About Intellectual-Property agreement with employer

Question

In IP agreement IP is define as below

Intellectual Property (whether or not patentable and whether or not made during working hours) is defined as but not limited to: all product specifications, developments, inventions, works of authorship, derivative works, technologies, programs, systems, software, mobile applications and other mobile programming interfaces, designs, methodologies, encryptions, ideas, techniques, patents, formulas, processes, concepts, know-how and date made or conceived or reduced to practice or developed during employment period ,remain the property of XXXXXXX[COMPANY_NAME]XXXX or its affiliates.

This is the first time I have seen any IP agreement. Isn't it too stringent? or its standard practice across industry?

If my understanding of french law isn't flawed, here it would be too broad to be legal and would allow you to keep the property of things which a better written agreement would have given to your employer. To get a valid answer for you, at least give the country and better don't rely on legal advice given on the web in a site targeted to non-lawyers, see one whose specialty is IP. — AProgrammer, Jun 05 '12 at 14:09
It's far too broad and overreaching. Don't sign it. It basically says "We own you, balls and all" (or breasts and all, if you happen to be female). Especially don't sign it if you already work there. — Robert Harvey, Jun 05 '12 at 14:32
tell them if you sign this, then they are legally responsible for all of the virus and worm programs you build in your spare time as a hobby ;) — Steven A. Lowe, Jun 05 '12 at 15:01
This is not unusual from all the IP agreements I've seen. However I would not sign it. You can easily fix this by making them add "practice or developed during employment period while using employer facilities and on employer related projects." — Andrew T Finnell, Jun 06 '12 at 13:48
I've heard of agreements like this. It usually isn't a problem as long as you pass the project by the company...tends to be more about you not competing with them given the insider domain knowledge you have. Still, IANAL and I don't know the company or country. — Rig, Jun 06 '12 at 14:04
Here's Joel's answer http://answers.onstartups.com/questions/19422/if-im-working-at-a-company-do-they-have-intellectual-property-rights-to-the-st/20136#20136 — MarkJ, Sep 28 '12 at 07:45
Since answers.onstartups.com is gone, here's the archive.org link: https://web.archive.org/web/20131207173301/http://answers.onstartups.com/questions/19422/if-im-working-at-a-company-do-they-have-intellectual-property-rights-to-the-st/20136 — Bill B, Apr 23 '15 at 17:53
I'm voting to close this question as off-topic because it is asking programmers to evaluate a legal document. — , Mar 03 '16 at 22:10

Jason Lewis · Answer 1 · 2012-06-06T12:55:46.903

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IANAL, but the language of this agreement is overly broad. If it is enforceable in the state (or country) where you work (work-for-hire laws vary from state to state (and, obviously, country to country), and in some cases may preclude contractual clauses like this), it would effectively bar you from making any contributions to open-source projects, creating any software of your own, or even posting ideas for software to internet discussion groups without

those ideas becoming the sole property of the employer, and
exposing yourself to liability for disclosing the intellectual property of your employer.

I for one would never sign or advise anyone else to sign an agreement this broad, partially because software is my main hobby as well as my job, and mostly because Github Is Your New Resumé.

Most companies that have contacted me with job offers had already found my Github profile, seen my open-source contributions. Many recruiters I talk to at conferences say they would never hire anyone who didn't have significant activity on Github.

If this is a job you are considering, get a lawyer to review the agreement first. If it's for your current employer, look for a new job.

It occurs to me that based on the license, you may be able to contribute patches to existing open-source projects, if that interests you. But I'm pretty sure doing a startup-weekend or hackathon style event and owning the result is impossible if this agreement is indeed binding. Either way, this type of agreement is far too stringent, and certainly not standard. It might have been common decades ago; Steve Wozniak had to offer the original Apple to Hewlett-Packard, where he worked at the time. Luckily, they weren't interested.

Today, this sort of contractual obligation would make it very, very hard for a company to attract good developers. That's something to consider, as well — would you want to work with developers who were willing to sign their every idea over to the company?

edited Jun 06 '12 at 12:55

answered Jun 05 '12 at 14:11

Jason Lewis

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"If it is enforceable in the state ..." Don't assume everyone is in the USA :-) – James Jun 06 '12 at 07:38
@James - Good point. Edited to try to take this into account. Thanks. – Jason Lewis Jun 06 '12 at 12:56
`Today, this ... would make it very, very hard for a company to attract good developers.` I could go into detail, but I can assure you that this is only the case for small or poorly known software companies. In most cases, with your employment agreement, you provide a list of software/ideas that you want to or have begun to develop. – Steven Evers Jun 06 '12 at 13:34
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State means country everywhere except the US. So it still applies. – Andrew T Finnell Jun 06 '12 at 13:45
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@SnOrfus I've been asked about projects I'm working on. That's common. But I've never heard of a company expecting to acquire a developer's personal projects when hiring them, unless they were being hired as part of an acquisition deal. Other than that, a company is hiring me, not buying me. They don't automatically acquire my capital assets, and shouldn't expect to acquire non-competing, non-work-related projects. – Jason Lewis Jun 06 '12 at 15:55
@SnOrfus - allegedly it's already making it very hard for companies in Massachusetts to recruit programmers. The state has a record of enforcing these terms so rigidly that many companies now won't hire anyone who has worked for an Ma based company. – Martin Beckett Oct 02 '12 at 16:04
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@MartinBeckett: Wow! That's incredible. I'd be interested in reading more about that; do you have any references that talk about it? – Steven Evers Oct 02 '12 at 20:05
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More about non-competes, but same principle http://hbswk.hbs.edu/item/6759.html – Martin Beckett Oct 02 '12 at 20:36

score 7 · Answer 2 · answered Jun 05 '12 at 14:30

There are many companies that take this approach. It's way to stringent for any reasonable need of the company. Some folks have said it's unenforceable in some localities, and you could check with a lawyer on that aspect.

I'd suggest responding with a proposed alternate version that gives the company anything you develop during work hours, or while using company resources (one can't blame the employer for wanting to get what they've paid you for, nor for stuff you do using their equipment).

Not knowing how much you may need the job, I don't know whether you can afford to try to negotiate or not, nor whether you can afford to walk away. If you have intentions of doing ANYTHING productive outside of work, then this agreement is going to be a big problem for you, because it will taint the ownership of anything that you do on your off hours.

Now, it should be noted that your employer (and especially your prospective boss) probably has no intention of watching what you do on the side and making a grab the instant you do something interesting. The legal department almost certainly authored this with an eye toward maximum protection for the company, and no one else has bothered to pay much attention to it (lawyers, remember, are hired to protect their clients as much as possible. So they tend to reach just as far as they can and only pull back when someone else pushes a bit).

In fact, it's unlikely in the extreme that they'd ever try to enforce it outside of stuff you actually did for them. But it's there, and it COULD become a problem at some random future time, which is a good reason to avoid it.

It's a "We can make your life a living hell if we really want to" agreement. — Robert Harvey, Jun 05 '12 at 14:35
It is unenforceable in some states in the US, and enforceable in others. Of course, you can get sued on the claim that you used employer time or equipment or proprietary knowledge on your project anywhere. — David Thornley, Jun 05 '12 at 15:02
The important thing is, in my mind, that it's far more than the corporation actually needs in order to protect itself. It's just over-reaching. — Michael Kohne, Jun 05 '12 at 16:09

score 3 · Answer 3 · answered Jun 06 '12 at 17:16

A couple of points to add to the excellent answers already.

Ultimately this would be decided in court. By a jury of 'ordinary' people who just might not be software professionals. So while it would be obvious to them that, for example, a house painter producing watercolors at the weekend isn't in the same business as his employer - would they be able to distinguish between your network admin day job and your evenings writing iPhone apps?

Your current boss might be perfectly OK with you writing iPhone apps and they might think this is just silly legalese - but next year your company might be bought by Apple or $EVILCORP$ , what then?

score 2 · Answer 4 · answered Jun 05 '12 at 15:10

Such a clause would be unenforceable where I live (Minnesota), but I've seen businesses write unenforceable provisions into agreements, and I don't know where you live. (Small businesses may not have the best legal advice, large ones are likely to be multi-state, and even unenforceable provisions might discourage behavior the employer doesn't want.)

What you can do, anywhere, is negotiate agreements. Don't assume that what is put in front of you is necessarily unalterable, on a take-it-or-leave-it basis. If you have concerns about provisions like this, talk to whoever you're negotiating with at the company. Your best leverage will come between the time when you're offered a job and the time you accept.

score 1 · Answer 5 · answered Jun 05 '12 at 16:03

As others have pointed out, for legal advice, you really want to consult a lawyer. What provisions are actually enforcable will depend on the country and state in which you live among other issues that prevent a site like this from giving a canonical answer. A lawyer that is familiar with the laws where you live can give you a much better reply.

You can certainly see if the employer would be willing to amend the agreement. If you do that, though, understand that employers are unlikely to be willing to give up rights to any IP you create that is vaguely associated with the work you do for them. From the company's standpoint, the problem is that if you happen to figure out how to solve some problem related to the business the company is in on Saturday in your shower while not using any of their equipment, the company needs to have rights to that. Otherwise, employees could end up holding the company hostage claiming that all sorts of ideas that came to them while they slept or while they were driving in to work needed to be licensed. Of course, that just defers the problem because someone has to figure out after the idea is created whether it is related to the business the company is in and that can be very nebulous-- if you work for Google, for example, what software isn't related to something that Google does?

Practically, one question to ask is how likely the company is to enforce an overbroad IP agreement and how likely you are to actually go to court to defend any exceptions you carve out. If, for example, you get permission to build an open source chess application and your company decides later that some part of the chess application uses something that you developed in the course of your work for the company, are you really willing to go to court to defend those rights? That could be a very expensive (and mentally exhausting) process even if you are clearly in the right. On the other hand, if you think that you might like to start a company based around some open source app that you develop, you might well be willing to go to the courts to enforce the agreement.

If the company you're working for doesn't have a habit of suing employees to get rights to software that is unrelated to what the company does (and almost all companies fall into this category) and you just want to work on projects outside work as a hobby, perhaps an informal handshake agreement with your boss is sufficient. That won't stand up in court, but if you already know that you'd fold before it got before a judge, maybe that doesn't matter too much. If you want a bit more protection, perhaps you can negotiate some exclusions for particular projects or types of projects (i.e. linux, Apache, etc. depending on your skills and interests) or to negotiate that you'll inform the company about any open source projects you contribute to and they have N days to indicate that they want to object/ claim ownership.

About Intellectual-Property agreement with employer

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