vendor wants us to sign an agreement saying we wont reuse logic.

anyone deal with this? or does anyone make their customer do this?

my coworker says he is going to sign it cause he doesnt plan on reusing it anyway. I told him not to, we already payed for engineering time to program the logic.

do they even have a leg to stand on in court? Its not like they did anything special. ultimately it is up to him, I personally dont care, but if it were me I would tell them to stick their agreement up their you know what and turn over the logic or you never work for us again.

The customer owns the code in most of my cases and they can do with it what they want. It's a risk you take doing business that they aren't going to take that code and resell/reuse it outside of their company. Some vendors have tried to enforce not re-using the code by passwording it, and there have been many discussions on here involving whether that's a good practice or not. Most agree that it is not.

Now, I ask you in practical terms, how's the vendor ever going to know whether you re-used it or not?

Agreements???

What does the original contract look like? Does it spell out that you all own all code and designs? I have seen this several times with cookie cutter machines, I don't usually see this in one off machines.

When I ack as an end user the contract says that the purchaser own all intellectual property. If the vendor doesn't like it we don't do a deal.

I have 1 machine that I build, that for a extra fee I do sell the right to the logic. This is one of the machines that I sell to several companies. I designed this machine for my use and then desided to sell it to others. So I payed for the design time not a customer. If I design and build a one off machine for a customer they own all the code and design. After all they paid for the time.

So you are the end-user ?
It is the vendor of a machine that asks you to not copy the program ?

1. It only makes sense if you have access to the program. It is quite fair of the vendor to grant you this access.

2. Why would you "reuse" the program ? That sounds as if you would copy the machine, hardware and software and all. It is only fair of the vendor to wish to protect against that. I think the vendor has a very good case against anyone who would actually make a raw copy his IP.

If you reverse-engineer the program on the other hand, then there is not much the vendor can do, unless there is actually patented technology in there.

edit: What I failed to conclude: Sign the aggreement. It allows you the insight into the machine which is nice for troubleshooting. And it allows you to make changes (after the warranty has expired !). It does not allow you to rip him off. All fair.

I told him not to, we already payed for engineering time to program the logic.

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I read this as it is a standard machine, and the vendor made some modifications to standard program on your request. On that basis you should sign the aggreement.

If this is 100% custom made code then it is the other way around, you have invested time and know-how in the program, and the vendor should sign an aggreement to not reuse the know-how for other customers.

To me it is more of a deterrent and trust building item then anything else.

Not every machine is the same, however the programming methods/structure used in any machine built by the same vendor are going to be pretty similar. That's the intellectual property the vendor is trying to protect. Generically speaking those methods were not developed specifically for your machine, nor did you directly pay for those methods to be developed. Your machine is simply an adaptation of those programming methods which have been developed in-house at the vendors cost. Obviously there is logic specific to your process, but overall a lot of what is contained in a program is universal.

For example, the following items are pretty universal across any PLC system from a single vendor:

PID Logic
Hand/Off/Auto
Analog Scaling
Discrete I/O
Communications
Sequence Logic
Alarm Handling

All of those can be standardized by the vendor and re-used over and over, isn't it fair to say that the vendor has a right to protect that IP?

Would it be right for my customer to hand over a copy of the program to my competitor?

Your attitude in your post makes it sound like you could give **** about your vendor and their efforts. Good controls integrators/oems are hard to find, be careful before you go and burn bridges.

There are two key points here.

First is whether this is a "work for hire" or not. This depends to a large extent on who is at risk. If you paid the vendor by the hour or on a flat price basis to do the programming then it is a work for hire and you own the logic. This is reinforced if you provided the vendor with logic descriptions or a detailed sequence of operations.

On the other hand if the vendor is the machine builder and developed the code at his expense as part of the machine price then he is at risk, he owns the code, and he has a right to protect his intellectual property. This position is reinforced if the vendor had developed a significant amount of the programming logic for other machines prior to contracting with you.

Jeff Kiper touched on the second significant point. The ownership of the code should be identified in your Request for Proposal and PO as well as in the vendor's proposal and acknowledgement. We have a lot of proprietary logic in our systems. We always include in our proposal the stipulation that we will provide source code only after execution of a single site/machine license by the owner, binding on his subcontractors etc. Arguing about licenses now is a little late in the game - you have little leverage regardless of the legalities.

I don't see a problem in signing the agreement if you really don't expect to reuse it again.

they brought the logic and didnt bring an agreement. I am sure they finally came to their senses. we paid for them to develop the logic and paid for all equipment. I could see if we were renting the equipment, or if they had designed the equipment and then sold us on some type of improvement that they had came up with... but that was not the case.

we gave them all the info, and told them to design the logic based around these principles.

Like I told the guy in charge of this project, why open up our company to liability to make someone feel good? If somewhere were to get their hands on the logic and use it someone and they just so happen to find out, we could be held liable. and for what? because some guy was scared that the engineering time that we actually paid for could be used somewhere else? screw that. what I believe they were trying to do is make us call them for all of the service work.

palithad said:

I don't see a problem in signing the agreement if you really don't expect to reuse it again.

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I do, out of principle I wouldnt sign it because we paid for them to design the logic. 2nd, we open ourselves to liability for no reason at all, since we did pay for them to engineer the logic.

In your next contract with anyone for logic development check your state's 'work for hire' laws and make sure the appropriate language concerning ownership and transfer of all information is in writing.

As they say, an oral contract is only worth the paper it's written on.

diat150 said:

they brought the logic and didnt bring an agreement. I am sure they finally came to their senses. we paid for them to develop the logic and paid for all equipment. I could see if we were renting the equipment, or if they had designed the equipment and then sold us on some type of improvement that they had came up with... but that was not the case.

we gave them all the info, and told them to design the logic based around these principles.

Like I told the guy in charge of this project, why open up our company to liability to make someone feel good? If somewhere were to get their hands on the logic and use it someone and they just so happen to find out, we could be held liable. and for what? because some guy was scared that the engineering time that we actually paid for could be used somewhere else? screw that. what I believe they were trying to do is make us call them for all of the service work.

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I must not be understanding something here. In your first post you said they wanted you to sign an agreement that you didn't re-use the logic. What's that got to do with THEM re-using the logic, which sounds like your concern for liability. They are trying to protect Intellectual Property so that you don't make 20 of these machines either within your company or sell them elsewhere. In that case they are protecting THEIR liability and I see no exposure to you because of THEM. Whether you sign or don't sign doesn't address whether they can re-use the logic elsewhere.