Contract "Work Product" Meaning

[shauntir]

This is a clause I have in a recent contract that was sent to me:

The term “Work Product” means any and all software, procedures, data, documentation,specifications, products, product improvements, product modifications, inventions, innovations, know-how, methods, plans, procedures, recommendations, reports, techniques, writings of any nature, and work-in-progress and derivatives of pre-existing technology owned by Contractor (including without limitation, derivatives of pre-existing copyrighted works of Contractor) and any other work developed, written, made, conceived or reduced to practice in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement, whether or not jointly conceived; and (b) the term “IP Rights” means any and all patents and patent applications (including any divisions, substitutions, continuations, continuations-in-part, reissues, re-examinations, or extensions), copyrights, trade secrets, trademarks and other intellectual property and proprietary rights.

I am trying to determine what this exactly means. If I have an idea for an app and did some dev on it, when signing this contract, that app could belong to the employer? Is this something that you usually find?

 

[rrh]

Basically "yes" to both questions. This is fairly normal (in a contract) and is designed to cover those cases where:

• As part of the deal you are bringing in software that you have previously developed for the company to develop; or
• You resign to develop software based on IP that you have picked up whilst working at the company.

If you are spending nights working on something that you intend to market and that might cause a conflict best you cover it in a codicil to the contract.

 

[Ancalagon]

As far as I can tell, it means that let's say you developed a timer module before signing this contract on your own time. After you started the contract, the requirements you were given required a timer module, so you plugged yours in. That timer module now belongs to them, not you, and you can't reuse it without their permission.

EDIT:

Thinking about it...

• The term “Work Product” means any and all software, procedures, data, documentation,specifications, products, product improvements, product modifications, inventions, innovations, know-how, methods, plans, procedures, recommendations, reports, techniques, writings of any nature, and work-in-progress and derivatives of pre-existing technology owned by Contractor (including without limitation, derivatives of pre-existing copyrighted works of Contractor) and
• any other work developed, written, made, conceived or reduced to practice in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement, whether or not jointly conceived;
• and (b) the term “IP Rights” means any and all patents and patent applications (including any divisions, substitutions, continuations, continuations-in-part, reissues, re-examinations, or extensions), copyrights, trade secrets, trademarks and other intellectual property and proprietary rights.

Looking at that, the first part would mean that everything you have done, that you own, is covered by this agreement, whether or not you use it during your contract. Sounds overly broad to me, I wouldn't be comfortable with it.

ONLY work that you use DURING the contract should be covered. If you work on something in your spare time at night, it should not be covered, which it would be by this agreement.

 

[shauntir]

Thanks for the responses.

I do agree, if it is some type of development that I did and use in their product while working for them, that should be considered their IP or work product.

Outside of that, my work should be considered mine. I think it is too broad myself and would definitely ask for some changes. I have no idea how to word it though..

 

[rrh]

As far as I can tell, it means that let's say you developed a timer module before signing this contract on your own time. After you started the contract, the requirements you were given required a timer module, so you plugged yours in. That timer module now belongs to them, not you, and you can't reuse it without their permission.

ONLY work that you use DURING the contract should be covered. If you work on something in your spare time at night, it should not be covered, which it would be by this agreement.

According to the wording: "... in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement"

After-hours work would be excluded.

OTOH if you are already privately working on something that could be construed as related to your employer's business then best raise the issue before signing.

 

[Ancalagon]

According to the wording: "... in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement"

After-hours work would be excluded.

OTOH if you are already privately working on something that could be construed as related to your employer's business then best raise the issue before signing.

Notice the and though.

Its not only work arising out of the contract, its also prior work. Its the union of the two sets, not work that satisfies both conditions.

 

[rrh]

Notice the and though.

Its not only work arising out of the contract, its also prior work. Its the union of the two sets, not work that satisfies both conditions.

Come to think of it the paragraph supplied looks as though it is from the "definitions" section of the contract.

Surely one should be looking at the paragraphs where the actual terms of the contract are defined ?

 

[shauntir]

Come to think of it the paragraph supplied looks as though it is from the "definitions" section of the contract.

Surely one should be looking at the paragraphs where the actual terms of the contract are defined ?

This is from the definitions section. Essentially, that paragraph is there to define what "Work Product" means. It seems that it is used for definitions as well as some kind of enforcement?

 

[Ancalagon]

This is from the definitions section. Essentially, that paragraph is there to define what "Work Product" means. It seems that it is used for definitions as well as some kind of enforcement?

Can you give us a few of the sections where Work Product is used?

Like, "All your work product belong to us."

 

[shauntir]

Can you give us a few of the sections where Work Product is used?

Like, "All your work product belong to us."

Sure, here's the entire section:

8. Definitions of Work Product and IP Rights

8.1 All projects that have been discussed, briefed, spec’ed by the company and developed by the Contractor or within the company in the course of their employment, or using the Company’s resources, and all intellectual property rights and interests in that work will be the exclusive property of the Company at all times everywhere in the world. The Contractor waives all rights it may have in the intellectual property and will promptly disclose the intellectual property to the Company and not make use of any of the intellectual property except in the course of employment or with the Company’s written consent.

8.2 /snip - as posted originally

8.3 The Contractor acknowledges and agrees that any and all Work Product shall be considered “work-made-for-hire” within the meaning of Section 101 of the Copyright Act, and ownership of the entire right, title and interest in the Work Product shall reside with the Company.

8.4 The Contractor waives any and all claims to the Work Product and irrevocably assign and transfer to the Company any and all rights, title and interests, worldwide, in and to the Work Product, including without limitation, IP Rights and other proprietary rights embodied in or relating to the Work Product.

8.5 The Work Product shall at all times between the parties be and remains the sole and exclusive property of the Company and may not be used by the Contractor for any purpose other than the benefit of the Company.

8.6 The Contractor shall not include, embed or use any IP Rights of Contractor or any third party without the prior written consent of the Company. If the Contractor incorporates into the Work Product any such IP Rights, the Company is hereby granted and shall have, or Contractor will procure for the Company at its own expense, a non-exclusive, royalty-free, irrevocable, perpetual, worldwide, transferable and sub-licensable license to make, have made, modify, make derivatives of, use and sell, and commercially exploit in any manner whatsoever such IP Rights with no obligation to account to Contractor or any third party, unless otherwise agreed upon in writing by the parties.

 

[Ancalagon]

Okay, I get it. I think 8.2 is worded a little badly, but I understand what they are saying - it is nothing unusual and nothing to be worried about. 8.2 should be read like this:

The term “Work Product” means:

• any and all software, procedures,
• data,
• documentation,
• specifications,
• products,
• product improvements,
• product modifications,
• inventions,
• innovations,
• know-how,
• methods,
• plans,
• procedures,
• recommendations,
• reports,
• techniques,
• writings of any nature,
• and work-in-progress
• and derivatives of pre-existing technology owned by Contractor (including without limitation, derivatives of pre-existing copyrighted works of Contractor)
• and any other work developed, written, made, conceived or reduced to practice in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement, whether or not jointly conceived;

and (b) the term “IP Rights” means:

• any and all patents and patent applications (including any divisions, substitutions, continuations, continuations-in-part, reissues, re-examinations, or extensions), copyrights, trade secrets, trademarks and other intellectual property and proprietary rights.

Although they botched it and worded it badly, the bolded part is supposed to refer to the entire list, not just the last part.

 

[rrh]

My guess is that the lawyers have inadvertently used the term "Contractor" instead of "Company" in the definitions, i.e.

The term “Work Product” means any and all software, procedures, data, documentation,specifications, products, product improvements, product modifications, inventions, innovations, know-how, methods, plans, procedures, recommendations, reports, techniques, writings of any nature, and work-in-progress and derivatives of pre-existing technology owned by Company (including without limitation, derivatives of pre-existing copyrighted works of Company) and any other work developed, written, made, conceived or reduced to practice in the course of or arising out of the Services performed by or on behalf of the Company under this Agreement, whether or not jointly conceived; and (b) the term “IP Rights” means any and all patents and patent applications (including any divisions, substitutions, continuations, continuations-in-part, reissues, re-examinations, or extensions), copyrights, trade secrets, trademarks and other intellectual property and proprietary rights.

 

[Ancalagon]

Yes I think that is also true rrh.

 

[rrh]

Okay, I get it. I think 8.2 is worded a little badly, but I understand what they are saying - it is nothing unusual and nothing to be worried about. 8.2 should be read like this:

The term “Work Product” means:

• any and all software, procedures,
• data,
• documentation,
• specifications,
• products,
• product improvements,
• product modifications,
• inventions,
• innovations,
• know-how,
• methods,
• plans,
• procedures,
• recommendations,
• reports,
• techniques,
• writings of any nature,
• and work-in-progress
• and derivatives of pre-existing technology owned by Contractor (including without limitation, derivatives of pre-existing copyrighted works of Contractor)
• and any other work developed, written, made, conceived or reduced to practice in the course of or arising out of the Services performed by or on behalf of the Contractor under this Agreement, whether or not jointly conceived;

and (b) the term “IP Rights” means:

• any and all patents and patent applications (including any divisions, substitutions, continuations, continuations-in-part, reissues, re-examinations, or extensions), copyrights, trade secrets, trademarks and other intellectual property and proprietary rights.

Although they botched it and worded it badly, the bolded part is supposed to refer to the entire list, not just the last part.

I agree

 

[rrh]

We agree with each other = mutual admiration society

 

[shauntir]

We agree with each other = mutual admiration society

LOL. Thanks a lot guys! I will ask for a change in the wording to read "company" and not "contractor". If the original is in fact what they deem as correct, I will then ask for it to be laid out as Ancalagon has so that it is clear that work product is what belongs to the company based on service performed.