Key Harrington Barnes, PC

Intellectual property disputes with independent contractors

Entrepreneurs in Texas will likely associate protecting intellectual property with copyrights, patents and trademarks, but the contracts signed by workers and contractors can also be used to prevent the unauthorized use of formulas, designs, slogans and logos. While business owners frequently place non-compete clauses in their employment contracts to discourage workers from revealing proprietary information and trade secrets, they often fail to take similar precautions when entering into agreements with independent contractors.

Business owners who have become embroiled in protracted legal disputes with independent contractors over the ownership of work product are sometimes victims of their own assumptions. They may have taken for granted that any work performed by a contractor would become theirs once the bill had been settled, but court decisions are based on contractual provisions rather than words left unsaid.

When independent contractor agreements are not specific, judges may decide that contractors retained copyright ownership of the work they performed. Being on the wrong end of one of these decisions could be ruinous for entrepreneurs if the intellectual property concerned is a key component of their business model.

Attorneys with experience in employment contracts and intellectual property cases may suggest that their clients include work for hire language in all agreements signed by independent contractors. These clauses are designed to prevent prevent disputes from occurring by clearly defining the terms of ownership and payment. Attorneys may also recommend that all important company documents be reviewed on a regular basis to see if changes have been made necessary by newly passed laws or recent legal decisions. This kind of legal housekeeping is particularly important in areas like intellectual property protection due to the importance of these assets and the high costs involved in pursuing lawsuits against violators.

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