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Dimitry K., Esq.
Dimitry K., Esq., Attorney
Category: Intellectual Property Law
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Experience:  I assist my clients with IP questions that arise in their daily course of doing business.
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Company A hires a sub-contractor to write an application to

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Company A hires a sub-contractor to write an application to work with specific software. There is no written contract between Company A and the sub-contractor beyond the “service quote”, this quote lists exact what the sub-contract will do for Company A. it is understood from many years of work between the 2 parties that Company A would pay the sub-contractor x number of dollars and hour for their work and the hours are also listed on this quote but not the hourly rate to be paid to the sub-contractor. Wouldn’t that be the contract between these 2 parties?

Company A’s lawyer is now claiming that they have a non-exclusive implied license for the software above. It appears the sub-contract has no recourse against this claim, sub-contractor cannot afford to hire a lawyer and legal aid cannot help because the sub-contract makes $97.47 too much per month from their social security disability checks to qualify.

the software above is a 3rd party application written for an ERP called PFW. Sage is retiring PFW in March of 2014 but all users that want the “free” new software from Sage called Sage 300 must upgrade before Oct 2013.

Because the service quotes say the software (3rd party application) is designed to ONLY work with PFW and it would take a great deal of work to modify it to work with anything else. Doesn’t that mean when Company A’s clients upgrade to Sage 300 the implied license to use the application expires? And isn’t it copyright infringement (the sub-contractor is the sole owner of the copyright) to use part or all of the application to create a new application to work with Sage 300?

if this is correct what is needed are court cases or something that can be used against Company A and their lawyer.

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In the past when this person has done work for the company - have they ever demanded that they own the rights to such work?
Customer: replied 4 years ago.


Not sure I understand your question. Are you asking at any point did the sub-contract inform company A, they owned the rights to the work?


I should point out in this situation I am the sub-contractor.


No I never informed company A in writing I owned full rights to the software based on my understanding of how this worked is unless I sign away my rights to things I create they belong to me aka there was no work made for hire contract. I don’t even know until I received the letter from Company A's lawyer there was such a ting as an implied license


hope that answered your question

Oh, I thought you were from Company A.

In the past when you did work for Company A - did you own the rights to the work?
Customer: replied 4 years ago.


I am unsure how to answer that question. What do you mean by own? I designed the work from scratch using only my knowledge to do so. I am the sole author of the work. The only thing company A would do is say client x need some work done contact them and get the details and write up a quote.


Sorry to repeat myself but just want to be clear about this, I never signed away any rights to the work to anyone.

I'm going to opt out because I think you need someone more knowledgable than I about intellectual property law.

I am going to opt out of your question and open this up for other professionals. You do not have to stay online for the question to be active, or rate this question yet as it would then discourage others from answering. Should a professional pick it up, you should be alerted via email and/or SMS (text message) unless you actively disable these features.

There is no need for you to reply at this time as this may "lock" your question back to me, thus inadvertently delaying a response from someone else.
Thank you for your question. A different professional here. Please allow me to assist you if I can.

I have reviewed the dialogue between you and the previous professional and believe I understand the situation. Have you, at any time, been employed for A as an employee, or have you always been a sub-contractor?
Customer: replied 4 years ago.

i was never an employee of company A i was always a sub-contractor.

Thank you for your follow-up.

One final question if I may--how long did you work for this company as a sub-contractor, and did you ever create other applications or code for them while working for them?
Customer: replied 4 years ago.

I worked on and off with Company A for about 6 years and yes there are at least 5 projects I did for them, application count is closer to 30 because some projects required several applications to complete the project/contract…


All work was done strictly for PFW. And it will not work with any other ERP with out a great deal of work done to the original application.


Other information:

Company A's lawyer says they have a non-exclusive implied license. Even though I do not agree with his analysis of the facts I do not think I am able to disprove his theory. I am more interested with does the non-exclusive implied license expire when Company A's customers move to new software like Sage 300.


my argument is the service quotes that say its an application for PFW is the contract between myself and company A and since its no longer going to be used for PFW doesn’t that terminate the contract and in response the implied license?

Thank you for your follow-up.

I tend to somewhat agree with their attorney's interpretation. They have an implied license even if that was not contracted for in your agreement because you built the code directly for their use (which is what grants them the license), but beyond that you retain all other rights to the code that you created for them since intellectual property is retained by the contractor by default. If any changes are made to your code without your consent, it would be a direct infringement of your copyright. If the company does not use your code but you built it for them they still retain an implied license since they retain the right to use that code at any future point going forward.


Hope that clarifies.

Customer: replied 4 years ago.

ok i think you lost me, are you saying a non-exclusve implied license only allows the licensee the right to USE, copy and distribute the work they cannot make changes to it? so they cannot take my work and change it to make it work with a totally different ERP?


compnay A broke privilage a week ago and sent me an a-mail that also whent to their lawyer stating they have already made changes to my work...

Thank you for your follow-up. I would be happy to clarify.

A license, any license, grants the person or entity the right to use a product (or software) but it does not transfer ownership rights or a right to modify the code. They cannot make changes to something that they have an implied license for--they can arguably claim they have a license based on the fact that they purchased your services to create the work for them, but as you retained all other rights, they cannot MODIFY the work as it is not theirs to modify. They cannot, therefore, take your work and change it into something else. That would be copyright infringement and something that should you choose to pursue, you would be able to pursue and likely prevail under. They would only be able to modify if you granted them a license with that specific permission (which you did not), or you transferred your rights to the code to them via contract.

Good luck.

Dimitry K., Esq., Attorney
Satisfied Customers: 41221
Experience: I assist my clients with IP questions that arise in their daily course of doing business.
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