9th Circuit: Under Copyright Act's Work for Hire Doctrine Computer Programmer Doesn't Own Source Code

In Justmed, Inc. v. Byce, 600 F.3d 1118 (9th Cir. April 5, 2010), the Ninth Circuit found that a corporation owned a computer programmer's code, even though he didn't receive a salary while doing the programming and wasn't declared as an employee while he authored most of the code.

The court applied the T.B. Harms test to find that it had federal question jurisdiction over the dispute involving copyright ownership because the Copyright Act's work for hire doctrine was implicated.

The facts were a little muddy, but the company was a startup, the employee held the title of "Director of Engineering" and got shares of stock (with no written agreement).  When a merger opportunity came up, he deleted all of the source code from the company's computers and put a personal copyright notice on the source code.  Prior to that, the company's copyright notice was on the source code.

Bad behavior, plus muddy facts, together with expensive litigation show the wisdom of figuring out who owns what in advance and drafting clear employment agreements.  The court applied the CCNV v. Reid test - the federal common law of agency - to determine whether the programmer was an employer or an independent contactor.