IP Rights in Employment Agreements
(Pro-Employer, Long Form)

Summary

This IP Rights in Employment Agreements (Pro-Employer, Long-Form) clause is a long-form IP rights provision for an employment agreement, drafted from the employer's perspective. The template provides a starting point for drafting an IP rights clause and should be tailored for the facts and circumstances of the proposed arrangement. Practical guidance is included in this template summary. Employers often assume that any intellectual property (IP) developed by an employee within the scope of that person's employment automatically becomes the employer's property as works made for hire. However, for the avoidance of doubt, you should include a work made for hire clause within employment agreements as a condition to their employment and prior to their creation of any proprietary works. Written IP rights clauses have the practical effect of placing employees on notice of the arrangement and, as a legal matter, clarify the ownership status of IP created by employees. For a more detailed discussion on works made for hire, see Works Made for Hire. Note that the Federal Circuit has held that an assignment of future inventions is effective to transfer title, notwithstanding the fact that on the date of the assignment the invention does not yet exist and cannot be specifically identified. See, e.g., DDB Techs., L.L.C. v. MLB Advanced Media, L.P., 517 F.3d 1284, 1289-1290 (Fed. Cir. 2008). For a useful discussion of the case law on employee assignment of future rights, see Sycamore IP Holdings Llc v. AT&T Corp., 2018 U.S. Dist. LEXIS 25605 (E.D. Tex. February 16, 2018). Also, be aware that some state laws restrict an employer's ability to require assignment of employee inventions. For state laws that govern employee assignment of inventions, see Assignment of Employee Inventions State Law Survey. This template does not address: • Confidentiality, non-competition, and non-solicitation of employees • Compliance with obligations required by any relevant law, regulation, or rule • Obligations of the employee on termination (e.g., return of records to the employer) • Privacy and data security activities and obligations