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Intellectual Property Assignment Agreement Guide: Protecting Your Business Assets

Learn how intellectual property assignment agreements work, why they're crucial for businesses of all sizes, and how to implement them effectively to protect your valuable innovations and creative works.

Introduction

An Intellectual Property Assignment Agreement is a legal document that transfers ownership of intellectual property (IP) rights from one party (often an employee, contractor, or business partner) to another (typically a company). This agreement ensures that the company owns all intellectual property created during the course of employment or a business relationship. Whether you're an established company expanding your supply chain, a startup founder with an innovative product, or a small business owner, understanding how IP assignment agreements work is essential for protecting your business assets and preventing costly disputes down the road. This guide will help you navigate the complexities of IP assignment agreements in plain language, so you can make informed decisions about safeguarding your company's innovations and creative works.

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Key Things to Know

  1. 1

    IP assignment agreements should be signed before work begins to avoid disputes over ownership of intellectual property created during the relationship.

  2. 2

    Different types of intellectual property (patents, copyrights, trademarks, trade secrets) may require specific language in the assignment agreement to ensure proper transfer.

  3. 3

    Some states have laws limiting what intellectual property employers can claim from employees, particularly for inventions created on personal time without company resources.

  4. 4

    For maximum protection, IP assignment agreements should include both present assignments ('I hereby assign') and future assignments ('I will assign') of intellectual property.

  5. 5

    International IP assignments may require compliance with different laws and regulations in each country where protection is sought.

  6. 6

    The work-for-hire doctrine automatically assigns copyright to employers in certain situations, but doesn't cover all creative works or other forms of IP like patents.

  7. 7

    Consideration (something of value) must be exchanged for an IP assignment to be legally binding—this can be money, employment, or other benefits.

  8. 8

    IP assignment agreements should address not just the intellectual property itself, but also related rights like the right to sue for past infringement.

Key decisions before you file

Before you file a Intellectual Property Assignment Agreement in Delaware, a few decisions shape the document: which option to choose and what each one means. The Intellectual Property Assignment Agreement guide walks through them.

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Delaware Requirements for Intellectual Property Assignment Agreement

  • Delaware Uniform Trade Secrets Act (6 Del. C. §§ 2001-2009)

    Compliance with Delaware's trade secret protection laws, which define trade secrets and provide remedies for misappropriation. The agreement must properly identify trade secrets being assigned and acknowledge the protections afforded under state law.

  • Delaware General Corporation Law (8 Del. C. § 101 et seq.)

    For corporate entities, compliance with Delaware's corporate governance laws regarding the authority to enter into IP assignment agreements and the proper corporate approvals needed for such transactions.

  • Delaware Limited Liability Company Act (6 Del. C. § 18-101 et seq.)

    For LLCs, compliance with Delaware's LLC governance laws regarding authority to enter into IP assignment agreements and proper approvals for such transactions.

  • Delaware Statute of Frauds (6 Del. C. § 2714)

    Requirement that certain contracts, including those transferring intellectual property rights, must be in writing to be enforceable.

  • Delaware Contract Law (Delaware Common Law)

    Compliance with Delaware's common law of contracts, including requirements for offer, acceptance, consideration, and mutual assent in the formation of the IP assignment agreement.

  • Federal Copyright Act (17 U.S.C. § 204)

    Compliance with federal copyright law for the valid assignment of copyrights, including the requirement that copyright assignments must be in writing and signed by the owner of the rights conveyed.

  • Federal Patent Act (35 U.S.C. § 261)

    Compliance with federal patent law for the valid assignment of patent rights, including the requirement that patent assignments must be in writing.

  • Federal Trademark Law (Lanham Act) (15 U.S.C. § 1060)

    Compliance with federal trademark law for the valid assignment of trademark rights, including the requirement that trademark assignments must include the associated goodwill of the business.

  • Defend Trade Secrets Act (18 U.S.C. § 1836 et seq.)

    Compliance with federal trade secret protection law, which provides a federal cause of action for trade secret misappropriation and requires notice to employees about whistleblower immunity.

  • Work-for-Hire Doctrine (17 U.S.C. § 101, 201)

    Proper application of the work-for-hire doctrine under federal copyright law, which determines whether the employer or contractor is the author and initial owner of copyrightable works.

  • Delaware Employment Law (19 Del. C. § 101 et seq.)

    Compliance with Delaware employment laws regarding the enforceability of IP assignments from employees, including consideration requirements for agreements signed after employment begins.

  • Delaware Restrictive Covenant Law (Delaware Common Law)

    Compliance with Delaware law regarding the enforceability of restrictive covenants that may accompany IP assignments, such as non-competition and non-solicitation provisions.

  • Federal Electronic Signatures in Global and National Commerce Act (15 U.S.C. § 7001 et seq.)

    Compliance with federal law regarding the validity of electronic signatures on IP assignment agreements.

  • Delaware Uniform Electronic Transactions Act (6 Del. C. § 12A-101 et seq.)

    Compliance with Delaware law regarding the validity of electronic signatures and records in IP assignment agreements.

  • Federal Bankruptcy Code (11 U.S.C. § 365(n))

    Consideration of federal bankruptcy law provisions that may affect the assignment of intellectual property rights, particularly in the context of licenses.

  • Delaware Choice of Law and Forum Selection (Delaware Common Law)

    Compliance with Delaware law regarding the enforceability of choice of law and forum selection clauses in IP assignment agreements.

  • Federal Antitrust Laws (15 U.S.C. § 1 et seq.)

    Compliance with federal antitrust laws to ensure IP assignments do not create anticompetitive effects or constitute illegal restraints of trade.

  • Delaware Deceptive Trade Practices Act (6 Del. C. § 2531 et seq.)

    Compliance with Delaware consumer protection laws to ensure the IP assignment does not involve deceptive practices.

  • Federal Tax Law (26 U.S.C. § 1 et seq.)

    Consideration of federal tax implications of IP assignments, including potential capital gains treatment and transfer pricing issues for international assignments.

  • Delaware Tax Law (30 Del. C. § 1 et seq.)

    Consideration of Delaware state tax implications of IP assignments, including potential income and transfer taxes.

Frequently Asked Questions