IT law is Information Technology law. Who needs Information Technology law? Anyone in the Information Technology industry – this means you the developer and you the client.

Information technology law is the legal framework for collecting, storing and using electronic information. It covers providing Information Technology services, such as developing an application, developing software or developing a website.

Information Technology law also covers software as a service, master services agreements and service level agreements.

Who do Information Technology lawyers assist?

We represent individuals and businesses in the Information Technology industry, and clients who need Information Technology created.

Recent clients included a sole trader who was having an app developed by a developer and a designer, a small business who was creating a significant piece of customer relationship management software for a large business, and a large developer who was creating a master software and support agreement to develop software then provide ongoing support to his client.

This article will look at what Information Technology lawyers  focus on when drafting Information Technology Agreements.

Scope/Statement of Work

The first focus of a contract is what is being provided, when and by whom. The requirements, the time frames, and the obligations on both sides need to be clear. It is not fair, for example, if a developer does not finish a piece of work in time, but the reason for the failure is because the developer’s client failed to provide necessary information or testing. We address time-frames and expectations clearly in development contracts.

A development agreement needs a clear Statement of Work. This should generally include tasks, time-frame, quality assurance, support and related project management activities.

The agreement should set out the reporting requirements, for example, a weekly report that covers milestone status. This report can also be used to track action items and escalations between the developer and client.

The parties should agree, and the agreement should set out, quality metrics that will apply to the services.

We can provide our views on market practice ways to deal with these issues.

Intellectual property rights

The second focus of the contract are the intellectual property rights. Who owns what intellectual property? What rights does the other party have to use intellectual property? This is a significant issue. Each party must understand what they own, and if any intellectual property is licensed, how the license operates.

When we act for a client paying a developer, we seek that all intellectual property created for the work, e.g. the software, app or website, be assigned from the developer to the client. The developer then needs to give a moral rights waiver to the client.

The developer will seek to carve out their pre-existing intellectual property. This is defined as Proprietary Software, and what items are included in the definition of Proprietary Software can be contentious. A well-advised client will seek a license from the developer to use the developer’s Proprietary Software as required for the client’s application, website or software.

The agreement also needs to address open source software used by the developer. The client may seek a full list of all open source software used by the developer. The client should seek a suite of warranties that the developer has read, understood and fully complied with the requirements for using that open source software, including the requirements set out in the open source software to include the copyright notices and permission notices in all copies or substantial portions of the open source software.

Disputes and dispute resolution

Another key focus is disputes and dispute resolution. It is crucial to address this clearly, to give both parties a path forward if and when disputes arise.

The parties should agree, and the agreement should set out an ‘issues reporting system’. Both parties need to use these systems for requirements management, issue tracking, document management, source control and other support functions during the course of the project.

The developer and client need to agree priority assignment for all issues. The agreement should also set out an escalation procedure, including who pays for the time to resolve issues. The agreement needs clear dispute resolution procedures. We recommend setting out a path that encourages the parties to resolve disputes themselves, then requires them to seek third party assistance, before going to court. This is to resolve the dispute outside of court if possible, as court proceedings can be long and costly.

Conclusion

In conclusion, most Information Technology agreements deal with important pieces of work. It is well worth the time and effort to have a good written agreement between the parties.

Developers should have strong and comprehensive agreements that they can tailor for each new client. Clients need to obtain advice on the contract before they sign, as each Information Technology agreement that we have reviewed for a client has been developer friendly and has had crucial omissions.

LegalVision’s Information Technology lawyers have considerable experience with Information Technology law and agreements. It is our pleasure to assist you.

Ursula Hogben

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