A new game studio raising its first round usually prepares for the wrong risk. Founders rehearse the valuation, the board seat, the liquidation preference and the option pool, and treat the intellectual property section of the investment agreement as boilerplate they will sign at the end of the meeting. In practice, the clause most likely to destroy the round is the one confirming that the company owns the game. Where the founding team is still employed by another studio, or left one recently, that confirmation is not a formality: Turkish copyright law starts from a default that favours the former employer, and the investor’s lawyer knows it. This article sets out where that default comes from, why the usual founder defences are weaker than they sound, what an acquirer actually gets when the chain of title is broken, the assignment founders commonly sign that does not work, and the evidence and paperwork that make the question answerable before a term sheet is signed.
The default rule already favours the old employer
Under Article 8 of Law No. 5846 on Intellectual and Artistic Works, the author of a work is the person who created it. Authorship therefore attaches to a human being, not to a company, and it does not move merely because the work was made at an office. What does move is the right to exploit the work. Article 18(2) provides that unless the contrary follows from a special agreement between the parties or from the nature of the work, the rights over works created by civil servants, employees and workers while performing their duties are exercised by those who employ or appoint them, and that the same rule applies to the organs of legal persons.
Two things in that sentence deserve attention. The first is that the employer does not need a contract. The rule operates by default; a studio with no IP clause at all in its employment contracts is still in the stronger starting position. The second is the phrase “while performing their duties”. That is the entire battleground. A studio asserting a claim over a game built by its departing team does not have to prove theft. It has to persuade a court that the work fell within the scope of what those people were employed to do, and a team of game developers building a game is, on its face, doing the thing it was hired to do. The burden of showing that a particular project sat outside that scope tends to fall on the people who say it did.
A game is an indivisible joint work
Where several people contribute to a work that forms an inseparable whole, Article 10 provides that the work belongs to the union of its creators, and that the union is governed by the rules on ordinary partnerships. The fourth paragraph matters more for studios: where such an inseparable joint work is produced, and no contract, terms of service or applicable law provides otherwise, the rights over the joint work are exercised by the natural or legal person who brought the authors together.
A game is the paradigm case of an inseparable whole. Code, art, level design, narrative, audio and tooling are not distributable into discrete authored parcels once they are shipped as one product. If three or four people who met at the same studio, sat in the same room and used the same pipeline created a prototype together, the question of who “brought them together” is not rhetorical. It is a statutory hook, and it points at the employer unless the team can show a different arrangement. Article 10 also notes that technical services or incidental assistance in producing a work do not found participation, which cuts both ways: it narrows who counts as an author, and it does nothing to help a contributor whose involvement is characterised as support.
“I built it at home, on my own laptop”
This is the answer most founders give, and standing alone it is rarely enough. Article 396 of the Turkish Code of Obligations No. 6098 requires the employee to perform the work with care and to act loyally in protecting the employer’s legitimate interests. Its third paragraph is explicit: for as long as the employment relationship continues, the employee may not, in breach of the duty of loyalty, provide services to a third party for remuneration, and in particular may not compete with their own employer. No non-compete clause is needed for that; the duty is statutory and operates during employment. The fourth paragraph adds that the employee may not use or disclose information learned in the course of the work, particularly production and trade secrets, during the relationship, and remains bound to secrecy afterwards to the extent necessary to protect the employer’s legitimate interest.
Post-termination restraint is a different and narrower matter. Article 444 allows a written non-compete undertaking only where the relationship gave the employee access to the customer circle or to production secrets, and where the use of that knowledge could cause the employer significant harm. Article 445 limits such a restraint in place, time and type of work, caps it at two years absent special circumstances, and lets the judge narrow an excessive clause. Founders often fixate on this clause and miss that the real exposure during the build was Article 396, which needed no clause at all.
There is also an employment-law consequence while the build is under way. Article 25(II)(e) of the Labour Law No. 4857 lets the employer terminate immediately where the employee abuses the employer’s trust, steals, or discloses the employer’s professional secrets, as conduct inconsistent with honesty and loyalty. And if a founder sits on the board of the old company, Article 396 of the Turkish Commercial Code No. 6102 goes further than damages: without the general assembly’s permission a board member may not, for their own account or another’s, transact in a line of business falling within the company’s field of activity, and the company may claim compensation or, instead, treat the transaction as made on its own behalf. A company that elects the second remedy is not asking for money. It is asserting that the game is its own.
The new studio is exposed too, not only the individuals. Article 55 of the Commercial Code lists, among acts of unfair competition, inducing third parties’ employees to act contrary to their duties by offering them undeserved advantages, and inducing employees to disclose or obtain their employer’s production and trade secrets. It separately lists unauthorised exploitation of another’s work product, including exploiting a proposal, calculation or plan entrusted to someone where it should have been known that it was supplied without authority, and the unlawful disclosure of production and trade secrets. Article 56 then gives the affected party a suite of remedies: a declaration that the act is unlawful, prevention, removal of the resulting factual situation, damages where there is fault, and moral damages. Disclosure of trade secrets can also be a criminal matter: Article 239 of the Turkish Penal Code No. 5237 punishes disclosure of trade, banking or customer secrets learned by virtue of one’s position, duty, profession or craft with imprisonment from one to three years and a judicial fine of up to five thousand days, upon complaint.
What the investor is actually buying
The reason a careful investor treats this as a gating item rather than a diligence footnote is Article 54 of Law No. 5846. A person who acquires an economic right or a licence from someone who was not entitled to transfer it is not protected even if they acted in good faith. Good faith is a defence in many parts of Turkish private law. Here it is not. An investor who wires money against a share purchase agreement warranting clean title, in complete ignorance of the founders’ prior employment, still ends up holding equity in a company that may own nothing.
The chain matters as much as the origin. Article 49 provides that a person who has acquired an economic right or a licence from the author or their heirs may transfer it onward only with their written consent, and that the same consent is required for a transfer of the adaptation right. So a title running from the individual creators to a founder and then to the new company needs written consent at each link, not a single document at the end. Article 52 then imposes the formal requirement that agreements and dispositions concerning economic rights be in writing and that the rights forming their subject matter be specified separately. A clause reciting that “all intellectual property rights belong to the company” does not specify anything separately. It is the most common defect we see in founder paperwork and it is the easiest to fix before it matters.
The assignment founders sign that does not work
There is a trap here that catches experienced teams. Article 48 lets the author or their heirs transfer their economic rights, limited or unlimited as to duration, territory and content, and lets them grant a bare licence to exercise those rights. Its third paragraph then provides that the dispositions described in the preceding paragraphs are void where they relate to a work not yet created or still to be completed. Article 50 rescues the position only partly: undertakings concerning such dispositions are valid even if given before the work exists, and undertakings relating to all of an author’s future works, or to a defined category of them, are addressed separately.
The practical consequence is precise. The assignment a founder signs on incorporation day, purporting to transfer the intellectual property in a game that does not yet exist, does not operate as a transfer. It binds as a promise. Title passes only when a further disposition is made over the work once it has come into existence, in writing and with the rights listed. A studio that signs its founder IP assignment once, at the beginning, and never again, has a promise and no title. The fix is unglamorous and cheap: a standing undertaking at the outset, then periodic confirmatory assignments as builds, builds of assets and releases actually come into being, each one written and specific.
Moral rights do not move
Article 48 permits the transfer of economic rights. It says nothing about the rights of disclosure, attribution, integrity and access that Law No. 5846 grants the author personally, and those do not travel with an assignment. For a game this is usually a credits and modification question rather than an existential one, but it is worth knowing before a publisher asks for an unrestricted right to alter the work, and before a founder who has left on bad terms starts thinking about what they can still object to.
What to do before the term sheet
The objective is not to win the argument later. It is to make the argument unattractive to start. That means assembling, before the raise, an evidence file that a third party can read: a version-control history that shows when the first commit landed and from which machine and account, timestamps that sit outside working hours in a way that is consistent rather than convenient, hardware and accounts that belong to the founders rather than to the old studio, engine and middleware licences taken in the new company’s name, and purchase records for every third-party asset in the build. Where any part of the prototype predates the resignations, say so internally and price the risk rather than hoping the question is not asked.
The cleanest structural answer is separation before creation: resign first, then build. Where that has not happened, the next best is a written waiver or assignment from the former employer, narrow and specific, naming the project. Studios are often willing to give one in exchange for a modest fee, a non-solicit of their remaining staff, or a small revenue participation, and a signed waiver is worth more to an investor than any number of founder declarations. Contractors and freelancers need real assignment agreements rather than non-disclosure agreements, because an NDA transfers nothing, and Article 52’s requirement that rights be listed separately applies to them exactly as it applies to founders.
How the round should be papered
Where the history is imperfect and cannot be perfected in time, the answer is disclosure rather than silence. Investors price known risk; they punish discovered risk. A disclosure letter that sets out the employment overlap, the steps taken and the residual exposure lets the parties deal with it in the documents: a specific representation on ownership and non-infringement, a special indemnity carved out of the general liability cap and surviving longer than the standard warranty period, a holdback or escrow of part of the proceeds pending a waiver or the expiry of a limitation window, tranching against a milestone that includes delivering the waiver, and founder vesting that treats a successful third-party claim as a leaver event. None of this is pleasant to negotiate. All of it is less expensive than a preliminary injunction landing two weeks before launch.
If the claim arrives
The remedies on the other side are not symbolic. Article 68 of Law No. 5846 allows the rightholder whose written permission was not obtained to claim up to three times the amount that could have been demanded had a contract been made, or three times the market value determined under the Law. Article 56 of the Commercial Code adds prevention and removal of the factual situation, which in a games context can mean the removal of a build from storefronts rather than a payment. The commercial damage usually arrives before the judgment: a credible claim, raised publicly, is enough to stall a platform submission, a publishing agreement or the next round. That asymmetry is the reason to resolve the question while it is still cheap to resolve, which is before the money lands rather than after.
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