Design rights – who owns the design?

These and 6 other frequently asked questions (FAQ) are of great interest to our customers and clients.

1. -> What are the design costs?
2. Design rights – who owns the design?
3. -> What risks does the designer bear?
4. -> How can the quality of the design performance be measured?
5. -> For whom does a design agency work?
6. -> How does a design project work?
7. -> How do I start a design project?

This is part of a series of articles to help you with some often-confusing design situations. In this part, we will answer some important design-related questions in hopes of alleviating common issues that come up between designers and their clients.

What rights do you as a client acquire?

The starting point is clear, you want to own the design and use it for commercial purposes and at the same time disclose as little sensitive information as possible. Let us, however, go through diverse law domains and see if there are some fields you did not think about, but they could affect you as a customer. In particular:

-non-disclosure rights or confidentiality rights
-usage rights
-copyright ownership
-patent rights
-third parties rights

Non-disclosure agreement or confidentiality agreement

In majority of cases, there should be no discussions or agreements on design without reciprocal non-disclosure agreements. This protects your interests, your valuable business secrets, as well as the valuable know-how of your design partners that could be revealed when discussing certain projects. As you yourself have strategies and tools in doing business, so do the designers, and we want them protected.

A crucial part of our agreements is a proven and tested NDA standard form, which we will provide for you in German and English (see the links at the end of the article). In the course of the design project, the design partner then has the obligation, in the event of conversations with third parties, to ensure that this agreement is also transferred to these third parties. This provides for a comprehensive protection of your interests and business secrets.

To learn more about the NDA, sometimes called confidentiality agreement (CA) you can listen to a podcast or read a comprehensive blog post on the following link.

Ownership of the final design

You as a customer want to ensure that you can fully use the design result that you’ve paid for. Unless otherwise agreed upon, in most design agencies this means that upon full payment of the fees agreed upon in the contract, all transferable rights to the final design are passed on to you for use, without any temporal, spatial, or quantitative restrictions. You have paid and chosen a design that you also want to own and have rights to, after all. You do not, however, have the rights on the in-between versions, that are rejected and further developed, as these are usually not documented. Normally, if so desired you can purchase additional rights on further results from the development phase.

For some clients this does not seem logical, some people are confused about not having access to source files. We understand that, maybe you think that along the lines you would want to readjust some aspects of the final product, especially when it comes to graphic design? However, this is hard from the standpoint of designer, because what you are essentially asking for are the tools themselves. Sheila Peterson from Apex Creative neatly explains it:

“The best analogy I can think of is going out to dinner. Me and the hubby love the Cheesecake Factory. But when we pay $20 for our medium-rare Kobe burger with Cheddar, all we get is that one meal for that one visit. Can you believe it? The price doesn’t include the chef coming out, giving us his recipe, utensils, and ingredients to take home, as well as a tutorial.”

Who owns the design copyright? German Copyright Act

The German copyright act is harder to interpret when it comes to design. While the copyright act is clear for literary innovations, music, photography or visual art, even when the inventiveness is lower scale, for design it is usually not the case. When it comes to design the vocabulary used is applied and commercial art, and very often the personal inventiveness is under the question mark. With web and product design, very few creations are copyright protected (a nice, concise summary of related regulations can be found on the RA Margaret May website).

Since the copyright act is already in place when the piece is created, there is no need for a creation to be registered. The personal rights are not transferable, however the rights to use the products can be transferred on other entities or persons. The industrial designer, therefore, has a right to continue to advertise their products as their property. However, the user or the customer is the own who owns the design result and is free to use it for business purposes.

For a rich explanation of the state of arts in the US context, which varies to some extent from the German one, visit the link above.

When it comes to other protection rights that need to be registered, such as design patent, utility patent, trademark law etc. it is the responsibility of the customer itself to take care of these. Your designer will, however, be happy to help with registration, give you advice and put you in touch with relevant consultants and service providers. What the designer can’t do is guarantee that you will be able to register the patent rights.

Doing your own research is quite easy; in Germany, for instance, the websites of the German Patent and Trademark Office DPMA and the European Office for Harmonization in the Internal Market OHIM are excellent resources. In any case, we recommend that every customer consult professionals dealing exactly whit these kinds of topics.

The so-called third-party rights

As the client, you want that the chosen design and the desired purpose of use is not contrary to the rights of a third party, and that they can’t be claimed or used by that party. This can be guaranteed only by careful research and development of one’s own ideas and designs, that condition that the designer has made something which is his personal innovation and result of his creative work.

Nevertheless, there are unfortunately no 100% guarantees, especially because pending rights of third parties may be partially traced only by expensive, global searches. In our 24 years of international design practice we haven’t had a single case in which a design created by our office violated the rights of third parties. This should at least reassure you!

As you can see design rights are not an easy topic. There are many ways in which you can get to your desired goal. Feel free to ask us! We will do our best to answer.

There are couple of interesting resources you could consult to familiarize yourself with the topic even more.

AGD: Reimbursement Contract
VDID: information on design contracts

And a couple of related links for you:

https://eyeondesign.aiga.org/what-young-designers-need-to-know-about-copyright-law/

https://www.aiga.org/copyright-basics-for-graphic-designers

http://www.breakawaygraphics.net/2011/12/layered-files/