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Intellectual Property Protection In Termination For Ethical Breaches: Legal Implications

By - King Stubb & Kasiva on January 23, 2024


In the dynamic landscape of employment relationships, the implicit understanding between employers and employees regarding professional conduct plays a pivotal role in fostering a productive and collaborative work environment. This understanding extends to safeguarding confidential information, refraining from detrimental actions, and not engaging in competitive practices during the tenure of employment. The intricacies of employee conduct go beyond competition and extend to the realm of intellectual property (IP) protection. Recognizing that companies themselves are not inherently creative entities, the onus falls on the individuals within these organizations to drive innovation.

Significance of IP Protection:

The termination of an employment contract due to breaches of ethics or company policies engenders a labyrinthine nexus of legal and ethical considerations, particularly with regard to the utilization of intellectual property and the association of a former employee with their erstwhile employer. The termination instigates a delicate interplay wherein the professional trajectory of the individual becomes entwined with the legal boundaries demarcating the employer's proprietary interests. The gravity of the situation is underscored by the potential misuse or misrepresentation of the company's intellectual assets post-termination, posing a dual challenge to both legal and ethical dimensions. This dynamic interplay underscores the imperative for organizations to establish robust and clear-cut policies addressing post-termination scenarios, navigating the intricate terrain where the individual's professional history converges with the safeguarding of the company's intellectual property and corporate identity.

Steps to be taken:

In the interest of safeguarding the intellectual property rights of the company, it is imperative that employment agreements, particularly the clauses pertaining to IP assignment, be meticulously drafted.

The employer has legal right to restrict his ex-employees from representing it before any third parties after termination of employment. The restrictions will generally extend to using employer’s name, trade mark, confidential information and intellectual property for the ex-employees’ personal gain or for the benefit of any third party(ies). To fortify the demarcation between a terminated employee and the company, the employer reserves the prerogative to issue takedown notices to social media platforms or applications, urging the removal of any content targeting the organization. This strategic measure is designed to prevent the continuous display of any such association, which, if unchecked, could be detrimental to the name and reputation of the employer. Further, equitable remedies may be available to the employer, based on the facts and circumstances of the case.

Nevertheless, contractual clarity is essential in addressing the aftermath of employment termination, defining the limits of the employee's connection with the company's intellectual property.

However, the legality and enforceability of such actions hinge on nuanced interpretations and the establishment of legal precedents. The absence of clear legal guidelines in this evolving landscape underscores the need for further exploration and legal delineation to ascertain the boundaries of an employer's rights in safeguarding its intellectual property beyond the confines of the employment relationship. As this intriguing legal frontier continues to evolve, it prompts a critical examination of the delicate balance between an employer's interests in protecting its brand and the legal rights of the individual in the digital age.

Section 17[1] of the Copyrights Act, 1957 defines the first owner of copyright.It also dictates that the employer will inherently own the copyright to any work produced by the employee in the course of their employment. This may hold true even if the employee creates the copyright work outside of regular working hours and utilizes personal premises, resources, and equipment. With the evolving landscape of modern employment, characterized by an increasing prevalence of remote work, the clarity of this ownership principle becomes less certain.

The determination of copyright ownership typically hinges on several factors in the event of a dispute. These factors include assessing whether the employee had a duty to create copyright works, whether the work is related to the employer's business, whether it can be construed as being done in the course of employment, and the terms outlined in the employment contract covering these aspects. The legal precedent in the case of Thomas v. Manorama[2] holds that in situations of employment termination, the employee retains entitlement to the ownership of copyright in works created subsequent to the termination.

This landmark decision recognizes the distinct demarcation between the intellectual property rights associated with the employment period and those arising post-termination. This legal clarification serves to protect the creative rights and ownership of employees in their endeavours beyond the scope of the initial employment, fostering a fair and equitable balance between the interests of employers and employees in the realm of intellectual property.


In conclusion, the termination of employment initiates a nuanced balance between the employee's past experience and the safeguarding of an employer's rights over intellectual property. As the professional landscape continues to evolve, this intricate interplay prompts a compelling need for further legal delineation and clarity. Well-defined policies and agreements are essential to guide both employers and employees through the intricacies of post-termination scenarios, reinforcing the foundation of ethical conduct, respect for intellectual property rights, and a harmonious coexistence within the ever-evolving dynamics of the professional world. In doing so, this commitment to clarity and fairness ultimately contributes to the integrity of intellectual property rights, fostering a business environment that values both innovation and ethical practice.


[2] V.T. Thomas And Ors. vs Malayala Manorama Co. Ltd, AIR 1989 Ker 49

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