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(handwritten) C. Tech. Transfer

1 further amended by inserting after section 12 the following
2 new section:
3 SEC. 13. REWARDS FOR SCIENTIFIC, ENGINEERING, AND TECHNICAL
4 PERSONNEL OF FEDERAL AGENCIES.
5 "The head of each Federal agency that is making
6 expenditures at a rate of more than $50,000,000 per fiscal
7 year for research and development in its Government-operated
8 laboratories shall use the appropriate statutory authority to
9 develop and implement a cash awards program to reward its
10 scientific, engineering, and technical personnel for--
11 "(1) inventions, innovations, or other outstanding
12 scientific or technological contributions of value to the
13 United States due to commercial applications or due to
14 contributions to missions of the Federal agency or the
15 Federal government, or
16 "(2) exemplary activities that promote the domestic
17 transfer of science and technology developed within the
18 Federal Government and result in utilization of such
19 science and technology by American industry; or business,
20 universities, State or local (rest of line cut off)
21 non-Federal parties.".
22 SEC. 7. DISTRIBUTION OF ROYALTIES (rest of line cut off)
23 AGENCIES.
24 The Stevenson-Wydler Techno (rest of line cut off)
25 (as amended by the preceding pr (rest of line cut off)

(handwritten) Pete-
Here is the latest House offer on royalty sharing (bill & report language). It goes even further toward the Senate position. Cassie Phillips has the language.
David (illegible)

(handwritten) C. Tech. Transfer

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1 further amended by inserting after section 12 the following
2 new section:
3 SEC. 13. REWARDS FOR SCIENTIFIC, ENGINEERING, AND TECHNICAL
4 PERSONNEL OF FEDERAL AGENCIES.
5 "The head of each Federal agency that is making
6 expenditures at a rate of more than $50,000,000 per fiscal
7 year for research and development in its Government-operated
8 laboratories shall use the appropriate statutory authority to
9 develop and implement a cash awards program to reward its
10 scientific, engineering, and technical personnel for--
11 "(1) inventions, innovations, or other outstanding
12 scientific or technological contributions of value to the
13 United States due to commercial applications or due to
14 contributions to missions of the Federal agency or the
15 Federal government, or
16 "(2) exemplary activities that promote the domestic
17 transfer of science and technology developed within the
18 Federal Government and result in utilization of such
19 science and technology by American industry; or business,
20 universities, State or local governments, or other
21 non-Federal parties.".
22 SEC. 7. DISTRIBUTION OF ROYALTIES RECEIVED BY 
23 AGENCIES.
24 The Stevenson-Wydler Technology Innovation Act of 1980
25 (as amended by the preceding provisions of this Act) is

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1 further amended by inserting after section 13 the following
2 new section:
3 "SEC. 14. DISTRIBUTION OF ROYALTIES RECEIVED BY FEDERAL
4 AGENCIES.
5 "(a) IN GENERAL.-- (1) Except as provided in paragraphs
6 (4) and (6), any royalties or other income received by a
7 Federal agency from the licensing or assignment of inventions
8 under agreements entered into under section 12, and from
9 inventions of Government-operated Federal laboratories
10 licensed under section 207 of title 35, United States Code,
11 or under any other provision of law shall be retained by the
12 agency whose laboratory produced the invention. The head of
13 the agency or his designee shall pay at least 15 percent of
14 such royalties to the inventor (or co-inventors), as a
15 percentage royalty share or in accordance with paragraph (2),
16 if the inventor (or each such co-inventor) was an employee of
17 the agency at the time the invention was made. The balance of
18 such funds shall be transferred by the agency to its
19 Government-operated laboratories, with the majority share of
20 the royalties or other income from any invention going to the
21 laboratory where the invention occurred; and the funds so
22 transferred to any such laboratory may be used or obligated
23 by that laboratory during the fiscal year in which they are
24 received or during the succeeding fiscal year --
25 "(A) for payment of expenses incidental to the

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1 administration and licensing of inventions by that
2 laboratory or by the agency with respect to inventions
3 which occurred at that laboratory, including the fees or
4 other costs for the services of other agencies, persons,
5 or organizations for invention management and licensing
6 services;
7 "(B) to reward scientific, engineering, and
8 technical employees of that laboratory as part of the
9 agency's reward program established pursuant to the
10 preceding section of this Act;
11 "(C) to further scientific exchange among the
12 government-operated laboratories of the agency; or
13 "(D) for education and training of employees
14 consistent with the research and development mission and
15 objectives of the agency, and for other activities that
16 increase the licensing potential for transfer of the
17 technology of the Government-operated laboratories of the
18 agency.
19 Any of such funds not so used or obligated by the end of the
20 fiscal year succeeding the fiscal year in which they are
21 received shall be paid into the Treasury of the United States.
23 "(2) An agency may promulgate, in accordance with
24 section 553 of title 5, United States Code, regulations
25 providing for an alternative program for sharing royalties

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1 with inventors who were employed by the agency at the time
2 the invention was made and whose names appear on royalty-
3 producing inventions. Such regulations must--
4 "(A) guarantee a fixed minimum payment to each such
5 inventor, each year that the agency receives royalties
6 from that inventor's invention;
7 "(B) provide a percentage royalty share to each such
8 inventor, each year that the agency receives royalties
9 from that inventor's invention in excess of a threshold
10 amount;
11 "(C) provide that total payments to all such
12 inventors will exceed 15 percent of total agency
13 royalties in any given fiscal year; and
14 "(D) provide appropriate incentives from royalties
15 for those laboratory employees who contribute
16 substantially to the technical development of a licensed
17 invention between the time of the filing of the patent
18 application and the licensing of the invention.
19 "(3) An agency planning to promulgate regulations under
20 paragraph (2) may elect not to make payments to inventors
21 under paragraph (1) until the expiration of two years after
22 the date of the enactment of this section or until the date
23 of the promulgation of such regulations, whichever is
24 earlier. If an agency makes such an election and after two
25 years the regulations have not been promulgated, the agency

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1 shall make payments (in accordance with paragraph (1)) of at
2 least 15 percent of the royalties involved retroactive to the
3 date of the enactment of this section. If promulgation of the
4 regulations occurs within two years after such date, payments
5 shall be made in accordance with such regulations retroactive
6 to the date of the enactment of this section.
7 "(4) If, after payments to inventors under paragraph (1)
8 or (2), the royalties received by an agency in any fiscal
9 year exceed 5 percent of the budget of the
10 Government-operated laboratories of the agency for that year,
11 75 percent of such excess shall be paid to the Treasury of
12 the United States and the remaining 25 percent may be used or
13 obligated for the purposes described in subparagraphs (A)
14 through (D) of paragraph (1) during that fiscal year or the
15 succeeding fiscal year. Any funds not so used or obligated
16 shall be paid into the Treasury of the United States.
17 "(5) Any payment made to an employee under this section
18 shall be in addition to the regular pay of the employee and
19 to any other awards made to the employee, and shall not
20 affect the entitlement of the employee to any regular pay,
21 annuity, or award to which he is otherwise entitled or for
22 which he is otherwise eligible or limit the amount thereof.
23 Any payment made to an inventor as such may continue after he
24 leaves the laboratory or agency. Payments made under this
25 section shall not exceed $100,000 per year to any one person,

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1 unless the President approves a larger award (with the excess
2 over $100,000 being treated as a Presidential award under
3 section 4504 of title 5, United States Code).
4 "(6) A Federal agency receiving royalties or other
5 income as a result of invention management services performed
6 for another Federal agency or laboratory under section 207 of
7 title 35, United States Code, shall retain such royalties or
8 income to the extent required to offset the payment of
9 royalties to inventors under paragraph (1), costs and
10 expenses incurred under paragraph (1)(A), and the cost of
11 foreign patenting and maintenance performed at the request of
12 the other agency or laboratory. All royalties and other
13 income remaining after payment of the royalties, costs, and
14 expenses described in the preceding sentence shall be
15 transferred to the agency for which the services were
16 performed, for distribution in accordance with subparagraphs
17 (A) through (D) of paragraph (1).
18 "(b) CERTAIN ASSIGNMENTS.--If the invention involved was
19 one assigned to the Federal agency--
20 "(1) by a contractor, grantee, or participant in a
21 cooperative agreement with the agency, or
22 "(2) by an employee of the agency who was not
23 working in the laboratory at the time the invention was
24 made,
25 the agency unit that was involved in such assignment shall be

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1 considered to be a laboratory for purposes of this section.
2 "(c) REPORTS.--(1) In making their annual budget
3 submissions Federal agencies shall submit, to the appropriate 
4 authorization and appropriation committees of both Houses of
5 the Congress, summaries of the amount of royalties or other
6 income received and expenditures made (including inventor
7 awards) under this section.
8 "(2) The Comptroller General, five years after the date
9 of the enactment of this section, shall review the
10 effectiveness of the various royalty-sharing programs
11 established under this section and report to the appropriate
12 committees of the House of Representatives and the Senate, in
13 a timely manner, his findings, conclusions, and
14 recommendations for improvements in such programs.".
15 SEC. 8. EMPLOYEE ACTIVITIES.
16 The Stevenson-Wydler Technology Innovation Act of 1980
17 (as amended by the preceding provisions of this Act) is
18 further amended by inserting after section 14 the following
19 new section::
20 "SEC. 15. EMPLOYEE ACTIVITIES.
21 "(a) IN GENERAL.-- If a Federal agency which has the
22 right of ownership to an invention under this Act does not
23 intend to file for a patent application or statutory
24 invention registration, or to promote commercialization of
25 such invention, the agency shall allow the inventor, if the