Understanding Intellectual Property Clause in Contract Understanding Intellectual Property Clause in Contract
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  1. #1

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    Default Understanding Intellectual Property Clause in Contract

    I provide various IT solutions that are based on a bunch of algorithms that I've set up that I then tailor to whichever company I work with.

    Each time they run the algorithm it produces a report that they sell, I then get paid for each report completed.

    Verbally agreed that the Intellectual Property remains mine, even if I enhance my algorithms whilst working with XXX.

    I've had the contract through and it stipulates:

    "Intellectual Property
    1. The Contractor shall have a royalty free, non-exclusive, non-transferable licence to use XXX’s Intellectual Property as necessary to enable the Contractor to render the Services under this Contract.
    2. Any Intellectual Property created or developed by the Contractor under this Contract shall be owned by the Contractor subject to a royalty free, non-exclusive, non-transferrable licence to use any such Intellectual Property by XXX in its businesses."

    Does anyone know what the implications of the second part of point 2 means? - "subject to a royalty free, non-exclusive, non-transferrable licence to use any such Intellectual Property by XXX in its businesses."

    If I enhanced the algorithm using XXX's IP would that then mean I lose my rights to charge? (I don't think it does, but want to make sure)

    Thanks in advance for any help.

  2. #2

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    Quote Originally Posted by Newbie2020 View Post
    I provide various IT solutions that are based on a bunch of algorithms that I've set up that I then tailor to whichever company I work with.

    Each time they run the algorithm it produces a report that they sell, I then get paid for each report completed.

    Verbally agreed that the Intellectual Property remains mine, even if I enhance my algorithms whilst working with XXX.

    I've had the contract through and it stipulates:

    "Intellectual Property
    1. The Contractor shall have a royalty free, non-exclusive, non-transferable licence to use XXX’s Intellectual Property as necessary to enable the Contractor to render the Services under this Contract.
    2. Any Intellectual Property created or developed by the Contractor under this Contract shall be owned by the Contractor subject to a royalty free, non-exclusive, non-transferrable licence to use any such Intellectual Property by XXX in its businesses."

    Does anyone know what the implications of the second part of point 2 means? - "subject to a royalty free, non-exclusive, non-transferrable licence to use any such Intellectual Property by XXX in its businesses."

    If I enhanced the algorithm using XXX's IP would that then mean I lose my rights to charge? (I don't think it does, but want to make sure)

    Thanks in advance for any help.
    Ask a solicitor but to me it means - they have a royalty free (no additional cost to them), non-exclusive (so you can reuse and sell to others) and non-transferrable (so they cannot sell it to other people) licence to use what you write in their businesses.
    merely at clientco for the entertainment

  3. #3

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    Quote Originally Posted by eek View Post
    Ask a solicitor but to me it means - they have a royalty free (no additional cost to them), non-exclusive (so you can reuse and sell to others) and non-transferrable (so they cannot sell it to other people) licence to use what you write in their businesses.
    that's how I read number 2.

    Number 1 reads that the contractor (Newbie2020) can use the client's IP to develop ther service, has to pay no royalties for that, can use that IP for other clients (non-exclusive) but cannot sell the rights to the IP (non-transferable).

    Seems reasonable to me.
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    Quote Originally Posted by Lance View Post
    that's how I read number 2.

    Number 1 reads that the contractor (Newbie2020) can use the client's IP to develop ther service, has to pay no royalties for that, can use that IP for other clients (non-exclusive) but cannot sell the rights to the IP (non-transferable).

    Seems reasonable to me.
    Nope:-

    Number 1 allows you to use the company's IP but it's only for the purpose of this contract as it's non-transferable so can't be used for work with other people.
    merely at clientco for the entertainment

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