Work for hire contracts software

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The nine categories are:. As you look at these categories, it becomes clear that business software and technical documentation are not contemplated. Aside from some website contributions e. Those arguments might be important after the fact if an existing contract relies on the work for hire doctrine without an assignment of copyright. But at the contract drafting stage, it makes no sense to rely on work for hire to obtain ownership since the doctrine is obviously designed for other types of works, especially since a simple assignment can give the hiring company ownership.

The best approach is for the contract with the independent contractor to include an assignment of the copyright in all works developed under the contract to the company.

For example:. Independent contractor hereby assigns to company or company's designee, for no additional consideration, all independent contractor's rights, including copyrights, in all deliverables and other works prepared by the independent contractor under this agreement.

Independent contractor shall, and shall cause its employees and agents to, promptly sign and deliver any documents and take any actions that company reasonably requests to establish and perfect the rights assigned to company or its designee under this provision.

Keep in mind that the assignment should be affirmative and in the present tense. Simply stating that the company "will be the owner" of the works may leave the company with nothing but an implied promise by the independent contractor to, at some point, assign the copyright to the company.

If the independent contractor never provides the assignment, the company may have a breach of contract claim but it does not own the copyright. Many contracts take a belt-and-suspenders approach, designating the deliverables as works for hire and providing that, if they don't qualify as works for hire, they are assigned to the company.

In theory, this may capture an incremental benefit because, if the deliverable were to qualify as a work for hire, the company would be deemed to be its "author" giving the company certain additional rights under copyright law rights an assignee does not have. Moreover, if the assignment included the right to prepare derivative works, the assignee will retain ownership in the derivative works it created during the term of the assignment though termination can limit or eliminate the assignee's right to prepare additional derivative works after the effective date of the termination.

In an industry where software that is even one year old is frequently considered obsolete, it seems unlikely that the revocability of copyright assignments would present a significant obstacle in the negotiation of agreements for the creation of customized software solutions. Nevertheless, parties considering an assignment should seek the advice of qualified counsel to be sure they understand the implications of the particular assignment being contemplated. If the parties contemplate that the copyright will remain with the developer, a license will be the more appropriate mechanism to specify the parties' respective rights and responsibilities.

Copyright licenses are powerful tools that can be used to vest the licensee with a wide range of rights that can amount to the practical equivalent of ownership if that is what the parties wish to accomplish.

A copyright owner can license any or all of the exclusive rights conferred by the Copyright Act, and the parties can contractually agree to a wide range of additional provisions. Licenses can be exclusive or non-exclusive, though in this context the vast majority of licenses would typically be exclusive. Copyright licenses can be complex instruments, and should always be negotiated and drafted with the assistance of qualified counsel.

Among other things, parties negotiating an exclusive software license should carefully consider and address the following intertwined and non-exhaustive issues:. Whether an assignment or a license is appropriate for a particular agreement will vary from case to case, and parties should carefully consider the advantages and disadvantages of both mechanisms in the context of any given negotiation. Obviously when the parties opt for a license over an assignment, the question of whether to include "work made for hire" language is moot because the parties are not seeking to vest copyright ownership in the customer.

There are several reasons that both software developers and their customers should think carefully before including "work made for hire" language in software development contracts. In many cases, the restrictive language of the Copyright Act may render such language legally ineffective as a means to vest copyright ownership in the party purchasing the software.

Moreover, such language can have significant implications - or at least create ambiguity -with respect to applicable labor laws. Parties negotiating such agreements should consider whether more flexible alternatives such as an assignment or a license would more effectively effectuate their intent.

Copyright Office's Circular No. This site uses cookies to store information on your computer. Some are essential to make our site work properly; others help us improve the user experience. In Stanacard, LLC v. The following are some ways a business can protect its ownership of software developed by employees or independent contractors:.

Contracts with software developers should always include transfer language where the developers agree to transfer all rights and ownership he or she owns with any copyrightable work created in the course of their employment relationship.

Source code can also be protected by trade secret law but the hiring company must demonstrate that the software is not generally known to the public, confers some sort of economic benefit to the owner, and is maintained by reasonable efforts of security. Contracts with employees and independent contractors should contain confidentiality clauses that specifically identify the software in its definition of confidential information.

Where appropriate, a non-compete clause can restrain the use of the software for anyone other than the business. One caveat with non-competes.

They must be carefully drafted to be reasonable in terms of scope and duration to be enforceable. A business can put itself ahead of competitors with custom software or add-ons. With the proper protections in place, that business can also assure that the ownership of the custom software remains with the business and does not follow the Craigslist software developer out the door.

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