4 Keys To Successful Software Development Agreements

By | Software Agreements, Software Lawyer | No Comments

software development agreementsWhether you are a software developer, or your business outsources app development, you’ll need software development agreements to protect your legal interests. Many business owners think they can simply copy and paste agreements they find online, but this is a recipe for disaster.

Why is it risky to “borrow” a Software Development Agreement Template?

Borrowing an agreement drafted by and for another company can lead to serious legal repercussions. App development contracts are considered intellectual property and can only be used under license from the copyright owner (usually the lawyer or firm who drafted the contract). If you have not paid for the right to use the agreement (or worse, if the legal form generator you are using doesn’t explicitly own the forms), you could face hundreds of thousands in legal damages.

Also, legal agreements are unique and will vary depending on your (and the other party’s) needs. Even if you download a template with legal permission, you could unintentionally omit clauses which you require or subject yourself to unnecessary obligations.

There are four essential things you should know before creating a software development contract:

  1. the standard items you need to include in your agreement;
  2. how to handle ownership of intellectual property;
  3. when you’ll need additional contracts; and
  4. how you will handle maintenance of the app after development.

1. Standard Items You Must Include in Your Software Development Contract

While your contract should be tailored to your unique situation, there are some common issues you’ll want to address in any Software Development Agreement. Be sure to discuss the scope of work you will be performing for the agreed-upon cost and how you will handle change orders. You also want to outline key milestones and deliverables.

If the client is not satisfied with a deliverable, will you agree to any edits? If so, describe how much time your client has to request a change and how many changes you will make.

If you plan on outsourcing work to third-party coders or programmers, make that clear in your contract.

Also, detail payment expectations and any warranties you are willing to provide for your client.

2. Intellectual Property Ownership: How to Balance Competing Interests

One of the most important aspects of your contract will be defining ownership of the intellectual property you are creating. Consider whether you or the client will maintain ownership rights or if you will be granting a license to use your software.

Software developers often want to keep ownership of the code used to create a client’s software so they can recycle the code for future projects. Clients, on the other hand, often want to own the intellectual property subject to a software development agreement to prevent the developer from re-selling the software to potential competitors.

Fortunately, there are creative ways to balance these two competing interests by creating a software license with non-competition provisions. This enables the developer to retain ownership over intellectual property while also restricting the purposes for which the code can be recycled.

3. If You Are Developing Multiple Apps for a Client, You Need a Master Service Agreement

A Software Development Contract is typically utilized for a single project only. However, if you are anticipating an ongoing relationship and multiple projects for a single client you will also want to execute a Master Services Agreement.

This Agreement should outline the essential terms that apply to all apps being developed and additional agreements for each project should be attached as “work orders.”

Related Article: How To Modify A Software Development Agreement

With each work order, you can reference the key terms used in the Master Agreement or you can make exceptions to certain provisions based on the unique needs of each project.

4. You Need to Plan for Maintenance, Support, and Upgrades

Virtually any form of software application will require bug fixes and upgrades to keep the program up-to-date and functioning properly. A well-written software development agreement will detail who is responsible for maintenance of the application, additional costs involved (if any), and how to request support for bugs and glitches.

Developers who maintain ownership over the intellectual property and merely license the software to the client often take responsibility for ongoing maintenance, support, and upgrades: but it is imperative that these details are clearly outlined in your contract. Ironing out all of the details of your agreement will go a long way toward preventing disputes, ensuring a good working relationship, and keeping clients satisfied.

Software development agreements are highly detailed, unique legal documents. It is wise to seek the counsel of an experienced software attorney to prepare development contract templates that you can use repeatedly while still protecting your best interests.

Our software attorneys prepare app development agreements on a flat fee basis. To learn more, check out our Software Development Legal Protection Package.

3 Things You Should Know About Website Design Agreements

By | Internet Lawyer, Website Lawyer, Website Legal Documents | No Comments

Website Design AgreementsAre you a web designer? Or a business owner who is interested in website design agreements?

If you are a business owner, you understand that a company’s website is your online storefront. Your site is often the first thing potential clients see and informs their first impression of your business. The design of your website can also influence your search engine ranking, setting you apart from your competitors.

If you are reading this article, chances are you already understand the importance of good web design and want to know exactly what to look for in  website design agreements to protect your interests.

While you will have slightly different needs depending on whether you are the purchaser of design services or the designer, there are a number of common contract issues you will want to familiarize yourself with:

1. Your web design contract should outline the scope of work, deadlines, and payment.

The “scope of work” section is the bread and butter of any service contract. Identify, in detail, all the deliverables, the deadlines for receipt of the deliverables, and when/how much payment is expected.

Scope of work is one of the greatest risks for dispute, so include as much detail as is possible in order to predict and steer clear of common disagreements. As a designer, you may want to specifically exclude certain design and development tasks that you have not included in your quoted price.

2. Your agreement should address warranties, disclaimers, and change orders.

Clearly describe any warranties or disclaimers being provider by the designer. For example…

  • Does the designer warrant that all content used is royalty-free and you have full permission to utilize the content on your site?
  • Does the designer warrant satisfaction? Does the designer want to limit liability for content that you may add to your website after the initial design is complete?
  • Also consider how you will handle edits, change requests, or work that you would like to add that falls outside the original scope of work.
  • Do not forget to address changes in deadlines and pricing that will occur due to the additional work.

3. Your agreement should discuss intellectual property (IP) ownership!

Do not assume you automatically have ownership of your website design (whether you are the designer or purchaser). Clearly address intellectual property ownership in your website design agreement.

First of all, you may have to pay to license certain content like stock photography or custom fonts. If you want exclusive ownership of the design elements used on your website so that your designer cannot create a similar website for competitors, you may have to negotiate a higher premium to ensure your content is not recycled for multiple clients.

When you find common ground on which elements a designer may recycle and which should be single-use only, be sure to commit your agreements to writing.

4. Your agreement should consider how you will handle disputes.

If service disputes were rare, there would hardly be a need for website design contracts.

Don’t fool yourself into thinking that a dispute won’t happen to you. Instead, proactively avoid disputes by determining how you will handle conflict from the start.

You should include a clause in your contract that outlines how disputes will be handled, whether you have a preference to use arbitration or mediation to save on court costs, and where your dispute will take place. You also want to state what laws will govern your agreement (such as, “the laws of the State of Texas” if your business is in Texas).

The last thing you want is to be summoned to an out-of-state court over a dispute that could otherwise be handled in your backyard.

Just as web design is unique and varies from client to client, so should your website design agreement. The look and functionality of your website is important to create the professional image you want your business to portray. Unfortunately, it is not hard to find low-cost web designers who will sell you a low-quality website. Don’t fall into this trap. Clarify your expectations from the outset to create a positive, working relationship with a professional web designer. Chances are, you will want to develop an ongoing relationship with your web designer so that your site will continue to stand out among competitors for years to come.

Finding high-quality web designers and creating a positive relationship starts with a rock-solid website design agreement. You’ve taken the first step by getting informed.

If you find that you are ready for the next step of drafting the contract, consider contacting an experienced Internet lawyer for recommendations, advice, and an honest review of your agreement.

At our Internet law firm, an experienced attorney can professionally review any website design agreements before you sign to make sure you are getting the best possible terms for your money. We also offer customized website design contracts for those that would like us to handle everything.

Either way, we’re in your corner. To get started, just schedule a phone consultation today.

SEO Agreements: 3 Things You Ought To Know

By | Business Contracts, Business Lawyer | No Comments

SEO AgreementsBefore we discuss SEO agreements, understand that search engine optimization is essential to online marketing. And, as a business website owner, you can’t avoid it.

  • You want your website to be the first thing your clients see in a Web search.
  • You want your content at the forefront of your client’s minds so that they keep coming back.
  • But, if you’re not an SEO expert (or you simply don’t have the time to optimize your content), you will probably need to work with an SEO professional.

To get the best possible contract (and possibly develop a continuing relationship) with your SEO professional, it helps to know what to include in SEO agreements.

What makes a solid SEO Agreement?

All good SEO agreements start with an honest Q & A session. Know which questions to ask the online marketing professional about their services. Then, make sure you commit your terms to writing.

Ideally, you will be able to structure your contract to lead to a positive, continuing relationship-because SEO isn’t a “one and done” task that you can check off your marketing list after one project. After all, SEO is a way to keep your ideal clients coming in, and this is something you will want to continue (and improve upon) to help your business grow.

1. Key Questions to Ask Your SEO Professional

Before you jump right into a contract, you’ll want to make sure you work with an SEO professional that gets your business and has the bandwidth to meet your needs. Understand that Search Engine Optimization is a marketing strategy, so don’t hesitate to ask your professionals what their process is and exactly how they are going to help optimize your content.

Ask to see proof of past results and examples of their work, to see if you can take their claims seriously. Ask about the tools they use and how they will show you proof of the work they perform (however be wary of “guarantees that you will be the #1 result on Google”). Be very clear that you are looking for someone that complies with Google’s best practices and isn’t just a “spammer.” Spammers abound in the SEO world, and they’ll gladly send tons of spam contact emails or bogus leads to your site (that do NOT result in a single dollar in sales).

Tons of website traffic isn’t helpful if you are not reaching potential clients and seeing a positive return on your investment.

2. Issues to Address in Your SEO Agreement

a. Scope of Work, Deadlines & Term

Clarify deliverables and when you expect the deliverables to be completed or reported (the milestones). Also determine whether this project will be ongoing (for how long?) and if the contract will automatically renew. Or if you will need to take some action to renew the agreement.

b. Payment Structure

Payment structures vary among SEO agreements, but typically there are set monthly fees. Be careful to look for pay increase clauses and try to negotiate a cap on the amount your fees can increase.

c. How You Will Handle Change Orders

Changes are possible (and even likely) in all business contracts, including SEO agreements. Enable flexibility by including a procedure for handling change orders in your contract. Perhaps you will want to increase services down the road when you start seeing positive results…you will want to have a way to change the scope of deliverables without renegotiating a new contract every time.

d. Cancellation & Default

One of the worst mistakes you can make with contracting with an outside professional is forgetting to discuss how you will handle cancellations or breach of contract issues. This procedure is best determined when the relationship is in good standing…before problems arise.

e. IP Ownership

As always, consider who will own the work product. SEO professionals will generate strategies, reporting accounts, ads, and content, so be sure to discuss whether you own the work product or your SEO professional. If you want to prevent the SEO provider from using any of your content for other clients, clearly state this within your contract.

3. Set Yourself Up for Success: Create a Continuing Relationship with Your SEO Professional

Search engine optimization is merely one part of your marketing strategy, but in today’s internet-driven market: it’s an essential part of business marketing. Most clients search, discover, and choose whom they will work with online.

To keep bringing in clients, you will want to continue enhancing your SEO-which likely means continuing your relationship with the SEO professional of your choice. After you’ve asked the right questions, entered a solid agreement, you’ll want to continue track your SEO progress and results to make sure everything is working as planned.

At least monthly you will want to discuss SEO metrics, specifically: your search rankings, search traffic, conversions, and a summary of all SEO activities your SEO professional has completed. Track these metrics against your other marketing activities in order to keep an eye on your ROI. You may even discover that you can shift money toward higher-ROI activities, saving you money and bringing in more clientele.

Negotiating and drafting business agreements that protect your best interest are crucial to your business’s success. Getting informed is the first step, but ensuring you’re covering all the bases (repeatedly) can become exhausting really fast. An experienced business and technology lawyer can help set you on the right path and keep you there.

We offer seasoned advice for flat fees, so there are never any surprise bills. If you need a professional SEO services agreement, check out our Business Contract Legal Protection Package.

Set Up A Texas Business? Choose The Right Entity

By | Business Lawyer | No Comments

As I mentioned in the “Top 10 Things To Do When You Set Up A Texas Business,” the second thing you should do is pick the business entity that’s right for your venture.

Sole Proprietorship or General Partnership

If you’re broke with few assets, it may make sense to set up a sole proprietorship (one person) or a general partnership between two or more individuals (e.g. spouses).

Of course, this doesn’t provide you with a personal liability shield.

So, if there’s a lawsuit against your business, your personal assets might be taken to satisfy any judgment for the plaintiff. This is a key reason why a sole proprietorship or general partnership between individuals rarely makes sense unless you’re essentially judgment-proof because of the lack of assets.

Texas Corporation

A for-profit Texas corporation is one alternative you may want to consider when you set up a Texas business entity. If you do it right, the entity will provide a corporate shield of your personal assets against most claims. In other words, if there’s a lawsuit or a business fails, you can typically walk away with your personal assets intact.

There’s also the ability to choose to way your entity is treated for tax purposes. For example, you can have it treated as a Subchapter C corporation or a Subchapter S corporation for federal income tax purposes.

Texas Limited Liability Company

A popular choice to consider when you set up a Texas business entity is a limited liability company (LLC). Like a Texas corporation, a Texas LLC offers a shield that protects your personal assets from most claims. And an LLC requires less paperwork to run it correctly.

Related Article: Form A Texas LLC Or Corporation

A Texas LLC also provides you flexibility for tax purposes. For example, you can tell the IRS to treat it like a Subchapter S corporation, a partnership (if more than one equity owner), or even a disregarded entity (like a sole proprietorship) if there’s one owner (a single member LLC).

Which Entity Do You Pick When You Set Up A Texas Business?

Talk with an experienced Texas business lawyer in order to make an informed decision on the type of entity that’s right for you. To speak with Texas Business Attorney Mike Young, set up a phone consultation now.

Set Up A Texas Business? Have A Legal Consultation First

By | Business Contracts, Business Lawyer | No Comments

I recently identified the “Top 10 Things To Do When You Set Up A Texas Business.” The first thing to do is to talk with an experienced Texas business lawyer.

Why?

Because the Texas business attorney will give you advice that can save you time and money.

For example, you may learn that it makes more sense to form a Texas limited liability company instead of a Subchapter S corporation…or vice versa.

Or you’ll learn that business equity ownership should be structured differently than you originally intended because it will protect your interests, save you a fortune in taxes, etc.

Plus, you’ll discover the essential business contracts needed to protect your new venture.

In short, your legal consultation with the Texas attorney is an excellent opportunity to review and revise your business plans in a way to maximize your chances for long-term success.

On the flip side, entrepreneurs who ignore the legal aspects of a startup (in the Lone Star State or elsewhere), risk losing everything through the shortsightedness of believing messes can be cleaned up easily after the fact.

Wise business owners know that it’s easier to prevent legal problems than fix them later.

Are you’re ready to set up a Texas business? Schedule a phone consultation with Texas Business Lawyer Mike Young today.