B-165279, FEB. 18, 1969

B-165279, FEB. 18, 1969

TO TECHNICAL COMMUNICATIONS CORPORATION:

WE REFER TO YOUR TELEGRAM OF SEPTEMBER 18, 1968, AS SUPPLEMENTED BY YOUR LETTER OF NOVEMBER 1, 1968, PROTESTING THE AWARD BY THE NAVAL AVIONICS FACILITY, INDIANAPOLIS, INDIANA (NAFI), OF CONTRACT N00163-68 C-0399 TO THE UNIVERSITY OF MICHIGAN, AND REQUESTING CANCELLATION THEREOF, ON THE GROUND THAT THE AWARD WAS MADE IN VIOLATION OF YOUR RIGHTS IN RESTRICTED PROPRIETARY DATA FURNISHED BY YOU TO THE NAVY. SUCH ACTION, YOU CLAIM, IN CONNECTION WITH THE ATTEMPTED DEFAULT TERMINATION BY NAFI OF AN EARLIER CONTRACT WITH YOU IN THE SAME FIELD, DEMONSTRATES AN OVERALL EFFORT BY NAFI TO ELIMINATE YOU AS A FACTOR IN THE FIELD OF BUOY TELEMETRY.

CONTRACT -0399 CALLS FOR THE UNIVERSITY TO CONDUCT FOR NAFI A DEVELOPMENTAL PROGRAM TO DEMONSTRATE AN SFM (SWEPT FREQUENCY MODULATION) WEATHER BUOY DATA LINK SUITABLE FOR INCORPORATION IN NAFI EXPERIMENTAL CODED SIGNAL EXTRACTION (CSE) BUOY COMMUNICATION EQUIPMENT.

THE SUBSTANCE OF YOUR COMPLAINT IS THAT COMMENCING IN 1964 YOU SUBMITTED TO VARIOUS DEPARTMENT OF THE NAVY ACTIVITIES UNSOLICITED PROPRIETARY PROPOSALS, BEARING RESTRICTIVE LEGENDS, RELATING TO SPECIAL MODULATION TECHNIQUES DEVELOPED BY YOU FOR DATA TRANSMISSIONS USING HIGH FREQUENCY RADIO TRANSMISSIONS FROM BUOYS; THAT NAFI WAS ONE OF SUCH ACTIVITIES; AND THAT IN VIOLATION OF YOUR PROPRIETARY RIGHTS THE INFORMATION CONTAINED IN ONE OF YOUR PROPOSALS, WHICH WAS SUBMITTED TO THE NAVY IN SEPTEMBER 1966, IS BEING USED FOR OVERALL GUIDANCE OF THE UNIVERSITY PROGRAM UNDER CONTRACT -0399. YOU STATE THAT THE SFM TECHNIQUE OF THE UNIVERSITY IS ALMOST IDENTICAL TO YOUR CSE TECHNIQUE WITH RESPECT TO THE WAVE FORM TRANSMITTED BY THE RADIO FREQUENCY, BOTH TECHNIQUES EMPLOYING A CHIRP OR SWEPT FREQUENCY PULSE REPRESENTING THE DATA TRANSMITTED. THE ONLY APPARENT DIFFERENCES, YOU CLAIM, ARE THAT YOU USE A VOLTAGE CONTROLLED OSCILLATOR (VCO) TO GENERATE THE CHIRP PULSE WHEREAS THE UNIVERSITY USES A SHIFT REGISTER, CLOCK SUMMING AMPLIFIERS AND FILTERS, AND AT THE DEMODULATOR YOU USE A MATCHED FILTER CONSTRUCTED OF INDUCTANCE-CAPACITANCE NETWORKS AND GATING UTILIZING A TRACKING LOOP AS OPPOSED TO THE USE BY THE UNIVERSITY OF A DIGITAL MATCHED FILTER AND A DIGITAL TRACKING LOOP.

IN ADDITION TO THE FOREGOING, YOU STATE THAT IN DECEMBER 1965 YOU APPLIED FOR A PATENT ON YOUR MODULATION TECHNIQUE, RECEIPT OF WHICH YOU EXPECT IN ABOUT SIX MONTHS (MAY 1969). YOU FURTHER STATE THAT IN SEPTEMBER 1968 YOU LEARNED THAT NAFI HAD APPROACHED THE OFFICE OF NAVAL RESEARCH (ONR) PATENT OFFICE AND HAD URGED ONR TO ATTEMPT TO UPSET YOUR PATENT POSITION ON YOUR CSE MODULATION TECHNIQUE.

FINALLY, YOU CHARGE THAT WITHOUT THE PROPRIETARY INFORMATION WHICH YOU PROVIDED, NAFI WOULD NOT HAVE PURSUED A PROGRAM TO EVALUATE EITHER CSE OR SFM FOR RADIO TELEMETRY AND THAT FROM THE INFORMATION CONTAINED IN TWO RECENT REPORTS ISSUED BY THE UNIVERSITY ON THE NAFI BUOY SFM SYSTEM IT IS FAIR TO CONCLUDE THAT NAFI HAS TAKEN YOUR CONCEPT AND FUNDED THE UNIVERSITY TO DUPLICATE YOUR TECHNIQUE USING A DIGITAL FORM OF IMPLEMENTATION. ACCORDINGLY, YOU CHARGE THAT NAFI HAS BREACHED THE TRUST ATTENDANT UPON ACCEPTANCE OF YOUR CONFIDENTIAL DATA, AND THAT THE PRESERVATION OF THE INTEGRITY OF THE GOVERNMENT AS A CONTRACTOR REQUIRES THAT THE UNIVERSITY CONTRACT BE CANCELLED AND THAT THE GOVERNMENT BE PROHIBITED FROM DISCLOSING YOUR PROPRIETARY DATA TO ANYONE OUTSIDE THE GOVERNMENT FOR ANY PURPOSE AND WITHIN THE GOVERNMENT FOR ANY PURPOSE OTHER THAN EVALUATION OF YOUR SYSTEM.

THE RECORD MADE AVAILABLE TO OUR OFFICE INCLUDES A COPY OF CONTRACT NONR- 4759/00), DATED FEBRUARY 15, 1965, AS AMENDED, WHICH THE ONR NEGOTIATED WITH YOU FOR THE PERFORMANCE OF AN ANALYSIS AND DESIGN OF A MULTIPLE ACCESS DISCRETE ADDRESS (MADA) DATA COMMUNICATION SYSTEM FOR METEOROLOGICAL BUOYS DURING THE PERIOD FEBRUARY 15, 1965, TO OCTOBER 14, 1966. THAT CONTRACT INCLUDED A PATENT RIGHTS CLAUSE IMPOSING ON YOU CERTAIN OBLIGATIONS RELATIVE TO INVENTIONS MADE, AND SUBCONTRACTS AWARDED, UNDER THE CONTRACT. IN ADDITION, THE RECORD INCLUDES A COPY OF A LETTER DATED MARCH 4, 1968, CONCERNING THE PATENT RIGHTS CLAUSE IN THE MOST RECENT CONTRACT WITH YOU, NO. N00163-67-C-0445, IN WHICH YOU INFORMED NAFI THAT THE CLAUSE DOES NOT APPLY TO YOUR CSE TECHNIQUE, ON WHICH YOU IDENTIFY THE RELATED PATENT APPLICATION AS SERIAL NO. 518 901, FILED JANUARY 5, 1966, IN VIEW OF ITS DEVELOPMENT BY YOU FROM PRIVATE FUNDING PRIOR TO THE AWARD OF CONTRACT -0445.

WITH RESPECT TO CONTRACT -0399 WITH THE UNIVERSITY, THE DEPARTMENT OF THE NAVY REPORTS THAT IT RESULTED FROM THE SUBMISSION BY THE UNIVERSITY OF AN UNSOLICITED PROPOSAL AND COVERS CONTINUATION OF WORK PERFORMED BY THE UNIVERSITY UNDER A PREVIOUS RESEARCH AND DEVELOPMENT CONTRACT. FURTHER, THE DEPARTMENT STATES, THE EQUIPMENT RECEIVED FROM THE UNIVERSITY UNDER CONTRACT -0399 IS THE DIRECT OUTGROWTH OF TWO REPORTS ISSUED IN 1964 BY THE RADIO SCIENCE LABORATORY OF THE UNIVERSITY'S INSTITUTE OF SCIENCE AND TECHNOLOGY.

THE FIRST OF THE UNIVERSITY REPORTS, DATED JANUARY 1964, WAS PREPARED UNDER TASK NO. 410715 OF PROJECT NO. 4107, AIR FORCE CONTRACT AF33/657/- 8840. THE PROJECT WAS CALLED "TELEMETRY AND COMMAND DESTRUCT TECHNIQUES," AND THE WORK WAS ADMINISTERED UNDER THE DIRECTION OF THE AIR FORCE AVIONICS LABORATORY, AIR FORCE SYSTEMS COMMAND. THE REPORT BORE THE TITLE "APPLICATION OF SWEPT-FREQUENCY MODULATION TECHNIQUES TO PCM TELEMETRY.' IN THE FOREWORD TO THE REPORT, IT IS STATED THAT THE WORK COMMENCED IN MAY 1962 AND WAS CONCLUDED IN AUGUST 1963. IN THE INTRODUCTION, IT IS STATED THAT THE SFM TECHNIQUE FOR MINIMIZING THE EFFECTS OF IMPULSE NOISE IN DIGITAL DATA LINKS WAS CONCEIVED IN LATE 1959 AT THE INSTITUTE OF SCIENCE AND TECHNOLOGY AS THE OUTGROWTH OF OTHER WORK IN WHICH COHERENT-OPTICAL- PROCESSING TECHNIQUES WERE BEING APPLIED.

THE SECOND REPORT, DATED MAY 1964, WAS PREPARED INCIDENT TO WORK PERFORMED BY THE UNIVERSITY FOR THE FEDERAL AVIATION AGENCY UNDER CONTRACT FAA/ARDS-487. THE TITLE OF THE REPORT IS "SURVEY AND ANALYSIS OF LONG- DISTANCE COMMUNICATION TECHNIQUES.' OF PARTICULAR INTEREST HERE IS THE MENTION ON PAGE 18 OF THE REPORT OF THE USE OF OCEAN STATION BUOYS TO IMPLEMENT A TERRESTIAL RELAY NETWORK AND REFERENCE ON PAGE 19 TO A STUDY OF THE DIFFICULTIES OF MOORING BUOYS IN DEEP WATER, WHICH WAS PERFORMED BY THE UNIVERSITY'S NAVIGATION AND GUIDANCE LABORATORY UNDER FAA CONTRACT ARDS-499.

BOTH OF THESE REPORTS WERE MADE AVAILABLE TO YOU BY NAFI, AND THE FILE INCLUDES A COPY OF YOUR LETTER OF MARCH 2, 1967, RETURNING THE REPORTS TO NAFI, IN WHICH YOU STATED THAT YOU FOUND THE WORK OF THE UNIVERSITY INTERESTING ALTHOUGH NOT DIRECTLY RELATED TO THE PRESENT (YOUR) PROGRAM. YOU ALSO TOOK OCCASION THEREIN TO POINT OUT CERTAIN DISADVANTAGES OF THE DIGITAL SYNTHESIS OF A MULTIPLEXED SWEPT-FM WAVEFORM, AS COMPARED WITH THE ANALOG APPROACH ADOPTED BY YOU IN THE BUOY APPLICATION.

REFERENCE TO THE MAY 1964 REPORT WAS MADE BY THE UNIVERSITY IN AN UNSOLICITED PROPOSAL FOR CONSULTING STUDIES IN WEATHER BUOY DATA LINKS WHICH THE UNIVERSITY'S WILLOW RUN LABORATORIES SUBMITTED TO NAFI ON FEBRUARY 17, 1967. OF ADDITIONAL INTEREST IS A STATEMENT IN THE PROPOSAL THAT THE EXPERIENCE ACQUIRED BY THE UNIVERSITY OVER THE PREVIOUS SEVEN YEARS (1960-1967) WITH THE THEORETICAL ANALYSIS OF SFM SYSTEMS AND IN THEIR IMPLEMENTATION WAS BELIEVED TO BE UNIQUE. THE PROPOSAL RESULTED IN THE AWARD TO THE UNIVERSITY EARLY IN 1967 OF CONTRACT N00163-67-C-0515. PURSUANT TO THIS CONTRACT, THE UNIVERSITY ISSUED A REPORT DATED AUGUST 1967 ENTITLED "EVALUATION OF SFM DATA LINK FOR WEATHER BUOYS.'

THE PROPOSAL WHICH LED TO THE AWARD OF CONTRACT -0399 TO THE UNIVERSITY IN JANUARY 1968 WAS SUBMITTED TO NAFI ON NOVEMBER 10, 1967, AND IT SPECIFICALLY STATED THAT THE SFM WEATHER BUOY DATA LINK PROPOSED THEREIN RESULTED FROM THE STUDIES CONDUCTED FROM NAFI UNDER THE 1967 CONTRACT. THE BIBLIOGRAPHY OF SELECTED SFM REPORTS INCLUDED IN THE PROPOSAL CITES PAPERS ISSUED AS EARLY AS MAY 1962 BY THE UNIVERSITY ON THE SFM CONCEPT.

WITH SPECIFIC REFERENCE TO YOUR SEPTEMBER 1966 PROPOSAL, WHICH WAS THE BASIS OF THE AWARD OF CONTRACT -0445 TO YOU, NASC REPORTS THAT WHILE ONLY A RESTRICTIVE LEGEND IN GENERAL TERMS WAS USED BY YOU, RATHER THAN THE MARKING REQUIRED BY ARMED SERVICES PROCUREMENT REGULATION (ASPR) 3-507.1, NAFI NEVERTHELESS TREATED THE ENTIRE PROPOSAL IN CONFIDENCE AND FOR EVALUATION PURPOSES ONLY AS A BASIS OF AWARD OF THE CONTRACT TO YOU. THE NAVY FLATLY DENIES THAT SUCH PROPOSAL OR ANY OF THE INFORMATION CONTAINED THEREIN WAS DISCLOSED TO THE UNIVERSITY,AND WE HAVE BEEN FURNISHED INDIVIDUAL STATEMENTS TO THAT EFFECT FROM ALL TECHNICAL PERSONNEL WHO HAVE BEEN INVOLVED IN THE PROGRAM SINCE SEPTEMBER 1965, EXCEPT ONE STUDENT EMPLOYEE WHO WORKED ONLY DURING ONE SUMMER. IT IS FURTHER STATED BY THE NAVY THAT COMPARISON OF THE HARDWARE BUILT BY THE UNIVERSITY UNDER CONTRACT 0399 WITH THE TCC PROPOSAL P66-24A SHOWS THAT THE CONCEPT AND DESIGN OF THE HARDWARD BEARS NO RELATION TO WHAT WAS SPECIFIED IN YOUR PROPOSAL.

THE FOREGOING INDICATES THAT BOTH YOU AND THE UNIVERSITY OF MICHIGAN HAVE FOR SOME TIME BEEN WORKING FOR THE IMPLEMENTATION OF CORRELATION SIGNAL PROCESSING, YOUR WORK BEING ON THE ANALOG METHOD USING A MATCHED FILTER AND THE UNIVERSITY ON THE DIGITAL METHOD USING A DIGITAL CORRELATOR. FURTHER, THERE IS NO EVIDENCE THAT DATA FURNISHED BY YOU TO THE NAVY, EVEN WHEN NOT MARKED AS REQUIRED BY THE PROCUREMENT REGULATIONS, HAS BEEN MADE AVAILABLE TO THE UNIVERSITY.

AS TO THE TERMINATION OF CONTRACT -0445 WITH YOU, WHICH WAS ALSO PROTESTED IN YOUR TELEGRAM OF SEPTEMBER 18, 1968, THE RECORD ESTABLISHES THAT WHILE TERMINATION WAS INITIATED UNDER THE DEFAULT CLAUSE ON THE BASIS OF YOUR FAILURE TO MAKE DELIVERY WITHIN THE TIME REQUIRED BY THE CONTRACT, THE ACTION WAS SUBSEQUENTLY CHANGED TO A TERMINATION FOR THE CONVENIENCE OF THE GOVERNMENT, UNDER THE CLAUSE INCLUDED IN THE CONTRACT PURSUANT TO ASPR 8-701 (A) RESERVING THAT RIGHT TO THE GOVERNMENT.

WITH RESPECT TO YOUR CHARGES OF A NAVY CONSPIRACY TO ELIMINATE YOU FROM THE BUOY TELEMETRY FIELD, THE RECORD INDICATES THAT THE NAVY HAS DETERMINED THAT EITHER OF TWO OTHER APPROACHES WHICH WERE EXPLORED BY NAFI AT THE SAME TIME AS YOUR APPROACH WILL SATISFY THE NAVY'S NEEDS FOR IMPROVING THE LONG RANGE COMMUNICATION LINK; THEREFORE, THE NAVY DOES NOT CONSIDER IT NECESSARY AT THIS TIME TO PURSUE THE APPROACH TRIED BY YOU, ESPECIALLY IN VIEW OF THE DIFFICULTIES IN PERFORMANCE WHICH YOU ENCOUNTERED.

IN VIEW OF THE FOREGOING, WE ARE UNABLE TO CONCLUDE THAT THE AWARD BY NAFI OF CONTRACT -0399 TO THE UNIVERSITY OF MICHIGAN VIOLATED YOUR PROPRIETARY RIGHTS, NOR DO WE FIND ANY SUPPORT FOR THE PROPOSITION THAT SUCH ACTION AND THE TERMINATION OF CONTRACT -0445 ESTABLISH AN IMPROPER OVERALL EFFORT BY NAFI TO ELIMINATE YOU AS A FACTOR IN THE FIELD OF BUOY TELEMETRY.

AS TO THE ISSUE OF YOUR CSE PATENT APPLICATION, NAFI STATES THAT IT HAS NOT REQUESTED THE ONR TO UPSET YOUR POSITION. IN THIS CONNECTION, THE RECORD SHOWS THAT THE PATENT APPLICATION CAME TO LIGHT WHEN A LETTER DATED MARCH 14, 1967, WAS ADDRESSED TO YOU BY ONR, VIA THE DEFENSE CONTRACT ADMINISTRATION SERVICES REGION OFFICE, BOSTON, MASSACHUSETTS, CONCERNING YOUR OBLIGATIONS UNDER THE PATENT RIGHTS CLAUSE IN CONTRACT -0445. AFTER RECEIPT OF YOUR LETTER OF MARCH 4, 1968, MENTIONED ABOVE, IN WHICH YOU CLAIMED THAT YOU HAD ESTABLISHED A PROPRIETARY POSITION ON THE CSE DESIGN AND FABRICATION BEFORE YOU EXECUTED CONTRACT -0445, THE NAVY REVIEWED YOUR PRIOR CONTRACTS AND SUBCONTRACTS TO DETERMINE WHETHER THE GOVERNMENT HAD LICENSE RIGHTS IN THE CSE TECHNIQUES SET FORTH IN YOUR 1966 PATENT APPLICATION. THE RECORD INDICATES THAT AS OF SEPTEMBER 26, 1968, THE MATTER HAD NOT YET BEEN RESOLVED; HOWEVER, ONR STATES THAT THE DATE OF FILING OF THE PATENT APPLICATION IN RELATION TO THE TERM OF CONTRACT NONR- 4759/00) AND A 1964 CONTRACT (NONR-372/00) ( RAISED A STRONG PRESUMPTION THAT THE SUBJECT MATTER HAD BEEN CONCEIVED OR REDUCED TO PRACTICE UNDER THE FIRST CONTRACT.

THE NAVY'S ACTIONS THUS APPEAR TO HAVE BEEN IN ACCORDANCE WITH PRESCRIBED PROCEDURES WHICH ONR FOLLOWS WITH RESPECT TO SIMILAR CONTRACT INVENTION REPORTING REQUIREMENTS, IN ORDER TO PROTECT THE RIGHTS OF THE GOVERNMENT IN INVENTIONS DEVELOPED FROM USE OF GOVERNMENT RESEARCH AND DEVELOPMENT FUNDS. THERE IS NO INDICATION OF ANY ACTION BY ONR WHICH WOULD HAVE ANY BEARING UPON THE PROCESSING OF YOUR PATENT APPLICATION BY THE PATENT OFFICE. IN THE CIRCUMSTANCES, WE MUST CONCLUDE THAT THE RECORD DOES NOT SUPPORT YOUR CHARGES REGARDING UPSET BY ONROF YOUR PATENT POSITION.

FOR THE REASONS STATED, YOUR PROTEST IS DENIED. FURTHER, SINCE WE HAVE NO REASON TO DOUBT THE NAVY'S STATEMENT THAT YOUR 1966 PROPOSAL DATA IS REGARDED BY THE NAVY AS PROPRIETARY, WE SEE NO NEED TO ISSUE ANY SPECIFIC INSTRUCTIONS TO THE NAVY CONCERNING THE USE OR DISCLOSURE OF SUCH DATA.