With the proliferation of mobile devices in the past few years, application developers may now target their services and offerings to an ever-widening, always-connected audience. These apps involve the interplay of code and data in new and innovative ways. Whether an app developer begins the project informally in a garage, or as part of a team of developers, a host of intellectual property (IP) concerns exists from the inception of the idea, to the day the app is available for distribution in an app store. One simple, and often overlooked aspect of development is this: who owns the code?
Copyright and Computer Code
17 USC Section 117 of the Copyright Act states computer code, or software, is considered copyrightable material, providing it protection from unauthorized reproduction or distribution. This protection serves to reward innovators for their works, allowing them to benefit from their creations for a limited time. For an app developer, this means that the code created from the inception phase to completion is subject to copyright protection. Unless explicitly stated, it is not always clear just who retains ownership rights to the code.
Inception
In the early stages, the app is often-times no more than an idea. As time goes on that idea is fleshed out, wireframes and prototypes are created, and the project can begin to take on a life of its own. It is not uncommon in agile development communities for any number of developers to initially provide input on a burgeoning idea for an app, only to later drop out of the development process. During this time, work created by an individual developer will, in fact, belong to that individual developer. This may raise an issue at a later date when, after achieving some level of success, the perceived owner of the app decides to take the company public; enter into a licensing agreement; or sell the rights to the software. At that point, all of the interested parties who have an ownership stake in the app must be clearly determined. An early-stage developer who contributed substantially to the project, but later dropped out, may still have a legal claim to a portion of the app’s success. By initiating a copyright claim, the early-stage developer may show ownership of his code contribution.
Such a situation, however, could be easily remedied through the use of a written employment agreement during the app’s inception phase. A detailed work-for-hire contract, or a documented IP transfer would allow for a clear assignment of ownership rights regarding the code.
By clearly defining in writing the roles and any ownership stake at the inception phase, such ownership issues may be avoided when trying to capitalize on potential opportunities.
Work-for-Hire Agreements
Once the app has grown from an idea to an actual project with targeted deliverables, possible funding, and a concrete timeline, other developers may be brought on to help meet the established goals. In scenarios such as this, the developers may be employees or contracted freelancers. In the case of employees, there should be agreements in place defining the ownership of any employee code (and, for that matter, any other intellectual property) that is created while at work.
Freelancers may also be creating code, graphics and other digital assets. For every item created, a copyright exists, granting exclusive ownership of the work to the creator of the work. In the absence of a work-for-hire agreement, even if the freelancer delivers the asset for use on the app, the copyright remains with the freelancer. This relationship could prove sticky at a later date should the app be licensed or sold. Without the freelancers consent or further agreement, the licensing or sale could be jeopardized. At best, the freelancer’s copyrighted asset could be removed. At worst, the asset could be an integral portion of the app and could scuttle any further deals future development.
Establishing a work-for-hire agreement at the outset of any freelance relationship will clearly define the any underlying ownership and avoid copyright complications later on. Such an agreement would establish the ownership rights of the code created during the development period. The developer essentially transfers ownership of the created code to the other person, usually in exchange for money.
Open Source Software
Developers who make use of open-source software must also be aware of the ownership requirements inherent in the use of the code. Open source software is software in which the underlying code is available to the general public. Popular open source initiatives include Mozilla, the group behind the popular Firefox browser; the enterprise-level content management system, Drupal; and productivity suite Open Office. Developers using open source software may use the existing code and even further extend the code by adding to it. The license attached to open source projects, however, often stipulates that programs built using the code must be made freely available to the public.
App developers must be mindful of the terms of the license associated with the open source project. Many different open source licenses exist (http://opensource.org/licenses), and each extends a specific set of instructions around what can and cannot be done with the underlying code. Understanding these details will ensure the app developer has taken the necessary steps to abide by any licensing agreements, while understanding what ownership rights he or she has in the code.
Conclusion
It’s important for app developers to keep in mind the question of ownership through every phase of development – from the informal stages of creation, agreements should be put in place to clearly define ownership, and developers should take steps to understand the restrictions around any open source code that is used. Taking these steps early on in the process and consistently throughout will help avoid legal issues later on.
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