How do I keep my employer from claiming ownership of my business?

[TreyAllDay]

Okay, so the situation is a bit complicated. I would love some advice from anyone who has been through this before or knows how to protect yourself from these situations. I'll try to keep explanation simple.

So, I am a 25 year old Marketing Manager with a nation wide tire distributor, but I look after the retail division meaning we own retail stores that sell the product. Anyway, as my background is in computer sciences I took it on myself to design our intranet for our retail stores in the past. The intranet basically allows us to post content and store managers can read it - we have a training plugin designed by a 3rd party that allows them to take training if they'd like. I mostly designed it on my spare time, which is another story, but basically spent a year wanting to go the extra mile and move up with this company (like a slow laner!) Anyway, I have built 2 of these before for other companies and there is nothing proprietary about them......

In January I decided to start my fastlane journey and began building a software on the web. It's nothing like the one I built at work- my software is kind of like an intranet but allows companies or smaller businesses even to implement a full scale people management platform including hiring processes, onboarding, management, training, etc. The problem is, my boss had been asking a long time ago for us to begin building an HR program for our stores and I never got around to it on company time. Basically I just chose I wanted to create my own advanced version of an HR and training technology and sell it- It has a feature that allows you to write company messages and feature them on the homepage when your employees log in. In my opinion it is nothing like our work intranet, but i could see how one might think one inspired the other. However, I have designed 3 intranets now for different employers- people might own the intranet itself and the code you write, but the idea is not proprietary. HR systems are not proprietary either, I am not stealing any content whatsoever.

I believe my stores I manage at work would be great first users of the site to prove that it works. Basically my question is, are there any steps I should take to protect the ownership of my software? I have never worked on it on company time, and I've never worked on it with company equipment. My boss is a very open person, I was thinking of writing him a letter and full-disclosure tell him I am building a software and disclose that I am not using company times or tech to do it- just be completely honest?

Any advice would be greatly appreciated.

 

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[BlackPebbles]

Ooooooh. This has shitfight potential written all over it.

If you did it on your time, from your own life experience, with your resources then that's cool, it's yours, but try to pitch it to customers you only know through working at this company you're gonna have a bad time.

If you can prove you made it on your own time why not licence it to the boss to use. [emoji48]

I sense drama ahead with this because you've been asked at some point as an employee to create such a system.

Safest bet is to peddle it to companies outside your current pool.

 

[lowtek]

you must definitely and absolutely consult a lawyer and ask these questions of him or her.

do not disclose anything to your employer until you have solid legal advice.

 

[Ikke]

Perhaps inform him that you are to busy to make it in company time. But that you are very happy to make it in your own time and sell/rent it to them? If it's a no, nothing lost. If it's a yes, congratulations on your first deal.

 

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[Roli]

First thing to do is, read your employment contract, is there a clause in there about intellectual property? Do you understand the clause? If not get a lawyer to read and explain it to you.

My guess is, you're fine, however the only way to truly protect yourself is to quit your job and then sell the software to them.

Sounds like your fastlane journey could be about to begin; good luck buddy

 

[biophase]

Sounds alot like the beginning of Facebook.

Question, you are a marketing manager. Are you suppose to be building software for your company? Did they just ask you to do it because you can program?

It does sound like you are going to run into problems. If I were to do this I would:
1) incorporate and create the software within your company
2) either quit work, then try to sell it to your old company
3) tell your boss what you are doing, allow his company to use your software free forever, hoping he doesn't get angry

 

[Ninjakid]

Get legal advice from a lawyer.

Review the contract you signed with the company.

If your boss asked you to build something for the company, it's most likely theirs. But if you didn't get paid for it, it's a different matter.

If I was your boss and while you were working for me, I tasked you with creating Ninja Doritos which was going to be my new product, and you were like "F*ck you, Ninjakid, they're my Doritos," you would likely experience a legal Shitstorm Katrina because while you made my Doritos, you took them for yourself.
Basically in this case you're getting paid to work for the company, and the company owns what you make.

But if I ask you to make me Ninja Doritos on your own time because it would be a nice thing, and you bring in said Doritos, and I decide because you = slave I = master, that they're my Doritos, then I'm the jackass because I'm not paying you to make Doritos for the company.

But once again, I do not = lawyer, and the laws may be slightly different in your part of the world, so check with your lawyer.

 

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[BlackPebbles]

If I was your boss and while you were working for me, I tasked you with creating Ninja Doritos which was going to be my new product, and you were like "F*ck you, Ninjakid, they're my Doritos," you would likely experience a legal Shitstorm Katrina.

This. Delicious AND terrifying. [emoji23]

 

[Betuterien]

you must definitely and absolutely consult a lawyer and ask these questions of him or her.

do not disclose anything to your employer until you have solid legal advice.

I second that, consult a lawyer.

Having someone at your back isn't at all good for business, I know that as I currently going through a similar situation.

 

[biggeemac]

Sounds alot like the beginning of Facebook.

Question, you are a marketing manager. Are you suppose to be building software for your company? Did they just ask you to do it because you can program?

It does sound like you are going to run into problems. If I were to do this I would:
1) incorporate and create the software within your company
2) either quit work, then try to sell it to your old company
3) tell your boss what you are doing, allow his company to use your software free forever, hoping he doesn't get angry

It does sound like you are going to run into problems. If I were to do this I would:
1) incorporate and create the software within your company
2) either quit work, then try to sell it to your old company
3) tell your boss what you are doing, allow his company to use your software free forever, hoping he doesn't get angry

After incorporating and creating your OWN company, why not just tell the boss "Hey look what I RANDOMLY found out on the internet....a company that sells EXACTLY what we need"?

 

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[Jon L]

I've been in this situation before and it didn't work out well for me: my boss had millions of dollars to pursue me with, and I had nothing. Lawyers are $$$.

Here's what I would do:

1) Talk to a lawyer (I'm betting you're fine - a company that sells tires is very unlikely to want to get into the business of HR software...and a marketing manager isn't likely to have an IP clause in their contract)
2) Find a mentor to run that legal advice past...pick someone that has a lot of business experience that you trust.
3) You might offer to your current boss that you pay the company you work for a royalty for a period of time...even though I don't think you're obligated to do this...it shows good faith. And, if your boss says 'no,' then youre in the clear. ***Get this in writing***

 

[Iwokeup]

Will (possibly) respond in more depth later, as I was once in this exact situation.

Basically:

1. Talk to a lawyer. The $ spent now will save $$$ down the road.

2. is designing software within the reasonable or specific job requirements? Not what you've done for them on your own time, but actually spelled out in your contract/hiring forms?

3. If both 1 and 2 say "no problem," then there's no problem.

Even better: quit, do something else, and then start your own thing. Then no conflict of interest.

 

[OldFaithful]

IMO, first ask yourself this...Do I want to quit working at the tire place and start my own business in software?

YES! If yes, say nothing to your boss and find another job asap. Problem solved. Then create your own company and run with it. Once you've got a finished product, you can always offer it to your previous employer.

NO! If no, then several of the members before me have offered excellent advice!

Godspeed.

 

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[TreyAllDay]

Ooooooh. This has shitfight potential written all over it.

If you did it on your time, from your own life experience, with your resources then that's cool, it's yours, but try to pitch it to customers you only know through working at this company you're gonna have a bad time.

If you can prove you made it on your own time why not licence it to the boss to use. [emoji48]

I sense drama ahead with this because you've been asked at some point as an employee to create such a system.

Safest bet is to peddle it to companies outside your current pool.

Thanks for the advice

 

[TreyAllDay]

Thank you for the advice everyone.
This is the first post i've received alot of feedback on and it makes me feel very welcome!

 

[Andyc2288]

I have a similar thing that is happening with me right now.

I launched my own brand on amazon, now my ex boss is harassing me for "stealing information"
It was my job to understand the whole mechanics of amazon fba in the first place

Following this thread to see how you handle this

 

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[BlackPebbles]

It is honestly such a complicated legal area because it relates to what you learn and experience in your mind against the company's own intellectual property and confidential information rights.

Black and white answers are not going to be found on here.

Generally speaking, the skills you learn and take when you go are yours. Business secrets, customers and novel IP are not.

And harassing only counts when it's served on you in paper form. Mind you flaming turd bags are also unpleasant.

 

[Ubermensch]

Okay, so the situation is a bit complicated. I would love some advice from anyone who has been through this before or knows how to protect yourself from these situations. I'll try to keep explanation simple.

So, I am a 25 year old Marketing Manager with a nation wide tire distributor, but I look after the retail division meaning we own retail stores that sell the product. Anyway, as my background is in computer sciences I took it on myself to design our intranet for our retail stores in the past. The intranet basically allows us to post content and store managers can read it - we have a training plugin designed by a 3rd party that allows them to take training if they'd like. I mostly designed it on my spare time, which is another story, but basically spent a year wanting to go the extra mile and move up with this company (like a slow laner!) Anyway, I have built 2 of these before for other companies and there is nothing proprietary about them......

In January I decided to start my fastlane journey and began building a software on the web. It's nothing like the one I built at work- my software is kind of like an intranet but allows companies or smaller businesses even to implement a full scale people management platform including hiring processes, onboarding, management, training, etc. The problem is, my boss had been asking a long time ago for us to begin building an HR program for our stores and I never got around to it on company time. Basically I just chose I wanted to create my own advanced version of an HR and training technology and sell it- It has a feature that allows you to write company messages and feature them on the homepage when your employees log in. In my opinion it is nothing like our work intranet, but i could see how one might think one inspired the other. However, I have designed 3 intranets now for different employers- people might own the intranet itself and the code you write, but the idea is not proprietary. HR systems are not proprietary either, I am not stealing any content whatsoever.

I believe my stores I manage at work would be great first users of the site to prove that it works. Basically my question is, are there any steps I should take to protect the ownership of my software? I have never worked on it on company time, and I've never worked on it with company equipment. My boss is a very open person, I was thinking of writing him a letter and full-disclosure tell him I am building a software and disclose that I am not using company times or tech to do it- just be completely honest?

Any advice would be greatly appreciated.

Your "end game" should be to get an agreement signed. Otherwise, this is simply mental masturbation.

Use the language below as a starting point.

The highlighted portion is that which is most relevant to your situation.

Nothing contained herein shall give either Party any ownership rights in or to, or license to use any materials, trademarks, or information of the other Party. Further, unless specifically set forth in writing, neither Party grants the other any right, title, or interest in or to any software, scripts, customizations, integrations, or other work product produced during the course of performance of this Agreement.

B. “Confidential Information” means all business and technical information of either Party whether disclosed in writing, orally, or in any other form, tangible or intangible, including but not limited to: (i) information concerning inventions, discoveries, concepts, brainstorming, ideas, techniques, processes, designs, specifications, drawings, diagrams, models, samples, flow charts, computer programs, algorithms, data, finances and financial plans, customer lists, business plans, contracts, marketing plans, production plans, distribution plans, system implementation plans, scripts, business concepts, supplier information, business procedures, business processes, business operations, all know-how and intellectual property, and any and all materials related thereto; and (ii) any information or materials that either Party obtains from any third party that the obtaining Party treats as proprietary or designates as Confidential, whether or not owned by the obtaining Party.

C. Both Parties agree that the following information shall not be considered Confidential if it: (i) is already known by the receiving Party prior to signing this Agreement; (ii) is or becomes publicly known through no wrongful act of the receiving Party; or (iii) is rightfully received by the receiving Party from a third party without restriction and without breach of this Agreement.

D. The Parties agree not to disclose, reveal, or otherwise release any Confidential Information obtained, developed, or disclosed in the performance this Agreement, whether oral or written, to any third party, or directly or indirectly use such Confidential Information, other than in performance of this Agreement, except as previously authorized in writing by the other Party.

E. Company and Agent will be providing information and/or lead opportunities relating to their confidential customer base for purposes of providing material and service(s) on behalf of Company. Agent may be in the business of providing the same or similar product(s) and service(s) as Company; as such, Agent and Company agree to remain in the roles in which they are initially introduced with each client contact. Company, Agent, and appointed agents shall remain the primary contact and facilitator between Agent and Company’s customer(s). Company shall not discuss product(s), product alternative(s), or pricing directly or indirectly with customer(s) generated or solicited by Agent unless directed by Agent. It is furthermore agreed to that all billing and invoicing for the product(s)/service(s) will be prepared by Company as the vendor and distributed by Company or with Company approval. Company shall bill clients directly for contingency fees unless otherwise agreed to in writing. In the event a customer that Agent solicited or generated directly contacts the Company or its affiliates for a current or future project, the Company shall refer the customer to the Agent, and Agent shall make all communications with said customer. Both Company and Agent shall make no attempts to solicit business from existing, generated, and solicited customers of the other Party. The monthly reports generated shall include a comprehensive list that will reflect the Parties’ existing, solicited, and generated customers for the purposes of determining the Parties’ customers. Furthermore, Company agrees not to sell directly to representatives of Agent without express written permission of Agent.

F. Agent hereby agrees that it will not engage in direct competition with Company for a period of five years, even if and when this agreement is terminated. Company shall not solicit Agent’s employees or its representatives, including its Agents. For a period of two years from the date of a former employee’s or Agent’s termination, Company is prohibited from hiring and soliciting Agent’s former employee(s). Company shall be prohibited from soliciting or utilizing for a period of two years after termination of this Agreement any of Agent’s industry contacts, including but not limited to: (1) financiers; (2) wholesalers; (3) vendors; (4) suppliers; (5) contractors; and (6) subcontractors.

 

[GIlman]

Look at your contract. As far as consulting a lawyer, what ever answer they give you it doesn't necessarily mean that your boss can't/won't came after you...but at the same time I'm guessing it probably won't be worth the hassle - unless your making money from it already. If you can get them as a customer or quite your job and move well beyond before you do...probably very little recourse they have.

The thing about attorneys, they just offer opinions...that's it - they are master debaters and can argue both sides of the same coin, and they do all the time. I've seen more than one time where one attorney offers what seems like a completely rational opinion, usually it's rational because it's taking your side of things. Then you deal with another attorney that gives a completely different opinion, and provides legal basis and precedence to back it up.

If you end up in court, it's because you have a point and someone else has a point...and no matter how much you think your point is right the people hearing the case will usually just see you as a quibbling party just as at fault as the other.

Then you realize, the whole legal system is basically a sham. Made up arbitrary rules, that are usually very vague, and often seem nonsensical to your rationalities. Juries and judges are just people that get to pick a winner on whatever basis they choose...winning cases is as much about one attorney playing the physiology of the judge/jury as anything else. It's literally a legal lottery.

Rant aside, I would still meet with an attorney, not that this will prevent you from getting sued...but because they can help you mold reality to fit your best case scenario in advance....if there is even anything for you to do to change your situation.

And one thing, win or lose the case, if your employer were to sue you - you lose. Plain and simple. The biggest loss is being sued at all. It's costly, time consuming, and extremely emotionally draining. Even if you win, don't expect to get any compensation, that rarely happens.

 

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[EPerceptions]

I've seen this too often even in freelance contracts over the years. Read everything you signed, including employee handbooks. Look for intellectual property clauses, non compete clauses, and moonlighting clauses.

IANAL and good luck

 

[501331]

I have the same question as the OP and I don't know the answer.
Lots of good advise above.
One of my thoughts is why not just keep your new company secret?
Create a shell company to own it, hire someone to do sales for you, and just try to stay behind the curtain.
If it takes off, just quit your current work and keep going.

 

[Jon L]

Look at your contract. As far as consulting a lawyer, what ever answer they give you it doesn't necessarily mean that your boss can't/won't came after you...but at the same time I'm guessing it probably won't be worth the hassle - unless your making money from it already. If you can get them as a customer or quite your job and move well beyond before you do...probably very little recourse they have.

The thing about attorneys, they just offer opinions...that's it - they are master debaters and can argue both sides of the same coin, and they do all the time. I've seen more than one time where one attorney offers what seems like a completely rational opinion, usually it's rational because it's taking your side of things. Then you deal with another attorney that gives a completely different opinion, and provides legal basis and precedence to back it up.

If you end up in court, it's because you have a point and someone else has a point...and no matter how much you think your point is right the people hearing the case will usually just see you as a quibbling party just as at fault as the other.

Then you realize, the whole legal system is basically a sham. Made up arbitrary rules, that are usually very vague, and often seem nonsensical to your rationalities. Juries and judges are just people that get to pick a winner on whatever basis they choose...winning cases is as much about one attorney playing the physiology of the judge/jury as anything else. It's literally a legal lottery.

Rant aside, I would still meet with an attorney, not that this will prevent you from getting sued...but because they can help you mold reality to fit your best case scenario in advance....if there is even anything for you to do to change your situation.

And one thing, win or lose the case, if your employer were to sue you - you lose. Plain and simple. The biggest loss is being sued at all. It's costly, time consuming, and extremely emotionally draining. Even if you win, don't expect to get any compensation, that rarely happens.

This is *exactly* right. You need legal advise followed by sage business advice. If you can get your boss on your side in advance, even better. I know a guy that took an idea to his boss. His boss said, 'we're not interested in building this...why don't you do it yourself?' He did, and sold his company for $100M 20 years later, after building a $35M house in Montecito, CA with some of his profits.

 

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