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Debugging your Software Contracts

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Richard Stephens

on 26 September 2016

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Transcript of Debugging your Software Contracts

Debugging your Software Contracts
What is a Contract:
principles, structure and red flags

Keeping it Confidential
: an introduction to NDAs

Top Ten:
things to look out for in software development, licensing and maintenance contracts
Exploiting the Cloud
Collaboration:
IP ownership, licensing and reselling

Contract Formation
"Battle of the Forms"
Contract Structure
Red flags
What are they and why are they used?
Drafting Issues
Enforcement and remedies
1. Who owns what?
2. Development - The Software Development Agreement
5. Licensing - scope
7. Licensing - Escrow
8. Maintenance - Scope and support
9. Maintenance - Service Levels & Service Credits
10. Maintenance - Liability
Navigating the cloud: what is it?
The commercial approach to cloud services
Service Levels & Service Credits
IPR issues
Data protection and information security
Third party agreements and back-to-back terms
The Future
Development phases
IP Ownership
Collaboration Agreement
Reselling
Requirements to create a contract:

Offer
Acceptance
Consideration
Intention to create legal relations
Certainty of terms

Contractual terminology

Warranties

Indemnities

Liability

Governing law and jurisdiction
Key terms

Boilerplate terms

Schedules
What is it?

Why should you worry about it?

How to avoid the problem
Create contractual obligations that control the use of information

Increase the disclosing party's chances of enforcing the confidentiality obligation

Preliminary agreement

Limitations
Who should the agreement apply to?

The definition of confidential information is key

Restrictions on use

Term

Return of information
Injunction

Damages for breach of contract / account of profits

Difficulty in proving breach
How is software protected

Copyright
Patents

Ownership

Impact on contract

Assignment
Licensing
Types of licensing

Permitted use

Duration

Specification
4. Development - Contractual protections
At a basic level, cloud computing is the delivery of IT products and support as services over the internet.

Cloud-computing service providers (CSPs) host applications and provide computing power from data centres, providing low-cost IT service provision to customers.

On-demand self-service

Broad network access

Resource pooling

Rapid elasticity

Measured service

Key Features
Definitions
SaaS

Remote hosting and management of customers’ software applications by IT providers who also provide initial and ongoing support services.

PaaS

PaaS suppliers adapt and scale existing infrastructures to provide platforms for third-party use in the cloud, allowing the third-parties to host their software applications on these platforms in order to distribute them to customers.

IaaS

Delivery of computing resources over the internet such as servers, network equipment, memory, CPUs, disk space and data-centre facilities.


Predictable fixed, and often low, service charges

Anytime, anywhere access

Low hardware investment costs

A greener solution as carbon usage can be outsourced


Support package may not be tailored to customers' specific needs

Contracting on fixed standard terms with limited warranties and indemnities

Lack of integration with existing systems

Reliance on online connectivity

Risk of lock-in

Hidden extras / increased costs

Risks


Benefits
Uptake and attitudes
Best uptake among consumers and start-ups

Increased interest in the public sector

Slower uptake in large corporate

Negotiation
Pre-contract due diligence and post-contract governance

Ideally, agreements should be tailored to fit the context:

Risk

Relationship

Results

Any standard term agreement is likely to be strongly supplier-centric

Formation

Research and development

Exploitation

Termination

A written agreement which should cover the following key issues:

The Work Programme

Background Technology

User Rights

Access to Results

Non-competition

Protection of results

Background IP, Foreground IP (new), Exploitation, Registration

Inventing party usually owner of IPR

Avoid 'joint ownership'

Concerns:

Employees/commissions
Filing
Exploitation
Prosecution
Confidentiality
"the Developer shall use its reasonable endeavours to meet the Service Levels"
vs.
"the Developer shall meet the Service Levels"
Agency
Distribution
Developer
Customer
Services Contract

SaaS / PaaS / IaaS
Agent
Sales or Marketing Agency Agreement
Developer
Developer /
Value Added Reseller
Customer
Developer Licence
EULA
Software development contract / Maintenance & Support Agreement / Licence / Systems Integrations Agreement
Third Party Developer
Developer Licence / right to sub-licence
Navigating the cloud: what is it?
If a cloud computing service involves processing of personal data and the customer is established or the data is processed in an EU member state then the service will need to comply with the Data Protection Directive.

Relevant provisions:

Distinctions between data controllers and data processors

Restrictions on data transfers

Security obligations

3. Development - Implementation
6. Licensing - warranties and indemnities
Software Warranty

IPR Warranties

IPR Indemnities
Ability to obtain access to source code

Third Party Development / Maintenance

Licensing protection
What is a fault / defect

Categorise faults / defects

Categorise support

Hours of availability

Levels of upgrade: faults fixes / upgrades
Example of a multi-vendor enterprise ICT environment
Example of outsourced services integration
Finding a meeting point
Software Licensing

Content licensing and issues

IPR indemnity

Protecting IPR
Disaster Recovery / Business Continuity
Idea
Full transcript