Loading...
Answers
MenuIf I created a product and business, and then worked for a new employer and we talk about and demo my invention, is it now my employer's IP?
Answers
Several follow up questions:
1. Do you have any sort of employment agreement now?
2. Did you disclose early on that you were working on this side project?
3. What state are you in?
4. Have you taken steps to protect the proprietary info to date--such as using an NDA?
5. Does anyone else within the company know about this recipe?
6. Is the former employer in the industry to any extent? From your description it sounds like a maybe.
The goal here would be to separate the proprietary details and show that this did not fall within the realm of your employment. I don't think that your employer has enough of a leg to stand on here so even going to court would not be a sure thing for him. However there are some preventive steps you can take now based on answers to the questions above.
Let me know if you would like to chat more,
Thanks,
Madhu
When you registered your business in early 2014, did you also apply for a patent? (LegalZoom's information on patenting recipes: http://info.legalzoom.com/apply-patent-recipe-20489.html )
If you were able to apply for a patent that would definitely work in your favor, but for the sake of your question I'll assume there's no patent...after a few IP disputes of my own (and working with legal startups Lexicata & LawKick), I've learned that when these disputes arise, your first steps (**before saying anything**) should be to:
1) Gather together any & all proof that the intellectual property (recipe) was entirely created by you *prior* to your employment with the former boss in question; and
2) Carefully review every detail of your historical conversations & agreements with said employer.
Once that's done, if court is looking like your future then you should definitely go beyond Clarity and get an in-state attorney's option, for advice specific to your location & scenario (try asking this same question on Avvo.com), but here a few things I've found helpful consider:
- When your former boss paid for ingredients, was it with the company's funds or his own?
- Are there any IP clauses in any documents associated with your former employer? (think beyond contracts - check email signature disclaimers, anything that could be construed in way that would seem you made it the company's product)
- Did you at any point use company property and/or resources to further your product? (e.g. a company-issue laptop)
- Did you mix your business & personal email at all? (for instance did you ever handle any of the company's business from your personal email address, or forward company emails/documents/etc. to your personal email - doing so can sometimes put you at risk of having your personal email inbox subpoenaed if a court believes it's relevant).
Related Questions
-
Do I have to file form 5472 for "additional paid-in capital"?
Yes you should be reporting the capital contributions. Under the old Form 5472 rules, it's true that only items that impacted taxable income would be reportable transactions. So, a capital contribution by you to the corporation would not be reportable, unless the equity contribution was somehow below or above a fair value contribution in exchange for services that you might provide for the corporation - essentially an imputed reportable transactions. When the IRS changed the Form 5472 rules to require non-U.S. owned single member LLC's, they expanded the reportable transaction definition to include virtually everything. The term “transaction” is defined in Treas. Regs. Section 1.482-1(i)(7) to include any sale, assignment, lease, license, loan, advance, contribution or other transfer of any interest in or a right to use any property or money, as well as the performance of any services for the benefit of, or on behalf of, another taxpayer. So, for example, contributions and distributions would be considered reportable transactions with respect to such entities. These amounts can be reported on Lines 12 and 25 with an explanatory footnote that clarities the amounts are capital contributions and not amounts that impact taxable income.Jason KnottJK
-
Where to incorporate a new software as a service busines?
I'll keep try to keep this answer brief, but there are several factors and nuances that can be discussed in more depth. Where you decide to incorporate partly depends on what your future goals are with your company. Companies that plan to seek venture capital or go public typically choose Delaware as the state of incorporation, and usually choose a C-Corp. Delaware has a very well developed body of law surrounding corporate governance and that provides comfort and more certainty to future VC investors. If you're not planning to seek VC money any time soon, an LLC is a smart decision because of the tax benefits it can provide to you as the owner. It sounds like you want to grow your company on your own without outside financing. If that's the case, I would recommend forming your LLC in California. Regarding California vs. Delaware, one benefit to forming your LLC in California is that you can avoid paying a registered agent fee which can cost anywhere from $100-200 a year. If you plan to seek venture capital down the road, you can reincorporate in Delaware.Jared IversonJI
-
What is the best way for a startup to draft Terms of Service and Privacy without spending thousands of dollars?
Your first point of reference should be experience. The most effective way to create your ToS is to consult with a lawyer who specializes in your industry. This also hold true for your that and any business legal document. It’s true that you can find different online services and templates to assist you, but the truth is that these documents could very well be null and void. Your business is specific and unique and your ToS should be the same way. I advise against copying your ToS or using one of the “easy to use” sites as they will almost certainly fail to include or capture everything. Read more: https://lawtrades.com/blog/protect-website-liability/ At www.lawtrades.com, we have plenty of experienced Terms of Service and Privacy policy lawyers who will complete it for you on-demand. I have seen PP and TOS prepared routinely for $599 or less, and these documents essentially serve as a “blueprint” for your business. (Full disclosure: I'm the founder/CEO). In my opinion, copying your competitors legal documents will not work for you in the long run. The odds are high that the business had their documents customized, and by copying and pasting you are claiming that your business has the same features and services which is highly unlikely. Hope this helped address some of your concerns. When you're ready, you make your request completely free at www.lawtrades.com to get a better feel for the process. Feel free to mention "clarity" for a discount :)Raad AhmedRA
-
How do I write an NDA with the right jurisdiction/governing law?
From a legal standpoint: an NDA is an agreement - something contractual, and therefore is not limited (by law) to any specific jurisdiction. So, you can select Delaware or California, or India for that matter. From the business aspect, the best jurisdiction to select would depend on: 1. Jurisdictions that are known to be 'friendly' to your type of business. 2. Jurisdictions in which your lawyer is licensed to practice / the cost of lawyers isn't too expensive. 3. Somewhere not to far from where you are physically located - in case you actually have to go to court. Lastly, best to add a required arbitration or mediation clause if you don't have one. Good luckAssaf Ben-DavidAB
-
If I come up with a coaching methodology / formula, is it protected under Copyright?
(I'm a small biz attorney who helps people with copyright, trademark, and other IP law, and I'm answering per U.S. law.) As soon as you take your idea and put it into a tangible format (write it down, create an infographic, record a video), then that writing/infographic/video is automatically protected by copyright law. You can record the copyright on it too, which makes it easier to protect and get damages from other people taking it. But the formula itself would be probably protected under trade secret law or patent law. Patent law obviously takes a bit more effort, because you have to apply for the patent and get your application examined by the USPTO, which takes years and $$$. Keeping it protected under trade secret law means you have to make an effort to keep it secret (which may not work if you are disclosing it as part of your marketing efforts), such as keeping it confidential and requiring NDAs. As someone else said, the other terms you use might be protected under trademark law. If a member of the public would use those terms to link your products/services with the source of the product/service (aka, your company), then they could be trademark-able. There are some state law protections for trademarks, and you can also file to register the trademark with the USPTO and get more protection. Hope that gets your started!Elizabeth Potts WeinsteinEP
the startups.com platform
Copyright © 2025 Startups.com. All rights reserved.
