Aladdin’s genie had “Phenomenal cosmic powers! Itty-bitty living space!” Space Act Agreements (SAAs) are very similar. They give NASA considerable flexibility to partner with private entities. NASA can start from essentially a blank slate in order to create an agreement aimed toward a specific goal like using the International Space Station as a national laboratory or developing robotic vehicles capable of delivering supplies to low earth orbit. On the other hand, SAAs may not be used in many circumstances. For example, funded SAAs are typically used only where a NASA objective cannot be achieved through the use of traditional contracts. When SAAs are used, The Chiles Act may force NASA to take ownership of any intellectual property developed under the SAA. However, there are ways to avoid the title taking action. Even when NASA does take title to the IP, many SAAs provide a clear path to returning ownership of patents and other IP that is developed under the SAA to the private developer.
Space Act Agreements are formed between NASA and a private entity, like a company or university, in order to carry out specific objectives. The agreements establish how NASA resources like personnel, equipment, and testing facilities may be used to achieve the specific goal defined in the SAA.
SAAs generally come in three flavors: reimbursable, nonreimbursable, and funded.
Nonreimbursable agreements are typically created where NASA and a private company are working together toward a common goal. NASA and the partner company work together in a limited manner, but no funds are exchanged.
Reimbursable agreements provide more flexibility, but at a cost to the private entity. The private entity may use NASA’s resources (e.g., wind tunnels) for the entity’s own purposes, but must reimburse NASA for that use.
Funded agreements, darlings of the commercial space race, are used “only sparingly”, when traditional funding methods are inappropriate. NASA provides funds, expertise, and other assistance to the private entity to achieve a goal, such as developing a private space ferry to the International Space Station.
Under the laws which created NASA, inventions made under NASA contracts, including Space Act Agreements, are the property of the federal government. Traditionally, this has discouraged may innovative companies from working with NASA, for fear that the company will have no control over technologies they conceive of or first construct under contract with NASA. At a 2006 symposium on space law and intellectual property rights, NASA IP counsel Gary Borda stated that this structure “has worked with traditional contractors such as Boeing and Lockheed” but “ [NASA does] not get the innovative ideas from the smaller companies” because they don’t want to lose rights to their technological data.
If the SAA directs the private party to perform work of an inventive type for NASA, NASA generally automatically owns the patent rights to inventions made that SAA. Many funded SAAs involve inventive-type work, such as the COTS program.
Under these SAAs, the private party must establish invention reporting procedures which ensure that both NASA’s rights and the private party’s inventive rights are preserved. New technologies must generally be reported within six months of conception or production via the NASA New Technology Reporting System.
Even where NASA is set to automatically take title to patent rights on inventions developed under an SAA, NASA may waive rights to all technology developed under the SAA, either in advance or on a case-by-case basis. NASA “liberally grants waivers to SAA Partners for the purpose of commercializing the waived invention”, but the partner has to ask for the waiver and report newly developed technologies! In any event, NASA is entitled to a government purpose license of the technology.
As previously mentioned, NASA must take title where inventive work is being performed for NASA by the private party. Generally, work performed under a nonreimbursable SAA or a reimbursable SAA is not inventive work performed for NASA. Technologies developed solely by the private party are generally not subject to ownership by NASA.
Inventions jointly developed by NASA and the private party under an un-funded SAA must be reported to NASA and the two entities may decide how to assign the inventive rights.
Space Act Agreements are powerful tools which allow NASA to advance its objectives and the objectives of the commercial sector. SAAs may still be subject to laws such as the Chiles Act which requires NASA to take title to inventions developed at its direction. Companies entering into SAAs should be aware of reporting and invention assignment requirements before entering into SAAs and should consider alternative development arrangements and funding sources where appropriate. Armed with this knowledge, companies make take advantage of the “phenomenal cosmic power” a Space Act Agreement can hold!