For many businesses, the way that you feel “legit” and announce your debut, is to put up a website. Most folks buy a domain name and find a website developer. Well, before bringing a website developer on board, it is a very good idea to negotiate and write up a website development agreement. On the other hand, it is NOT a very good idea to hire a website developer (or designer, or writer) on a handshake, friendship, verbal understanding OR EVEN by simply slapping the words “WORK MADE FOR HIRE” across the top of whatever contract you downloaded off of the internet or “borrowed” from a friend.
Why is that not acceptable? Because 17 USC §201(a) creates a presumption that intellectual property created by a third-party belongs to the creator and NOT TO YOU. Repeat, the law does not presume you own the intellectual property you pay to have created for your use, just because you paid for it. The law presumes you do NOT own the designs, the copy, the layout, or any of the other intellectual property you own UNLESS you have a written agreement that gives you those ownership rights.
Why does this matter to you? Most business owners don’t want to pay to have your website created and then ALSO pay a royalty to the developer for as long as they are using their own website.
What to do? Get it in writing. Your website development agreement must contain detailed provisions on ownership of the finished website and all underlying work product. Also, website development shouldn’t be an open-ended process. Attach a “Statement of Work” that describes how the website will look and what it will do. Most business owners know about “scope creep” – and this can be an issue for the developer as well as the business owner. A good lawyer will be sure to account for what happens if the project extends beyond the originally intended scope.
Of course every business lawyer should know that a website development agreement should be in writing and clearly identify who will do what by when for how much and who will own what.
1. the responsibilities of each party,
2. when items must be delivered or services performed,
3. how much development will cost and when payments are due, and
4. who will own the materials developed under the agreement.
But not every business lawyer should be expected to know…not unless he or she regularly deals with these issues…that your website development agreement should also include that “Statement of Work” (SOW) mentioned above as an attachment so that it can be amended and updated as changes are needed. The SOW should contain a detailed description of how the website will look and how it will function. The parties should include drawings, diagrams, images—anything to more clearly define the desired end product. This will not only make you happier but it should also help the website developer as well.
So while it is true that the “conventional wisdom” is that if you contract a creative person for a “Work for Hire,” you will implicitly own the resulting work, this isn’t always the case. And if you plan to build your business on your ideas and intellectual property, you don’t want to leave open the possibility that someone else could own it.
