Who Owns Your Website – You or Your Web Design Company?

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  • Written on: July 3rd, 2007

A few weeks ago a friend of mine (we’ll call her Mary here) found herself wondering if the website she paid thousands of dollars for was actually hers. In her painful example, there is an important lesson to learn about what to do and what not to do when you contract with a web design or marketing company.

The Weaving of a Web Design Disaster

Mary emailed me late in the evening to ask me if there was anything Schrock Innovations could do to help her out of a terrible situation. She had hired a local web design company to build her a website for just over $45,000. The site was incredibly complicated and specialized. The project was mostly completed over the course of a year, but there were constant glitches and other issues that needed to be addressed.

At first her web design company (who required her to pay up front in full) was willing to address her concerns. But over time, that cooperative spirit devolved into heated words over what was covered by the customer’s original purchase and what would require additional expenditure.

Mary informed the hosting company that she would be taking her website to be hosted elsewhere. That was when she was floored by the company’s answer.

We Own Your Website and you Can’t Access it or Take it

Mary was told that she could leave anytime she wanted, but her website was the property of the design company and she could not take it with her.

In addition, the design company suddenly raised her quarterly hosting price 100% to help cover “an unusually high number of maintenance requests.”

So Mary had a choice – she could walk away and spend another $45,000 to have the site rebuilt with another company, or she could swallow the hosting increase and pay extra to get the functionality that was originally promised in the project document.

How Can a Web Design Company Do This

The web design company claimed that they went through the time and effort to create components that are used in Mary’s website but are not owned by Mary. Specifically, the company claimed they created a content management system and a scheduling system. Without these systems, Mary’s website would be useless.

The design company claimed that they use those components in many websites, and that Mary had only purchased a license to use those components as long as she was hosted with them.

In addition, the company also designed Mary’s company logo and website layout. The copyright notice in Mary’s source code claims that the design company has the rights to all of it – even her company logo and brand.

Mary’s Side of the Story

Mary felt she paid $45,000 for a website and that she should own it. The licensing distinction was never disclosed to Mary in any project document or conversation. Mary was shocked when she found she was artfully backed into a corner by her web design company.

In fact, after talking with me Mary found out that there are tons of open source content management and scheduling systems out there that are free for use.

If the design company would have used these components instead of developing them all over again at Mary’s expense, their claim to the website would be significantly weaker.

Mary found that unless she had a “work for hire” contract (which she didn’t) with her web design company it was up in the air as to who owned the website.

Mary’s options are now to sue the web design company and sort out who owns what. Unfortunately, the design company also reserves the right to refuse service to anyone for any reason, so a lawsuit would most likely result in the design company terminating her hosting contract. Mary would lose $40,000+ a month in business revenue if that happened.

Option two was to swallow her pride and open her wallet. She would have to pay the design company to keep things working while she spent three months worth of profit to redevelop the website all over again with a more reputable web design company.

After a couple days of talking with Mary about this horrible situation, we found another potential solution that *could* allow Mary to take back her website, stick it to her design company and make them take on the expense of suing her if they really wanted to claim ownership of the code.

The Third Option to Take Your Website Back

If you find yourself in Mary’s situation and you own your URL there is a third option. If you own your URL (that is you registered it in your name or your design company registered it in your name with them as the technical contact) you might be able to TAKE your website back without your design company’s permission.

Typically design companies do not host websites themselves. Instead they outsource hosting to an outside hosting company. Since you own your URL, you can contact the co-location center where your website is hosted and DEMAND a complete copy of your website and all associated databases.

They are required by law (although I am not a lawyer and you should always consult yours) to give you what you own, and they typically will. Now keep in mind that they will also notify the design company of what they are doing, so it is a good idea to have a plan in place to deploy the website immediately once you get it to avoid down time.

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