
A Reason Why Your Contractual Agreement Shouldn't Be a “Work for Hire” - jqueryin
https://blog.craftblue.com/2016/12/work-for-hire-freelance-contractual-agreement/
======
MrFoof
> _A highly recommended practice is to institute a clause which covers a
> variety of scenarios of assignment of the copyright for all work produced._

This is what I've done for years with my Service Agreement. IP transfer
officially occurs on full payment, and rights are assigned to Client if
Product would not be considered a work made for hire under applicable law.
Though if I'm not paid, I send a written warning after N past due. If still
don't get paid N days past said notice, I reserve the right to equitable
relief, send a cease to desist, and if I still don't get paid I can go to
court and get an injunction to stop Client from using it. There is some
language that clearly provides a grace period to the Client to use it while
awaiting invoices, etc.

IP transfer is the most leverage you have as a freelance software consultant.
It's the one thing you should have clearly defined in a Services Agreement,
and you shouldn't waffle on.

~~~
faitswulff
How would you recommend drafting something similar? Did you work with a lawyer
to produce your Services Agreement?

~~~
wernercd
Consult a lawyer. Someone versed in it.

Obligatory: Fuck You, Pay Me
[https://www.youtube.com/watch?v=6h3RJhoqgK8](https://www.youtube.com/watch?v=6h3RJhoqgK8)

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sean_hogle
There are at least four US District court decisions that stand for the
proposition that software qualifies as a work for hire as either a
"contribution to a collective work" or a "compilation": iXL Inc. v. Adoutlet
(N.D. Ill. March 29, 2001); Logicom Inclusive, Inc. v. W.P. Stewart & Co.
(S.D.N.Y. August 9, 2004); Siniouguine v. Mediachase Ltd. (C.D. Cal. June 11,
2012); and Stanacard, LLC v. Rubard, LLC (S.D.N.Y. February 3, 2016). So far
no appellate court has ruled on the issue AFAIK.

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rebelde
Can somebody point me to a model contract that does what we all want it to do?
There must be some good ones out there that we can use.

~~~
CalChris
Cooley has these.

[https://www.cooleygo.com/documents/](https://www.cooleygo.com/documents/)

Adding Wilmer Hale, Orrick and Founders' Workbench

[https://launch.wilmerhale.com/build/document-
generator/](https://launch.wilmerhale.com/build/document-generator/)
[https://www.orrick.com/Total-Access/Tool-Kit/Start-Up-
Forms](https://www.orrick.com/Total-Access/Tool-Kit/Start-Up-Forms)
[http://www.foundersworkbench.com/](http://www.foundersworkbench.com/)

I think Clerky does this as well.

 _Documents just want to be free_.

[https://techcrunch.com/2015/01/10/documents-just-want-to-
be-...](https://techcrunch.com/2015/01/10/documents-just-want-to-be-free/)

~~~
rch
My impression is that Cooley tends to be more company-favorable. Those docs
are to help a startup get to the point where they can afford to hire Cooley.

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zekevermillion
My old law partner liked to harp on this point as well, and it is a valid one.
However, as a matter of practice most well-drafted work-for-hire agreements
also contain a backup assignment clause something like "to the extent the work
is not a work-for-hire, I hereby assign the copyright". "Work-for-hire" is one
of the many misnomers you find in commercial contracts, along with
"intellectual property".

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msolujic
Joel Spolsky recently wrote on this topic, with focus on full time employment

[https://www.joelonsoftware.com/2016/12/09/developers-side-
pr...](https://www.joelonsoftware.com/2016/12/09/developers-side-projects/)

"... If you hire a photographer to take pictures for your wedding, you own the
copies of the pictures that you get, but the photographer still owns the
copyright and has the legal monopoly on making more copies of those pictures.
Surprise! Same applies to code."

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steveeq1
Ok, wait. I am somewhat confused by this article. It is from my (non-lawyer)
understanding that intellectual property ownership generally default to the
creator. This happens even in "independent contractor" type of relationships,
from my understanding. In the case of an employee/employer relationship, on
the other hand, IP generally lies on the employer.

So if it's a work-for-hire relationship, IP automatically goes to the
potential employer?

~~~
dagss
At least in my country the IP goes to the author, full stop. In employment
contracts you then specifically transfer the IP to the employer.

~~~
joshuak
Though I'm not a lawyer, I have direct experience with this having
successfully sued a client over IP related issues.

Under California law all IP produced by an employee during their employment,
that is within the domain of the employer's work product and regardless of
where that work was produced, is by default owned by the employer. All IP
produced by a independent contractor is owned by the independent contractor,
you pay for their time not for their work product.

'Work for hire' clauses are used to simply and effectively move an independent
contractor into the same category as employee with respects to the IP they
produce. It does not do the same with respect to the independent contractor's
compensation, or rights as employees.

Generally the 'work for hire' clause itself is entirely inflexible, it is
other areas of the agreement that must be addressed to protect payment.
Hollywood, for example, is run almost entirely under work for hire agreements
and could not function without it.

~~~
DannyBee
" that is within the domain of the employer's work product and regardless of
where that work was produced, is by default owned by the employer."

It's broader than that, actually.

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jhummel
Has anyone seen any clauses within an independent contractor agreement, which
would allow the retention of certain pieces of the finished work? For
instance, I write a class/component/plugin/etc. that I want to use in several
projects to increase productivity. Is there a standard way to carve out and
retain those pieces of code?

~~~
gleenn
I don't know if there is a standard way to do it, bit that's the arrangement
we have with almost all our clients. There are clauses about basically not
taking IP, just reusable code for our own purposes. Clients with existing
codebases are harder to sell but new projects almost never mind. You can tell
the client this significantly benefits them because then they might also get
"free" code from our other clients. It's like a microcosm of open source.

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arvidkahl
While it may not fall under the precise definitions, I like to think that the
source code I produce is both a translation (from an abstract concept language
into a machine-executable/-readable language) AND an instructional text (for
the machine to parse and execute).

From the perspective of a machine, that makes a surprising amount of sense.

~~~
Thrillington
Sure, but the law is generally interpreted from the perspective of the humans

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jocoda
DRY (Don't Repeat Yourself) is one of the prime commandments of software
development.

The problem I see with transferring IP/copyright on a 'work for hire' basis,
is that certainly in my case a substantial portion of the codebase is often
code that is being reused for good reason.

Losing control of that code now effectively prevents the same code from being
reused this elsewhere without getting into further messy contractual details.

Personally I refuse to do work for hire - instead the client gets unrestricted
right to use code as desired but does not own copyright.

Thoughts?

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BatFastard
You could certainly argue that writing software as part of a team is "a
contribution to a collective work".

What surprises me is how many startups are not even aware of at least
including a "work for hire" clause when bring on software developers.

~~~
matthewmcg
Sure, but even then if contributed code is part of a collective work, the
copyright act _still_ requires a work for hire agreement.

Section 101 says: A “work made for hire” is—

(1) a work prepared by an employee within the scope of his or her employment;
or

(2) a work specially ordered or commissioned for use as a contribution to a
collective work, as a part of a motion picture or other audiovisual work, as a
translation, as a supplementary work, as a compilation, as an instructional
text, as a test, as answer material for a test, or as an atlas, _if the
parties expressly agree in a written instrument signed by them that the work
shall be considered a work made for hire._

[https://www.copyright.gov/title17/92chap1.html#101](https://www.copyright.gov/title17/92chap1.html#101)

~~~
droithomme
Yeah, that is indeed the legal definition in the US of a work-for-hire.

As is pointed out though, for non-employees (contractors) there's an
enumerated list of categories that that can be applied to. Writing software
isn't in there. Although software and a web site designs might be considered
an audiovisual work in some cases. Games and multimedia software are clearly
audiovisual works. Accounting software, maybe not. Backend scripts, probably
not.

The second clause of the definition should probably be updated by Congress to
reflect modern realities. However, as it has not been updated, an explicit
copyright transfer is needed, or some form of licensing agreement. A lot of
specialists for hire will insist on a license instead of an outright copyright
transfers because they sure are not going to give away their core work
permanently to one party, short of a buy out. With either a copyright transfer
or licensing contract it doesn't need to be a work for hire, that issue is
irrelevant, the contract is written to cover what you actually need.

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raverbashing
It should be "one of its requirements" in the text

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late2part
Citation needed - why must they fall in one of these categories?

 _The deliverables must fall within one of nine limited categories of works_

~~~
daenney
It's literally in the same sentence you're quoting:

> Per 17 USC 101, the deliverables must fall within one of nine limited
> categories of works.

Though I'll grant you that _17 USC 101_ might not be blatantly obvious, a
quick Google search will reveal
[https://www.law.cornell.edu/uscode/text/17/101](https://www.law.cornell.edu/uscode/text/17/101)
as a source for further information.

~~~
late2part
Your point is valid. Mea culpa. What isn't obvious to me is that the produced
work is only protected by copyright, not trade secret property. But my wonder
is immaterial to the practical issue as most code is copyrighted; and any
arguments I would make about trade secrets or patents would be easily
refutable without a long debate. Apologies and mea culpa.

