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Govt Contractors Allege Air Force Stole IP, Proprietary Data

by Chris Brook on Tuesday March 3, 2020

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Two contractors claim the U.S. Air Force took their proprietary data and used it to develop, market, and sell their own version of a storage tank used by planes to fight fires.

Two government contractors are alleging the U.S. Air Force skirted a data rights agreement the contractors had in place and over the course of several months in 2014 stole proprietary data to recreate its own version of a fire-retardant tank system to be used in airborne firefighting.

Blue Aerospace, a Florida-based company and United Aeronautical Corporation, a California company, collectively develop, market, and sell the modular units, known as the Mobile Airborne Fire Fighting System, or MAFFS.

The units are essentially self-contained, roll on roll off aerial firefighting equipment. The tanks, which are mostly used by the US Forest Service to fight forest fires, can store upwards to 3,000 gallons of water or fire retardant. They’re primarily designed to fit Lockheed's C-130 Hercules military aircraft.

Both companies are accusing the U.S. Air Force of stealing proprietary data on MAFFS II after entering into a data rights agreement to operate and maintain its existing units. According to a lawsuit filed in a California federal court on Friday, United Aeronautical Corporation, license the use of the MAFFS II proprietary data to the United States Forest Service in order to maintain the eight units they and the Air National Guard have. The plaintiffs, UAC and Blue Aerospace, released a copy of the data to the U.S. Forest Service - a MAFFS II proprietary data package, including Level 3 drawings and data - on a hard drive.

The two parties allege that without their knowledge, the Forest Service passed that hard drive to the Air National Guard without knowledge of the data's limited use rights. In the summer of 2014, the ANG turned that data over to a federal contractor, Redstone Defense Systems, to "develop a derivative MAFFS II system under the AMRDEC Contract." The U.S. Army Combat Capabilities Development Command Aviation & Missile Center, formerly known as AMRDEC, or the Aviation and Missile Research, Development and Engineering Center, handles research and development for aviation and missile weapons systems.

The plaintiffs claim that as the data is theirs, the government entities aren't allowed to use the data to sell or market the unit or similar products to the international market but that appears to be exactly what happened.

In 2017, using FOIA requests, the companies realized the U.S. government was taking actions to market and promote iMAFFS abroad - something that the plaintiffs are arguing could cause unlawful dissemination of their confidential MAFF II proprietary data.

As a result, the contractors claim the Air Force's actions have affected their efforts to sell the design of the tanks to international customers. One of the reasons is because the Air Force, in its marketing, apparently favored their own system and claimed MAFFS II is "obsolete and has safety issues."

As usual, there's a laundry list of regulations, like nonexclusive license rights between contractors and civilian agencies for instance, that government agencies and contractors need to follow in situations like this – rules that can make disseminating the truth tricky.

While the Air Force has since agreed to discontinue marketing iMAFFS to the international market and review UAC and Blue Aerospace's claims, a litany of questions remain.

Whenever and if this case goes to trial, there will be a handful of them. With regards to the proprietary data, who has ownership rights? Did the Air Force's procurement violate the Administrative Procedure Act and procurement law? Did the government’s use of the MAFFS II proprietary data exceed the rights around it?

Tags:  IP theft

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