Intellectually protecting project intellectual property
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ntellectual property is a significant asset providing value on mining projects while enhancing opportunities for project owners and contractors (or subcontractors). When executing contracts associated with mining projects, the intellectual property considerations of both parties, including protection of intellectual property and the license or assignment of intellectual property, are key factors to be determined between project owners and contractors. Contractors who use their intellectual property to provide goods and services to project owners should take necessary precautions to ensure they are not inadvertently weakening their intellectual property rights. Project owners who rely on a contractor’s intellectual property should also take necessary precautions to ensure they are entitled to use and benefit from a contractor’s intellectual property during and following the completion of the contractor’s performance of work on a project. Although the intellectual property rights and interests of project owners and contractors are sometimes well-defined and understood by all parties, occasionally circumstances arise where the parties’ intellectual property interests are not completely aligned and require negotiation to achieve a compromise that is acceptable to all parties. Generally, if a contractor’s intellectual property existed prior to a contract between a project owner and the contractor, commonly referred to as contractor background intellectual property, then
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By Derek Hoffman and Hasith Andrahennadi the intellectual property belongs to the contractor because it was developed independently of the project. The project owner and contractor can agree on the terms and conditions for the project owner’s ability to use and benefit from the contractor background intellectual property for the project; however, the project owner is generally not granted rights in the contractor background intellectual property. However, if intellectual property was developed by a contractor during their performance of work under their contract in connection with the project – commonly referred to as project intellectual property – then such project intellectual property rights, or a portion of them related to the contract and project, may belong to the project owner because the project intellectual property was developed in association with project work. A further complicating factor can arise when a contractor must use a project owner’s intellectual property, commonly referred to as owner background intellectual property, because it is required to complete the contractor’s performance of work under their contract. Regardless of which intellectual property circumstances apply, contractors and project owners should be diligent and careful to clarify the ownership and treatment of both background and project intellectual property rights in the terms and conditions of their project contract.
When negotiating project contracts, the determination of appropriate intellectual property terms and conditions, as well as the allocation of intellectual property rights such as copyright, patent, and industrial design interests, can depend on several factors, including: • The subject matter of the contract between the owner and contractor – e.g. is the intellectual property the primary subject matter of the contract, or is it supplementary to the primary goods or services under the contract; • The date of the contract between the project owner and contractor – e.g. did the intellectual property exist prior to the contract; and • The date of any intellectual property protection applications and registrations, or the date of first use of such intellectual property – e.g. was the intellectual property developed independently of the contract. Although there are several ways intellectual property rights can be managed by a project contract, generally, a contractor who wishes to protect their intellectual property rights will seek to include contract terms and conditions that specify the contractor background intellectual property and project intellectual property belongs solely to the contractor so actual ownership of such rights are not assigned to the project owner. On the other hand, generally, project owners will seek to include contract terms, which ensure the project owner
