Recent Answers to Intellectual Property Rights Agreement Law Questions

Randy M.

Answered Sep 8, 2025

Here’s how I’d approach structuring an Employee IP Agreement if your goal is to protect your company’s intellectual property without running into enforceability issues under U.S. law. Covering Core IP OwnershipCovering Core IP Ownership First, start with a “work made for hire” clause. It’s a good foundation, but it’s not enough on its own. Under U.S. copyright law (17 U.S.C. § 101), only certain types of work qualify as “made for hire,” and many employee-created assets may fall outside that definition. So you’ll want to pair it with a present-tense assignment clause. Be specific here. Use language like “the employee hereby assigns” rather than “will assign.” That slight shift matters. It ensures the company owns the rights immediately when the work is created. Also, define “intellectual property” broadly. Don’t just list patents or source code. Include software, algorithms, documentation, trade secrets, databases, and anything tied to your business. The scope should clearly include anything created during work hours, using company tools or systems, or connected to your current or future business operations. Disclosure and Documentation You’ll want to require employees to promptly disclose any inventions or creative works they produce. Put it in writing. This gives your company the chance to evaluate whether the work is covered under the agreement. It’s also a good idea to require them to maintain proper documentation. Accurate records can make a real difference in patent filings or if a dispute ever comes up. Pre-Existing IP and Legal Carve-Outs There should be a section where employees list anything they’ve developed or own before joining the company. If they don’t list anything, the agreement should include language confirming they’re representing that no such prior inventions exist. This prevents claims down the road that something developed during employment was actually theirs from before. Now, depending on your state, you may need to include statutory carve-outs. California, Illinois, and Washington all have laws that limit how far IP assignment clauses can go. For example, in California, you’re required to carve out inventions developed entirely on the employee’s own time, without company resources, and unrelated to your business (see California Labor Code § 2870). Without that carve-out, your entire assignment provision could be thrown out. Confidentiality Obligations Make sure there’s a strong confidentiality section. This should cover source code, technical documentation, designs, product plans, customer lists, financial data, and anything else proprietary. Make it clear that the obligation continues even after the employee leaves. You’ll also want to require that all company property and digital assets are returned at the end of employment, including devices, credentials, and files. Ongoing Cooperation and Enforcement Mechanisms Include a clause requiring employees to cooperate in IP protection efforts even after they leave. That could mean signing patent paperwork or providing testimony if needed. To make that enforceable, add a power of attorney clause. This gives the company the authority to act on the employee’s behalf if they’re unwilling or unreachable. It’s a simple way to prevent delays when you’re trying to secure or enforce rights. It’s also smart to include a waiver of moral rights where allowed. This is especially useful for creative works and software. It gives the company full freedom to modify or use the work without needing future approval. Legal Remedies and General Terms Be clear that the company can pursue equitable relief, like an injunction, if there’s a violation. Sometimes monetary damages aren’t enough to prevent harm. Include a severability clause so that if one part of the agreement is invalidated, the rest still stand. Don’t forget to specify the governing law and venue for any disputes. As for restrictive covenants, keep in mind that non-compete clauses are unenforceable in California and heavily restricted elsewhere. Non-solicitation clauses may still be allowed, but they need to be narrowly written. You should have your legal team confirm their enforceability based on your state. Finally, think about consideration. For new hires, the job offer itself usually counts. But for existing employees, you’ll likely need to offer something extra, like a bonus or promotion, to make the agreement stick.

Paul S.

Answered Mar 31, 2023

That's something that would be negotiated between the parties involved in the joint venture.