The Ontario Court of Appeal (“ONCA”) has issued a timely reminder that when it comes to employee-created intellectual property, there is no substitute for a well-drafted employment agreement.
In the recent decision of Nexus Solutions Inc. v. Krougly (“Nexus Solutions”),[1] the ONCA held that copyright in competing software developed secretly by an employee during his employment belonged to the employee and not the employer. The result, which the trial judge himself described as “harsh,” turned on the absence of a written employment agreement and the narrow scope of the employee’s assigned duties.
The Importance of Employee-Created IP
Employees routinely create works in the course of their employment, from software code and business plans to technical reports, training materials and graphic designs. To secure ownership, many employers include intellectual property (“IP”) assignment provisions in their employment agreements. Without such provisions, employers must rely on section
