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Is it normal to have a generic Intellectual Property agreement without specifically naming out what is considered to be IP/Confidential?

After working as a web developer and then as a manager for the past 10+ years with this company, they have asked me to sign an intellectual property/confidentiality agreement, along with a non-compete contract. I have built an app for the company and I will be turning over the rights to all that source code with this agreement.

There is no expiration on this confidentiality agreement, since it includes trade secrets. Based on this confidentiality agreement, all information possessed by me during my employment (10+ years) is considered confidential and therefore company property.

Has anyone experienced any issues with signing such a broad contract? Is this normal contract terms for IT/web development industry? Looking for advice on if I should sign it, or just move on.

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    Why they didn't ask you to sign this 10 years ago? Also, is this legally binding or just an informal NDA? Finally, do you intend to leave the company soon, or why are you hesitant in signing? – DarkCygnus Sep 9 at 21:04
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    @DarkCygnus They just realized that my app is pretty valuable to them, so they want to protect it, as well and to prevent me from leaving and building it for the competition. I had no intention of leaving (until now), but I'm hesitant to sign away my future if it means I could never work anywhere else. It is a legal contract that includes a NDA and confidentiality / IP agreement. – John Sep 9 at 21:15
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    Depending on your location, if you built the app on their time/resources, you're only signing away the things they own anyway, it may not be that much of a sacrifice. – cdkMoose Sep 9 at 21:26
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    If you have some leverage with the company, I'd suggest a severance package worth 1 year of your salary if they want a 1-year non-compete agreement. – svavil Sep 9 at 22:46
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    I think you could be in a very strong position. Confidentiality? No issue there, right? Non-compete? Well you just spent ten years establishing your value and their actions are validating it. If they'd like you to stay then an employment contract is reasonable ... better salary and guaranteed increases and/or bonuses. – Randy Zeitman Sep 10 at 1:47
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This is called an "Confidential Information and Invention Assignment Agreement". (You can see an example here.) . Requiring all employees to sign them as a condition of employment is increasingly standard especially in technology companies - I haven't heard of anyone not getting one in the last decade around here.

Now, in this particular case if you built an app "for the company" - in other words, in the scope of your employment and using company time and/or resources, they are due it both legally and ethically and this is just an attempt to make that ironclad for whatever reason. So that's not really a problem, the problem is that it can include anything else you've done over the last 10 years if you're not careful.

Usually there is an allowance for an exclusion list of things you have done prior or will then do that can be omitted given the company agrees. I have a lot of "side" things (online courses, conferences, books) that I am working on and so I make sure those are listed on the exclusion attachment and I amend it to add new items as they come up. Generally companies aren't trying to "steal your ideas" with them, they want to make sure you're not stealing their ideas (or spending huge amounts of time that would interfere with your work).

Feel free and have an employment lawyer review it, how enforceable any given provision is varies from state to state. (Specifically, noncompete declarations are not universally enforceable.) But in at will states, companies can and do make signing one a requirement of employment.

Sucks, but that's how The Man keeps you down.

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    Contacting an employment lawyer is a good idea, so OP can get advice on the legal side of this question – DarkCygnus Sep 9 at 21:18
  • It's not the man keeping him down if the man paid for the app in the first place (time/resources) – cdkMoose Sep 9 at 21:27
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    I would be concerned about the retroactivity of the agreement when it doesn't outline specifically what will or will not be covered by it. It seems reasonable for the company to want, and get, all of that for the app, but I wouldn't want the risk of a decade's worth of personal projects being grouped in as well. Since it's yet unsigned, the OP has some leverage to make the agreement more specific. – Upper_Case-Stop Harming Monica Sep 9 at 21:34
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    I have reached out to a lawyer, so waiting to hear back from them. This is at will state, so my options are pretty clear, sign and stay or leave (and sign a similar one at the next place). I don't mind signing it, as long as it's not damaging for my future career. I also don't want this to be a license for them to treat me bad thinking that I'm stuck with them with a 1 yr non-compete and unexpiring confidentiality agreement. My major concern was the statement that all information possessed during my employment is confidential, without any further definition. – John Sep 9 at 21:48
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    The good news is that the noncompete is the part that's frequently unenforceable. Flip side of a "right to work" state is that you have the right to work. Your lawyer will fill you in on the deets in your area. – mxyzplk says reinstate Monica Sep 9 at 21:50
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IANAL, but the general rules are:

  • If you do it on company time with company resources, it belongs to the company unless the company signs something to the contrary.

  • If you do it on your own time with your own resources, and it isn't something in the company's product line, then it's yours unless you sign something to the contrary.

  • If you do it on your own time with your own resources, but it's a product like unto something the company produces, then the company will think it's theirs and there are lawyers on the starting blocks ready to make it very expensive for you to claim it as your own.

Case in point: The guy who came up with the Bratz dolls used to be a Mattel employee. He left Mattel and started a new company to produce the Bratz line. Mattel—who make the Barbie line of dolls—claims that (a) he was on the job when he came up with the idea, and (b) therefore the whole Bratz line is their IP. The college for many children of lawyers has been funded by the legal mess.

  • Agreed that work done during company time is their property, but I'm more concerned about "all information possessed during employment" being confidential, and therefore protected under this contract. I feel that is way too generic. – John Sep 10 at 10:25
  • I can't see this being enforceable beyond information that the employee can access only by virtue of his/her employment. – EvilSnack Sep 10 at 13:41
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You didn't mention the exact wording of the contract, so I can't tell if it is as broad as it seems from your question.

I have been asked to sign contracts that broad before. They basically say something like "everything you created while you worked for us belongs to us." It's lazy and not particularly bright on the part of the company; anything that broad won't be enforceable. If you wrote a short story and got it published while you were employed, according to the contract they could claim it but any sensible judge would toss that claim out...unless they could prove that you wrote it during your working hours.

In the past, I have pointed out how ridiculous the breadth of the contract is and usually I'll be told, oh, yeah, it is kind of overkill... This proceeds into either 1) "...but just sign it anyway, it's only a formality" or 2) "here's another contract which is worded better" or 3) (sounds of silence)

My recommendation is that you look over the wording, decide if they are trying to lay claim to something they have no right to, and if so, push back. Tell them that you will sign a reasonably worded contract, where they lay claim only to intellectual property that directly pertains to the work that you did specifically for the company.

Also look over the non-compete and understand what they are asking for. I was once asked to sign a contract that said I agreed to not work for anyone who the company did business with. I said "say, what...?" because they were a contracting firm that did business with all my major sources of employment. I told them no way was I signing that, and they said "oops, that was the contract that we give to HR people leaving the company so they don't take their contacts with them".

So read the contract over carefully and make sure the terms are fair and don't let yourself be bullied or hustled. It might be a tempest in a teapot, but why take the chance?

  • The exact wording in the confidentiality section is "Employee agrees that all information possessed by employee, or disclosed to employee, or to which employee access during the course of the employment shall be presumed to confidential, and the burden of proving otherwise is upon the employee" – John Sep 11 at 0:28
  • I'd say they ought to modify "all information" to "all information disclosed to employee as a consequence of his employment". "All information" is ridiculously broad, and just a sloppy job of writing the contract. If it were me I'd hold out for something more professional. You might google for better worded ND contracts and tell them you'd be willing to sign one of them. – Francine DeGrood Taylor Sep 11 at 14:43

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