Technology-based start-ups essentially face several challenges that they must be prepared for, but intellectual property concerns are definitely at the top of that list. This is including but is not limited to, developing a product, hiring qualified employees, raising capital, and more. With all of these issues, intellectual property can feel distracting, expensive, or contrary to the goals of just getting a product to market before someone else does. The value of the intellectual property as an asset thus increases multi-fold. Its protection may mean obtaining proper venture capital funding and preventing unfair competition.
Some documentary proof of the association of innovation with a certain start-up is no longer an idea born out of paranoia. It, in fact, seems to be the most obvious way to deal with the risks of undesirable revelations from a start-up’s plans of action regarding their product or service. In today’s highly competitive environment, even giants like Apple have trouble proving their authorships. There are all kinds of non-disclosure agreements: between business partners, employees, service providers, and outsourcing vendors. Sign them to protect your sensitive data and have something to fall back on/patent registration in Delhi
1) FOUNDER’S AGREEMENTS
It is important for a company’s founders to have an agreement among themselves even before creating an entity. Founders’ agreements are the product of conversations that should take place among a company’s founders at the early stages of formation rather than later in the life of a company/sole proprietorship trademark registration.
A Founders’ Agreement is a contract that a company’s founders enter into that governs their business relationships. The Agreement lays out the rights, responsibilities, liabilities, and obligations of each founder. Generally speaking, it regulates matters that may not be covered by the company’s operating agreement. Ultimately, Founders’ Agreements are designed to protect each founder’s interests and memorialize that all founders are in agreement about the venture’s basic structure and how the founders will work together to move their business forward. Forging an agreement between all founders helps mitigate the risk of a lawsuit over who owns the business. There is a wide range of provisions that could be addressed in a Founders’ Agreement. The following are essential components:
- transfer of ownership;
- ownership structure;
- decision-making and dispute resolution;
- representations and warranties; and
- choice of law.
2) ASSOCIATION OF OWNERSHIP
An Intellectual Property assignment agreement could be one of the key legal start-up documents that determine whether a start-up can attract the investments it needs to grow. This is especially accurate for technology companies because it’s often the value of an IP portfolio that investors and venture capital firms are evaluating.
- Technological Assignment Agreements are made between a shareholder and the start-up. Here the shareholder assigns their intellectual property to the respective company. These consist of the intellectual property of persons before the formation of the company.
- Invention Assignment Agreements are relevant when there is an innovative product or service created by a company’s employees. Invention Assignment Agreements ensure that the company owns all rights of the IP portfolio in this particular case.
Works of authorship (“works”) include software code, website content, and marketing materials. Generally, works are owned by the author as of the moment they are created (written down or typed into a computer). But when the work is created by an employee within the scope of his or her duties, or in very limited circumstances, by a contractor with a special written agreement, the employer is deemed the “author” of the work from the outset. To avoid ownership problems related to works, one must ensure that they either (i) fit squarely into one of the exceptions under which the company is the author; or (ii) have a written agreement assigning the rights to the company/trademark registration in Ludhiana
Many start-ups mistakenly think their founders or contractors fit within the exception, only to later learn that some legal formality was missing, making the exception inapplicable. So, wise entrepreneurs always have written agreements (that include an assignment) with their employees, founders, and contractors, that clearly states the company owns all works. They don’t simply assume that the “work for hire” exception applies.
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