Who owns the IP rights for a product you're making outside working hours (in USA)?


Does the company you're currently work for owns the IP rights if you are creating a product after work hours? Is there anything that can defend me if the company at one point claims that they own it because I am their employee?

I have read my employment contract but it doesn't say anything explicitly that the company will own the IP as long as:

  • I'm doing something that is not related to their core business
  • Outside work hours or specifically at home
  • Not using company resources

But is there any default values from the government? I know in some countries the default values is that the company owns your IP if it is not explicitly stated in the work contract. What about in the US?

Also when it says not using company resources, how far does that go? I read the story about Steve Wozniak when he was making Apple computers while he was still working in HP, yet he still gets away with it. Is that ethical?

Employees Intellectual Property

asked Dec 4 '09 at 21:00
1,342 points
  • It's disconcerting when you edit the question in response to the answers posted :-)... A couple points about the current version of the question :-): What's a company resource? 1) time (your normal working hours); 2) equipment; 3) anything else that is tangible and the company pays for and the expectation is that you will use it for work. As to "ethical"... I think the only question is "is it legal," no? Otherwise we are just looking at differences of opinion. – Gabriel Magana 14 years ago
  • This thread is a superb read for people interested in "who owns my spare cycles" questions: http://www.brightjourney.com/q/working-company-intellectual-property-rights-stuff-spare-timeHoosteeno 11 years ago

8 Answers


I'm not a lawyer or familiar with US law but I would imagine UK law is pretty similar regarding this.

You really need to check your contract of employment / employees handbook

What does it say about ownership of IP?

In the UK things are generally on your side unless:

You did anything during work hours (you say this is after hours, so you should be ok here)

you used any company property such as laptops, equipment

Your contract explicitly states ownership of all IP including out of hours

Your IP utilised knowledge you specifically gained as part of your job

You have a non compete clause and your IP is based on a similar product/industry etc

answered Dec 4 '09 at 22:41
61 points


Just to add to gmagana's comments.

I would just comment that while some employment agreements might say that they own everything you do some state laws trump that so you can't just go by what it says in the contract. If your contract seems too strict do a little research on the law in your state. For example California is very liberal on this.

In addition, regardless of the law/contract you can always do this if your employer gives you permission. Many employers are completely OK with their employees working on side projects and having their permission is the best way to have clear IP in the future.

answered Dec 5 '09 at 02:52
1,866 points


LloydPickering has it very close to the US. These are the things I think are different:

You can work on your own things on the side even if you use knowledge you gained in your job. Let's say you get on the job training in X technology at your workplace. Your employer paid for it, and you learned it while on the job. You are free to use that knowledge for anything, even if it does not relate to or benefit your employer, as long as you do not use any company resources. The reason for this is that if your employee trains you, and you cannot use that training to your benefit outside of work done for the benefit of that employer, then that is tantamount to slavery (you would be unable to work for anyone else, and that is what slavery is). Note that this is different when signing a non-compete agreement or similar, for that stuff you definitely need a lawyer's counsel because it gets very technical.

Another thing you should pay attention is your employment agreement. Very carefully read this, because your employer may claim all IP that comes from you while you are employed, even if you did it on your own time. Several high-tech companies do this, and it seems to be holding up in court, so take a read at this.

As always, if this is a life/death thing for you, it is well-worth consulting an attorney. You do not want to get sued years later and have a former employer claim a share (or all of) your IP. There are things you can do right now that will answer later questions about IP you create on your own (for example, create a detailed log of when you work on your side project, purchase new hardware out of your own funds to work on your own projects, etc...). An attorney would know what are the key steps to secure yourself proof right now should questions arise later.

answered Dec 4 '09 at 23:25
Gabriel Magana
3,103 points


It boils down to the contract you signed with your employer, the jurisdiction you are in and the specifics of the case. Don't fool around with this: have the courage of your convictions and consult a labor law attorney.

answered Dec 5 '09 at 04:25
Bob Walsh
2,620 points


In cases like this one, the only real answer is to check your employment contract. We agree with Dane above that some contract agreements attempt to go beyond what can legally be enforced especially depending on state laws.

Jason Cohen wrote a blog post that we thought was very useful on this exact subject. He's also commented above with very useful advice. Consulting an attorney in this case wouldn't be a bad idea. Plus it helps you establish an official timeline of events around the creation of the IP outside of work.

answered Oct 1 '12 at 19:56
101 points


There is no general answer. It depends on your employment contract and local labor laws.

Just because something's in an employment contract doesn't mean it's enforcable. gmagana mentions some of those cases hold up -- many others have been stricken down, especially in California.

You absolutely need to ask a lawyer familiar with local laws and with your signed docs in hand.

Even then you are taking a significant risk. I know several people sued over this sort of thing, and even if you win you cannot recover legal fees or the time/pain it puts you through.

answered Dec 6 '09 at 06:47
16,231 points


Ultimately it comes down to what the jury decides!

The problem in the past has been, that while a typical judge and jury will accept that your hobby business selling watercolors is different from your job in the paintshop at Ford - will they understand that doing web design at home is different from being a DBA at work? Or is it all just "computer stuff" ?

At sometime in the future the man in the street will probably be better informed - but think of the typical jury today.

answered Jan 14 '13 at 10:57
101 points


Under US Law unless you're explicitly signing over the rights of your project over to your company (through your written contract) than the right belong to the creator. Certain exceptions apply. I.E. You're using the IDE that the company bought (using their license), their laptop, their version control, or anything else owned by them..including you on their time.

But if it's your personal computer at home, using an internet connection they don't pay for, and using your own licenses for software, unless it is a derivative or related to their product, or a direct competitors product, you're fine.

answered Oct 19 '12 at 00:46
Randy E
632 points

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