Contracts: Make Sure There is an Intellectual Property Ownership Clause

If you own a business, you have undoubtedly entered into contracts with others for various purposes. However, you may not be aware of or fully appreciate their legal implications on your company’s valuable intellectual property assets, such as trademarks, copyrights, patents, and trade secrets. These “intangible property” rights and interests may be of considerable value to your company either presently or in the future. Therefore, it is crucially important that your business contracts clearly and concisely address the issue of ownership of any intellectual property. Your company will want to insist that the contract contains a clear, express provision that both identifies the intellectual property that is subject to the agreement and that ownership of the intellectual property will remain with your company.

The “work-for-hire” doctrine is an exception to the general rule of law that copyright in an original work of authorship is owned by the work’s author.  For example, if you hire another person to take a photograph of you in front of your business, or to create a graphic design or software program for your company, without the proper language in your contract for those services, you might forfeit important intellectual property rights that your business needs to retain. Unless there is an appropriate intellectual property provision included in the written contract with the photographer in the above scenario, you would only own the photograph itself; not the potentially valuable copyright interests associated with it.

This is but a brief synopsis of the multitude of problems that can befall a company that fails to exercise scrupulous care when entering into any contract that affects its intellectual property. It is always good practice to hire an intellectual property attorney with skill and experience negotiating and drafting these types of agreements. Always remember that each word in a contract has meaning and legal effect. Precision and clarity are crucial.

This article is not legal advice but should be considered as general guidance in Intellectual Property law.  You can contact us at 207.784.3200.  Skelton Taintor & Abbott is a full service law firm providing legal services to individuals, companies, and municipalities throughout Maine. It has been in operation since its founding in 1853.