IP Assignment and Background Asset Carveouts in an Independent Contractor Agreement: A Guide for a Scriptwriter

Introduction

As a scriptwriter, understanding the intricacies of intellectual property (IP) ownership and background asset carveouts in your independent contractor agreements is crucial. These concepts can greatly influence how your creative work is protected, and what happens with your proprietary tools and methods. If these elements are overlooked or missing, you may find yourself in challenging situations where your rights are compromised. This guide will walk you through these concepts, offering clarity and practical advice. It's essential to be proactive about adding these clauses to your agreements to safeguard your interests.

What Is IP Assignment?

IP assignment refers to the transfer of ownership of intellectual property rights from one party to another. When you create content as a scriptwriter, your clients typically expect full ownership of the work once they make payment. This expectation is rooted in the idea that when a client invests in a project, they should have control over the final product. For you, as a creative, having clear terms in your agreement is vital. Clarity helps prevent misunderstandings and ensures that you retain rights to any foundational elements or tools you developed in your creative process.

What Are Background Assets?

Background assets encompass the materials, tools, and techniques that you own and may use to create your work. These could include proprietary frameworks, methodologies, or even specific techniques that are not part of the final deliverables but are essential to your creative process. By establishing a carveout for these assets, you protect your valuable resources and ensure that your clients can utilize the final product without taking ownership of the underlying creative tools. This balance is beneficial; it allows clients to use the work product they paid for while you maintain control over the proprietary methods that define your unique approach.

Work Product. Upon full payment of the Fees provided in the SOW, Consultant agrees that the deliverables, work product, content and other materials created, developed or conceived by Consultant for Client for purposes of this Agreement as provided in the SOW (the “Work Product”) shall be the sole and exclusive property of the Client. Consultant hereby irrevocably assigns to Client all right, title and interest worldwide in and to the Work Product, including all copyrights, patents, trademarks, trade secrets, and other intellectual property rights therein. Consultant acknowledges that to the extent permitted by law, all of the Work Product consisting of copyrightable subject matter is “work made for hire” as defined in 17 U.S.C. § 101 or any similar or analogous law or statute of any other jurisdiction and such copyrights are therefore owned by Client. To the extent that the Work Product and/or the results and proceeds of the Services may ever be determined under the laws of any country not to be a “work made for hire,” Consultant hereby confirms that effective on the date of creation of the Work Product, it assigns (or has assigned) to Client all right, title and interest thereto (including all copyright and associated rights, extensions and renewals, and all causes of action appurtenant thereto) throughout the world. If Consultant has any rights in any jurisdiction, including without limitation “artist’s rights” or “moral rights,” in the Work Product that cannot be assigned, Consultant hereby unconditionally and irrevocably waives the enforcement of such rights, and all claims and causes of action of any kind against Client or Client’s customers.

Background Assets. “Background Assets” are the materials, tools, utilities, techniques, technical frameworks, data models, object models, methodologies, know-how and information (both in object code and source code) made available to Client by Consultant under this Agreement that are proprietary to Consultant. This Agreement grants Client a non-exclusive limited right to use the Background Assets and does not constitute a sale or convey title or ownership of the Background Assets or any intellectual property rights therein to Client. Consultant is and shall remain the sole and exclusive owner of all right, title and interest in and to the Background Assets, including all improvements or modifications made thereto, and all intellectual property rights embodied in or related to the Background Assets.

Establishing the right balance in these clauses is critical. It protects you while ensuring that your clients receive the value they expect from your work.

Example Scenario

Imagine a scriptwriter who uses a proprietary writing framework developed over years of experience that includes specific exercises and prompts to generate creative ideas. This framework constitutes their background asset. When they enter an agreement with a production company, including a carveout clause for this framework means that while the production company owns the screenplay upon completion and payment, the scriptwriter retains ownership of their proprietary tools. This setup enables them to continue using their framework for future projects without fear of losing ownership to the production company.

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FAQs

What is the difference between work product and background assets?

Work product refers to the final deliverables created for the client, whereas background assets are the proprietary tools and methods used to create those deliverables.

Do clients have a license to use the background assets?

Clients typically receive a limited license to use the background assets for the purpose of the project, but they do not own them.

Are source files included in the work product?

Source files can be included, but it depends on the specifics of the agreement. It's essential to clarify this in the statement of work (SOW).

How do I handle third-party or open-source components in my work?

It is crucial to document any third-party or open-source components and clarify their handling in your agreement to avoid ownership issues.

How can I document the split between work product and background assets in the SOW?

The SOW should explicitly outline what constitutes the work product and what is included as background assets, ensuring both parties have a clear understanding.

Final Thoughts

Understanding and implementing IP assignment and background asset carveouts in your agreements is essential for every scriptwriter. By adding these clauses now, you safeguard your creative tools and maintain control over your proprietary methods. If you have questions or need assistance with drafting, consider reaching out to us. Protect what you’ve worked hard to create.