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The 3 contracts that every game developer needs
by Zachary Strebeck on 03/17/14 11:37:00 am   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutraís community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

These three contracts should be in every game developer’s toolkit in order to help the development go smoothly and protect those assets.

Any business that operates as more than a sole proprietorship with one worker requires what may seem to be an overwhelming amount of contracts. However, these agreements are necessary in order to define all of the relationships, ensure that everyone is on the same page and give legal recourse should things go wrong. Even more important is retaining the rights to any intellectual property created by others.

These three contracts should be in every game developer’s toolkit in order to help the development go smoothly and protect those assets.

Partnership Agreement:

In any venture that involves more than one person, there should be a written agreement between the partners that answers the following questions, at a minimum:

  • What are the partners bringing into the partnership?;
  • How are the profits and losses apportioned?;
  • What is each partner’s ongoing contribution to the partnership?; and
  • What happens when the partnership dissolves?

Of course, there are many more aspects to a partnership that should be ironed out before beginning work. These questions, however, should be a good starting point for any discussion between potential partners.

Work-for-hire Agreement:

This can avoid any potential future claims for royalties from a contractor.

Often, a partnership hires a contractor to create game assets, such as art, music or programming. Absent an agreement and without an employer-employee relationship, the person who created those assets could be the owner of the copyright to that work.

Therefore, it is a smart move to have the contractor sign an agreement stating that the assets are “works-made-for-hire,” and assign all of the rights to the employer. This can avoid any potential future claims for royalties from a contractor.

Licensing Agreement:

The licensing relationship needs to be defined in detail.

When a developer is working with the intellectual property of another, such as a trademark or a copyrighted character, it is important to get the proper licensing agreements in place. A “handshake deal” is generally not enough.

The licensing relationship needs to be defined in detail. If the product is a huge success, failure to get everything in writing could mean some lengthy and costly litigation in the future, as the licensor tries to get their cut of the profits.

These are just a few of the many agreements that are necessary in order to avoid the common problems that can arise in game development. Future posts will explore more essential agreements and delve a little deeper into these three. In the meantime, to get these agreements drafted for your development project, contact a game lawyer who knows the ins and outs of your business.

A quick request: I'm trying to build my Twitter following, so if you enjoy this or any of my other blogs here or on my site, please tweet out the link to your followers! Thanks!

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Yulan Cardoso
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Off-topic, but I like this font and formatting :)

Zachary Strebeck
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Thanks! I just copy and paste from my own website. Font is Open Sans Google font, I believe. It's free if you want to use it!

John Szeder
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Don't forget the NDA agreement. Not technically a contract, but having a well worded and short mutual non-disclosure agreement is also helpful.

Zachary Strebeck
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Yeah, I'm going to do a second post next week with three more fun agreements! :D

Randel Reiss
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Great developer-legal-tutorial article, Zachary. I'm definately going to pass this along in my circles.

The only contribution I would add, is before needing a licensing contract, as startup/indie, we ended up needing likeness and name releases for the team members. We ended up using a standard model release forms. This helped in game credtis and putting names and photos on the website and other promotional publications. Now-a-days, that release can usually be slipped into work-for-hire contract you recommended.

I'd also recommend "The American Bar Association's Legal Guide to Video Game Development." Has a CD filled with your recommended contracts and others that are free to modify and use.

Thanks, again!

Zachary Strebeck
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I recommended the same book in an earlier post. It is really great (though my copy has a blank cd, and I didn't notice until it was past the point of returning. Oh, well).

Yes, a good work-for-hire contract should cover all bases! Thanks for your input.