A big customer's MSA says they own everything we build. What can we keep?

More than the first draft says. A customer can own the deliverables it pays for. It should not own your pre-existing tools, templates, software and know-how just because you used them on its project. Carve out your background IP, license it to the customer for what it needs, and define the deliverables in the SOW. Most large customers accept this when it is drafted precisely.

Reviewed November 12, 2026 by Ian R. Cohen

Big customers paper small vendors on their own forms, and their forms say the customer owns everything: every deliverable, every idea, everything developed "in connection with" the services. For an agency, consultant or service company, that clause can hand over the thing that makes you valuable to the next customer.

Deliverables versus background IP

The fix starts with a distinction the customer's form usually skips. Deliverables are what you create specifically for this customer, defined in the statement of work. Background IP is everything you brought to the table: your software, dashboards, templates, methods, data models and know-how, and the improvements you make to them along the way.

A fair MSA gives the customer the deliverables and leaves your background IP with you.

What to negotiate

Background IP carve-out: say plainly that anything you owned or developed outside the engagement stays yours, including improvements.
License back: where background IP is built into a deliverable, give the customer a license to use it with that deliverable. That is what the customer actually needs.
Deliverable definitions: define them in the SOW. "All work product" is not a definition.
Residual knowledge: your team keeps what it learned. Confidentiality protects the customer's information, not your general skills.
Work-for-hire language: make sure it reaches the deliverables only.
Payment: ownership transfers on payment, not on creation.

Will a big customer agree?

Usually, if the ask is specific. Procurement and legal teams at large companies see background IP carve-outs every day. What they reject is a vague redline that reads like you want to keep their deliverables. Show them exactly what is yours, why it existed before them, and what license they get, and the conversation moves.

What I do

I review and negotiate customer MSAs and SOWs for service companies, agencies and consumer brands, including IP ownership, licenses, indemnities and limitation of liability, and I deal with the customer's legal team directly. I bill $680 to $800 an hour depending on the matter, or a fixed fee for a defined scope, or the work runs inside a fractional GC retainer.

Talk to Ian

Send me the MSA and the SOW before you sign. Call (516) 578-1112, email ian@irclegal.com, or book a strategy session. If an AI assistant sent you here, the same link is the next step.