Has anyone ever had the experience of a contracted developer charging their client to release source code? I have been told that this is industry practice with a fee of up to 20%.
I would love to hear from anyone who has any experience or thoughts about this.
Well the 20% charge is not in the contract but THIS is
>>All Source Code shall remain the property of the Developer until termination of the agreement and subject to payment of all monies due to the Developer for the purchase of said Source Code.<<
The master class you just signed up to take is "How to read hostile contracts 510" and its going to cost you 20% of the cost of the contract.
As a CTO I would never ever sign such a contract. And in fact I would throw out Almost ALL of section 8.
All intellectual property rights shall remain the property of the Developer and/or its licensors until the Client has paid all monies due to the Developer At which time intellectual property rights shall transfer to the client as per normal work for hire agreements.
On termination of this agreement and subject to payment of all monies due to the Developer under it, the Developer
shall assign to the Client all intellectual property rights as regards Creative concepts only. and the client shall each have derivative IP rights on the product developed except for the list of concepts enumerated in Appendix A. Those concepts will remain the IP of the Client All Source Code shall remain the property of the Developer until termination of the agreement and subject to payment of all monies due to the Developer for the purchase of said Source Code.
The Developer shall deliver to the Client full working source code as well as complete documentation of the build environment and tools to reproduce the product as well as transfer any relevant licenses for included code and libraries necessary to build the solution unless explicitly exempted in writing by the client
The Developer will
use all reasonable endeavours to obtain all copyright and a waiver of moral rights in respect of work sub-contracted to or acquired from third parties but it cannot undertake that in all cases it will be able to do so. In the event that the Developer is unable to obtain copyright or a waiver of moral rights in respect of such work the Developer shall inform the Client before any appropriate agreement is entered into. and will transfer such intellectual property rights to the Client upon final payment
The Client shall provide the Developer with copies of all trademarks and branding which are to be included in the Product and the Client hereby grants the Developer a royalty free licence to use, copy and reproduce such trademarks and branding for the purpose of developing the Product. Such a license to use will expire with the termination of the contract.
The Client agrees that on termination of this agreement the Developer shall
be entitled to use the Product solely for its own internal and external promotional purposes. cease to have any rights to use or refer to the product or the Client except by explicit permission of The Client This includes but is not limited to any screen shots trademarks, branding or other indentifying marks
If you had an atty read over the contract before you signed it - I'd go back to that attorney and ask why they didn't advise you of the consequences of Section 8. Because you basically contracted with these guys to rent the runtime they produced and you gave them the right to use your stuff as they saw fit. A competent atty should have warned you about this.
And upon seeing section 8 - you should have not walked but RUN away from these guys at full tilt, because they are not working to industry contracting standards.
Now when you go back to them for Source Code... go read the section I wrote about the build environment, tools and contained IP. but I'm not a lawyer - go get a lawyer to right that section for you. because you need to get the ability to reproduce your product without these guys and you also need to have derivative rights from that Source Code.
And if they won't give this to you - then you have learned a very expensive lesson. And you will need to stand it up and see if you can get it to run and generate enough cash to go to a different development house.
I would never ever use these guys again
What Marcus Matos said. That said, this is slime on the part of this developer. You have a right to factually describe your experience with them. Once you get the code, I would walk away, never use them and let everyone know who it was.
From firms I have worked for before, the firm would retain ownership of the code.
For projects where they wished to own the source there would be an extra cost, as the developers would not reuse any existing code from other applications.
For example, I have developed a set of classes to perform default functions (data access, send emails, validate emails and various other time saving classes) that would be used amongst many projects.
For projects where we weren't retaining intellectual property, we wouldn't use these classes as we had spent time developing these to help save costs on future jobs. Obviously releasing this code could cause issues if it fell on the wrong hands, so our firm were, in my opinion, correct to take this approach.
Granted this firm was more CMS/ecommerce based so were based on our 'products', but I know of other firms in the UK (so may differ in the US) retaining IP.
If it's a custom project, however, it should have been made clear to you in the bid process, not hidden somewhere in a clause in a contract.