Legal question - Invention ownership clause

[mnemosyne]

Before I ask the question, I want to be clear that I understand that you are not my lawyer, this advice is not specific to the jurisdiction in question, etc. I understand all the disclaimers, and we have a lawyer we can contact for specific advice depending on the answers my husband gets tomorrow from his (future) employer. That lawyer is simply not available to us tonight.

That said, we have questions pertaining to the following situation, and a little bit of generic advice would be appreciated.

My husband received a copy of his contract to work as a full-time employee at Company X. It’s a pretty standard contract, and he understands and agrees with all but one clause - the ownership of inventions clause. While he understands the need for it, and agrees in principle that his work belongs to X, the specific wording of the clause is worrisome. It reads, in it’s entirety, as follows:

The Employee acknowledges and agrees that any Inventions shall be the exclusive property of X. “Inventions” shall mean any inventions (patentable or not), discoveries, innovations, improvements, concepts, ideas, or their expression, including developments in computer programs, whether or not reduced to practise within the scope of any fields related to X’s business activities. The Employee agrees that with respect to any inventions that he/she may conceive, make, or develop solely or jointly with others, during or after working hours, whether at any X premises or elsewhere, during the term of his/her employment and/or within twelve (12) months after termination of this Agreement, the Employee will;

a) promptly disclose and describe such Inventions in writing to X.
b) assign his/her entire rights, title and interests in such Inventions, applications for letters patent, copyrights, industrial designs, and any other form of intellectual protection. The Employee agrees to waive and not assert all his/her moral rights with respect to such inventions; and
c) Perform all acts deemed necessary or desireable by X to permit and assits X, at X’s expense, t draft, prepare, obtain, maintain, defend and enforce any patents, copyrights, industrial designs and other intellectual property rights resulting from such Inventions, on a world-wide basis.

The obligations set forth in this Article Y shall continue to be binding on the Employee after termination of this Agreement, and shall also be binding on his/her assigns, heirs, executors and other representatives

I’m pretty sure that in most jurisdictions, this type of clause is unenforcable. X seems to be saying that anything hubby would create, even if he was doing it as a hobby, or at a part-time, side job, whether or not related to the business that X is in, it would still belong to X. The job is as a software developer in simulators. This week, he wrote a small code to deal with wireless networking… had he already signed the contract, would that belong to X? The language is just so vague, hubby is very uncomforatble signing it. How can X control what he does during his off hours?

He’ll be asking the HR person about it, seeing if it can’t be clarified (in writing!) or even reworded or removed entirely, but what kind of possible outcomes are there here? What might he be facing, and what should be do in response. We don’t want to go to a lawyer on this, because it seems a little extreme for an otherwise dream job, but it seems like such an all-encompasing clause…!

What options should we be considering here?

Also (and this is somewhat of an aside, more out of curiosity than anything else please focus on the questions above!), how can that last statment be enforced? How can a contract that Hubby signs be binding to me, as his spouse (assign, heir, executor, representative)? I didn’t sign it, so in general, are these kinds of clauses enforcable? He can’t sign a contract on my behalf, can he?

Anyways, any advice or suggestions you SDMB lawyers might be willing to share before early tomorrow morning would be appreciated. We just don’t know if this is as extreme a wording as we think it is, or if we shouldn’t worry about it at all. Contracts in my line of work haven’t been that explicit in their restrictions.

Thanks for any help you can offer. Again, I understand that advice on a messageboard is not real legal advice, etc. Still, it’s nice to know there’s a group of intelligent people out there who might be able to at least point us in the right direction

[butler1850]

I’ve had to sign many of these. I’ve never thought they were very enforcable, but they seem to be pretty standard, even here in the US. I’m not very inventive, so it has never applied to me.

I’d love to hear the answers from the legal eagles on the board though.

[Acsenray]

I think you would be advised to take this kind of thing seriously. I have heard of such contracts (anything you invent during the time you are employed with us belongs to us regardless of whether you do it at work or on your own time), so they aren’t uncommon. And although I don’t recall reading any specific case in which specifically this kind of provision was enforced, I also don’t remember reading a case in which such a provision was found unenforceable. Just my personal feeling about the way contract law works gives me a hunch that it is enforceable. So it’s a good thing that your husband is going to ask about it. I rather think that you need to consult your own lawyer about what the provision means and what kind of language your husband should be negotiating for.

[Acsenray]

@mnemosyne

Also (and this is somewhat of an aside, more out of curiosity than anything else please focus on the questions above!), how can that last statment be enforced? How can a contract that Hubby signs be binding to me, as his spouse (assign, heir, executor, representative)? I didn’t sign it, so in general, are these kinds of clauses enforcable? He can’t sign a contract on my behalf, can he?

When executing an estate, there are some people who come first and, broadly speaking, those are people who have contractual relationships with the deceased (most often creditors). They get their money (or other obligations first) and the heirs, assigns, etc., come after. Basically what this is saying is that your husband is instructing the executor of his will (which is a trustee-type relationship) to heed his obligations under this contract. And if you don’t, then the employer gets to go to probate court to force the executor to do so.

So, it’s not literally an obligation you bear as his wife, but if you end up being his executor, then you will be required to act according to your husband’s contractual obligations before your own. As an executor, you hold the estate in trust and the law will not allow you to act in a self-serving manner. So, if the employment contract says that all inventions belong to the employer, then the executor will have to take all the inventions that are present in the estate and deliver them up to the employer. (Assuming (1) that that’s what the contract says and (2) it’s enforceable, neither of which I could possibly know.)

[anu-la1979]

I am not your lawyer and this doesn’t constitute legal advice, nor do I intend to establish a lawyer-client relationship with you. I urge you to seek a lawyer licensed in your own jurisdiction for representation as to the facts of your particular case. My anecdote below is merely a relation of similar facts and does not propose to outline the nature of intellectual property clauses in employment contracts.

You should hire a lawyer to contact their lawyer to see if the clause can be changed. I can’t speak to its enforceability, which is a question you should pose to an employment lawyer in your own jurisdiction-but when I represented my brother for his contract with one of the companies he does business with, I re-wrote parts of the contract that I considered too harsh (including pretty much the same invention ownership clause you posted) and I explained the implications of others very clearly to him (non-compete clauses). Based on what he wanted, I sent over drafts of language we wanted to sub into the employment contract and their attorneys agreed. I re-wrote the language to limit intellectual property ownership to any product derived, related etc. etc. from “X”, “X” being very specifically defined earlier in the contract. (X is the program he developed for the company)

He had a lot of bargaining power vis-a-vis this organisation because he developed the entire system they work off, YMMV.

[ENugent]

The Employee acknowledges and agrees that any Inventions shall be the exclusive property of X. “Inventions” shall mean any inventions (patentable or not), discoveries, innovations, improvements, concepts, ideas, or their expression, including developments in computer programs, whether or not reduced to practise within the scope of any fields related to X’s business activities.

It appears to me that there’s a comma missing after “reduced to practise” [sic], and that the final clause is supposed to limit the agreement to inventions “within the scope of any fields related to X’s business activities.” Still potentially very broad, but not quite as broad. At least, that’s been the intent of similar language that I’ve seen in other agreements. I personally would kick up more of a fuss about the 12 months after language, but I definitely do advise you to consult your lawyer, and also the hiring company’s representatives, on the meaning of that clause.

Also (and this is somewhat of an aside, more out of curiosity than anything else please focus on the questions above!), how can that last statment be enforced? How can a contract that Hubby signs be binding to me, as his spouse (assign, heir, executor, representative)? I didn’t sign it, so in general, are these kinds of clauses enforcable? He can’t sign a contract on my behalf, can he?

The idea is that you are bound once you become his assign/heir/executor/representative. That is, if he dies and you are winding up his affairs, you still have to abide by the agreement as he would. It doesn’t mean that you have to assign things that you currently invent, because you’re not his heir yet. You’re a potential heir, but he can’t have actual heirs until he’s dead.

[astro]

Seriously ask yourself how bad does he want the job? It really doesn’t (IMO) make sense to be making them jump through hoops re adjusting their boilerplate unless he’s got a pretty high demand skill, or there’s a pretty damn good chance he’s really going to write an income producing application within 12 months of terminating his employment with them.

What are the real world chances of this happening? Is it worth it to make a fuss about the language? Employees perceived as high maintenance tend not to get hired.

[mnemosyne]

My husband spoke to the HR person today, and they pulled out the French version of the clause (and the entire contract, really). That contract reads so that is is specifically related to works he might invent related to X’s business. Pretty much what was said in examples we were able to find online and discussions about enforcability etc in Canada that I researched. So it appears that the English version is awkwardly worded. My husband has decided he will sign the French version, the one that says what he expects these types of clauses to say. The HR person agreed the English one was kind of odd and open to very broad interpretation.

This is pretty much my husband’s dream job, and the type of job is one where he will be creating software for the company’s products. So in the context of the type of job, it makes perfect sense for the company to request ownership of his creations. It’s just that the wording above… well, as I said, it was very odd!

Thanks for all your comments, I’m glad to see it seemed odd to other people too!

(Meanwhile, I started my job, and the only truly confusing things about the pile of paperwork are the damn financial benefit forms…!)

[Acsenray]

@astro

Seriously ask yourself how bad does he want the job? It really doesn’t (IMO) make sense to be making them jump through hoops re adjusting their boilerplate unless he’s got a pretty high demand skill, or there’s a pretty damn good chance he’s really going to write an income producing application within 12 months of terminating his employment with them.

What are the real world chances of this happening? Is it worth it to make a fuss about the language? Employees perceived as high maintenance tend not to get hired.

Take the world of X type of contracts, in which one party is an Xee and the other is an Xor. If all the Xees decide that it’s not worth it for them to negotiate for the kinds of terms that they like, they will quickly find that all X contracts have exactly the same terms, the ones most favourable to Xors.

And “high maintenance”? That’s exactly the kind of bullshit spin jargon that Xors use to intimidate Xees, and it’s especially effective given the vast resources and support that Xors have.

It almost makes one think that Xees might find it useful to get together and bargain for terms on a collective basis, so that Xors can’t just pick them off one by one.

[iamthewalrus_3]

@butler1850

I’ve had to sign many of these. I’ve never thought they were very enforcable, but they seem to be pretty standard, even here in the US. I’m not very inventive, so it has never applied to me.

They may be widespread, but they’re not universal. My contract specifies that it only pertains to any invention I might make that is reasonably connected to the work I do, the markets the company is in, or is done during company time or using company resources.

I’d imagine that all-encompassing clauses like that are put in because most people will sign them. If you express a desire to more closely define the company’s ownership to his work for them or in a related field, they’ll probably go for it. Get a lawyer, though.