David W. Tollen - The Tech Contracts Handbook: Cloud Computing Agreements, Software Licenses, and Other IT Contracts for Lawyers and Businesspeople

Cover design by Amy Mandel with the Section of Intellectual Property Law.

The materials contained herein represent the opinions of the authors and editors, and should not be construed to be the views or opinions of the law firms or companies with whom such persons are in partnership with, associated with, or employed by, nor of the American Bar Association or the Intellectual Property Section unless adopted pursuant to the bylaws of the Association.

Nothing contained in this book is to be considered as the rendering of legal advice for specific cases, and readers are responsible for obtaining such advice from their own legal counsel. This book is intended for educational and informational purposes only.

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Library of Congress Cataloging-in-Publication Data

Tollen, David W., author.

The tech contracts handbook : cloud computing agreements, software licenses, and other IT contracts for lawyers and businesspeople / by David W. Tollen.Second Edition.

pages cm

Includes index.

ISBN 978-1-63425-179-2 (epub)

1. Computer contractsUnited States. 2. Technology transferLaw and legislationUnited States. 3. Computer softwareLicensesUnited States. 4. CopyrightComputer programsUnited States. I. Title.

KF905.C6T65 2015

346.7302dc23 2015020358

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Thank you to my wife, Wendy Pagett-Tollen. Thanks also to Mani Adeli, Paul Ambrosio, Marc Bernstein, Jay Botelho, Lee Bruno, Michael C. Carlson, Ralph Chandler, Guy Clarke, H. Ward Classen, Christopher B. Conner, Matteo Daste, Gary S. Davis, Mark K. Dickson, Karen Masterson Dienst, R. Oak Dowling, Roxanna Friedrich, Frederick Gault Jr., Kim David Greenwood, Jennifer Hanley, Michael A. Jacobs, Nels Johnson, John M. Keagy, Michael F. Kelleher, Cecilia Toman Mangoba, Alex Mann, Heather Meeker, Nathaniel D. McKitterick, Denise Olrich, Kathy OSullivan, Jay Parkhill, Martin Plack, Penelope A. Preovolos, Robert A. Preskill, Deborah Pulido, Mark F. Radcliffe, Ian A. Rambarran, Michelle M. Reichert, Aaron P. Silberman, Ken Stratton, Robert W. Tollen, Larry Townsend, Richard Vestuto, and Amy Ward. Finally, thank you to my excellent research assistant, Josh L. Young.

Please visithttp://TechContracts.comfor contract clauses and full-length contract forms you can download, and for other resources.

Contents

Attorney David W. Tollen represents buyers and sellers in cloud computing and software licensing agreements and in other technology transactions. He also provides advice and assistance related to e-commerce, social media, industrial design, and intellectual property. Finally, he provides in-house and public training on drafting and negotiating technology contracts, for lawyers and for contract managers, salespeople, financial executives, and other businesspeople. Hes the founder of Sycamore Legal, P.C., a technology and intellectual property law firm based in San Francisco (http://SycamoreLegal.com).

Mr. Tollen graduated with honors from Harvard Law School and has degrees from Cambridge University in England and U.C. Berkeley. He has served as general counsel of a publicly traded software company, as vice president of business development for a technology start-up, and as a lawyer in the Silicon Valley offices of Morrison & Foerster LLP.

Finally, Mr. Tollen writes fiction that teaches history and science. Hes the author of the multiple-award-winner The Jericho River, A Novel About the History of Western Civilization (Winifred Press 2012, 2014) and also of Secrets of Hominea, to be published in 2016. (For more on these works of fiction, please visit http://DavidTollen.com.)

This book will help you negotiate, draft, and understand information technology contracts. Specifically, it will help you with software licenses and other software transfers, cloud computing agreements, and technology professional services agreements. It addresses contracts between businesses, as well as business-to-consumer and business-to-government contracts. It also addresses both offline contracts and contracts related to the Internet and e-commerce.

This book is for both lawyers and nonlawyers. The text stays away from technical jargonlegalese, engineerese, and programmereseand where it absolutely cant avoid jargon, it provides a definition. In other words, this book is written in simple English, like a good contract.

You can use this book as a training manual or a reference guide or both. If youre training, read this book cover to cover. It provides an overview of the key technology contracting concepts.

If youre after a reference guide, you can pick and choose the chapters to read. When youre negotiating a contract, or reading or writing one, look up the various clauses to learn what they mean and whats at stake. Youll find sample language in each chapter, which you can incorporate into your own contracts. Plus, if you visit this books website, http://TechContracts.com, you can copy the longer sample clauses and paste them into your document. Youll also find several full-length contracts at the website, which you can download and revise to fit your deals.

Finally, you can also use this books table of contents as an issue spotteras a checklist of clauses to consider.

This book cant replace a lawyeror a colleague with more information technology (IT) experience, if you are a lawyer. But it can help you understand your lawyer or colleague. And whether you have legal help or not, the better you understand your contracts, the more effective youll be.

Im a technology lawyer, and this book grew out of seminars I teach, for both attorneys and nonattorneys. At the end of the program, students often asked where they could learn moreif I knew a good book on IT contracts. Most of the books I knew were massive tomes on intellectual property or contract law. Theyre written for lawyers only, and their more practical lessons are spread across hundreds or thousands of pages. Ive learned much of my trade on the job, rather than from a book. Ive served as a technology lawyer with a global firm, as general counsel for a publicly traded software company, and as vice president of business development for an Internet start-up. I now practice through my own technology-focused law firm in San Francisco and the Silicon Valley. The material for my seminar came from the contracts Ive negotiated and written in those positions. Id never seen a really user-friendly outline of the issues. So I wrote this book.

The rest of this introduction provides more detail about the types of contracts this book covers. It also explains the structure of a contract and of this book and offers a few explanations that will help you get the most out of your reading. Finally, it provides a short explanation of some IT industry languagejust a little, particularly regarding cloud computingand then offers three lessons about contracting in general.