When I asked if they intended this to include brain surgery, they agreed to amend it to only seizing documents.

I've never in my life had trouble collecting an invoice. Once I resorted to a collections lawyer[1], and the company paid by wire within two days (it was a six figure invoice). Knowing your rights and leverage is more important than demanding unusual clauses in contracts (and Patrick, I say that with all due respect as a friend).

Another point: Reputable companies have a lot to lose by shafting contractors. This is the real reason it pays to work with reputable customers.

[1] For the curious, the lawyer threatened to put a lien against the company, and they suddenly realized that they really did owe me the money. Feel free to email me with any questions.

On the other hand, that's exactly the reason you want to have IP assignment clauses in contracts with startups - it gives a lot of incentive to the client to fully pay the invoice in case of a firesale.

I have seen cases where a company went bankrupt, but at the same time sold the software to another company held by the same people, cheating freelancers out of their money. That cannot happen in this case, as the IP assignment blocks the sale unless the buyer agrees on paying out the contractors.

As a contractor, that's your only lever in that case.

Your case only works if the client is actually solvent.

If it's minor payment dispute, they they can just pay the invoice and get on with the M+A transaction.

Personally, I can't see why the client should expect to own work done at their request if they haven't paid.

For any good client, an investment round or M&A transaction is to them what my fee is to me, and my fee is to them what the late charge on my waterbill is to me—easier to just pay the $1.20 than to give any fuss about it.

In other words, if they're that worried about it, they can always just pay the dispute and sort it out later. My business, however, might be significantly hindered by them not paying.

From my own experience, I would also suggest in actual negotiations with clients to bring up the example of Wordpress and blogs. By making a blog for you using Wordpress, you don't come to own the Wordpress platform. This underscores the economics to a client based on a real life example.

The consultancy should have its own reusable "platform" (which it refers to in its standard contracts) which can include the knowhow, software and whatever else. The client is offered a worldwide, royalty-free, unlimited license to the platform, app and all its source code. If they balk, then you do copyright assignment, but of the app only, never the platform.

That way it's presented cleanly to the client in terms they can hang their hat on -- platform and app.

Can this possibly be enforceable? I've seen two extremes from prior employers: "Sign everything away because nobody will sue a consulting employee" and "Be belligerent in the contract process to point of risking not getting the deal done."

For better or worse, the more "well run" firm overall was the most lenient in agreements around what consultants could and couldn't do. Somehow people still wound up spending 10 years servicing clients in the same industry despite non-competes. I think they just assumed it wasn't worth chasing folks over.

Normally: yes. For more explanation on this, see Mike Monteiro's great presentation during a CreativeMornings event: http://vimeo.com/22053820. Most of us will recognize the talk by the title alone: "F*ck You. Pay Me."

(IANA lawyer, but I learned this from one while contracting.)

This is in some cases fraudulent in itself, but being able to block the sale is a much clearer case.