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Intellectual Property Law: Just Because You Paid For That Custom Software Does Not Mean You Own It.

Companies sometimes pay large sums of money to independent contractors to create a custom software program and mistakenly assume that they own the result.

Many companies have valuable intellectual property developed within their business, one of which is rights in copyrighted materials. Copyrights do not involve just novels and artwork; they can include software programs, apps, training manuals and even website content. Thus, companies should investigate what works of authorship they have created. When investigating the works, companies frequently find that they do not own all of the rights in some materials – despite paying dearly for them.

If your company’s work is created by your employees, that work is automatically deemed to be authored and owned by you, the employer, under the “work made for hire” doctrine. However, this is not necessarily the case if you hired an independent contractor to create the work, regardless of the cost. Rather, the independent contractor owns the rights in the work, and you may have only a license to use it, unless your agreement for the work specifically provides otherwise.

Thus, when negotiating with an independent contractor to create a work for your company, make sure the agreement provides that you will own all rights in the work, including copyright and all other intellectual property rights. Further, to the extent you have already had works created for you such as software programs, websites, survey manuals, you should review your contracts to determine the ownership rights. If you find that you do not own the rights in the work, you could consider re-negotiating with the independent contractor to assign the rights to you.

For more information please contact Kim Grimsley at 410-583-2400 or grimsley@bowie-jensen.com.

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