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Copyright vs Exclusive License?

Posted by Cliff on from the what-rights-do-you-have-if-you-paid-for-the-development dept.

cdanzig asks: "My company recently hired a development house to do some contract work for us. They did great work, but they are claiming that they now own the copyright on the code and are issuing us a permanent and exclusive license. My bosses are concerned that this will hamper our ability to make changes to the code or prevent us form being able to claim the software as a company asset. What is expected protocol between a client and a development house? What is the long-term difference between owning a copyright and owning an exclusive license? If we paid for the development of the code, is it fair for us to demand ownership?"

3 of 95 comments (clear)

  1. This is an Ask Slashdot FAQ by Bruce+Perens · · Score: 5, Informative
    This kind of question pops up on Slashdot quite often. It's usually of the form "I should have had a lawyer when I started this, now what do I do?"

    If your company didn't negotiate this when you hired the development company, it's your company's fault. But all is not lost. You may be able to prove that the software is a work-for-hire. Get a lawyer. Your laywer might be able to negotiate in a way that you can not, because it will be clear when the lawyer calls that you would consider a lawsuit. Tell the lawyer you want the other company to provide the copyright, and your legal fees.

    Next time, have a lawyer work with you before you sign a contract with any company.

    FYI: I am an expert witness. I get paid to testify in lawsuits when engineers don't call laywers before they accept a license or sign an agreement.

    Bruce ~

    --
    Bruce Perens.
    1. Re:This is an Ask Slashdot FAQ by Bruce+Perens · · Score: 5, Informative
      I think they need a lawyer to at least explain to them what they signed. They may have explicitly signed their rights away, in which case they may have little recourse. If they did not sign their rights away, they need to have the lawyer explain that, too. They might actually be right. And even if they are not right, they get to play "which side blinks first". A lawyer can look at the other company and tell them the probability of that game being successful or not. Also, the development company might not have much in the way of grounds for a counter-suit, and may prefer to have repeat business and good references to having a lawsuit on their record whenever anyone else checks up on them before choosing their company.

      Bruce

      --
      Bruce Perens.
  2. Not enough information. by amper · · Score: 4, Insightful

    You didn't specify the terms of the license agreement. It's great that it's permanent and exclusive, but if you want the copyright transferred to your company, be prepared to pay for that privilege. This is a fairly common practice.

    In increasing order of expected value:

    1. Temporary, non-exclusive right
    2. Permanent, non-exclusive right or temporary, exclusive right
    3. Permanent, exclusive right
    4. Copyright transfer

    The author has the right to expect greater compensation for greater value delivered. Perhaps you should try to negotiate a transfer agreement before you get too up in arms about this matter.