A wake up call to small business:  Don’t become the victim of a government scam

Uncle SamWe have been working with small businesses entrepreneurs at the John Galt Program now for over three years.  The instances of fraud, waste and abuse in government programs that were originally intended to help small businesses has been growing exponentially.

The patent laws that were originally meant to spur innovation are being dismantled by Congress.  Small businesses that turn to the government for help are, with growing frequency, destroyed in the process by the misappropriation of their intellectual property. The very same agencies of the government where small business are directed for help do nothing or worse—they actually become part of the problem.

In cases where small businesses apply for government grants to help capitalize the commercialization of their advanced technologies they frequently find themselves destroyed by government infringement and the misappropriation of their trade secrets.  Proprietary markings, promises of confidentiality and promises of help to make your business successful by the government too often lead to only one thing—the misappropriation and exploitation of your intellectual property by the government.

While the government was originally intended to serve as a fair broker of anti-competition laws it no longer does so.  More and more, the continued expansion of our government and its power over the lives of ordinary Americans means that the government itself has “gone into business.” The government now competes directly with small advanced technology businesses across America forcing them out of business.  Instead of enforcing unfair competition laws as in the past, the government now leverages its “sovereign immunity”, i.e., the government and their large contractors cannot be sued unless they agree to be sued, to misappropriate the technology innovations of small business entrepreneurs.

The principle tactic employed by the government works like this.  A small business discovers a new mouse trap.  It then applies for a U.S. government grant.  Under promises of confidentiality, entrepreneurs provide their patented ideas and trade secrets to the government.  In most cases, the small business gives up government rights to their technology in return for the early capital necessary to develop and commercialize their technology.  For example, under the Small Business Innovation Research (SBIR) Program, while entrepreneurs may receive a phase one or two grant they are often “cut-off” at the crucial time just before commercialization begins only for the government to exercise their “march-in” rights and take the technology and all of the developments made during the grant period and give it away to one of their large preferred contractors.

In other cases, the small business applies for a government agency grant to do a particular thing. The agency misrepresents itself with promises of confidentiality for the trade secrets and copyrighted materials contained in proposals.  In this way, the government uses grant programs to solve specific problems as nothing more than a honey pot to attract unwitting entrepreneurs to get their good ideas and trade secrets.  Instead, of giving the small business the grants they have applied for the government works with its large support contractors under the guise of the “sovereign immunity” rule to misappropriate the entrepreneur’s intellectual property and give it away to their support contractors for commercialization.  In this way, the government retains “march-in rights” for the technology that they have stolen.

The number one tactic employed by government agencies to unfairly compete against small business occurs when an entrepreneur complains to the government about what it is going on.  Usually, a small business will write a letter or file a complaint with the agency’s Inspector General (IG) “hotline” telling them that their technology has been stolen.  Invariably, the IG’s refuse to investigate and instead refer the matter to the agency’s Office of General Counsel (OGC) to “look into the matter.”  Too often small businesses fall for the ploy and believe that their own government will be objective and fair not realizing that U.S. Government attorneys are obligated to protect their client first—in this case the government itself—not the small businessman or woman who filed the complaint.  Government counsel’s sole objective is to build a case against the entrepreneur and to attempt to force any possible resolution of the matter down the very narrow, lengthy and expensive legal pathway of patent litigation.  They do this as a matter of course knowing full well that small business entrepreneurs cannot afford to fight the government’s gamesmanship of the judicial process.

To protect small business entrepreneurs from the government’s predatory practices we at JGPIS have conferred with some of the world’s best legal minds to find solutions.  As a result, we are going to be taking new initiatives to make all entrepreneurs aware of the dangers and pitfalls of dealing with the government to provide capital in any form for the commercialization of their valuable technology.  Second, we are offering, through our network of the best legal minds in the country, assistance to marry the small business victims of government misappropriation with the right type of legal help.   Our goal is to level the competitive playing field by fighting the predatory and anticompetitive conduct of the government.

The John Galt Program for Investigative Studies will henceforth be issuing alerts to entrepreneurs on issues that they should be aware of before dealing with any U.S. Government agency.  We will be working to equip you with the right legal protection to prevent the misappropriation of your intellectual property.  When government agencies engage in unfair competition we will have a cadre of legal experts at the ready to help you.  Coming forward will no longer entail the threat of losing future government contracts because you have the courage to tell the truth.

So, if you are a small business victim of government fraud, waste and abuse please contact us.  We are here to help you.  You are our number one priority.  If you need help please write to us by completing the form at https://jgpis.org/report-infringement/.   After reviewing the information on the form we will call you at the phone number you provided.  Upon the completion of the phone interview, we will work with others to get you in contact with the highly specialized legal assistance that you need.