Joint development agreements and who owns co-developed IP

1. The core idea#

Deeptech companies rarely build alone. A battery startup co-develops a cell format with a carmaker. A materials company tunes its coating with a glass manufacturer's process engineers. A medtech team works with a hospital's clinicians to design a workflow. A quantum startup builds a component with a national lab. Each of these produces new inventions with both sides' fingerprints on them, and the question of who owns them decides whether the startup ends up with a sellable platform or a one-customer custom project.

A joint development agreement (JDA) answers that question before the work starts. Its core is three definitions and one allocation:

• Background IP: what each party brings in. Each keeps its own.
• Foreground IP (also called "developed" or "arising" IP): what is created during the project.
• Field of use: the products, markets or applications each side cares about.
• Allocation: who owns which foreground IP, and what licences each side gets.

The default the law supplies if you don't agree something is usually bad for a startup. Inventions made jointly become jointly owned, and the rules for joint owners differ by country in ways that can let the larger partner use or license your technology without paying you, or let either side block the other. So the most common advice in this area is simple: avoid joint ownership where you can, and replace it with clear sole ownership plus licences.

The startup's goal is to own everything that improves its core platform, while giving the partner what it really needs: ownership of what is specific to its own products, and a licence, often exclusive in its field for a period, to use the results.

Who this is for: founders whose pilot is turning into co-development; anyone collaborating with a corporate R&D group, university lab, national lab or consortium; anyone asked to sign a partner's "collaboration agreement".

Pairs with: 4.14 (pilots and customer contracts), 2.14 (university labs after spinout and sponsored research agreements), 2.07 (licence anatomy) and 2.18 (trade secrets).

2. What the law says#

Who is an inventor is a legal question, not a contract question. In all three countries, inventors are the people who contributed to the conception of at least one claim, not those who ran the experiments or paid for them. A partner's engineer who suggests a key feature can be a co-inventor, whatever the contract says about the project. The contract can and should then say who owns the invention, by requiring assignment.

Without an agreement, co-inventions are co-owned, and co-ownership works differently by country:

The consequences for a startup:

• In the US, a large partner co-owning a patent can license it to your competitors, or use it in its own products, and owes you nothing. It can also refuse to join a lawsuit, which can stop you enforcing.
• In the UK and India, neither side can license without the other's consent, so a coowned patent can become a deadlock asset: valuable to nobody unless both agree. An investor or acquirer will see it as an encumbrance.

Copyright in jointly written code or designs follows a similar split. In the US, each joint author can grant non-exclusive licences but must share the profits. In the UK, using or licensing a joint work generally needs every author's consent.

Trade secrets and know-how can't be "co-owned" sensibly at all. Once both teams know something, the practical question is what each may use. Watch for residuals clauses, which let the partner's staff use anything they "retain in unaided memory". For a deeptech startup whose value is know-how, a broad residuals clause can give away the core.

Public money brings its own rules.

• US federal funding (Bayh-Dole Act): small businesses and universities may keep title to inventions, but must disclose them to the agency, elect title within set deadlines, and give the government a non-exclusive licence. Some obligations favour US manufacturing.
• UK university collaborations: the government-backed Lambert Toolkit provides model research collaboration agreements, from "university owns, company gets a licence" to "company owns".
• EU Horizon Europe projects: results belong to the participant that generated them, joint results are jointly owned unless agreed otherwise, and consortium agreements (often based on the DESCA model) set access rights.
• India: DST, BIRAC, DSIR and other grant schemes set their own IP terms. Typically the grantee owns IP but the government keeps rights to use it, and some schemes require royalty sharing or consent for transfer abroad.

3. The method#

Step 1: Record your background IP before you start#

List, in a schedule to the agreement, your patents, applications, software, designs, data and know-how relevant to the project, at a level of detail you can prove later (application numbers, repository tags, dated lab notebooks). Ask the partner to do the same. File any provisional patents on your own ideas before the project begins; anything conceived afterwards risks being argued as joint.

Step 2: Pick an ownership model#

In the split-by-field model, write the line in technical terms both sides' engineers understand: "improvements to the electrolyte formulation and cell chemistry belong to the startup; improvements to pack integration, thermal management in the vehicle and the vehicle's battery management software belong to the partner."

Step 3: Negotiate the core clauses#

• Assignment: each party assigns to the agreed owner, with "hereby assigns" wording and a duty to help with filings.
• Licences: scope (field, territory, exclusive or not), duration, royalties or none, sublicensing rights, and what happens on change of control.
• Exclusivity: if the partner wants exclusivity, tie it to a narrow field, a limited period (often 1–3 years after first sale), and minimum purchase volumes or milestones. Exclusivity should lapse automatically if they are not met.
• Patent filing and costs: who decides to file, who pays, and who controls prosecution of each type of foreground IP. The other party gets copies and can take over if the owner decides to abandon.
• Confidentiality: a long tail (5+ years) and indefinite protection for trade secrets. Resist broad residuals clauses; if you must accept one, exclude your core know-how and patentable information.
• Publication: academic partners will need to publish. Allow it with 30–90 days' prior review so you can file first or remove confidential details.
• Funding and contributions: who pays for what, in cash and in kind (staff, equipment, materials), and what happens if one side underperforms.
• Non-assertion and freedom to operate: each party will not sue the other for using the results within its licence.
• Exit: termination for breach or convenience, what happens to work in progress, licence survival, and return of materials.
• Change of control: if the partner buys a competitor of yours, or you are acquired, what happens to exclusivity and licences.

Step 4: Run the project with clean records#

Keep a joint invention log: who proposed what, when, with dated notes. Hold an IP review at each milestone to decide what to file and who owns it. Keep partner staff out of your core repositories unless the agreement covers it.

Worked example#

CellForge, an Indian startup with a new sodium-ion electrolyte, is offered a JDA by a large two-wheeler maker to develop a battery pack for an electric scooter.

• The partner's draft: all foreground IP owned by the partner; exclusivity for sodium-ion batteries in all vehicles worldwide for five years; a broad residuals clause.
• CellForge's counter: CellForge owns all improvements to the electrolyte, cell chemistry and cell manufacturing process. The partner owns pack design, vehicle integration and its battery management software. Each licenses the other royaltyfree for the project. The partner gets exclusivity for two-wheelers in India for two years from start of production, conditional on buying at least 200,000 cells a year. No residuals clause.
• The landing point: exclusivity for two- and three-wheelers in India for three years with the volume condition; a joint steering committee to classify inventions at each milestone; joint inventions assigned according to the field rule; the partner's right to publish nothing about the chemistry; CellForge's right to name the partner after launch.
• Two years later: a car company approaches CellForge for a larger cell. Because the electrolyte improvements made during the JDA belong to CellForge and the exclusivity covers only two- and three-wheelers in India, CellForge can sign without the first partner's consent.

4. Partner types and country notes#

Corporate partners. They usually have a standard collaboration template drafted to give them ownership. Their legal teams generally expect negotiation on IP and exclusivity. Your strongest argument is a commercial one: the partner benefits if you can keep improving and selling your platform, because that lowers their cost and secures supply. Corporate venture arms sometimes invest alongside a JDA. Keep the investment and the JDA separate, and watch for investor rights that extend into the JDA (such as rights of first refusal on a sale of the company).

Universities and research institutes. Most have policies requiring them to own what their staff invent, and a need to publish. Common outcomes: the university owns its staff's inventions, with an option or exclusive licence for the startup on pre-agreed terms; or the startup owns results of work it funds fully, with the university keeping research and teaching rights. If a founder still holds a university post, check carefully for conflicts (2.12, 2.14).

National labs and government research bodies. Expect standard agreements with limited room to negotiate, government use rights and, sometimes, rules on manufacturing location. In the US these are often Cooperative Research and Development Agreements (CRADAs); in India, technology development or transfer agreements with CSIR, DRDO and other labs have their own standard terms.

Country points.

• India. Patents Act s.50 makes co-owners' licensing subject to mutual consent. Section 39 also matters when an Indian team co-invents with a foreign partner: an Indian resident inventor may not file a patent abroad first without the Patent Office's written permission, unless an Indian application was filed at least six weeks earlier with no secrecy direction. Agree in the JDA where joint inventions will be filed first. If the partner is foreign, check export controls on the technology (4.16). Stamp duty applies to assignment deeds.
• US. Joint owners can license without consent, so joint ownership is especially risky. Federally funded work needs Bayh-Dole compliance: disclose to the agency within two months of the inventor reporting it internally, elect title within two years, and file within one year of electing.
• UK. Joint owners need each other's consent to license or assign; deadlock risk is high. University collaborations commonly use the Lambert Toolkit models. Innovate UK grants generally let participants keep the IP they generate, with a collaboration agreement required between partners in a consortium.
• EU. Horizon Europe consortium agreements govern access rights and joint ownership; read them before signing a grant agreement, because they are hard to change later.

Competition law. Agreements between competitors to develop technology are generally allowed, but exclusivity, market-sharing and restrictions on independent R&D can raise issues. The EU's Research and Development Block Exemption Regulation (revised in 2023) and the UK's equivalent (in force since 1 January 2023) set conditions, including market-share thresholds. For most startups this matters only when partnering with a dominant firm in its own market.

5. Scripts, mistakes, related playbooks, sources#

Scripts#

Opening the IP conversation:

"Before our engineers start, let's agree who owns what. Our proposal is simple: we own improvements to [our platform], you own improvements to [your product or process], and each of us licenses the other for the project. That way you're not paying to develop something you'd have to share with competitors, and we can keep improving the core you're buying."

Pushing back on "we're paying, so we own it":

"We understand you're funding much of this work. What you're paying for is a [product] that performs in your [vehicle or line], and you'll own everything specific to that. If you owned improvements to our underlying chemistry, we couldn't sell it to anyone else, which would make it more expensive for you and us both. We can offer exclusivity in [field] for [period] tied to volumes instead."

Responding to a residuals clause:

"We can't accept a general residuals clause, because our know-how is most of what we're bringing. We're happy to confirm that your people can use general skills and experience, and information that becomes public, but not our confidential process information."

At a milestone IP review:

"Here's the invention log since the last review. We think items 1 and 3 fall in our field, item 2 in yours, and item 4 is joint. Can we agree classification and filing owners today, so nothing waits?"

Common mistakes#

1. Starting work before signing, so early inventions fall into default joint ownership.
2. No background IP schedule, making it hard to prove what you brought.
3. Accepting joint ownership as a compromise, especially under US law.
4. Broad, open-ended exclusivity with no field, time limit or volume commitment.
5. Residuals clauses that let partner staff use your know-how freely.
6. Vague field definitions that engineers on both sides read differently.
7. Ignoring inventorship: assuming the contract decides who the inventors are.
8. No publication review with academic partners.
9. Forgetting change of control, so a partner's acquisition puts your IP in a competitor's hands.
10. Grant terms unread, especially government use rights and transfer restrictions.

Related playbooks#

• 2.07 Licence anatomy, clause by clause
• 2.09 Sublicensing and change-of-control clauses
• 2.14 University labs after spinout; SRAs
• 2.15 Licensing from government labs
• 2.18 Trade secrets vs patents for process technology
• 4.14 Customer contracts: MSAs, SOWs and pilot agreements
• 4.16 Export controls: ITAR, EAR, SCOMET
• 4.20 Litigation and IP dispute basics

Sources#

• 35 U.S.C. §§116, 262; Ethicon, Inc. v. U.S. Surgical Corp., 135 F.3d 1456 (Fed. Cir. 1998).
• UK Patents Act 1977 ss.36, 66; India Patents Act 1970 ss.39, 50.
• Bayh-Dole Act, 35 U.S.C. §§200–212; 37 CFR 401.14 (standard patent rights clause).
• UK Intellectual Property Office, Lambert Toolkit model agreements.
• European Commission, Horizon Europe Model Grant Agreement; DESCA consortium agreement model.
• EU Research and Development Block Exemption Regulation (EU) 2023/1066; UK Competition Act 1998 (Research and Development Agreements Block Exemption) Order 2022.