Software Development Agreement Practical Law

ICEL informed the High Court that, although it was not mentioned in its agreement with Virrage that copyright was transferred to them, “the agreement between the parties was so obvious that it did not need to be mentioned”. A complex agreement has been reached between ICEL and Virrage Industries for the development of infection control software for hospitals. The deal was complicated by the fact that Virrage shared a director with Link Information Systems (LIS), a company that had not produced the software under a previous agreement with ICEL. “ICEL asserts that, although the agreement does not specify who should own the relevant intellectual property rights, it must be inferred from the entire origin that the copyright in the software with which the system was executed should be transferred to ICEL at any time,” the judgment states. The court rejected the proposal that two directors of Virrage, not the company, owned the software. The judgment stated that a clause in the agreement stipulated that if the software was finalized and sold directly by ICEL, the copyright would be transferred to it so that it could be resold, but that this situation did not occur. Following the Supreme Court ruling, ICEL said this meant that under the new agreement, it would own the copyright in the resulting software. The LIS agreement contained a clause stating that “ownership of the product is subsedible with full payment of the purchase price. As of that date, the title, copyright, and all other proprietary rights in the software system remain with ICE. “The defendants argue that even when a copyrighted work is commissioned, the copyright belongs to the authors of the work, unless there is an explicit agreement to the contrary or such an arrangement follows from the necessary conclusion,” reads the Supreme Court decision of Justice Chambers QC. `To the extent that the claims are reimbursed, the exercise consists in examining the situation not only from the point of view of the person claiming that the copyright has expired, but also from the point of view of the person or persons who would have transferred such a right.` “I think there was no provision in the agreement that ICEL owned or had to own the copyright in the software before there was an agreement to sell to third parties,” Judge Chambers said. “In particular, I note that the purpose of the agreement was not for ICEL to hold the copyright in the software before it was paid for, unless there was an agreement to sell the software that prefers such payment.” ICEL and Virrage agreed on the work that “for the avoidance of doubt, the specifications will be the same as those previously agreed by ICEL with Link Information Systems, unless both parties agree that changes should be made”. Court of Appeal rejects possibility of derogating from EU copyright The High Court disagreed.

“Since more than one sale is contemplated, there should be no transfer of ownership of copyright when a sale takes place,” the judgment states. “To make the `sales`, ICEL does not need to have ownership of the copyright: a sub-licensing right will be just as effective.” Proposed reforms of judicial review in England and Wales “It is said that, if it turns out that a right has been established by the necessary conclusion, such a right will only be the minimum required by the conclusion. . . .