Buying IP from your employer

Question

I've been working on an interesting image processing project at work. I've finally gotten the program to the point that it works, however my employer has put the project on hold due to lack of funds. They don't want to invest any more money/time to buy a robot which we would need to complete the project.

Realistically, it doesn't look like anything further is going to happen with this project. Even though my manager has estimated it would bring a saving of about $300,000 a year. More than enough to pay for the project. I think the problem is that the company is hesitant to take risks at the moment.

In my employment contract, my software belongs to the company. Although I have not had this checked out by a lawyer. The invention has not yet been patented, and I'm considering buying the IP from my employer and building the robot myself with my own money.

I should also add that I'm the only one who understands how the software and mathematics work. Also, my employer seems to be concerned to a degree about competitors getting the technology.

I guess there are a number of out comes that could come from making them an offer:

1. My employer recommences the project, but refuses my offer.

2. My employer decides to sell the IP to me, allowing the project to be completed with no risk to them.

3. We negotiate some kind of shared IP arrangement. (This may be the best option?)

4. My employer refuses offer, and does not continue project.

5. ? some thing else I haven't considered

Are there any other options I should consider?

Which situation is most advantageous?

What steps should I take in approaching them for this offer? Should I get legal advice? How do I ensure that I get the best advice?

In the case of situation No. 4. what other options are available to me?

A certain subset of the work that I have done is pure maths. On its own, if published, would not give any competitors an advantage. If I run out of all other options, should I consider just publishing an academic paper?

Answer 1

I guess there are a number of out comes that could come from making them an offer:

4. My employer refuses offer, and does not continue project.

Unfortunately, I believe this is the most likely outcome. Nobody in the chain of command wants to be associated with having let go of something big. It's less risky for everyone's resume to just postpone the project indefinitely due to lack of funds.

If you still want to float a proposal on the off-chance, by all means, but I'd recommend trying to minimize your costs at this stage. For example, by avoiding expensive legal advice before there's any talk of a deal (see below).

3. We negotiate some kind of shared IP arrangement. (This may be the best option?)

Ugh. This is a very tricky route. It probably sounds like the best option right now only because the details haven't been fleshed out, and any drawbacks aren't apparent yet. The trouble is, at some point the details will have to be fleshed out, and the drawbacks will become apparent. For example, suppose your employer retains a right to practice (make and sell) the invention according to the shared IP arrangement. Then, after you've done all the work of proving the concept and creating a market, the company can enter and complete with you in the market. Once you've eliminated such undesirable scenarios, my guess is you're left with a solution that looks a lot more like buying the IP rather than sharing it.

Should I get legal advice?

I'd get legal advice when it looks like a deal might be coming together, and not sooner. You can float something vague about wanting to carry on the project outside the company and being willing compensate the company for the IP with cash or shares, without specifying which or amounts. If you get a "no way" vibe then I guess you're done right there. If you get a "let's talk" vibe then you can get legal advice when putting together the deal.

How do I ensure that I get the best advice?

That's a tough one. Paying more doesn't necessarily get you better advice. And its not like you can get an idea of how good an IP lawyer is by reading contracts he's written. That stuff makes your head hurt to read.

If I run out of all other options, should I consider just publishing an academic paper?

With your employer's permission, why not? Make sure you get permission, as even "pure mathematics" can qualify for trade secret protection.

On its own, if published, would not give any competitors an advantage.

If the company agrees with this statement, all is well. If not, there may be a protracted legal battle resulting from a difference of opinion on this point.