Legal Question in Business Law in California

Re: use of product

A contract that describes the usage of the product, its design, the sharing of profits, and the responsibilities for marketing, etc. Wherever there are artistic creations involved the intellectual property issues must also be addressed. Only in that way can you try to insulate yourself from future litigation.

Re: use of product

With this limited information about how the arrangement will work my best advice would be to develop and have both parties sign a license agreement. There are many options to think about here (limited or unlimited license, cost vs. no-cost, etc.) so you should have a good idea of how you want to structure the deal already. Then it's just a matter of putting it into words.

BTW, it's good to see so much foresight by a business owner. Usually I hear about these things long after the product has shipped and money has been made.

I'm happy to put something together and advise you on the proper approach. It's usually a good idea to have a lawyer help since there are some pitfalls you could easily fall into.

Lastly, a written contract/agreement will not prevent her from suing. It will simply help in defining what the oral agreement between the parties was. It also helps both parties to really think about what they want and what they expect to get from the deal.

Re: use of product

If the value, or potential value, of the deal (including the potential commercial value of the right to the design) isn't sufficient to warrant paying a lawyer to draw up a proper agreement, you're better off with a simple do-it-yourself contract than nothing at all - but as one of the prior answers points out, preventing suits and preventing a winnable suit are different concepts.

How about taking a xerocopy or photograph of the design, and in the margin or on the reverse write: "I, X, in consideration of $10 paid to me today by Y, hereby irrevocably grant to Y the right to commercialize this design, which I created and own, without any further royalty or fee. Signed, X, dated a/b/2008."

Re: use of product

A basic licensing agreement should work for you. You can get complex, but it doesn't sound like you really need to. Just understand that a license is a privilige that can be revoked at any time.

If you want a more concrete, then create a contract for use over a certain period of time, say 1 or 2 years, with an option to renew.

If you need assistance, please feel free to contact me at my office (numbers listed by lawguru) or though one of my many firm web sites such as RulesOfEmployment.com.

Scott