Contractors and the Legal Ownership of your Intellectual Property
By David Lotimer, July 25th, 2017
Many entrepreneurs and small business owners exhibit an extraordinarily high level of motivation. They are individuals with the wide-ranging skill set that is necessary to achieve success in their chosen field. One of the most important characteristics of these leaders is the ability to recognize their own deficiencies and to identify a capable person to fill that void within their team. If they’re lucky these individuals will sign on to be a part of the team full time as an employee, however many teams are filled with freelance developers, contractors, consultants and the like. Utilizing these less permanent team members can be cost effective and can help to bolster the capabilities of your company. However it can also create legal issues relating to intellectual property ownership.
It important to protect the legal rights associated with intellectual property developed by you and your team, and to ensure that you are not breaching the legal rights of others. It is also important to ensure that your company legally owns the valuable assets you and your team have created. Clear ownership rights comfortably allow you to use, license and sell the inventions, products, and software developed by your team.
Generally when an employee contributes to work done for the employer in the context of their employment, all work product of that employee will automatically be owned by the employer. However ownership rights are slightly murkier when a non-employee is involved in the creation of work product.
What happens for instance when a contractor creates a website for your company based on a template she produced prior to her engagement? What if a software developer uses source code originally created during his engagement with another company in the creation of a new platform for your business? How will ownership rights in a logo created by a graphic designer be distributed? The relationship between employers and non-employees can bring about these types of work product ownership questions.
But don’t fret – there are many ways to structure a relationship with a non-employee in order to protect your business and to guarantee your ability to use the work product created for your company.
Clear intellectual property ownership clauses within a contractor agreement can provide you with confidence in legal ownership of work product. Disclosure and liability obligations related to third party material used within contractor developed work product can be essential to protect your company from legal attacks. Intellectual property licensing can help define invention contributions and allow your company to legally incorporate previously developed intellectual property into your own creations. These are but a few of the strategies you can utilize to clarify ownership rights with non-employees.
The next time you look to fill out your team with a specialized contractor, consider obtaining the advice of an intellectual property expert. We can help you structure the relationship so that you can confidently work with a non-employee, and allow you to get back to focussing on driving the success of your business.
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