The Tech Contracts Handbook: Cloud Computing Agreements, Software Licenses, and Other IT Contracts for Lawyers and Businesspeople, Third Edition

by David W. Tollen

Overview

Written in a clear, plain-English style and updated and expanded for an everchanging world, The Tech Contracts Handbook is a complete resource for lawyers, contract managers, and anyone responsible for getting IT deals done.

Author David W. Tollen, one of the industry's leading authorities on technology contracts, took on the challenge to create a reference manual and training guide that covers cloud computing agreements, software licenses, and various other IT contracts. 

Complete with negotiation tips, guidance on the business issues behind the terms, and sample contract language, The Tech Contracts Handbook covers all topics in technology contracts, including data privacy and security terms, warranties, indemnities, open source software, deconversion and transition, limitations of liability, SaaS escrows, copyright licensing, and service level agreements (SLAs).

This third edition provides a greater focus on some of the key concerns in IT contracts today including: clauses addressing rights in data, privacy, control of data, and data security. Updated to reflect current best practices in technology contracts, the book offers increased discussion on a variety of other terms, payment clauses, including indemnities, and other liability-related terms.

This handbook describes each clause typically found in a technology agreement, outlines the issues at stake, and offers negotiation tips and sample contract language. It addresses:

• Software-as-a-service (SaaS) and other cloud services contracts

• On-premise software license agreements

• Software distribution contracts

• Software ownership transfers

• IT professional services agreements

• And more

The Tech Contracts Handbook is a useful, accessible, and essential resource for those in the IT contracts field. 

Product Details

ISBN-13:	9781641058537
Publisher:	American Bar Association
Publication date:	05/25/2021
Edition description:	Third Edition
Pages:	398
Product dimensions:	6.00(w) x 9.00(h) x 0.85(d)

About the Author

David Tollen is the founder of Tech Contracts Academy™, which provides in-house and public training on IT contracts, for both lawyers and businesspeople—including contract managers, procurement officers, and IT staff. He’s also the author of the ABA’s bestselling manual on IT agreements, The Tech Contracts Handbook: Cloud Computing Agreements, Software Licenses, and Other IT Contracts for Lawyers and Businesspeople.

In his practice, Mr. Tollen represents buyers and sellers in technology transactions, particularly IT outsourcing contracts and other large-scale agreements. He also provides advice and assistance related to e-commerce, social media, industrial design, and intellectual property. He practices in San Francisco with a law firm he founded, Sycamore Legal, P.C.

Mr. Tollen graduated with honors from Harvard Law School and has degrees from Cambridge Universityin England and U.C. Berkeley. In addition to his legal work, he’s the author of an award-winning novel that uses fantasy to teach history, called The Jericho River. David currently lives in Los Angeles, California.

Table of Contents

About the Author xi

Introduction xv

Subject Matter: Types of IT Agreements xvii

The Structure of a Contract and of This Book xix

Using This Book xx

A Little Industry Language, Particularly Re Cloud Services xxi

Three Lessons about Contracting xxiii

1 Good Fences Make Good Neighbors xxiii

2 There Is No Such Thing as "Legalese" or "Technicalese" xxiii

3 Ask Yourself "What's Our Best Option?" Not "What's Fair?" xxiv

Part I Prime Clauses 1

A Simple End-User License, On-Premise Software 3

1 Reproduction and Use 4

2 End-User Conditions and Restrictions 6

B Simple Distribution Software License 8

1 Distribution 8

2 Distribution Conditions and Restrictions 11

C Software Licenses in General 13

1 Copyright License Rights 13

2 License Scope Terms 16

3 License Conditions and Restrictions 22

D Subscription for Cloud Services 25

1 Cloud Services Subscriptions 26

2 Cloud Services Scope Terms 27

3 Cloud Resale 28

E Promise of Professional Services 31

1 Defining the Professional Services 32

2 Statement of Work Forms and Procedures 35

3 Change Orders 37

F Transfer of IP Ownership: Assignment and Work-for-Hire 39

1 Limited Transfer of IP Ownership 42

2 Broad Transfers of IP Ownership 45

3 Transfers from the Provider's Employees and Contractors 50

G Payment 52

1 Payment by Customer 52

2 Payment by Distributors and Resellers 56

3 Sales Tax and Other Duties 58

4 Due Dates and Fee Disputes 60

Part II General Clauses 63

A Specifications 65

1 The Definition of Specifications and Their Central Role 66

2 Responsibility for Specifications 67

3 Organizing and Editing Specifications 68

4 Specifications as a Moving Target 69

B Service Level Agreement (SLA) 70

1 The Provider's SLA 71

2 Customer-Friendly SLA Edits 76

C Maintenance, Including Updates and Upgrades 80

D Documentation 83

E Schedule, Cooperation, and Assumptions 86

F Deliverables: Acceptance and IP Rights 91

1 Acceptance and Rejection 91

2 License and Other Rights to Deliverables 94

G Minimum Obligations to Distribute or Resell 97

H Nondisclosure/Confidentiality 99

1 What's Confidential? 100

2 Restrictions on Use 103

3 Injunction, Termination, and Retention of Rights 104

4 DTSA Exception and Immunity 107

I Business Continuity, Including Disaster Recovery 109

J Data Management, Privacy, and Security 112

1 Customer Data Definition and Ownership 115

2 Use of Data 120

3 Compliance with Privacy and Security Laws 124

4 Data Location, Access, Deletion, and E-Discovery 126

5 Data Security 129

6 Audits and Testing 132

7 Data Incidents 134

8 Limited Data Terms 136

K Warranties 142

1 Warranty of Function 144

2 Intellectual Property Warranty 146

3 Data Warranties 148

4 Professional Services Warranties 150

5 Other Warranties 151

6 Disclaimers of Warranties and Other Liabilities 153

7 Warranty Remedies (and IP Remedies) 160

L Indemnity 164

1 Indemnity in General 165

2 IP Indemnity 171

3 Data Indemnity 177

4 Other Indemnities 182

5 The Cause Problem (or Advanced Indemnities) 189

M Limit of Liability 195

1 Dollar Cap 196

2 Exclusion of Consequential Damages 200

3 Unconscionability and Required Clarifications 202

4 Exceptions: Unlimited Liability 204

5 Limit on Indemnity Performance (as Opposed to Liability) 207

N Liquidated Damages 209

O Audits of Software Use and Fees 212

1 Provider's Software Audit 212

2 Customers Audit of Fees 214

P Technology Escrow 217

1 Deposit and Verification 219

2 Escrow License and Confidentiality 220

3 Release Conditions 223

4 SaaS Escrow 224

Q Step-in Rights for Outsourcing 232

R Financial Stability 238

1 Financial Reporting 238

2 Insurance 239

S Use of Trademarks 242

T Feedback Rights 245

U Non-Compete and Employee No Poaching 250

1 Non-Compete 251

2 Employee No Poaching 254

V Term and Termination 257

1 Term 257

2 Termination for Cause 259

3 Termination for Convenience 262

4 Effects of Termination and Post-Termination Obligations 264

W Transition Assistance 268

X Dispute Resolution, Including Mediation and Arbitration 271

1 Escalation and Mediation 271

2 Arbitration 273

3 Waiver of Jury Trial and Class Action 276

Y Assignment, Change of Control, and Divestiture 278

1 Assignment in General 278

2 Change of Control 281

3 Divestiture 284

Z Everything Else 287

Part III Boilerplate Clauses 289

A Introduction and Recitals 290

B Definitions 292

C Independent Contractors 293

D Choice of Law and Courts 295

E Notices 298

F Government Restricted Rights 299

G Technology Export 302

H Force Majeure 304

I Severability 306

J No Waiver 307

K Bankruptcy Rights 308

L Conflicts among Attachments 310

M Execution in Counterparts 313

N Construction 314

O Injunction 315

P Internet-Related Boilerplate 317

Q Entire Agreement 318

R Amendment 320

Appendices

1 Intellectual Property 329

2 Open Source Software Licenses 334

How the Open Source "Business" Works 336

Notice Conditions 337

Copyleft Conditions 338

Why Copyleft Probably Isn't "Viral" 339

OSS Contract Terms and Policies 341

3 Clickwraps, Browsewraps, and Other Contracts Executed without Ink 347

Clickwraps 348

Browsewraps 349

4 Online Policies 350

Acceptable Use Policies 352

DMCA/Copyright Notice Policies 355

Privacy Policies 359

Mini-Glossary 363

Index 365

Editorial Reviews

David Tollen's The Tech Contracts Handbook is a comprehensive yet concise summation and discussion of the principal issues involved in drafting, reviewing, and negotiating technology agreements. The book's insightful analysis of indemnities as well as data management privacy and security is especially helpful given the ever-increasing importance of these issues in today's technology agreements. — H. Ward Classen, Author of The Practical Guide to Software Licensing and Cloud Computing

From cloud computing environments to hardware and software products, proprietary and open source licenses, and technology professional services agreements, we increasingly live in a digital world governed by information technology (IT) contracts. The Tech Contracts Handbook, written by one of the most experienced technology lawyers and educators, provides a concise, well-organized, and clearly written guide for lawyers and non-lawyers alike who need to understand and negotiate IT contracts. The third edition provides up to date explanations and practical insights about how to navigate the evolving IT contracts realm. Highly recommended. — Peter S. Menell, Koret Professor of Law, Director and Co-Founder, Berkeley Center for Law & Technology, UC Berkeley School of Law

From the Publisher

David Tollen’s The Tech Contracts Handbook is a comprehensive yet concise summation and discussion of the principal issues involved in drafting, reviewing, and negotiating technology agreements. The book’s insightful analysis of indemnities as well as data management privacy and security is especially helpful given the ever-increasing importance of these issues in today’s technology agreements.

H. Ward Classen

From cloud computing environments to hardware and software products, proprietary and open source licenses, and technology professional services agreements, we increasingly live in a digital world governed by information technology (IT) contracts. The Tech Contracts Handbook, written by one of most experienced technology lawyers and educators, provides a concise, well organized, and clearly written guide for lawyers and non-lawyers alike who need to understand and negotiate IT contracts. The third edition provides up-to-date explanations and practical insights about how to navigate the evolving IT contracts realm. Highly recommended.

Peter S. Menell