It is important to make sure there is a written agreement in place with any employee, consultant or other party who creates intellectual property (“IP”) for the company which validly transfers to the company all rights to the developed IP. That’s because under applicable U.S. IP laws, there’s no guarantee that IP created for the company – even by developers who have been specifically hired and tasked with creating IP for the company – will be owned by the company. U.S. IP laws only provide a company with ownership of certain types of IP created by certain types of developers under certain circumstances when there is no written agreement in place governing IP ownership, so a written agreement is needed to ensure IP the company expects to own is indeed transferred over to the company.
IP assignments can be incorporated into standalone agreements (e.g., an IP assignment and confidentiality agreement signed by an employee) or baked into larger contracts that cover more than just IP assignment concepts (e.g., IP assignment clauses in services contracts). In all contracts that include IP assignments, it’s important to ensure the IP assignment provisions are enforceable under applicable law. For example, IP assignments must include a present tense assignment to be valid under U.S. law. IP assignments must also be supported by consideration – a bargained for exchange of benefits or burdens between the assignor and assignee – to be valid under U.S. law. Companies also must ensure the IP assignment complies with any legal limitations on assignment. For example, certain U.S. states require companies to provide employees with a written notice about what IP is not covered by their IP assignments to their employees (and a failure to do so can jeopardize the enforceability of the IP assignment). Finally, IP created outside the U.S. will be subject to the local laws where the IP was created that will govern how to properly assign the IP.