Amazon’s Indie Game Side Project Terms – are they normal?

Recently, I noticed an article from Tech Raptor, discussing Amazon’s terms regarding game dev employee side projects. They’ve caused a lot of outrage in the community, so I thought I’d throw in my two cents from a legal perspective. 

In my practice, I’ve worked on both sides of this issue (not with Amazon, though), both drafting these agreements for the employer and pushing back against them for the employee. Hopefully you can benefit from some of my experience dealing with these policies.

UPDATE 8-14-21 – Looks like Amazon may have dropped the existing policy, according to Bloomberg. It remains to be seen whether there will be a replacement, and what the terms of that might be. I can’t imagine they just have nothing. Will update this when I hear more!

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What does the law say?

Before we get into Amazon’s policy, I wanted to explain what the default ownership situation is under the law. While the specifics of employee IP ownership depends on the law of the state in question, we’ll go over 2 specific states – California (where tons of tech companies are located) and Washington (where Amazon is located). 

The easy part is that they’re both basically saying the same thing. The relevant parts of the law are these:

1. If your employer has you sign an agreement assigning all of your work product to them, there is a big limitation.
2. The limitation is that if you create work on your own equipment and on your own time, then you will own that work.
3. HOWEVER (and this is the most important thing), if the work you create is related to your employer’s business or anticipated business, then the EMPLOYER owns that work.

They also both include language that says an employer to require you to waive the “on your own time and on your own equipment, unless related to the employer’s business” provision of the law. (Note – I’ll post the full language of both laws at the end of this post.)

I hope you can see the big issue here, when you’re working for game company and want to create games on the side. Even IF you do them on your own time and on your own equipment, the things you’re creating are obviously going to be related to your employer’s business or anticipated business (games).

The follow-up question I usually get is this:

“But my employer makes mobile casino games, and I want to make PC isometric RPGs – is that REALLY in the same business as my employer?”

Unfortunately, the law and how it’s interpreted isn’t that nuanced. 

Courts won’t care about what genre, platform, or other game-specific distinction, as long as they’re both still considered “games.” If, on the other hand, your employer makes database software and you make a PC first person shooter on the side, that’s looking more like something that would be yours by default.

I realize that this is a bit grim for those who want to work in the games industry but also have tons of ideas for side projects. In the next section I’ll discuss Amazon’s alleged policy specifically, and then address some possible solutions for you to get those side projects made free and clear.

Amazon’s alleged indie game side project policy

According to the Tech Raptor article, Amazon’s policy for game dev employee side projects consists of the following 8 terms. In order to work there, you need to agree to all of them, obviously. Apparently, there is no wiggle room here (we’ll discuss this later in the article, so stay tuned). 

Along with each term of the policy, I’ll add my thoughts based on how common that particular clause is in the industry. 

Note: I don’t have any personal experience with this specific policy, nor do I have independent confirmation of the accuracy of Tech Raptor’s reporting. For the purpose of this article, let’s assume that it is accurate.

1. My Personal Game will not be based on, conflict with, or disclose, Amazon confidential information or current or future business activities.

This is pretty standard. Companies develop confidential information all the time, which they don’t want disclosed outside of work. Similarly, a company will reasonably expect that any employees’ side projects won’t interfere with their existing or planned business. 

It’s important that any side project you propose or start developing doesn’t conflict with, or even give the appearance of conflicting with your main job.

2. I will not use or incorporate Amazon resources or information in the development, release, or marketing of my Personal Game. This includes Amazon equipment, network connections, confidential information, know how, or facilities.

This is another clause that’s pretty standard in any tech, and tracks with the laws that we discussed above. If you make a game on the side, you can’t use Amazon’s stuff to do it. Pretty reasonable, if you ask me.

3. All work on my Personal Game will be performed outside of my regular working hours.

This also tracks with the requirements of the laws. The reasoning is obvious – they’re paying you to spend your work hours on THEIR projects, not your own. So do your side projects on your own time. Another reasonable restriction, I think.

4. Amazon is not responsible for any legal obligations or liabilities arising from my Personal Game.

This one also makes sense – if Amazon is not connected with the game’s development, they obviously don’t want any of the liability connected with the game.

All of the above are fairly standard for these types of agreements. The next 4, however, are where things start to diverge from the norm.

5. To help Amazon improve its platforms, I will make my Personal Game available via Amazon wherever possible (e.g.: if it’s a mobile game, I will submit it to the Amazon Appstore; if its a PC game made available for sale, I will submit it for sate on the Amazon platform) and provide feedback on these platforms where practicable. The extent to which Amazon distributes my Personal Game through its platforms remains within Amazon’s sole discretion.

6. To help Amazon improve its products and services, I will use Amazon’s publicly available products and services in the development and release of my Personal Game wherever possible (e.g.: if I am running a service in the cloud as part of my Personal Game, I will use AWS; if I am using an identity broker for my Personal Game, I will use Amazon Cognito; etc.) and provide feedback on these products and services where practicable. I am responsible for the fees associated with the use of those products and services.

The two sections of the policy above highlight Amazon’s reach across platforms and services, but it really feels a bit icky. 

They spend the first half of the policy wanting to distance themselves from the game in any way possible (from use of their equipment, time, know-how, and release of liability), but then want the benefit of a new customer for their services (AWS, Cognito, etc.) who is also their employee.

The aim here doesn’t seem to be just to have a normal additional customer – I’m sure they’re putting this in place in case the game ends up blowing up in popularity. Then, they’ve got the developer contractually locked in.

If you agree to something like this, and end up seeking a third party publisher to fund development and publish your game, it’s important that they are aware of this requirement. 

My fear is that requiring this deep connection to Amazon services could potentially scuttle a great publishing deal (particularly if that publisher has their own competing services). It’s not clear from the policy that this responsibility would extend to third-party publishers, but for the sake of this article let’s assume that it would.

7. I will own my Personal Game. However, Amazon will not be constrained in its development of games or incur any liabilities by allowing me to develop and release Personal Games. Accordingly, I hereby grant the following license to Amazon to ensure that Amazon will never be liable to me for any Amazon work on games: I grant to Amazon a royalty free, worldwide, fully paid-up, perpetual, transferable license to any and all of my intellectual property rights associated with the Personal Game and my Personal Game development.

The first part of this starts off pretty standard – you own what you create, and you can’t stop Amazon from creating anything that might compete with your game (or be extremely similar to your game). 

One thing that often comes up in drafting and negotiating non-disclosure agreements is the possibility that you share a game idea with a company, but they’ve already been developing something very similar. No smart company would agree that they won’t develop a game similar to yours, as that would put an unreasonable limit on their ability to create whatever game they want.

In Amazon’s case, they won’t necessarily know what game you’re creating, so if there are similarities between your personal game and a game already under development at Amazon, they’re just covering themselves.

However, once we get past that, it starts to get much broader than I’d be comfortable with. They demand a license to use your game intellectual property, presumably to avoid any potential liability for using something similar to what you own. However, like most broad licenses, it seems like they can basically do whatever they want with your game.

Because that’s literally what it says. Specifically, this sentence:

I grant to Amazon a royalty free, worldwide, fully paid-up, perpetual, transferable license to any and all of my intellectual property rights associated with the Personal Game and my Personal Game development.

There’s got to be a way to thread the needle here to both protect Amazon, and not have to give them this ridiculously broad license for them to use your game intellectual property! 

8. This agreement provides me with an opportunity for personal development and creative expression and not a means for competing with Amazon Games Studio or operating a meaningful commercial endeavor. As such, under this agreement I may collaborate on Personal Games only with other Amazon Employees who are eligible under this policy and who have accepted the terms of this agreement, or with minor dependents in my household. I will not work on Personal Games with anyone else. 

This last clause is an odd one. Again, the theme of Amazon waiting to move away from your game as much as they can in the first few, but then entangling you so much in the last few, comes back.

Here, I understand WHY they’re doing this – they want to be sure that anyone who is participating in this game is agreeing to these terms. However, it’s extremely limiting to your ability to develop a game on your own terms.

And I’m not sure why Amazon would care whether you have your kids or other minor dependents helping out with the game. It’s pretty overbearing as written, and could potentially stop you from getting a third party publisher for your game or bringing on friends and family who don’t work for Amazon. 

This is the probably first clause I’d seek to remove from any agreement signed by one of my clients.

Note: I’ve heard through the grapevine that this last clause is no longer in their policy (the Tech Raptor article is based on one potential hire’s experience from a few years ago). But I can’t confirm one way or the other here.

Are these agreements and policies common in the games industry?

Very much so. I draft game company agreements to include this language as a default. As I hinted at above, it’s a reasonable concern for the company that you’re potentially:

1. Using their intellectual property or confidential info outside of work
2. Spending time on your side project that’s hurting your main work

So any agreement you sign when a game company (or any tech-centric company) hires you will probably have some language to this effect. Usually, they will include language similar to the Amazon policy that gives them ownership of your side projects, creates a system for exempting certain projects, and sometimes gives them a first option to publish any of your side projects (called a “Right of first refusal,” among other things).

But, like any contracts, they’re negotiable to varying extents. We can always try to push back where things are too onerous for the employee.

What to do about these agreements with your game industry employer?

I’m approached by new clients fairly often when they are looking to start work with a game developer and publisher. Usually, they’ve been sent a contract (often called a Confidential Information and Invention Assignment Agreement) which has terms similar to those first four Amazon terms.

From the perspective of the employer, these agreements are necessary to be sure they have all rights in your employee work product. I draft them for employers all the time. If they’re working with a third party publisher or putting a game on one of the game store platforms, they need to promise that they do in fact own all of the work they’re creating. 

So it makes sense that they want this agreement to ensure they’re not in violation of any agreements with third parties.

However, many game devs want to work on side projects, often game-related. Since we usually can’t rely on state law to exempt those side projects (as you could see in the CA and WA laws we discussed earlier), we need to “carve out” the rights for these specific side projects.

This can be done in a few ways:

1. Listing them as exceptions in the Invention Assignment Agreement you sign. This can work if the project already exists, but will probably not be effective for any work you do going forward. It’s possible to put some language in the exception stating that both the existing project and any additional work on it is exempted from any assignment to the company.
2. Getting a specific exemption for any new project you want to start working on. This should be IN WRITING – it’s not enough that they give you the okay on a phone call. I’m not even really fully comfortable with an email. I’d rather there was a document, specifically referencing the Invention Assignment Agreement and describing the game project that is exempted. 
3. Adjusting the Invention Assignment Agreement language so it has a blanket exemption for any side projects which are done on your own time and on your own equipment, regardless of what state law says. This is much tougher to get the employer to agree to, but is often the first step in negotiating changes to these agreements.

The specific changes that we can make will always depend on the particular agreement we get, so there may be other options. If you need help reviewing your employment agreement, you can contact a video game lawyer to set up a consultation by clicking here.

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Bonus – for those who love reading state statutes…

The Washington and California laws

Here’s the full text of the Washington law:

RCW 49.44.140 of the Revised Code of Washington:

(1) A provision in an employment agreement which provides that an employee shall assign or offer to assign any of the employee’s rights in an invention to the employer does not apply to an invention for which no equipment, supplies, facilities, or trade secret information of the employer was used and which was developed entirely on the employee’s own time, unless (a) the invention relates (i) directly to the business of the employer, or (ii) to the employer’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the employee for the employer. Any provision which purports to apply to such an invention is to that extent against the public policy of this state and is to that extent void and unenforceable.

(2) An employer shall not require a provision made void and unenforceable by subsection (1) of this section as a condition of employment or continuing employment.

(3) If an employment agreement entered into after September 1, 1979, contains a provision requiring the employee to assign any of the employee’s rights in any invention to the employer, the employer must also, at the time the agreement is made, provide a written notification to the employee that the agreement does not apply to an invention for which no equipment, supplies, facility, or trade secret information of the employer was used and which was developed entirely on the employee’s own time, unless (a) the invention relates (i) directly to the business of the employer, or (ii) to the employer’s actual or demonstrably anticipated research or development, or (b) the invention results from any work performed by the employee for the employer.

And here’s the full text of the California law:

Section 2870 of the California Labor Code:

(a) Any provision in an employment agreement which provides that an employee shall assign, or offer to assign, any of his or her rights in an invention to his or her employer shall not apply to an invention that the employee developed entirely on his or her own time without using the employer’s equipment, supplies, facilities, or trade secret information except for those inventions that either:

(1) Relate at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer; or

(2) Result from any work performed by the employee for the employer.

(b) To the extent a provision in an employment agreement purports to require an employee to assign an invention otherwise excluded from being required to be assigned under subdivision (a), the provision is against the public policy of this state and is unenforceable.