Front Cover 1
The IT/Digital LegalCompanion 6
Copyright Page 7
Dedication Page 8
Contents 10
Acknowledgment by Gene Landy 35
A Note from the Authors 37
About the Authors 38
About the Authors’ Law Firm 40
Form Downloading Instructions 44
Chapter 1: Introduction: Using this Book to Build Value 46
Your Need to Know Digital Business Law 46
Who is this Book For? 46
Organization of this Book 47
Approach of this Book 48
Understanding and Using Intellectual Property 49
Doing Deals 49
Understanding and Dealing with Legal Risk Factors 50
Global Perspective 50
Focusing on Your End Game from the Beginning 50
How to Use this Book 51
Using the Legal Forms 51
Limits to the Contents of this Book 52
Legal Counsel 53
Chapter 2: Digital Copyright Basics 54
Some History 54
Copyright Counts! 55
In this Chapter 55
The Nature of a Copyright 55
What Is Covered by US Copyright Law? 56
What Is a Computer Program under Copyright Law? 57
The (Very Modest) Requirement of Originality 57
Copyright and Musical Works 57
Exclusive Rights under Copyright Law 58
Expressions vs. Ideas and Methods 58
How to Get a Copyright 58
Copyright vs. Other Kinds of Intellectual Property (IP) 59
Duration of Copyright Protection 60
Public Domain 60
Notice 61
Copyright Registration 62
Infringement 62
Derivative Works 63
Works Made for Hire 64
More on Work Made for Hire 65
Work Made for Hire Clauses in Contracts 65
Note on the Right to Revoke Copyright Grants and Transfer after 35 Years 65
California Law Issue Involving Work Made for Hire Clauses 66
Problems When Parties Fail to Specify Who Is to Own the Copyright 67
Fair Use 67
Factor-Based Analysis 68
Fair Use and Personal Copying 70
The First Sale Rule 71
Thin Copyright Protection for Computer Databases 72
Copy Protection Technology and Anticircumvention Law 73
Digital Rights Management Technology and Anticircumvention 74
Anticircumvention Law Concepts 74
What Is Illegal under Anticircumvention Law? 75
Absence of Defenses 75
Registering Your Copyright 76
How Copyright Registration Works 77
Advantages of Copyright Registration 77
Statutory Damages under the Copyright Act 78
Getting a Good Shot at Attorneys' Fees 78
Filing for Timely Copyright Registration 78
Presumption of Validity of Your Copyright 79
Making Copyright Registration a Regular Practice 79
Recording Assignments and Exclusive Licenses 79
Criminal Copyright Violations 80
More on Copyright Law 80
Conclusion 81
Chapter 3: Copyrights on the Internet, for Software Protection and Around the World 82
In this Chapter 82
Topic One: Copyright and the Internet 83
Example 83
Analysis of Web Functions 84
Links 84
Deep Linking 84
Framing 84
Linking and Peer-to-Peer Copying 85
The DMCA Notice-and-Take-Down Rules 86
Protection from Libel Claims 92
More on Copyright and the Internet 92
Topic Two: Copyright and Software Protection 92
Unauthorized Copying of Copyrighted Computer Code 93
Piracy 93
Private Illegal Copying 94
Pieces of Software Programs 94
No Protection for Functional Elements Inherent in the Idea of the Application 95
No Protection for Commonly Used Software Elements 95
No Protection for Use of Interfaces and File Formats Needed for Compatibility 95
External Characteristics of Computer Programs 96
Copyright Law and the User Interface 96
Analysis of Similarity of External Characteristics 98
Clean Rooms: Duplicating Without Copying 99
Is There Any Protection for the Internal Structure of a Program? 100
Reverse Engineering 100
Topic Three: International Copyright Protection 102
Copyright Treaties 102
Chapter 4: Trademarks and Domain Names 106
In this Chapter 106
What is a Trademark? 107
Trademark Goals 108
Trademark Risks 109
Company Names vs. Trademarks 109
Scope of Legal Protection 110
Distinctiveness of Trademarks 110
Strong and Weak Marks 111
Confusingly Similar Marks 113
Obtaining Priority Rights 115
Necessity of a Trademark Search before Adopting New Marks 117
Scope of the Trademark Search 117
Limitations of a Trademark Search 118
Prescreening Potential New Trademarks 119
The Advantage of Federal Registration 120
Federal Trademark Registration System 120
Trademark Registration Process 123
Keeping Your Federal Registration In Effect 124
Do-It-Yourself Registration of US Trademarks 125
Essential Actions to Protect Your Trademarks 126
Trademark Notices 126
Vigilant Defense of Your Trademark to Prevent Dilution 127
Legal Protection of Famous Trademarks 128
Taking Trademarks Global 129
Paris Convention and Trademarks 130
Madrid Protocol 130
CTM Registration in the EU 132
Exploiting Trademarks in Distribution, Licensing, and Other Deals 132
Trademark Guidelines 132
Co-branding 133
Trademark Licensing 135
Trademark Transfers 136
Domain Names 137
Domains and Brand Identity 137
Domain Names vs. Trademarks 138
Cybersquatters and Remedies 138
Trademark Infringement Litigation 139
The Litigation Process 140
Proof of Infringement 140
Fair Use under Trademark Law 141
Infringement Remedies for Federally Registered Trademark 141
Infringement Remedies for Unregistered Trademarks 142
Conclusion 142
Chapter 5: Patents and Digital Technology Companies 144
In this Chapter 144
The Power and Use of Patents 145
Nature of United States Patents 146
How Do You Get a Patent? 147
Legal Standard for Patents 147
Reading Patents 148
Patents and Disclosure 151
Types of Infringement 152
Limits to the Right to Exclude Others 153
About Prior Art 153
Searching in Patent Databases 154
Software Patents and Business Method Patents 155
Patents on Software Generally 155
Business Method Patents 156
Doubts about Some Business Method and Software Patents 157
The Patent Application Process 158
Patent Lawyers and Patent Agents 158
Provisional Applications 159
Patent Priority and Documenting Inventions 159
Don't Delay Filing that Patent Application! 160
Capturing Employees and Contractors' Inventions 161
The Patent Issuance Process 161
Foreign Patent Applications and PCT Applications 162
Priority Date for Foreign Applications 164
Inventing and Patent Strategically 166
Strategic Factors 167
Deciding to Patent a Particular Invention 168
Getting Serious about Patents 169
Your Strategy for Use of Patents 170
Patents in Business Deals 170
Patent Licensing Agreements 171
Why Engage in Patent Licensing? 171
Business Terms 172
Covering Contingencies 172
Assignments 174
How Patents Can Be Used Against Your Business 174
Who Is at Risk of Patent Claims? 175
If You Receive a Cease-and-Desist Letter from a Patent Holder 176
Patent Infringement Lawsuits 177
Chapter 6: Trade Secrets and Non-Disclosure Agreements 182
In this Chapter 182
What Is a Trade Secret? 183
Basis of Trade Secret Law 183
Trade Secret Law vs. Contractual Protection of Confidential Information 184
Technology as a Trade Secret 185
Confidential Business Information 186
Confidential Information from Third Parties 186
Limits to Trade Secrets 187
How Long Trade Secrets Last 187
Patents vs. Trade Secrets 187
Can More Than One Company Have the Same Trade Secret? 188
Care and Protection of Trade Secrets 188
One Person in Charge of Confidentiality Measures 189
Controls on Access to Confidential Data 189
Entry Control and Badges 190
Confidentiality Legends on Documents, Code, and Other Data 191
Agreements with Third Parties to Protect Confidentiality 192
Confidential Undertakings by Employees and Contractors 193
Non-Disclosure Agreements and Confidential Disclosure 195
Mutual or Unilateral NDAs 195
Defining “Confidential Information" 196
What Written Information Is “Confi dential Information”? 196
What Oral or Visual Information Is "Confidential Information"? 197
Carve-Outs from Confidential Information 198
Prohibition of Disclosure 198
Use of Confidential Information 199
When Does Protection Time-Out? 199
Risks from Others' Confidential Information 200
Two-Stage Disclosure 200
Watch Out for "Residuals" Clauses 201
Are There Oral Agreements for Non-Disclosure? 202
Disclosure Agreements that Are the Opposite of NDAs 202
When You Negotiate a Deal, Should NDAs Be Superseded? 203
Confidentiality Clauses Generally 203
Violations of Trade Secret Law 203
What Is Illegal under Trade Secret Law? 204
What Is not Illegal under Trade Secret Law? 204
What if Trade Secrets Are Disclosed? 205
Dealing with Violations of Trade Secrets 205
Remedies Short of Litigation 206
Is Taking Trade Secrets a Crime? 207
Can Software Trade Secrets Be Licensed or Sold? 208
Use of Counsel in Managing Trade Secrets 208
Chapter 7: Confidentiality, Rights Transfer, and Non-Competition Agreements for Employees 210
In this Chapter 210
A Note on Terminology 211
About Employment Law Generally 212
The Contents of Employee Agreements 212
Confidentiality Provisions 212
Capturing Intellectual Property Rights 215
Noncompetition and Nonsolicitation Provisions 219
State with Limitations on Restrictive Covenants 219
About Consideration 220
Getting Employees to Sign 221
Enforceability of Provisions 221
Enforcement of Noncompetition Agreements by Employers 224
Obtaining Assurance of the Absence of Conflicting Prior Agreements 225
Chapter 8: Introduction to Digital Product and Service Contracts 228
In this Chapter 229
First Topic: Contract Concepts 230
Limits to Freedom of Contract 231
Contracts Are Binding and Enforceable 231
Oral and Written Agreements 232
Trust but Verify 232
Contracts Are More than the Words 233
LOI and MOUs 233
The Myth of the Two-Page Contract 234
Contracts, Company Sales, Investments, and Due Diligence 235
No "Agreements to Agree" 235
Form Agreements for Your Business 235
Conceptualizing the Contract 236
First: the Core Economic Bargain 236
Second: the Rules of Behavior 237
Third: the Contingencies (Risk Allocation) 237
Fourth: the Mechanics and Boilerplate 238
Note about the Uniform Commercial Code 239
About UCITA 239
Second Topic: Contract Provisions 240
The Promised Performance 240
The Acceptance Clause 241
The License Grant 242
Warranties 250
Prohibitions 254
Confidentiality Clauses 254
Intellectual Property Clauses 256
Risk Allocation: Remedies, Limitations, and Damage Caps 256
Indemnification Clauses 262
Term, Termination, and Survival 267
Source Code Escrows 268
Dispute Resolution 268
Choice of Law 271
Choice of Jurisdiction 272
Restriction on Assignment Clauses 273
Change of Control 273
Miscellaneous "Boilerplate" Clauses 275
Third Topic: Contract Negotiations 275
Preparation for Negotiation: the Overall Strategy 276
Get the Background Information You Need 276
Be Sure That You Can Deliver Value to the Other Side 277
Assess Your Credibility 277
Look for a Deal that Works for Both Sides 277
Try to Start with Your Own Form 277
Negotiating from the Other Side's "Standard Agreement" 278
Develop Justifications for Your Positions 278
Negotiating in the Right Setting 279
Deal with the Most Important Terms First 279
Listen Hard 279
Make Trades Rather than Concessions 279
Negotiate Price Terms with Firmness 280
Knowing When to Say "No" and When to Say "Yes" 280
The Role of Legal Counsel 281
Chapter 9: A Pragmatic Guide to Open Source 282
Introduction 282
In this Chapter 282
The Popularity of Open Source Software 283
What Is Open Source Software? 284
Source Code vs. Binary Code 284
Proprietary Source Code in Software Business 284
Commercial Source Code Licensing 285
Origins of Open Source 285
The Generations of Open Source 286
The Open Source Model of Licensing 286
Perceived Advantages 287
Perceived Disadvantages 288
Open Source Licenses 288
BSD License 289
GPL Version 2 290
GPL Version 3 294
The Lesser General Public License or LGPL 296
The Mozilla Public License 297
Quasi-Open Source License 297
Which Open Source License Form Should a Developer Use? 297
Risks in Using Collaboratively Developed Open Source Products 298
SCO Litigation 298
Patent Risks 299
Dealing Pragmatically with IP Infringement Risk 300
Open Source and Implied Patents License Grants 300
Open Source License and Trademarks 301
Open Source Use by Software Vendors 301
Open Source Software and Due Diligence in Company Sales or Investment Deals 301
Making Money with Open Source Programs Generally 302
How Copyleft Programs Can Be Made Quasi-Private 303
Dual Licensing 304
Sources of Information on Open Source Matters on the Web 305
Conclusion 305
Chapter 10: IT Services-Development, Outsourcing, and Consulting 306
In This Chapter 306
The IT Consulting Business Model 307
Development Deals 307
Why Outside Development? 308
Scale of Development Deals and the Development Forms 309
Development Can Be a Risky Business 310
Need for Planning and Risk Management 312
Process Overview 312
Writing and Responding to RFPs 314
Elements of an RFP-From the Customer's Point of View 314
Responding to RFPs-From the Developer's Point of View 316
The Agreement 317
Getting the First Draft on the Table 318
Structure of a Development Agreement 318
Development Planning 319
Deliverables 320
Requirements for Providing the Deliverables 320
Software and Data to Be Provided for Use in Development 321
Oversight and Management 321
Price and Costs 322
Acceptance 322
Postacceptance 322
"Detailed Design" 322
Dealing with Informal Specifications 323
Project Management Provisions 324
Personnel Assigned to Development 324
Change Management Provisions 325
Acceptance Procedures 325
Payment Provisions 326
The Right Schedule 328
Intellectual Property-Ownership and/or License 329
The Intellectual Property at Stake 329
Avoiding Jointly Owned intellectual Property 336
When the Web Developer Is Also Providing Web Hosting 336
Subcontractors 337
Noncompetition Clauses 337
Provisions on Confidential Information 338
Training and Support 338
Warranties 339
Disclaimers and Limitations 339
Date Processing (Y2K) Warranties 340
Open Source Provisions 340
Intellectual Property Warranties and Indemnities 340
Insurance 342
Clause on Customer Non-Solicitation of Developer Employees 343
Termination 344
Dispute Resolution 345
Boilerplate Provisions 345
About Offshoring 346
Other Types of Consulting Business and IT Services 348
Legal Issues in Development and Consulting Businesses 349
Conclusion 350
Chapter 11: Beta Test Agreements 352
In this Chapter 352
A Note on Terminology 353
Goals and Contents of a Beta Test Agreement 354
Variation in Beta Test Agreements 355
Marketing Uses of Beta Tests 355
Following Up on a Beta Test 356
Beta Test Plans 356
Two Forms of Beta Test Agreement 357
Chapter 12: Commercial End-User Agreements 358
In this Chapter 358
Business Setting for Software End-User Agreements 359
Some Guidance on License Design 360
Form of Software End-User Agreements 361
Agreements for Software Plus Hardware 361
Bargaining between Vendor and Customer 362
Vendor and Customer Goals 363
The Request for Proposal Process 364
Common Issues in Negotiating End-User Agreements 364
Delivery and Acceptance 364
The Permanent License Model: Initial License Fees and Support Fees 366
Software by the Month, Quarter, or Year 368
Permitted Use and Pricing 368
Software Maintenance and Support Provisions 377
Training Employees to Use the Program 380
Restrictions 380
Confidentiality Clause 380
Intellectual Property Indemnification 381
Warranty Disclaimers and Remedy Limitations 381
Term and Termination 384
General Provisions 384
Source Code Escrow Agreements 384
When to Offer Escrow 385
The Problem with Escrow 385
Two-Party and Three-Party Agreements 386
Multi-Beneficiary Escrow 386
Contents of an Escrow Agreement 387
Note on Commercial Licensing Software to the Government 390
Accounting for License Revenue 391
Software Licensing and Sales Tax 392
Why Sales Tax is Important? 392
The Concept of Nexus 392
Wholesale vs. Retail 393
Applicability of Sales Tax to Software Products 393
Products vs. Services 394
Conclusion 394
Chapter 13: Software as a Service (SaaS) 396
In This Chapter 396
Some SaaS History 397
SaaS Business Varieties 397
What Customers Like about SaaS 398
Customer Concerns with the SaaS Model 399
Advantages and Issues for SaaS Vendors 400
Mixing Traditional Software Licensing and SaaS 401
SaaS and Security 402
Points of Vulnerability 403
Measures for Data Security 403
State Security Breach Notification Statutes 404
Other Potential Harms 405
Contract Provisions on Security 405
Risk from Overstating Your Data Security 406
Sas 70 407
More Mandates 408
Foreign Data Privacy Laws 409
Hot, Cold, and Warm Disaster Recovery Sites 409
Open Source: the General Public License and the "SaaS Loophole" 411
SaaS Agreements 412
Service or License? 412
No Delivery of Software 413
Customization 413
Data Ownership 414
Security 414
Other Service Delivery Details 415
Pass Through of Litigation-Related Costs 415
Service Level Agreements 416
Uptime Guarantee 416
Service Response Metrics 417
Response Time Metrics 417
Bad Customer Data 417
Source Code Escrow 418
Term, Termination, and Transition 418
Pricing in SaaS Agreements 418
SaaS Agreement Form 419
Chapter 14: Commercial Distribution-Part I 420
General Principles, Deal Types, Reseller Deals, and Legal Rules 420
In this Chapter (and the Next Chapter) 420
A Note on Terminology-Partners and Resellers 421
Form Distribution Agreements for Your Business 422
Software Partnering and Channels 422
Resellers 422
VARs 423
Distributors and Dealers 423
System Integrators 423
Rebranding, OEM, or “White Label” Deals 424
Bundling Deals 424
Embedded Software and Software Components 425
Retail Distribution 425
Sales Representatives 425
About Strategic Alliances 426
Reseller Agreements 427
Vendor Goals 427
Reseller Goals 427
The Relationship Between the Vendor and Reseller 428
The Risk that the Vendor Will Go Direct 428
The Negotiation Dynamic for Software Reseller Agreements 429
Products Covered by the Agreement 429
End Customers Only 429
Nonexclusive Reseller Territories 430
Exclusive Reseller Territories 430
Restriction on Competing Products 431
Channel and Market Restrictions 431
Multiple Marketing Channels 432
Tiers of Partnerships 432
Pricing 433
Ordering, Delivery, and Payment 434
Sales Targets 435
Customer Information 436
Reseller Marketing Obligations 437
Marketing, Sale Assistance, and Reseller Training 437
Trademark Issues 438
Restrictions 438
Product Warranties and Remedies 438
Terms of Licenses to End-Users 441
Noninfringement Warranties Indemnification
Term, Termination, and Disengagement 442
Jurisdiction for Disputes 443
Foreign Distributors and Resellers 443
Some Legal Issues in Distribution 443
State and Federal Antitrust Laws 443
Resale Price Maintenance 445
Federal and State Franchise Laws 445
Common Errors 448
Form Agreements in this Book 449
Chapter 15: Commercial Distribution-Part II 450
Embedded, Component, and Other Distribution Deal Variations 450
In this Chapter 450
Forms Agreements 451
About "OEMs" and "OEM Deals" 451
Rebranding or White Label Deals 452
Bundling Deals 455
Embedded Software and Software Components 456
Retail Distribution 459
Sales Representatives 461
Form Agreements 462
Chapter 16: Clickwraps and Browsewraps 464
In this Chapter 465
Uses of Electronic Contracting 465
Categories of Mass-Market Forms Contracts 466
Shrinkwrap Agreements 466
Clickwrap Agreements 467
Browsewrap Contracts 468
Are Electronic Form Contracts Legally Enforceable? 468
Are Clickwraps Binding? 469
Software in the Box 469
Electronic Signatures, E-SIGN and Clickwraps 470
Who is Authorized to (Digitally) Sign What? 471
Are Browsewraps Enforceable? 471
Product Clickwrap Agreements 473
Acceptance of the EULA 474
Limitations on Installation and Use of the Product 474
Additional Restrictions 475
Specification of Program Ownership 475
Restriction of Copying, Transfer and Use 475
Limited Warranties and Support 475
Disclaimers and Liability Limitation 476
No-Warranty EULAs 477
Export Control Clause 478
Licensing to the Federal Government 479
Choice of Law, Jurisdiction 479
Arbitration 479
Termination 480
Boilerplate Provisions 480
The Magnuson-Moss Act and Consumer Product Warranties 483
Foreign Customs, Language, and Law 485
Chapter 17: Terms of Use for Web Sites and Online Applications 486
In this Chapter 486
About Web Terms of Use 487
When Should Your Terms Be a Clickwrap, a Browsewrap, or Both? 488
Web Site Proprietary Notice 495
Other Applications 496
More Web Site Forms 496
Chapter 18: Privacy and Use of Personal Data 498
In this Chapter 499
Personal Data and IT 499
Use of the Internet to Obtain Personal Data 500
Web Profiling and Cookies 501
Other Identifiers 501
Overview of US Law on Personal Data 502
The FTC Act and Little FTC Acts 503
Your Written Privacy Policy 506
Goals of the Process 506
Using Privacy Policy Forms 506
A Team Approach 507
What's Covered and What's Not 507
The Substance of Your Privacy Policy 507
Follow Up 511
Making the Technology Fit the Policy 511
Use Seal-of-Approval Programs 511
California Online Privacy Protection Act 512
California's "Shine the Light Law" and "Your California Privacy Rights" 513
Data Security Breach Notification Laws 516
California Law on Security Breach Notification 517
The Law in Other States 518
More Potential Liability for Financial Loss 519
Data Security and Planning 520
Possible Congressional Action on Data Breach Notification 520
Credit Report Security Freeze Laws 520
Anti-Spyware Laws 521
Children's Online Privacy Protection Act 521
Anti-Spam Provisions of US Federal Law 528
The Commercial Rules 529
Rules for Hardcore Spammers 530
Other Regulation of Personal Data Regulation 530
Financial Services 530
Health Care 531
Privacy and the International Data Economy 532
EU Directive on Data Protection 533
Transferring Personal Data from the EU to the United States 534
Taking Advantage of the EU-US "Safe Harbor Agreement" 534
Conclusion 537
Chapter 19: Digital Technology Standards-Opportunities, Risks, and Strategies 538
In this Chapter 538
Who Is this Chapter for? 539
Digital Technology Standards and the Modern World 539
How Do New Digital Technology Standards Matter to Your Business? 539
Sources of Standards 540
Single Company 541
De Facto Standards 541
Establishment Standard Setting Organizations 541
Other Broadly Based Organizations 542
Consortia and Alliances 543
Consortia Characteristics 544
Part icipating in a Consortium-Business Issues 545
Consortium Documents 546
Process and Organization 546
Tension between Patents and Standards 547
Key Concepts in Standards-Related Patent Licenses 548
"Contributions" and Patent Licenses 551
Proposed and Final Standards 552
Identifying Your Necessary Claims 552
Standards Bodies and Mergers and Acquisitions 553
Do You Really Need a License to All So-Called Necessary Claims? 553
Copyright 554
Termination 554
Patent Rules and SDOs 554
Staying Out of Trouble with Standards 555
Antitrust Concerns 556
Unfair Competition and Standards 556
Patent Pools 557
What Is an "Open" Standard? 558
Open Adoption Process 558
Royalty-Free 558
Forming Your Own Consortium 559
Conclusion 560
Chapter 20: Content for Digital Media 562
In This Chapter 562
Forms for Content 563
Some Background: Content and Intellectual Property 564
Copyright and Content 564
Topic One: Practical Guidance in Clearing Content 568
Getting Started in Clearance 568
What Content Items Need Clearance 568
Copyrights Clearance for Prose and Graphic Works 569
A Note about Fonts 570
Locations 571
Copyright and Clearing Music 571
Finding Music Copyright Holders 573
Other Music-Related Clearance for Groups 573
"Promotion Use" of Thumbnails and Clips 573
Sampling 574
Public Performance and Webcasting 575
Special Rules for Webcasting 575
A Note on Dealing with Employees and Contractors 582
Agreements that License Content for Digital Products and Services 582
Topic Two: User-Supplied Content 586
Rights Clearance in User-Supplied Content 586
Carefully Crafted Terms of Use 587
Content Guidelines 588
Blogging Terms of Use 588
Issues and Opportunities from User-Supplied Video Content 589
Topic Three: "Just Taking" Content 591
About Spidering 591
Copying Without Permission and Fair Use 592
Search Engines and Fair Use 592
About Mashups 595
Conclusion 598
Chapter 21: Deals in the Web and Mobile Value Chains 600
In this Chapter 600
Relationship with Other Chapters 601
Forms 601
The Web and Mobile Communications Environment 602
The Players 603
Internet and Mobile 604
Topic I: Communications Technology License Agreements 607
Defining the Basic Deal 607
Duration of the Deal 607
Technology Distribution through Multiple Levels 608
Control of Sub-Distribution 609
Source Code Integration and Transformation 609
Indemnification for Digital Communications Products 609
Technology On or Over the Copyright Edge 610
Standards and Patents 611
Other Technology Licensing Issues 612
Topic II: Digital Content Deals 612
The Flow of Content 613
Digital Content Agreements 615
Specifying the Offering 615
The License Grant 616
Hosting and Data Management 617
Digital Rights Management 617
Licensor's Branding and Attribution 619
Restrictions 619
Exclusivity 620
Links to Content Rather Than the Content Itself 620
No Warranty of Accuracy 621
Who Do You Trust to Supply Clearance? 621
Indemnities 622
Payment Terms 623
The DMCA Safe Harbor 624
Topic III: Hosting and other Services 624
About Widgets 626
Licensing and Widgets 627
Conclusion 630
Chapter 22: Video Games! Developing Games and Doing Deals 632
In this Chapter 632
The Game Industry 633
The Players 633
Industry Segments and Genres 634
Types and Genres 635
Features of the Video Game Business 635
What's in a Video Game? 638
Games and IP 640
Copyright and Games 640
Trademarks and Video Games 641
Patents and Games 642
Publicity Rights (Right of Personality) 643
Trade Secrets 644
Note on Dealing with Employees and Contractors 644
Third Party Game Engines/Game Tools/Libraries 644
Publishing Agreements 645
The Role of Publishers 645
Shared and Diverging Goals 646
About Leverage 646
Term Sheets and LOIs 647
Short Forms/Binding MOUs 647
Prototype and Game Design Agreements 648
The Development Provisions 649
Game Asset Ownership and Licensing 656
Marketing Obligation 658
The Money Provisions 658
Alternatives Means of Game Financing 664
Sequels 664
Multigame Deals 665
Special Issues in International Sales 666
Geographic and Platform Limitation and Reversions 666
Other Important Provisions 670
Internet Functionality-the Case of Blizzard v. BNETD 671
Massively Multiplayer Online Games 671
About MMOs 672
How MMOs Work 672
How MMOs Work Financially 673
Creating MMOs 673
Piracy-Resistant Games 674
MMORPGs and Virtual Money 674
Other Real World Issues 676
Conclusion 677
Chapter 23: Going Global-Doing Business in World Markets 678
Background: Globalization of Information Technology 678
The Opportunity 678
Globalization of Digital Technology Innovation 679
Software Designed for One Country or for the World? 679
In this Chapter 679
Getting into Global Markets 680
Use of US and Foreign Professionals 681
Direct Licensing or Sale from the United States 681
Can Your Business Be Sued in a Foreign Court? 682
Sales Agents 683
Foreign Distribution 684
Benefits and Disadvantages of Distribution 684
International Distribution Agreements 686
Establishing Foreign Subsidiaries of Your Company 692
Foreign Technology Development Subsidiary 696
Joint Ventures 698
Localization 703
Localization by Language 703
Other Localization 704
Dispute Resolution Procedures 706
International Intellectual Property Protection 707
International Patent Strategy 707
Copyright Protection Abroad 708
Taking Trademarks Global 708
Trade Secrets 709
Dealing with Software Piracy 709
Technological Measures 709
Enforcement Measures 710
Foreign Corrupt Practices Act (FCPA) 710
International Anti-Israel Boycott 711
Conclusion 711
Chapter 24: United States Export Controls 712
In this Chapter 712
Why Export Controls Matter 712
Do You Need to Worry About Export Controls? 713
Purpose of Export Controls 714
Multiple Regulators 714
Embargoed Nations and Denied Persons 715
Trade Sanctions 715
Prohibited Persons 716
The Regulation of Technology Exports by BIS 717
What Is an Export? 717
What Is a "Deemed Export"? 718
Overview of Rules 718
Regulation of Encryption Exports 720
What's Not Regulated Under the Encryption Rules 720
Some Countries Are Treated Differently 720
Range of Technologies 721
Other Countries Laws on Encryption 723
Conclusion 723
Chapter 25: Proactive Management of Your Legal Affairs 724
The Need for Control of Legal Affairs 724
Intellectual Property Protection Procedures 725
Information Protection and Control 726
Managing the Documentation of Your Business 727
Contract Management 727
Intellectual Property Documentation 728
Dispute and Litigation Records 728
Content and Permissions Documentation 729
Form Documents 729
Marketing and Sales Material 729
Lists of Consultants and Professionals 729
IP-Related Employee Documentation 730
Periodic Legal Audits and Strategic Reviews 730
Conclusion 731
Forms Appendix: About These Forms 732
From Downloading Instructions for the IT/Digital Legal Companion 733
Form 3-1: DMCA Web Site Copyright Policy 736
Introductory Note 736
Repeat Infringers 736
Notification of Alleged Copyright Infringement 736
Counter Notification 737
Form 4-1: Royalty-Free Trademark License Agreement 740
Introductory Note 740
Form 4-2: Royalty Bearing Trademark License Agreement 750
Introductory Note 750
Purpose of This Agreement 750
Form 5-1: Patent License Agreement 762
Introductory Note 762
Purpose of Agreement 763
Form 6-1: Mutual Non-Disclosure Agreement 778
Introductory Note 778
Form 6-2: Evaluation Agreement (Pro-Recipient) 784
Introductory Note 784
Form 7-1: Employee Agreement 788
Introductory Note 788
Form 10-1: Software Development Agreement 802
Introductory Note 802
Purpose of This Agreement 802
Form 10-2: Software Consulting Agreement (Favors Consultant) 832
Introductory Note 832
Form 10-3: Software Consulting Agreement (Favors Customer) 846
Introductory Note 846
Form 10-4: Web Site Development Agreement 862
Introductory Note 862
Purpose of This Agreement 863
Form 10-5: Web Hosting Agreement 878
Introductory Note 878
Purpose of This Agreement 878
Form 11-1: Beta Test Agreement - Consumer Application 898
Introductory Note 898
Form 11-2: Beta Test Agreement - Business Application 904
Introductory Note 904
Form 12-1: Evaluation License Agreement 912
Introductory Note 912
Form 12-2: Commercial End User License Agreement 918
Introductory Note 918
Form 12-3: Source Code Escrow Agreement 934
Introductory Note 934
Form 13-1: SaaS Customer Agreement 950
Introductory Note 950
Form 14-1: Reseller Agreement 970
Introductory Note 970
Purpose of This Agreement 970
Form 15-1: OEM Software Agreement 992
Introductory Note 992
Purpose of This Agreement 993
Form 15-2: Software Bundling and Distribution Agreement 1014
Introductory Note 1014
Form 15-3: Retail Software Distribution Agreement 1034
Introductory Note 1034
Form 15-4: Sales Representative Agreement 1048
Introductory Note 1048
Form 16-1: EULA - Consumer Product 1060
Introductory Note 1060
Form 16-2: Clickwrap EULA - Commercial Product 1068
Introductory Note 1068
Form 17-1: Web Site Terms of Use 1076
Introductory Note 1076
Form 17-2: Content Guidelines 1084
Introductory Note 1084
About WebCo’s Online Community 1084
Violations and Reports 1086
Form 17-3: Weblog Rules 1088
Introductory Note 1088
Your Agreement to These Terms of Use 1088
WebCo Contributions 1088
User Registration Required for Contributors 1089
User Contributions 1089
Non-Commercial Use 1090
Third-Party Sites and Links 1090
No Guarantee Regarding WebCo Contributions or User Contributions 1090
No Robots and Spiders 1090
Indemnifi cation 1091
Disclaimers and Exclusions of Warranties 1091
Limitation of Liability 1091
Compliance with Law 1091
Changes to Terms of Use 1091
Privacy Policy 1092
Copyright Complaints 1092
Form 18-1: Privacy Policy 1094
Introductory Note 1094
Effective on: [DATE] 1094
Registration 1094
Cookies 1095
Email from WebCo for Newsletters and Announcements 1095
Product Information and Offers 1095
Signifi cant Announcements by Email 1096
Additional Information for Specifi c Purposes 1096
Communications with Others 1096
Feedback to WebCo 1097
Anonymous Data 1097
Links 1097
Security Technology 1097
Correction/Updating of Personal Information 1098
Protection of Minors 1098
Business or Asset Transfer or Sale 1098
Release of Information for Legal Reasons 1098
Limited Use 1098
Changes in This Privacy Policy 1098
Your California Privacy Rights 1099
Form 20-1: Release for Video, Images and Music 1100
Introductory Note 1100
Form 20-2: Right of Personality Release and Permission 1106
Introductory Note 1106
Form 20-3: Location Release 1110
Introductory Note 1110
Form 21-1: Mobile Content License Agreement 1114
Introductory Note 1114
Purpose of This Agreement 1114
Form 21-2: Media Publishing and Services Agreement 1132
Introductory Note 1132
Form 21-3: Affiliate Media Services Agreement 1150
Introductory Note 1150
Terms and Conditions 1151
Form 22-1: Video Game Publishing Agreement 1164
Introductory Note 1164
Purpose of This Agreement 1165
Form 23-1: International Distribution Agreement 1208
Introductory Note 1208
Purpose of This Agreement 1208
Form 23-2: Term Sheet (Non-Binding) for an International Joint Venture 1232
Introductory Note 1232
Index 1238