Mark Pestronk
Q: Our agency recently won the business of two large corporate accounts. Each of them wants us to sign its standard master services agreement, or MSA for short. The first such contract says that all "works made for hire" belong to the corporate account. The second one says that all "work product" belongs to the corporate account. What do these terms actually mean? If we set up profiles for the corporation's employees, do the profiles belong to the account? What about a special management report? If we customize an online booking portal, does the portal belong to the account? Should we try to change the contract so that the account does not own the profiles, the report or the portal?
A: As you may already have realized, one of the biggest problems in corporate travel contracting is that most corporations' standard contract forms such as MSAs do not fit TMC-corporation relationships. MSAs are designed for services that are performed by someone like a computer consultant who works on the corporation's own systems.
A "work made for hire" is a term borrowed from copyright law. It means a specific piece of work that has been ordered or commissioned. It automatically belongs to the person ordering it when he pays for it.
The term "work product" is broader and refers to everything that a service provider does for the entity requesting the service. Here's an example of the definition from an MSA between a TMC client of mine and its prospective corporate account: "'Work product' is defined as all deliverables, data, information, reports, software, customizations, works of authorship, materials, inventions, items and discoveries conceived, created, authored, invented, developed or reduced to practice by supplier."
Further, "All right, title and interest in and to the work product shall belong solely and exclusively to company."
So do the corporate and employee profiles that you set up belong to the corporation because they are either works made for hire or work product? Arguably they do, if the contract has a clause like the one quoted above. That probably means that you must turn them over when you no longer have the account, which is a result you may not like.
What about a special management information report, such as a report of where all the company's travelers are at any given time? If ownership means that the account could stop you from producing the same report for other clients, you obviously wouldn't want to agree to that.
What if you had customized the online booking portal so that it had the company name on the start page and incorporated company travel policy? Here, it would certainly be problematic if the corporation made a claim to ownership of that page in particular or the portal in general.
Ideally, you would delete all clauses about work product and works made for hire from MSAs presented to you. However, in my experience the corporation's attorney would be unlikely to agree to such deletions, so you probably need to have your attorney try to carve out exemptions based on the exact work you will be performing.