Can you share Intellectual Property with a 3rd party?
Can you share the material that’s being created for you under a contract? Well, stick around and I’ll tell ya.
Hi, it’s Simon here from The Contract Company. Contracts, that’s what we do all day, every day and sometimes every night. I know what you’re thinking. Lucky us. Fair call.
Right-o. So you’ve entered into a contract with another party and they are creating material that is protected by intellectual property rights, such as copyright. You want to know whether you can share that material they created for you with someone else.
Can you Share Intellectual Property with a 3rd Party?
So, let’s use an example. Let’s say I engage KPMG. I’m paying KPMG, they’re providing services to me and they’re going to create a whole lot of documents and reports.
So, can I share that material created by KPMG with someone else? Well, the answer to the question lies in the contract you’ve signed with KPMG.
So you need to look at the terms and you want to see basically who owns the IP. Now, if you own the IP, that means you own the intellectual property rights in the material they’ve created. Assuming it’s drafted correctly, which they usually are, and that means that because you own it, it’s yours.
You can do what you want with it. So sure, share it with whoever you want.
However, some clauses or contracts will actually say that actually KPMG owns the IP. So what do you do then?
Well, usually while they own the IP, you would have the right to use that IP.
So, before you go sharing it with someone else, you need to check the contract to see what it says in relation to your licence to use that material.
Now if the licence has been drafted by me, you’ll have every right under the sun to use it. But if it hasn’t been drafted by me, unbelievable I know.
But if it hasn’t, then you’ll want to look for things like: Can you
- use it for any use?
- exploit it?
- commercialise it?
- use it for any purpose?
You want to look for broad statements like that to ensure that you have the right to farm it off or pass it off to a third party.
One other thing worth mentioning is that if there is no written contract between you and someone like KPMG, then the common law basically says that because you paid them for that material, they still own it but you have a broad license to use.
Now, usually that license is only for your internal business purposes. So if you need to share that information with someone else because they are going to provide a service to your organization, then you’re probably going to be fine.
If you wanted to share that with someone else so they could then make a commercial product from those books or manuals or reports, then you might have some problems.
So can you share Intellectual Property with a 3rd party? As always, it comes down to what’s written in the contract.
Anyway, I hope that helps. If you have any questions about this video, please feel free to get in touch. Simon at contractcompany.com.au or 1-800-355-455.
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