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Are NDA 'Prior Inventions' Clauses Safe to Sign?
BenderMan asks: "I own a small consulting company. Today I was asked by yet another corporate customer to sign an NDA with the increasingly popular 'Prior Inventions' clause. The gist of it is they want you to provide a list of all your past and current inventions and/or ideas so they can define and protect the intellectual property that they have hired you to build. Like many of us that lay awake at night, whilst the hamster wheel spins new ideas, I've got a number of un-patented works in various stages of development. Given that mutual NDAs only provide one year of protection, I don't feel obligated, nor do I have sufficient time and energy, to fully and properly document my inventions for an NDA. While these clauses are written with good intentions, the reality is that these valuable ideas would be placed in the hands of people that could potentially profit with impunity (Have you priced patents lately?). Unfortunately many companies are not willing to strike this clause from their contracts. Does Slashdot agree that this is a concern, and how have you dealt with these situations?"
I ran in to this situation. The company made me the offer, we negotiated and I said yes. They handed me the contract to sign. I read it. The employment contract had some wording about helping them secure intellectual property rights following the end of my employment. It was badly worded: as spelled out it created an indefinate obligation to do work for free following employment. So I said, "Look, I see what you're getting at here but this is bad wording. We should tweak it a bit." They said, "No, everybody signs it."
Not everybody. I didn't. And a month later I got a much better job at a much better salary.
My advice to you is this: If you're not important enough that they're willing to negotiate the contract then you're not important enough and while you work there you'll never be important enough. Walk away. Its a bad deal.
Moderating "-1, Disagree" is simple censorship. Have the guts to post your opinion.
The customer does not have ownership of anything not directly applicable to the work they are paying for. They acknowledge that they have no IP rights to anything you may invent on your own time, with your own equipment.
I have had customers demand ownership and license of all our prior work. After I stopped laughing, which really pissed off the purchasing agent, I pointed out that they really didn't want to test that in court, so that clause was declined. They try other ways as well.
Each customer will do their best to stake out territory in your mind. My approach has been to define for them what they may stake out, and what the limits are on it. If you control that conversation, they need to negotiate your terms. They claim they won't, but most reasonable ones will at the end of the day.
For this reason, we don't sign non-competes, and we require mutual NDAs. We have been burned a number of times with others NDA documents, so if we find them insufficient, we force the customer to sign one of ours, or we simply refuse to discuss confidential material with them. Non-competes between organizations are funny, but some customers try to require this. Our response is uniformly that we will sign the non-compete under the requirement that the customer requesting the non-compete execution pay full wages, business expenses, etc. for the entire duration of the non-compete. When they tell you how ludicrous that is, it lets you tell them how ludicrous it is to request that your company not work in its field for a period of time, and if they are going to demand it, they are going to need to pay for what they ask for.
We have had customers steal from us, "partners" lie to us and stab us in the back. It is part of business. Ethics and morality take a back seat to egos, and the pursuit of the almighty dollar.
Your job is to demand certain core rights, and stick to your guns. Have a few you can negotiate away and get something in return for this, but if the customer understands that there are some red lines not to be crossed, well, they will either respect you for it and negotiate, or leave you for some other pushover.
You create something outside of the contract domain, scope, with your own stuff, even if it was during the contract, as long as you did it on your own time and with your own stuff, you own it. You need to demand that. If you don't they are going to insist on owning everything in your head. If you let them push you around here, well, your compensation is going to suck as well.
velcro detachable sideburns
Shit.
*crumples and throws away patent application*
Here's a sample of a 'prior inventions' clause: http://www.rhs.com/web/blog/PowerOfTheSchwartz.nsf /d6plinks/RSCZ-6NY3U9
Like this guy says, I don't see how I could sign this, especially if I'm working with other customers at the time.
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Dear Bender,
Take the advice of my good friend Gary Kildall and refuse to sign anything like an NDA. Nothing good can ever come from it.
Sincerely,
Bill Gates III Esq.