3. Open source software has different implications for developers in giving up

1. Who Owns the Code?
A Brief Guide to Software Ownership
for Developers and End-Users
April 20, 2011
Brad Frazer
bfrazer@hawleytroxell.com
208.388.4875
@bfrazjd

2. Why Do You Care?
• Premise is that you, as a developer, code writer
or content creator, are an author, and that as an
author your creative works are valuable and
generate revenue for you and your clients.
• Corollary premise is that you, as an end user,
wish to have rights to fully use the software you
paid to have developed.
bfrazer@hawleytroxell.com / @bfrazjd

3. “Microsoft made a call to SCP and quickly licensed 86-DOS for
unlimited use by a "secret customer" for a one-time fee of $25,000,
and in turn licensed the DOS to IBM for a one-time unlimited use
fee of $80,000. Although this made a profit for Microsoft, to IBM
this was quite a bargain, and would allow IBM to charge a relatively
low fee for the operating system to its customers. In consideration
of the low license fee, Microsoft bargained to retain the rights to
license the operating system to other manufacturers as well.
Microsoft believed it could make MS-DOS the industry standard for
all PCs based on the 8086 or 8088 processor, and this type of deal
would allow Microsoft to retain control over DOS. IBM and
Microsoft signed what would probably become the most important
deal in computer history on November 6, 1980.”
http://e-articles.info/e/a/title/A-Brief-History-of-DOS/
bfrazer@hawleytroxell.com / @bfrazjd

4. “Software” is Inherently a
Copyright Concept
• Software (source code) is copyrightable subject
matter.
• Therefore, any discussion of software
ownership requires a discussion of certain basic
copyright law principles.
• Yes, patent rights can be implicated as well. . .
bfrazer@hawleytroxell.com / @bfrazjd

5. What is a Copyright?
• A property right that springs into existence
when a sufficiently creative idea is reduced into
or onto a tangible medium.
• Nothing more need be done to CREATE a
copyright: when you code, you create a
copyright in the source (insert “open source
caveat” here).
bfrazer@hawleytroxell.com / @bfrazjd

6. Copyright – Exclusive Rights
Only the copyright owner can lawfully:
• Make copies
• Create derivative works
• Distribute copies
• Publicly perform the work
• Display the work
17 U.S.C. Section 106
bfrazer@hawleytroxell.com / @bfrazjd

7. Copyright Ownership
• In general, the author owns the copyright and is
the only one who may exploit the exclusive
rights.
• Distinction between the media and the
copyright.
• But, who’s the author?
• Generally, the person who physically captures
the idea into the tangible medium.
• But: the “Work Made for Hire” doctrine . . .
bfrazer@hawleytroxell.com / @bfrazjd

8. A Work Made for Hire Is . . .
• A work prepared by an employee within the scope of
his or her employment; or
• A work specially ordered or commissioned for use as a
contribution to a collective work, as a part of a motion
picture or other audiovisual work, as a translation, as a
supplementary work, as a compilation, as an
instructional text, as a test, as answer material for a
test, or as an atlas, if the parties expressly agree in a
written instrument signed by them that the work shall
be considered a work made for hire. 17 U.S.C. Section 101
bfrazer@hawleytroxell.com / @bfrazjd

9. Therefore:
• Author owns the copyright and thus “owns the
code.”
• Unless:
• Author is an employee; or
• Code is a WMFH as defined; or
• Author assigns copyright in signed
agreement.
bfrazer@hawleytroxell.com / @bfrazjd

10. How Do You Control How Those
Exclusive Rights Are Used?
• Why does it matter?
• The license is the key . . .
• Exclusive license?
• Vernor v. Autodesk?
bfrazer@hawleytroxell.com / @bfrazjd

11. The Moral of the Story:
• For developers: does your price contemplate
that you are giving up the copyright?
• For owners: do you own the copyright in the
code you paid to have developed so that you
may fully exploit it?
bfrazer@hawleytroxell.com / @bfrazjd

12. Thirty Seconds on Open Source . . .
• Implications to developers
• Implications to owners and end users
bfrazer@hawleytroxell.com / @bfrazjd

13. THANK YOU!
Brad Frazer
Hawley Troxell
bfrazer@hawleytroxell.com
@bfrazjd