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Legal Research Digest 73 NATIONAL COOPERATIVE HIGHWAY RESEARCH PROGRAM February 2017 PRIMER ON PATENTABILITY AND USE OF IDEAS DEVELOPED BY CONTRACTORS PERFORMING WORK FOR STATE AND FEDERAL TRANSPORTATION AND LOCAL PLANNING AGENCIES This report was prepared under NCHRP Project 20-06, âLegal Problems Arising Out of Highway Programs,â for which the Transportation Research Board is the agency coordinating the research. The report was prepared under Topic 22-03 by Timothy R. Wyatt. James B. McDaniel, TRB Counsel for Legal Research Projects, was the principal investigator and content editor. Background State highway departments and transportation agencies have a continuing need to keep abreast of operating practices and legal elements of specific problems in highway law. The NCHRP Legal Research Digest series is intended to keep departments up-to-date on laws that will affect their operations. Foreword The United States Constitution, Article I, Section 8, Clause 8, gives Congress the power âto promote the progress of science and useful arts, by securing for limited times to authors and inventors the exclusive right to their respective writings and discoveries.â In 1790 Congress enacted the original Patent Act. The Act has been revised numerous times and is now codified at 35 U.S. Code. Congressâs lat- est enactment was in 2011 with the LeahyâSmith America Invents Act, which substituted the âfirst to inventâ system with the âfirst to fileâ system. Since the late 18th century, individual states have enacted patent legislation similar to the federal Act. Differences exist, however, in patent licensing and retainage rights between federal contracts and federally funded state and local government contracts. Further differences exist between federally funded state and local contracts and those that are not. Both federal and state patent laws carry a number of implications for U.S. transportation agencies. This research was prompted by the need to address confusion that exists in the interpretation and application of federal and state patent principles, particularly concerning state government patent rights and the granting of transferable or nontransferable licenses in the case of federally funded state government contracts. The research digest begins by summarizing federal and state patent laws and then reviews the similarities and differences between the two. It also discusses and distinguishes patentability issues concerning inventions by contractors for federal contracts, federally funded state and local government contracts, and state and local government contracts sourced by state and local funds. The balance of the digest is dedicated to a thor- ough review of patent infringement on state and local government contracts and defenses in the performance of these contracts. This digest will be useful to attorneys, transportation inventors and contractors, transportation officials, risk managers, planners, engineers, policy makers, students in transportation-related fields, and all persons interested in transportation patent rights and responsibilities. Responsible Senior Program Officer: Gwen Chisholm Smith