Recent Answers to Intellectual Property Law Questions

Randy M.

Answered Sep 30, 2025

When you’re preparing work for a client, the key issue isn’t whether you’ve run a formal copyright search, but whether you have the legal right to use the image. Copyright law automatically protects most images, so relying on the absence of a watermark or a registration record isn’t enough to keep you safe. Copyright Protection and Ownership Under U.S. law, copyright attaches the moment an original work is created and fixed in a tangible form (17 U.S.C. § 102). That means virtually every photo, illustration, or graphic you find online is already protected. Registration with the U.S. Copyright Office strengthens enforcement rights, but it isn’t required for protection. Likewise, the lack of a © symbol doesn’t mean an image is free to use. Because there’s no central database covering all copyrighted images, a formal copyright search isn’t practical or reliable in most cases. Even if you searched the Copyright Office’s records, you’d only be looking at registered works, which are a small fraction of what’s actually protected. Risks of Using Unlicensed Images If you incorporate an image without permission into a commercial project, you and your client could face serious consequences. Infringement can lead to cease-and-desist orders, statutory damages of $750 to $30,000 per work (and up to $150,000 for willful infringement) under 17 U.S.C. § 504(c), and potential liability for the copyright holder’s attorney’s fees. Courts generally view commercial use as disfavoring any “fair use” defense. Even if you didn’t intend to infringe, liability can still be imposed. Best Practices for Designers The best practice is to focus on obtaining images from sources where the licensing terms are clear and legally sound. For example: • Use reputable stock photo agencies such as Adobe Stock, Shutterstock, or Getty, where commercial licenses are explicit. • Choose Creative Commons images that allow commercial use (e.g., CC BY or CC0), but review license terms carefully. • Confirm public domain status when applicable, such as U.S. federal government works. • Contact creators directly for written permission if you want to use their work. • Keep copies of receipts, license agreements, or permission letters so you can show proof of rights if challenged. Reverse image search tools like Google Images or TinEye can be useful to trace the origin of an image and identify whether it’s sold or licensed by a third party. However, this is a step in due diligence, not a substitute for obtaining rights. Professional Responsibility As a freelance designer, your contracts may hold you responsible for ensuring that the materials you deliver don’t infringe anyone else’s rights. Delivering work that exposes your client to infringement claims can damage your reputation and your client relationship. The safest practice is to assume that any image you didn’t create yourself is protected until you confirm otherwise and secure the proper license.

Randy M.

Answered Sep 14, 2025

Yes, you can and should include clauses in an Intellectual Property License Agreement that protect your rights as the licensor. A license agreement is your main tool for controlling how your software is used, setting boundaries for your clients, and limiting your financial exposure. The key is to draft it in a way that leaves no doubt about what rights are granted, what’s restricted, and what happens if there’s a breach. Grant of License Start with a clear license grant. Spell out that you’re giving the client only limited rights, not ownership. Most licensors define the license as non-exclusive, non-transferable, and revocable if the client doesn’t follow the terms. For example, you might allow a client to use the software only for its internal business operations, and only on a set number of machines. It’s equally important to list what the licensee cannot do, such as reverse engineering, modifying, sublicensing, or providing the software to third parties. Intellectual Property Ownership Reinforce that you retain all ownership rights in the software and any related intellectual property. A simple but strong statement is that you hold all right, title, and interest in the software, and the client only receives a limited right to use it under the agreement. This prevents confusion between a license and a sale. You can also require the licensee to notify you if they discover third-party infringement and confirm that you alone have the right to pursue action against infringers. Confidentiality If you’re providing source code, algorithms, or other sensitive information, a confidentiality clause is essential. Define confidential information broadly to include not just the software itself but also any documentation or business information you share. Require the client to protect that information with at least the same care they use for their own confidential material, and make the obligation survive termination of the agreement. Termination Every strong license has a termination clause. Termination for cause should allow you to end the agreement if the client fails to pay, violates the license scope, or breaches confidentiality. Many agreements include a short cure period, such as thirty days, for the licensee to fix the breach before termination takes effect. Spell out the consequences of termination: the licensee must stop using the software immediately, return or destroy all copies, and certify that they’ve complied. Without this, you risk losing leverage if the relationship breaks down. Payment Terms Protect your revenue by making payment terms clear. Define license fees, support or maintenance fees if applicable, the payment schedule, and penalties for late payment such as interest. Courts generally enforce these provisions as long as they’re reasonable. Disclaimers and Limitation of Liability These clauses protect you from lawsuits if things go wrong. A limited warranty might cover basic performance for a set time, but beyond that you should disclaim all other warranties. Standard language is that the software is provided “as is” and you disclaim implied warranties of merchantability and fitness for a particular purpose. To limit your exposure, cap liability at a defined amount, often the fees paid by the licensee in the previous twelve months, and exclude liability for indirect or consequential damages such as lost profits. Courts usually enforce these limits, except in cases of fraud or intentional misconduct. Audit Rights If your pricing model depends on the number of users or installations, an audit right is valuable. This allows you to check, on reasonable notice, that the licensee isn’t exceeding their rights. For example, you might reserve the right to inspect usage records once a year during normal business hours. Governing Law and Dispute Resolution Designating which state’s law governs and how disputes are resolved reduces uncertainty. Many licensors choose their home state’s law and either local courts or arbitration for disputes. Remedies Make sure your agreement lets you seek injunctive relief if the licensee misuses or discloses your software. Monetary damages often aren’t enough to protect intellectual property, so courts will enforce contract terms that authorize immediate injunctive relief. Protect Your Software with Legal Guidance When you’re licensing valuable software, the details in your agreement can make the difference between real protection and unnecessary risk. The lawyers on Contracts Counsel are available to draft, review, or negotiate a license that secures your rights and keeps your business protected.

Randy M.

Answered Sep 13, 2025

Running a trademark search before registering your business name isn’t legally required, but it’s one of the most important steps you can take to avoid future problems. Registering your name with the state forms your business entity, but it doesn’t give you trademark rights. Trademark rights come from use in commerce and, if you file with the USPTO, registration at the federal level. Why a Trademark Search Matters The central legal test in trademark law is whether a name is likely to cause consumer confusion. That means you don’t need to copy someone else’s name exactly to get into trouble. Even something that looks or sounds similar in the same or related industry could be enough. If you skip the search and move forward, you risk: • Infringement claims: Another company could demand you stop using the name and, if necessary, sue for damages. • Forced rebranding: If you’ve already invested in your logo, website, signage, or marketing materials, being forced to change your name can be expensive and disruptive. • USPTO rejection: If you apply for a federal trademark, the USPTO will run its own search. If they find a confusingly similar mark, your application will be denied and you’ll lose the filing fees. A well-documented example is when small businesses open under a catchy name, only to receive a cease-and-desist letter from a national chain using a similar name in the same space. Even if you’re in a different state, a federal registration gives that company priority rights nationwide. A proper trademark clearance search should cover more than just identical names. You’ll want to check: • Federal database (USPTO TESS): This is the official record of all registered and pending federal trademarks. • State trademark databases: Many businesses register marks only at the state level. • Common law sources: Unregistered marks can still have legal protection. Check Google, industry directories, social media, and domain names. • Similar variations: Look for phonetic equivalents and alternative spellings, such as “Kwik” for “Quick,” or slight wording changes that could still cause confusion. Professional Assistance You can run an initial search yourself at no cost, but these searches have limits. For example, the USPTO database won’t flag marks that are spelled differently but sound alike, or names with similar meanings. Attorneys and specialized search firms use tools that uncover those kinds of risks. While hiring a professional costs more upfront, it’s often far cheaper than litigation or a rebrand. Limitations A search doesn’t guarantee that your name will never be challenged. Trademark law involves judgment calls about how similar marks are and whether they overlap in goods or services. Still, a thorough search puts you in a much stronger position to defend your choice and move toward federal registration if you want nationwide rights.

Benjamin M.

Answered Sep 9, 2025

Yes, you can achieve this through an IP license agreement versus a sale of your IP rights. In your license you would want to protect against gray market product manufacturing and also have provisions on how to handle defective products and components during the manufacturing process. I am available for a free consultation if you would like.

Amy B.

Answered Sep 9, 2025

Since the user uploaded copyrighted material to your website without your knowledge, generally you will not be automatically liable under the DMCA “safe harbor” provision. As you have already removed the content, make sure that your site has a published DMCA policy and that you have registered your designated agent with the U.S. Copyright Office. Generally, if you have everything in place, most of these matters are resolved without ongoing liability. Feel free to reach out if you need guidance on setting up a policy and agent registration.

Randy M.

Answered Sep 9, 2025

Invention Assignment Agreements usually require employees to hand over rights to any inventions they come up with during their employment. But things can get tricky when the agreement tries to claim ownership of something you created on your own time using your own resources. What’s Generally Enforceable Employers often write these agreements in broad terms, sometimes trying to cover anything you invent while you're employed, even if it’s unrelated to your job. Courts usually uphold fair agreements, but they’ll look closely at anything that seems to overreach. Most states try to strike a balance. If an invention is directly tied to your work or the company’s business, the employer may have a valid claim. But if it’s something truly independent that you built on your own time without company tools or knowledge, you’re more likely to keep it. State Laws That Protect Employees Some states have gone further and passed laws that give employees more protection. California’s Labor Code § 2870 is probably the most well-known. It says employers can’t force you to assign inventions that were developed entirely on your own time without using any company resources. The exception is if the invention is connected to the company’s business, research, or your actual job duties. Other states like Washington, Illinois, Delaware, Minnesota, and North Carolina have similar laws. New York passed its own version in 2023, called Labor Law § 203-f, which follows California’s lead. Most of these laws also require employers to give written notice to employees about their rights. In states without specific laws, courts typically rely on general contract principles and public policy. If a contract tries to claim every idea you’ll ever have, that language probably won’t hold up. But if the invention overlaps with your employer’s field, even if you built it at home, the company could still have a real claim. When Employers Still Have Rights Even with legal protections, there are a few situations where the company can still argue ownership: 1. If the invention is related to the business or current projects. 2. If you used any company tools, software, workspace, or confidential info. 3. If the invention came out of your assigned job duties, even if you worked on it after hours. These carve-outs are broader than most people realize. For example, if you’re a software engineer and your side project uses the same coding language or solves a similar problem as your employer’s product, that could raise red flags, even if you used your own laptop at home. How to Protect Your Own Inventions If you want to make sure you keep the rights to something you’ve created, documentation is key. Keep records of when you worked on it, what tools you used, and how it relates (or doesn’t relate) to your job. Don’t use your work email, computer, or cloud storage. And read your agreement carefully. Some contracts require you to disclose all inventions, even personal ones. Disclosure doesn’t always mean you have to assign it, but it can start a conversation you’d rather avoid. The Shop Right Rule Even if you own your invention, your employer might still be able to use it under what’s called the “shop right” doctrine. This means that if you used company time, tools, or resources, the company may have a free, nonexclusive license to use your invention in its operations. You’d still own it, but you couldn’t stop them from using it. Why Jurisdiction Matters The state where you work usually controls which laws apply to your agreement, not the state where your company is based. That can make a big difference. For example, engineers in California have strong statutory protections. Employees in Texas may need to rely on general contract law instead. The Final Analysis Your best move is to have an employment attorney review your agreement. The details matter, and so does your state's law. A good attorney can explain what's enforceable, help you negotiate better terms (like explicit carve-outs for personal projects), and show you how to protect your own work without violating your contract. If you're looking for this type of guidance, the attorneys on Contracts Counsel are available to help. Whether you need a quick contract review or full representation, you can connect with experienced employment lawyers who understand the nuances of invention assignment agreements in your state.