When everything goes well and we see the world through rose-colored glasses, you love your partners and they love you. All the IP accounts are open under everybody’s name — for example, the company’s social network accounts such as FB, Twitter, Linkedin, Slack, as well as very sensitive information tools like Github (for the code) and Confluence (for the spec.), or other assets such as trademarks and domain name, etc.

But things become difficult when a founder leaves the company, or a shareholder joins the team; that’s when it’s time to clarify which assets are inside or outside of the ownership of the company itself.

So those rose-colored glasses become…well, dark grey.

At that point, you can be lucky and find a partner who has always shared passwords and access with you, so the discussion will be focused on what really matters: the code, the specs on Github, the trademarks or the patent ownership. The discussion will then revolve around the provisions of your (hopefully) existing partnership agreement.

But if the partner has been centralizing all accounts, locking you out every access while you weren’t paying enough attention, well… there is not much you can do and fight through the courts, claiming damages and moving on.

So what can be done before things turn dark grey?

First, with respect to social accounts, be vigilant and make sure that all accounts are created under the name of the company; then create a password sharing account so you can keep control over the code and all the work you’ve accomplished. But remember that those accounts are not, yet, considered as a real asset by tribunals — if things go wrong, you’ll have a hard time recovering accounts held by an ex-partner. Don’t waste your energy — just find another name and start over.

Second, with respect to source code, trademarks, and patents, the situation can be subject to legal discussions. You can include a clause for the automatic transfer of these intellectual properties in your shareholders’ agreement. But French tribunals have a restrictive approach to trademarks or patent transfers (and any intellectual property in general). If they are not specific enough, the transfer is void. So to be on the safe side, always pair with a specific transfer agreement.

Why?

Because under French law and in Europe in general, the IP rights are transferred if the contract includes — in great detail — all of the rights assigned and the respective obligations of all signatories. This would include a detailed list of the types of rights assigned, for how long, for how much, where, and how (for private or public use)?

What should you do now in practice?

For the social accounts, don’t let any single member of the team exclusively hold all of the passwords; for example, you can use password sharing tools such as Lastpass, Zoho, etc. and make sure that you create the accounts under the name of the company.

For trademarks, patents, code, and any other IPs, execute a contract transferring the code and its development as soon as possible, even if the company exists prior to its incorporation. The longer you wait, the greater the risk. Find some good models here.

Last, but not least, if it all goes from dark grey to black, save your time and money. Move to your next project.

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