, 100 Stat. 1783–82, 1783–171, and Pub. L. 99–591, § 101(c) [title X, § 953(b)], Oct. 30, 1986, 100 Stat. 3341–82, 3341–171; Pub. L. 99–661, div. A, title IX, formerly title IV, § 953(b),Nov. 14, 1986, 100 Stat. 3951, renumbered title IX, Pub. L. 100–26, § 3(5),Apr. 21, 1987, 101 Stat. 273, Pub. L. 100–26, § 7(a)(5),Apr. 21, 1987, 101 Stat. 276; Pub. L. 100–180, div. A, title XII, § 1231(6),Dec. 4, 1987, 101 Stat. 1160; Pub. L. 103–35, title II, § 201(g)(4),May 31, 1993, 107 Stat. 100; Pub. L. 103–355, title VIII, § 8106(b),Oct. 13, 1994, 108 Stat. 3393; Pub. L. 109–364, div. A, title VIII, § 802(b),Oct. 17, 2006, 120 Stat. 2313; Pub. L. 110–181, div. A, title VIII, § 815(a)(2),Jan. 28, 2008, 122 Stat. 223; Pub. L. 111–350, § 5(b)(18),Jan. 4, 2011, 124 Stat. 3844; Pub. L. 111–383, div. A, title VIII, § 824(c),Jan. 7, 2011, 124 Stat. 4269; Pub. L. 112–81, div. A, title VIII, § 815(b),Dec. 31, 2011, 125 Stat. 1492.)
References in Text

Section 35(c) of the Office of Federal Procurement Policy Act, referred to in subsec. (f)(2), means section 35(c) ofPub. L. 93–400, which was classified to section 431(c) of former Title 41, Public Contracts, and was repealed and restated as section 104 of Title 41, Public Contracts, by Pub. L. 111–350, §§ 3, 7(b),Jan. 4, 2011, 124 Stat. 3677, 3855.
Codification

Pub. L. 99–591is a corrected version of Pub. L. 99–500.
Another section 2321 of this title was contained in chapter 138 and was renumbered section 2341 of this title.
Amendments

2011—Subsec. (d)(2)(A). Pub. L. 112–81, § 815(b)(1)(A), substituted “A challenge to a use or release restriction asserted by the contractor in accordance with applicable regulations may not be made under paragraph (1) after the end of the six-year period” for “Except as provided in subparagraph (C), a challenge to an asserted use or release restriction may not be made under paragraph (1) after the end of the three-year period” in introductory provisions.
Pub. L. 111–383, § 824(c)(1), substituted “Except as provided in subparagraph (C), a challenge” for “A challenge” in introductory provisions.
Subsec. (d)(2)(A)(iv). Pub. L. 112–81, § 815(b)(1)(B)–(D), added cl. (iv).
Subsec. (d)(2)(B). Pub. L. 112–81, § 815(b)(2), substituted “six-year period” for “three-year period” in two places in introductory provisions.
Subsec. (d)(2)(C). Pub. L. 112–81, § 815(b)(3), struck out subpar. (C) which read as follows: “The limitation in this paragraph shall not apply to a case in which the Secretary finds that reasonable grounds exist to believe that a contractor or subcontractor has erroneously asserted a use or release restriction with regard to technical data described in section 2320 (a)(2)(A) of this title.”
Pub. L. 111–383, § 824(c)(2), added subpar. (C).
Subsec. (h). Pub. L. 111–350substituted “chapter 71 of title 41” for “the Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.)”.
2008—Subsec. (f)(2). Pub. L. 110–181substituted “(other than technical data for a commercially available off-the-shelf item as defined in section 35(c) of the Office of Federal Procurement Policy Act (41 U.S.C. 431(c)))” for “(whether or not under a contract for commercial items)”.
2006—Subsec. (f). Pub. L. 109–364substituted “Expense” for “Expense for Commercial Items Contracts” in heading, designated existing provisions as par. (1), substituted “Except as provided in paragraph (2), in” for “In”, and added par. (2).
1994—Subsecs. (f) to (j). Pub. L. 103–355added subsec. (f) and redesignated former subsecs. (f) to (i) as (g) to (j), respectively.
1993—Subsec. (d)(1)(B). Pub. L. 103–35substituted “adherence” for “adherance”.
1987—Subsec. (a). Pub. L. 100–26, § 7(a)(5)(A)(ii), added subsec. (a) and struck out former subsec. (a) which read as follows: “A contract for supplies or services entered into by the Department of Defense which provides for the delivery of technical data shall provide that a contractor or subcontractor at any tier shall be prepared to furnish to the contracting officer a written justification for any restriction asserted by the contractor or subcontractor on the right of the United States to use such technical data.”
Subsec. (b). Pub. L. 100–26, § 7(a)(5)(A)(ii), added subsec. (b) and struck out former subsec. (b) which read as follows:
“(1) The Secretary of Defense shall ensure that there is a thorough review of the appropriateness of any restriction on the right of the United States to release or disclose technical data delivered under a contract to persons outside the Government, or to permit the use of such technical data by such persons. Such review shall be conducted before the end of the three-year period beginning on the date on which final payment is made on a contract under which technical data is required to be delivered, or the date on which the technical data is delivered under such contract, whichever is later.
“(2)(A) If the Secretary determines, at any time before the end of the three-year period beginning on the date on which final payment is made on a contract under which technical data is required to be delivered, or the date on which the technical data is delivered under such contract, whichever is later, that a challenge to a restriction is warranted, the Secretary shall provide written notice to the contractor or subcontractor asserting the restriction. Such a determination shall be based on a finding by the Secretary that reasonable grounds exist to question the current validity of the asserted restriction and that the continued adherence to the asserted restriction by the United States would make it impracticable to procure the item competitively at a later time. Such notice shall—
“(i) state the specific grounds for challenging the asserted restriction;
“(ii) require a response within 60 days justifying the current validity of the asserted restriction; and
“(iii) state that evidence of a validation by the Department of Defense of a restriction identical to the asserted restriction within the three-year period preceding the challenge shall serve as justification for the asserted restriction if—
“(I) the validation occurred after a review of the validated restriction under this subsection; and
“(II) the validated restriction was asserted by the same contractor or subcontractor (or any licensee of such contractor or subcontractor) to which such notice is being provided.
“(B) Notwithstanding subparagraph (A), the United States may challenge a restriction on the release, disclosure, or use of technical data delivered under a contract at any time if such technical data—
“(i) is publicly available;
“(ii) has been furnished to the United States without restriction; or
“(iii) has been otherwise made available without restriction.”
Subsec. (c). Pub. L. 100–26, § 7(a)(5)(A)(ii), added subsec. (c). Former subsec. (c) redesignated (e).
Subsec. (d). Pub. L. 100–26, § 7(a)(5)(A)(ii), added subsec. (d). Former subsec. (d) redesignated (f).
Subsec. (d)(4)(A). Pub. L. 99–180, § 1231(6)(A), substituted “subsection” for “paragraph”.
Subsec. (e). Pub. L. 100–26, § 7(a)(5)(A)(i), (B), redesignated former subsec. (c) as (e), inserted heading, and substituted “If a contractor or subcontractor asserting a use or release restriction” for “If a contractor or subcontractor asserting a restriction subject to this section”. Former subsec. (e) redesignated (g).
Subsec. (f). Pub. L. 100–26, § 7(a)(5)(A)(i), (C), redesignated former subsec. (d) as (f), inserted heading, and substituted “subsection (d)(3)” for “subsection (b)” in two places. Former subsec. (f) redesignated (h).
Subsec. (g). Pub. L. 100–26, § 7(a)(5)(A)(i), (D), redesignated former subsec. (e) as (g) and inserted heading.
Subsec. (h). Pub. L. 100–26, § 7(a)(5)(A)(i), (E)(i), redesignated former subsec. (f) as (h) and inserted heading.
Subsec. (h)(1). Pub. L. 100–26, § 7(a)(5)(E)(ii)–(iv), substituted “the use or release restriction” for “the restriction on the right of the United States to use such technical data” in introductory provisions, struck out “on the right of the United States to use the technical data” after “the restriction” in subpar. (A), and substituted “asserting the restriction” for “, as appropriate,” in subpar. (B).
Subsec. (h)(2). Pub. L. 100–26, § 7(a)(5)(E)(v), substituted “the use or release restriction” for “the restriction on the right of the United States to use such technical data” in introductory provisions.
Subsec. (i). Pub. L. 100–180, § 1231(6)(B), inserted “or subcontractor” in introductory provisions.
Pub. L. 100–26, § 7(a)(5)(F), added subsec. (i).
1986—Subsecs. (a), (b). Pub. L. 99–500, Pub. L. 99–591, and Pub. L. 99–661amended generally subsecs. (a) and (b) identically. Prior to amendment, subsecs. (a) and (b) read as follows:
“(a) A contract for supplies or services entered into by the Department of Defense which provides for the delivery of technical data shall provide that—
“(1) a contractor or subcontractor at any tier shall be prepared to furnish to the contracting officer a written justification for any restriction asserted by the contractor or subcontractor on the right of the United States to use such technical data; and
“(2) the contracting officer may review the validity of any restriction asserted by the contractor or by a subcontractor under the contract on the right of the United States to use technical data furnished to the United States under the contract if the contracting officer determines that reasonable grounds exist to question the current validity of the asserted restriction and that the continued adherence to the asserted restriction by the United States would make it impracticable to procure the item competitively at a later time.
“(b) If after such review the contracting officer determines that a challenge to the asserted restriction is warranted, the contracting officer shall provide written notice to the contractor or subcontractor asserting the restriction. Such notice shall—
“(1) state the grounds for challenging the asserted restriction; and
“(2) require a response within 60 days justifying the current validity of the asserted restriction.”
Effective Date of 1994 Amendment

For effective date and applicability of amendment by Pub. L. 103–355, see section 10001 ofPub. L. 103–355, set out as a note under section 2302 of this title.
Effective Date of 1987 Amendment

Pub. L. 100–26, § 12(d)(1),Apr. 21, 1987, 101 Stat. 289, provided that: “The amendments to section 2321 of title 10, United States Code, made by section 7(a)(5) shall apply to contracts for which solicitations are issued after the end of the 210-day period beginning on October 18, 1986.”
Effective Date of 1986 Amendment

Amendment by Pub. L. 99–500, Pub. L. 99–591, and Pub. L. 99–661applicable to contracts for which solicitations are issued after end of 210-day period beginning Oct. 18, 1986, see section 101(c) ofPub. L. 99–500and Pub. L. 99–591, and section 953(e) ofPub. L. 99–661, set out as a note under section 2320 of this title.
Effective Date

Section applicable with respect to solicitations issued after the end of the one-year period beginning Oct. 19, 1984, see section 1216(c)(2) ofPub. L. 98–525, set out as a note under section 2319 of this title.

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This is a list of parts within the Code of Federal Regulations for which this US Code section provides rulemaking authority.

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32 CFR - National Defense

32 CFR Part 518 - THE FREEDOM OF INFORMATION ACT PROGRAM

48 CFR - Federal Acquisition Regulations System

48 CFR Part 1 - FEDERAL ACQUISITION REGULATIONS SYSTEM

48 CFR Part 2 - DEFINITIONS OF WORDS AND TERMS

48 CFR Part 3 - IMPROPER BUSINESS PRACTICES AND PERSONAL CONFLICTS OF INTEREST

48 CFR Part 4 - ADMINISTRATIVE MATTERS

48 CFR Part 5 - PUBLICIZING CONTRACT ACTIONS

48 CFR Part 6 - COMPETITION REQUIREMENTS

48 CFR Part 7 - ACQUISITION PLANNING

48 CFR Part 8 - REQUIRED SOURCES OF SUPPLIES AND SERVICES

48 CFR Part 9 - CONTRACTOR QUALIFICATIONS

48 CFR Part 10 - MARKET RESEARCH

48 CFR Part 11 - DESCRIBING AGENCY NEEDS

48 CFR Part 12 - ACQUISITION OF COMMERCIAL ITEMS

48 CFR Part 13 - SIMPLIFIED ACQUISITION PROCEDURES

48 CFR Part 14 - SEALED BIDDING

48 CFR Part 15 - CONTRACTING BY NEGOTIATION

48 CFR Part 16 - TYPES OF CONTRACTS

48 CFR Part 17 - SPECIAL CONTRACTING METHODS

48 CFR Part 18 19

48 CFR Part 22 - APPLICATION OF LABOR LAWS TO GOVERNMENT ACQUISITIONS

48 CFR Part 23 - ENVIRONMENT, ENERGY AND WATER EFFICIENCY, RENEWABLE ENERGY TECHNOLOGIES, OCCUPATIONAL SAFETY, AND DRUG-FREE WORKPLACE

48 CFR Part 24 - PROTECTION OF PRIVACY AND FREEDOM OF INFORMATION

48 CFR Part 25 - FOREIGN ACQUISITION

48 CFR Part 26 - OTHER SOCIOECONOMIC PROGRAMS

48 CFR Part 27 - PATENTS, DATA, AND COPYRIGHTS

48 CFR Part 28 - BONDS AND INSURANCE

48 CFR Part 29 - TAXES

48 CFR Part 30 - COST ACCOUNTING STANDARDS ADMINISTRATION

48 CFR Part 31 - CONTRACT COST PRINCIPLES AND PROCEDURES

48 CFR Part 32 - CONTRACT FINANCING

48 CFR Part 33 - PROTESTS, DISPUTES, AND APPEALS

48 CFR Part 34 - MAJOR SYSTEM ACQUISITION

48 CFR Part 35 - RESEARCH AND DEVELOPMENT CONTRACTING

48 CFR Part 36 - CONSTRUCTION AND ARCHITECT-ENGINEER CONTRACTS

48 CFR Part 37 - SERVICE CONTRACTING

48 CFR Part 38 - FEDERAL SUPPLY SCHEDULE CONTRACTING

48 CFR Part 39 - ACQUISITION OF INFORMATION TECHNOLOGY

48 CFR Part 41 - ACQUISITION OF UTILITY SERVICES

48 CFR Part 42 - CONTRACT ADMINISTRATION AND AUDIT SERVICES

48 CFR Part 43 - CONTRACT MODIFICATIONS

48 CFR Part 44 - SUBCONTRACTING POLICIES AND PROCEDURES

48 CFR Part 45 - GOVERNMENT PROPERTY

48 CFR Part 46 - QUALITY ASSURANCE

48 CFR Part 47 - TRANSPORTATION

48 CFR Part 48 - VALUE ENGINEERING

48 CFR Part 49 - TERMINATION OF CONTRACTS

48 CFR Part 50 - EXTRAORDINARY CONTRACTUAL ACTIONS AND THE SAFETY ACT

48 CFR Part 51 - USE OF GOVERNMENT SOURCES BY CONTRACTORS

48 CFR Part 52 - SOLICITATION PROVISIONS AND CONTRACT CLAUSES

48 CFR Part 53 - FORMS

48 CFR Part 5433 - PROTESTS, DISPUTES AND APPEALS

 

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