> Well run companies would not allow for IP assignment to happen only after invoices were paid. A minor payment dispute could then hold up an investment round or M&A transaction, and that's completely out of proportion to the issue you're trying to address. The diligence lawyers /really do/ read every contract they have in the file.
On the other hand, that's exactly the reason you want to have IP assignment clauses in contracts with startups - it gives a lot of incentive to the client to fully pay the invoice in case of a firesale.
I have seen cases where a company went bankrupt, but at the same time sold the software to another company held by the same people, cheating freelancers out of their money. That cannot happen in this case, as the IP assignment blocks the sale unless the buyer agrees on paying out the contractors.
As a contractor, that's your only lever in that case.
Your case only works if the client is actually solvent.
On the other hand, that's exactly the reason you want to have IP assignment clauses in contracts with startups - it gives a lot of incentive to the client to fully pay the invoice in case of a firesale.
I have seen cases where a company went bankrupt, but at the same time sold the software to another company held by the same people, cheating freelancers out of their money. That cannot happen in this case, as the IP assignment blocks the sale unless the buyer agrees on paying out the contractors.
As a contractor, that's your only lever in that case.
Your case only works if the client is actually solvent.