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  1. #1
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    Question Intellectual Property Clause in Contract - sign all rights over?

    The last few months i have been working as a PPC freelancer (limited company in UK).

    Most of my work has come through a digital agency (small start up) where any PPC work has been passed to me. I have been working with them for several months but now they want me to sign a contract for new clients.

    Part of my PPC work is reporting via excel and i have created very powerful, complex and dynamic reports which took months to create. The rest of my work is the usual keyword research, ad creation, etc.

    I am planning to offer my reporting as a seperate service to other PPC agencies.

    The contract they wish me to sign appears to pass all intellectual property rights over to them - including any past, present or future works!

    Is this a standard contract (UK Law)?

    7 Intellectual property
    7.1 You hereby assign to the Company all existing and future intellectual property rights (including, without limitation, patents, copyright and related rights) and inventions arising from the Services for the Company. You agree promptly to execute all documents and do all acts as may, in the opinion of the Company, be necessary to give effect to this clause 7.
    7.2 You hereby irrevocably waive all moral rights under the Copyright, Designs and Patents Act 1988 (and all similar rights in other jurisdictions) which you have or will have in any existing or future works.
    7.3 You hereby irrevocably appoint the Company to be your attorney to execute and do any such instrument or thing and generally to use your name for the purpose of giving the Company or its nominee the benefit of this clause 7 and acknowledge in favour of a third party that a certificate in writing signed by any director or the secretary of the Company that any instrument or act falls within the authority conferred by this clause 7 shall be conclusive evidence that such is the case.
    Any legal advice would be appreciated as this contract really concerns me.
    Last edited by ppc freelancer; Feb 25, 2009 at 07:58. Reason: Specify Region

  2. #2
    Word Painter silver trophy Shyflower's Avatar
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    IANAL but I think you need an attorney to reword their clause in your favor or at least a more equitable arrangement. That looks to me like a work-for-hire clause and if you are a freelancer, you are not their employee.

    I also think a good attorney can reword it so it is more reader-friendly. I wouldn't sign that. At best, as a freelancer, I would only sign a non-disclosure agreement and that is definitely over the bounds of non-disclosure.
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  3. #3
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    7.2 You hereby irrevocably waive all moral rights under the Copyright, Designs and Patents Act 1988 (and all similar rights in other jurisdictions) which you have or will have in any existing or future works.
    That's certainly sounds wide ranging - for a start I'd like to see this clause make it clear that it only applies to existing and future works commissioned to you by their company.

    Sounds more like an employment contract - you are not an employee, you are a contractor. You are correct to be weary in signing over IP rights like this, it can severely restrict your business if this client is claiming ownership of your reporting system. Of course it can be a grey area - the client may argue that you developed the system 'on their time', as part of the work they commissioned and paid you for.

    Probably best to talk to a solicitor. And your accountant - if most of your work comes from a single client, HMRC is likely to consider this arrangement as falling under IR35 regulations; in their eyes you are an employee and should therefore be registered as such. That means the company needs to pay you a salary under PAYE and unfortunatley you don't get the tax advantages on the money earned (I assume it gets run through your LTD company, corp tax paid @21% and drawn out NI-free in dividends).

    The contract you are signing may also strengthen HMRC's arguement! Just note that your client may have just used some boilerplate template and themselves have no understanding of its content - you may be able to have them create something easier to read and less restrictive.

  4. #4
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    Quote Originally Posted by ppc freelancer View Post
    The last few months i have been working as a PPC freelancer (limited company in UK).

    Most of my work has come through a digital agency (small start up) where any PPC work has been passed to me. I have been working with them for several months but now they want me to sign a contract for new clients.

    Part of my PPC work is reporting via excel and i have created very powerful, complex and dynamic reports which took months to create. The rest of my work is the usual keyword research, ad creation, etc.

    I am planning to offer my reporting as a seperate service to other PPC agencies.

    The contract they wish me to sign appears to pass all intellectual property rights over to them - including any past, present or future works!

    Is this a standard contract (UK Law)?



    Any legal advice would be appreciated as this contract really concerns me.
    I'd never agree to signing anything like this. Clients have asked but I always explain that in my work I use a lot of components and solutions that I have developed earlier and will use in the future (for example my standard CMS) so I can't give them ownership of something that is vital to my business. I don't know whether this is legally true or not but in all cases they've backed off.

  5. #5
    Programming Since 1978 silver trophybronze trophy felgall's Avatar
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    Quote Originally Posted by A-OK View Post
    Clients have asked but I always explain that in my work I use a lot of components and solutions that I have developed earlier and will use in the future (for example my standard CMS) so I can't give them ownership of something that is vital to my business.
    Sounds reasonable. If you give them full rights to what you have written then you can't reuse any of it ever again which could lead to your not being able to work for anyone else without having to reinvent the wheel every time.
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  6. #6
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    Thanks for the help - i explained the situation and the client was happy to let me re-write the contract giving them an exclusive licence to re-use, modify or sell the work if they wish but not to have any restrictions on me using similar reporting templates for other clients.

    Thanks.

  7. #7
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    My normal clause is that the client has unlimited rights to a copy of the source code AND I have limited rights, the limitation being I cannot use the code developed for their project in a project for a direct competitor without their permission. All of my clients have been great with that arrangement, because it protects them to the extent they need the protection (getting the source code) and it protects me to re-use their code for anything that doesn't screw an old client. Since my clients never seem to overlap, this works out great.
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