Chapter 27 - Software Licensing and Maintenance Contracts

27.6.0 Intellectual property (IP) and ownership

The ownership of IP created or used under a state IT contract is an important issue for the Commonwealth, its agencies and suppliers. Suppliers invest significant sums of money in the development of IP and then seek to market their IP to multiple government and commercial entities in order to generate revenue. Purchasing agencies also invest a substantial sum of money in the development of IP by contractors. State and local governments may seek the ownership of IP when they have paid for the creation of changes to an existing system or other work products. In instances where a state or locality takes ownership of IP, the state may then permit other government entities to use the IP, thereby saving those government entities time and money in creating similar IT systems.

IP means the legal rights which result from intellectual activity in the industrial, scientific, literary and artistic fields. There are two main reasons for the protection of IP: One is to give statutory expression to the moral and economic rights of inventors in their creations and the rights of the public concerning those creations. The second is to promote creativity and the dissemination and application of such creativity while encouraging fair trading which would contribute to economic and social development.

IP refers to creations of the mind: inventions, literary and artistic works, and symbols, names, images, and designs used in commerce. Intellectual property is divided into two categories: industrial property, which includes inventions (patents), trademarks, industrial designs, and geographic indications of source; and copyright, which includes literary and artistic works such as novels, poems and plays, films, musical works, artistic works such as drawings, paintings, photographs and sculptures, and architectural designs. Rights related to copyright include those of performing artists in their performances, producers of phonograms in their recordings, and those of broadcasters in their radio and television programs. IP rights can be licensed or assigned. IP should be treated as an asset that can be bought, sold, licensed, or even given away at no cost. IP laws enable owners, inventors, and creators to protect their property from unauthorized uses.