I was looking for some insight that I might have missed.  In the world of contracts, your license actually will specifically state who has the ability to audit your license usage (if they have the right at all).  And in the world of law, the term “standing” is used to show who actually is allowed to raise a particular issue (via the courts, etc).  So the SPA/BSA/SIIA (SIIA is their current incarnation) (or any other third-party “enforcer”) wouldn’t have the legal right to ever come in and audit your software license use unless there’s language in the license that allows for such audit.

Even general audit language is probably safe to prevent the SIIA from knocking on your door one day.  Typical audit provisions include:

• explanation of who can come to audit (it usually says that the vendor has the right to audit)
• time-frame of any audits (I typically am very clear to limit audits to 1 time per calendar year)
• notice for audits (even bad audit language usually says that the vendor has to notify the licensee of the intent for an audit)
• who besides the vendor can come audit (if 3rd parties are allowed, I limit to a “big-four” accounting firm and have NEVER been challenged on this limit)

The result is that even with not-so-favorable audit language, I simply don’t see how the SIIA has any right to come and perform an audit, let alone try to sue a licensee for license violations (again, any license that has “no third-party beneficiary” language in it could be used to very clearly show that the SIIA doesn’t have any rights with respects to the license).

Additionally, it’s been suggested that there are two other routes to allow such an audit: the “source” (the licensee’s employee who reports a violation) and the potential for an assignment of audit rights.  As for the source person, unless they’re also the person in the company who can allow someone to come in, that individual probably doesn’t have internal authorization to allow the audit to happen – so I find this unlikely.  The assignment of audit rights potential does exist, and contracts that have poor assignment language could potentially allow the vendor to assign their rights to someone else (and, in fact, it appears that the SIIA attempts to use an assignment of rights in this manner).  So it’s conceivable, but I’ve never seen the language used in that way.

At the end of the day, the lesson is this:

1. Have strong audit language which clearly states who can perform the audit, on what time basis they can audit and what the results would mean (ie: usually you don’t have to pay any form of penalty unless usage exceeds 10% of the licensed quantity – but you’ll always have to pay for the difference in usage).  Include notice provisions and be very clear about whether the vendor can outsource their auditing… many will use large auditors, which is fine, but you don’t want Andy’s Audit Shack to be performing the audit.  Lastly, if you’re maintaining any kind of uber-confidential information (like SSN’s, bank account numbers, etc), then I would also be clear about what kinds of auditing tools can be used to complete the audit, as many vendors like to install their own auditing software onto your network.
2. Have clear assignment language which prevents EITHER party from assigning the agreement without the other party’s consent (not to be unreasonably withheld, if you so choose): “Neither party may assign or otherwise transfer this Agreement or any of the rights hereunder, without the prior written consent of the other, which consent will not be unreasonably withheld or delayed.”.

OK – so you’ve done the prior two things and the SIIA comes knocking (physically or with a letter requesting/demanding an audit).  What do you do?  Simple.  Deny them access – in writing.  They’ll threaten, similar to the Big Bad Wolf, to huff and puff and to blow your house down.  But if you’ve got things properly documented, the SIIA simply doesn’t have the legal right to audit.  It doesn’t matter whether the vendor they’re supposedly auditing for is a SIIA member.  It doesn’t matter if they claim to have permission.  (Oh, and interestingly enough, if they name names and tell you which vendor sent them to you, I would check your license agreement with that vendor because many vendors like to include confidentiality restrictions which prohibit either party from even identifying the other.)

Now, regardless of everything I’ve just told you, I also firmly believe that you should always be 100% compliant with your contractual obligations.  So use some form of license management tool to know that you’re only using what you’re licensed to use.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

My clients are typically organizations that fall into one of three obvious categories:

1. small organizations who need a contract negotiator for individual large deals;
2. medium-sized organizations seeking to create a contract management team; and,
3. large organizations who can benefit from strategic advice to bolster their internal staff resources.

So, if you or your organization have been considering contract renegotiation strategies or mitigation work based on risk management assessments, now might be a perfect opportunity to take advantage of the current economic situation.  Additionally, I can provide a VMO-in-a-box (the creation of all things necessary for the implementation of a vendor management office) or simply act as a sounding board to make sure that you’re extracting all of the value possible from each deal.

Contact me today if you’d like to use my knowledge to your advantage.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

I also realized that many of you might have no idea what you’re seeing below.  Sorry.  These are “tweets”, 140 maximum character messages sent via Twitter.  Within the Twitterverse individual users follow others and have followers (think of it like overlapping Venn diagram circles).  To read a tweet, you have to wade through a bit of jargon used to make the most of the 140 character limitation.  “RT” for example, is shorthand for “Re-tweet” and the @____ is the username of some other individual on Twitter.  Combined together, then, “RT @_____” means that someone else wrote a tweet that I found important and I now want to forward along to my followers.  The URL’s are then also shortened by shortening services like bit.ly to make the most of the character limitation, too.  Lastly, you might see “hash” identifiers “#______” which are ways to tag tweets of a particular flavor for easy searching later and “<” which means that I am commenting on what came before it.

• RT @TradeSecretLaw: Vary the Speed and Timing of Your Negotiations for a better deal. http://bit.ly/XP5W9 < Good. Are there better examples?
• RT @johnlwatkins: New blog post: Why Judge’s confidentiality rule may increase arbitration and mediation. http://bit.ly/j9PYj
• RT @TOpatentlawyer: Microsoft patents a way to make more money from MS Office http://ow.ly/tGOg (via @slashdot)
• RT @dahowlett: Qu: do software buyers make rational decisions? Methinks ‘not often.’
• The Cloud Computing Consultant: http://bit.ly/2lSgVQ (via @dealarchitect) < Hilarious and NSFW.
• MS attempts to patent software licensing based on time: http://bit.ly/kRcsO < I hope there’s a solid prior art search (and practice).
• RT @glambert: “When is a blog a sponsored endorsement?” (via DLA Piper) http://bit.ly/peWyj
• RT @CopyrightLaw: “NBC And CNBC Sued For Infringing Use Of…FONTS” http://tinyurl.com/yfob39h
• RT @jayshep:Best law school advice? “Say hi to Heidi. She’s in our section.” Been married to her 13 years with 2 beautiful daughters.<
• RT @TradeSecretLaw @worklawyer: Don’t lecture. Tell stories. Emotion is more persuasive than facts. < works w/ negotiation, too.
• RT @matthomann: Three great questions to help you remove ego from your (and your clients’) decision making: http://bit.ly/isPkL < Excellent!
• RT @CopyrightLaw: “More fair use follies — copyright infringement by court filing?” http://tinyurl.com/yh75nfc < I’m loving @copyrightlaw
• RT @gfiremark: Termination rights: music to artists’ ears http://bit.ly/15O7Hq
• RT @CopyrightLaw: Resale of International Textbooks to US Students Not Protected by First Sale Doctrine http://tinyurl.com/ybqo828
• RT @gfiremark: Was a Contract Formed? http://bit.ly/OvsQs < K wasn’t conditioned on others’ perf. Can’t wait to see the pics.
• @VBalasubramani OK… so who’s going to take this to the SCOTUS? And what’s the third case: Vernor, Cincom and…???
• RT @VBalasubramani: what’s the difference between a purchase and license of software? http://bit.ly/QSMwP < Congrats! Great job.
• Cool trademark search/registration site: http://www.trademarkia.com
• Andy Clarke (@cowshedstudio) on being a Contract Killer: http://bit.ly/Bv4pP <Good article by the kind of person I want as a contract client.
• RT @highrockmedia Freelance contracts: Do’s And Dont’s – http://bit.ly/hiXLg (via @smashingmag) < I’m commentator #39.
• SEC charges former CEO of IBSG with fraud in announcing fictitious licensing agreements: http://bit.ly/3NLp6U
• RT @gtiadvisors: Gmail, AOL, Yahoo! all hit by webmail phishing scam http://bit.ly/3UN3CM < What does this say about the USERS?
• RT @ITLeadersForum @alltop The Twitter decision flow chart – fun way to think about our use of Twitter…http://retwt.me/CgU4
• RT @marinafeehan: Nixon Peabody Says Student Recruitment needs Overhaul. http://bit.ly/CJsHL < Translation: We don’t want to go it alone.
• New post at licensinghandbook.com : FTC Required Disclosure http://bit.ly/18TPsw
• RT @WieseLawFirm: What are you saying that you aren’t saying? New Blog Post up on the importance of Body Language. http://bit.ly/4gSB7k
• RT @Molly_McDonough: Need a social media/copyright refresher? Take this @bobambrogi quiz http://bit.ly/EyHq
• RT @DanaNewman: Guns N’ Roses sued for copyright infringement: http://bit.ly/NbvWI
• Court Re-Affirms First Sale Doctrine Applies to Licensed SW – http://bit.ly/2fNwsI < Compare w/ Cincom http://bit.ly/IJKVR
• Just use whatever the hell you click “yes” to the first time you load up Resident Evil V to get you started. > http://bit.ly/3WiF51 < Oh my
• Stanford loses patent rights b/c a researcher signed a partner co’s visitor agreement (@ontechcontracts): http://bit.ly/vyPit
• RT @gtiadvisors @kaedron: Microsoft confirmed that thousands of Hotmail accounts compromised in a phishing attack – http://bit.ly/1kpIVT
• RT @fscavo: Expect to hear more of these. From @DavidLinthicum “SaaS Horror Stories Are Starting to Appear” http://bit.ly/kpFT4
• RT @Francineward: Intellectual property- Should biz methods be protected by patent? What will the Supreme Ct say? http://tinyurl.com/ya84d57
• RT @BrianNFletcher: Reading: Red Hat files briefing in support of stopping software patents http://sbne.ws/r/2WRe
• RT @DanaNewman: Dreamworks’ “Flushed Away” sued for copyright infringement: http://bit.ly/p9dOa
• New post at licensinghandbook.com : Announcing the Software Licensing Education Series on DVD http://bit.ly/7RNjZ
• RT @JoeTalik: Many firms unhappy with procurement outsourcing deals http://bit.ly/2lcPP < Don’t outsource what you don’t already do well.
• RT @gfiremark: Excellent Review of “most prolific scholar of copyright in history” http://bit.ly/2dGAws
• Have you downloaded my free Software Licensing Risk Matrix yet? http://bit.ly/FreeRiskMatrix
• RT @raesmaa: Do your lecture notes violate your prof’s copyright? Holy crap! http://bit.ly/1yyPoT < Read comment #8 for the best analysis.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

So it gives me great pleasure to announce the availability of the Software Licensing Education Series on DVD.  While previously offered here as a digital download, I wanted to make these videos available to a much broader audience.  Teaming with CreateSpace has given me that opportunity.

The Software Licensing Education Series is video-based software licensing training.  Designed with even a novice in mind, the Series progressively moves from basic topics to those requiring more experience and background.  Built around a college-courseware format (100, 200, 300, 400 and 500 levels are available), the Software Licensing Education Series provides instruction in bite size pieces for optimal learning.

Pricing for the DVD set is $750 – significantly cheaper than the cost of most software licensing-related conferences and packed with way more instructional time (551 minutes… more than 9 hours of material).  The DVDs may be used in a business setting, too… and are re-usable over and over as needed.

Buy the Software Licensing Education Series now via DVD or digital download and start saving money and reducing risk today!  Oh, and get a 10% discount through the month of October on the DVD using discount code: 89YYH47X

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

3.  Ask your client for a similar contract. Huh?  If your client has a similar contract, they probably don’t really need you.  Now, I’m not advocating reinvention of the wheel.  If there’s a pre-existing solution to the problem, by all means, use it.  But I’m guessing that someone’s coming to you to draft the agreement because you have the skills.  More importantly, however, is that their template/sample probably contains a LOT of issues.  So it’s usually 110% easier to start from scratch (or from your form) and customize it to your client’s specific needs.

4.  Check the form books and treatises for a contract form. and  5.  Buy forms on disk or CD-ROM. I don’t know who first created form books, but they’re not as good as one might think… and they’re not necessarily battle tested, either.  You’d be better off getting a template from someone else you know if you don’t know where to start.  There are exceptions, of course, but still – be careful (see the second part of my advice for #3 above).

6.  Don’t let your client sign a letter of intent without this wording. Actually, my advice is to NEVER sign a letter of intent, regardless of the wording.  As I’ve said before, a Letter of Intent is usually just a poorly written contract.  Don’t get caught up in that mess.

9.  Identify the parties by nicknames. This isn’t a hard-and-fast rule.  Use nicknames only if it actually makes things easier to draft AND read.  Be careful about using descriptive terms as nicknames (customer, vendor, consultant, etc) because other forms of that word could appear in the agreement.  Use the “Find” feature of your word processor to discover if this is true.

12.  Include recitals to provide background. I know a lot of people love these.  But I hate them.  I hate reading them and I hate writing them.  On the other hand, for complex deals where the agreement could apply to many different things and you want to be clear on what the contract is really covering, this is the place.  But for a standard software agreement, the place to list the products is in a product schedule… that way you can use the same license and only add additional product schedules w/o having to amend the agreement itself to modify some “Now therefore, the parties agree to license Word Processing application.” type of language.

17.  Title it “Contract.” Actually, the better advice is to simply make sure that it doesn’t say “proposal” or some other transient contract type (like “letter”).  Granted, I like document titles “Software Licensing Agreement” or “Amendment to Master Services Agreement”.  But putting “Contract” in bold at the top of the first page is silly and WAY outdated.

24.  Write number as both words and numerals: ten (10). I agree with Ken Adams on this one.  Use the standard rules for numbers: words for zero through ten and numerals for 11 on up.

25.  When you write “including” consider adding “but not limited to.” Not worth adding.  Ever.

26.  Don’t rely on rules of grammar. WHAT!?!?! OK.  Look.  Use plain English wherever possible.  Write clearly.  Using superior grammatical skills.  If you don’t have such skills, don’t draft contracts.

29.  Be consistent in grammar and punctuation. Well, at least Mr. Martin shows consistency in his inconsistency regarding grammar.

30.  Consider including choice of law, venue selection, and attorneys fee clauses. Consider?  Absolutely include choice of law and attorney’s fee clauses (though in some cases attorney’s fees won’t ever be granted… but it doesn’t hurt to ask).  On the other hand, you’ll almost NEVER get venue if the other side understands it well enough to ask for a different location.  But if you’re both in the same location, it never hurts to add it in to make sure you won’t be dragged out of state.

32.  Define a word by capitalizing it and putting it in quotes. and 33.  Define words when first used. No and No.  Define words in a definitions section up front.  Unless you only have an average of one defined term per section.  Then you can define “in line”.  Otherwise it just gets too ornery to try to make sure you define the term the FIRST time you use it.  This is especially true when definitions end up getting used in the definition of other defined terms.

34.  Explain technical terms and concepts. If you’re using terms that laypeople can understand, the only technical terms that should appear should be in a statement of work or other descriptive document regarding the work.  As such, it should be written so as to be understandable by the people that have to abide by the contract.  Judges and lawyers can find technical people to explain technical terms.  The only time you should explain technical terms is if there’s a reasonable disagreement in the technically-educated community as to the usage of the term.

35.  All contracts should come with a cover letter. Not necessary.  If your contract is so difficult as to not be able to understand how to sign it, you’ve got a problem.  The best thing I’ve seen so far?  “Sign Here” tape flags that you put on the side of the document they’re supposed to sign for each signature line.  Then paperclip your business card to the front with a post-it note attached thanking them for their help and asking them to sign and return one of the two originals.

38.  Use your word processor’s spelling and grammar checker. Yes, but don’t rely on it.  Two, to, too, toe.  Their, there, they’re.  Through, thorough.  Notice anything?  They are all real words and spelled correctly.  Spell checker isn’t going to flag any of these.  Grammar checker is no better: “A parakeet is not a bluebird.” is grammatically correct.  But if you intended to say that a parakeet isn’t blue, the prior sentence is not correct but won’t be flagged.

42.  Save the drafts as multiple files on your computer. Yes, but not how it was recommended.  Unfortunately, using periods in your filename is still problematic for some operating systems.  Weird abbreviations for drafts, comparisons, etc are also hard to decipher.  Instead, try this:  “filename vX date initials.doc”.  So if you have a file called MasterService and it’s the 4th iteration being saved on September 29, 2009 by Jeffrey I. Gordon, the filename would be:  “MasterService v4 092909jig.doc”  Why do I do it this way?  Well: a) it keeps the files in draft order in virtually all file systems (Windows, Mac, Linux); b) it notes which version it is (saves on confusion about which document is the latest); c) notes the date it was created; d) notes who created the draft.  Sometimes I’ll substitute my company’s TLA instead of my name… but usually, I like my initials better to let me know that I was the author of that version of the document.  When I get the last version that becomes the final, I change my initials to FINAL – so the name would now be: “MasterService v10 101509FINAL.doc”.  This lets me know that v10 was the final and which version was signed.

44.  Print the contract on 24 pound bond paper instead of 20 pound copier paper. Not worth the cost of paper.  Especially if you want the other side to sign first – ask them to print two originals, sign both and send to you… you can’t control the paper it’s printed on.  Besides, if you’re using a contract management system, you’re going to scan and forever more look only at the digital version, so the paper is irrelevant and not worth the added expense.

47.  Initial every page of the contract. Wholly unnecessary unless you don’t trust the other side and you’re signing first.  But as I’ve said before, if you don’t trust the other side, you shouldn’t be doing the deal in the first place.

48.  Identify the parties and witnesses who sign by providing blank lines below their signature lines for their printed names and addresses. and 50.  Add a notary clause that complies with the notary law. Witnesses and notaries aren’t necessary unless required by law for the specific type of contract you’re closing (usually for real property, but I’m not sure it’s required for any other type… anyone know for sure?).  Many businesses have a notary on staff, but unless the document is required to be signed “under seal”, this also is usually not a requirement and is an added expense to some (and added time/effort for everyone).

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

I also realized that many of you might have no idea what you’re seeing below.  Sorry.  These are “tweets”, 140 maximum character messages sent via Twitter.  Within the Twitterverse individual users follow others and have followers (think of it like overlapping Venn diagram circles).  To read a tweet, you have to wade through a bit of jargon used to make the most of the 140 character limitation.  “RT” for example, is shorthand for “Re-tweet” and the @____ is the username of some other individual on Twitter.  Combined together, then, “RT @_____” means that someone else wrote a tweet that I found important and I now want to forward along to my followers.  The URL’s are then also shortened by shortening services like bit.ly to make the most of the character limitation, too.  Lastly, you might see “hash” identifiers “#______” which are ways to tag tweets of a particular flavor for easy searching later and “<” which means that I am commenting on what came before it.

• Too cool… just got quoted in the Washington Post on severance negotiation (I can only find the article via Omaha): http://bit.ly/3aOqzb
• RT @gfiremark: The Scholarly Kitchen: ‘$80,000 per Song, and Perceptions of Copyright’ http://bit.ly/Ju3RO < Excellent post!
• RT @TradeSecretLaw: Ten Fatal Mistakes that Business Owners Make – No. 10: Failure to Protect Intangible Assets http://tinyurl.com/pmqcht
• RT @raesmaa: Every person … of restless mind writes a book. From Predictions for 1993 (1893). http://bit.ly/HA8UY < It’s the internet.
• NC law allows minors to back out of contracts unless approved by the Superior Court. The NCAA just figured this out: http://bit.ly/le6rl
• Some rumors should rest untested (via Lowering the Bar): http://bit.ly/MHgEr
• RT @blawgreview: Negotiation 101: Gender War Or Gender Peace And Prosperity? http://tinyurl.com/m4ewy6 (it’s @vpynchon, no less!)
• RT @DanaNewman: Fergie named in copyright infringement suit over “Voodoo Doll:” http://bit.ly/8JLEY
• RT @bethanyriskin @stacyrea: Leader Test: When your team members “fail,” do you wag your finger or extend a hand?
• New blog post on licensinghandbook.com: Contracting as a Specialty: http://bit.ly/iCFYQ
• RT @richards1000: “Professor Posts ‘Illegal Copy’ of Guide To Oregon Public Record Laws” http://tinyurl.com/kq35dc (via @CopyrightLaw)
• RT @BrettTrout: IBM’s new strategy: Open Innovation. http://is.gd/3o3DV < About damn time.
• RT @gtiadvisors @lawyerist: Lawyers do Love Arguing http://bit.ly/1uzoJ5 < Remember, though, that arguing isn’t negotiating!
• Open Source Business Models: http://bit.ly/EVvXC (by @stephenrwalli)
• Listening tips from a Hostage Negotiator: http://bit.ly/WUEMn < These are great… esp #2.
• New blog post: Business Continuity http://bit.ly/1dwMvn
• DOJ may revise eDiscovery procedures after 9th Cir ruling: http://bit.ly/ZNlet
• Apple pushes to change subscription accounting rules: http://bit.ly/Mjf4z < RevRec lesson of the day
• RT @kottkedotorg: Protecting yourself from your own irrationality http://bit.ly/12nj3M < Excellent negotiating advice!
• RT @AdamsDrafting: Blog Update: Lawyer and Contract Manager: Compare and Contrast http://bit.ly/KwMKo
• RT @uMCLE @SCartierLiebel @GabrielCheong: Agreements on Sex in Prenups http://bit.ly/4xnvsu < Love this lesson on contractual severability.
• RT @bobambrogi: LawSites blog: Free Site Enables Document Assembly http://bit.ly/vda1A (@jasonanderman)
• RT @bcuban @Smartalyx @Lotay: A blogger who gets a product (before/after a post) doesn’t disclose has ethical probs. Do you agree? <Agree
• RT @uMCLE @steigerlaw 16 Major Studios Sue ‘Ellen DeGeneres Show’ for 1,000+ copyright violations http://bit.ly/cSI6D < hehahahahahah
• Great negotiation advice: http://bit.ly/1dY7du

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

I also realized that many of you might have no idea what you’re seeing below.  Sorry.  These are “tweets”, 140 maximum character messages sent via Twitter.  Within the Twitterverse individual users follow others and have followers (think of it like overlapping Venn diagram circles).  To read a tweet, you have to wade through a bit of jargon used to make the most of the 140 character limitation.  “RT” for example, is shorthand for “Re-tweet” and the @____ is the username of some other individual on Twitter.  Combined together, then, “RT @_____” means that someone else wrote a tweet that I found important and I now want to forward along to my followers.  The URL’s are then also shortened by shortening services like bit.ly to make the most of the character limitation, too.  Lastly, you might see “hash” identifiers “#______” which are ways to tag tweets of a particular flavor for easy searching later and “<” which means that I am commenting on what came before it.

• RT @rwang0 @dealarchitect: Don’t cry for me Germany. SAP had plenty of warnings. http://tinyurl.com/mclvbm < I can’t wait to see who’s next
• RT @richards1000: Tuunanen et al. on Automated Software License Analysis http://bit.ly/svjQR < Cool but irrelevant. FOSS license are nonneg.
• RT @rwang0: reading the new twitter terms of service. like the fact that you and only you own your content. < At least for now.
• RT @jimcalloway @ernieattorney Important safety tip for ‘would-be lawyer bloggers’: if you lack common sense don’t blog http://bit.ly/2fFcBH
• New blog post: Content, Value and Commoditization http://bit.ly/27HVx
• RT @btannebaum: Lawyers, do you care about transparency on twitter? http://mylawlicense.blogspo…
• Contract negotiation according to the Marx Brothers: http://bit.ly/12U7pY
• US Registrar of Copyrights opposes Google book deal: http://bit.ly/KhP83 … so do I. Unwarranted monopoly.
• … and then there was a whole discussion on what constitutes being an expert at something, sparked by one lawyer’s assertion that it takes 6 months’ of research and then a good SEO strategy to get yourself to the top of the Google rankings.  I, and others, disagreed.  (RT @nikiblack @Adrianos: “How To Become An “Expert” In Your Niche In 6 Months” http://bit.ly/pIj2Q < I really do NOT like this!)
• New blog post: On Acceptance Testing… http://bit.ly/s0zsV
• @JasonAnderman The author misses part of the value of the lawyer – understanding that a form isn’t 1sizefitsall. Available /= viable.
• @ferrusi @PeterKretzman When discussing vendors, not having them in the room usually leads to more openness. It can also reveal biases.
• @PeterKretzman @mckenziesa: RE: Find a way to get the salesmen out of our vendor discussions! < Um, Ask them to leave?
• RT @glambert: Blogging Lawyer Charged with Confidentiality Violations – http://bit.ly/mLcTj (Public Defender tells a little too much)
• RT @rwang0 Cloud computing model – IDC numbers show s that its … 1/2 the cost < How does that translate to customer fees?
• RT @PeterKretzman @testobsessed Source code, like invty, is a liability, not an asset. (PK: indeed. It’s why I laugh at source code escrow)
• RT @vpynchon @tamerabennett: Disney, Pixar Sued by Luxo Lamp Co: http://bit.ly/MO4X7 < Shouldn’t matter. Pixar’s not selling lamps.
• RT @fscavo: @negot8or thinks #saas providers should set up living trusts (my word) for their customers. Read comments: http://is.gd/34L65
• Kate Gonzalez’s Tom Ten Force Majeure Imposters (via @superbuyer): http://bit.ly/Ol4Wy
• Confessions of a Car Salesman: meeting, greeting and dealing: http://bit.ly/3nihk (via edmunds.com)
• Antitrust lawyer slams Google book pact: http://bit.ly/83Hqp (via All Things Digital)
• RT @LeighMonette: RT @PrivacyLaw: “’Anonymized’ data really isn’t—and here’s why not” http://tinyurl.com/ksxz8t
• RT @fscavo: Just blogged: SaaS contingency plans need more than software escrow http://bit.ly/r2cJn < Escrow is wasted money IMHO.
• RT @jimcalloway: Blogged about lawyers taking their laptops across the U.S. borders. http://tinyurl.com/n4bfms
• RT @BrettTrout “World Patent” good for M$, bad for most everyone else. http://bit.ly/o0rbZ
• Jeremy Telman, contracts prof @ my almamater, on why execution before performance is a good idea: http://bit.ly/1iJjY7
• RT @vpynchon: http://twurl.nl/tiuvp7 the negotiation analysis of the lessons of the Cove (which halted the killing of dolphins for one day)
• RT @bobambrogi: LawSites blog: Plaxo’s New Terms of Service http://bit.ly/1BNRy
• RT @bobambrogi @paulzink: You and your attorney colleagues (esp. those in copyright law) may get a chuckle from this: http://bit.ly/jJd6G
• … and then we had a long discussion on the tweeting of the play-by-play via twitter of a NFL game (the NFL likes to exert some extreme control over their content).  Some folks thought that twitter was a game-changing technology.  I argued that it was control-changing…. that they should tweet every game in their own words: @FlashFusion @julito77 @gtiadvisors It’s only a copyright issue if you tweet the actual broadcast wording/play-by-play. Make up your own.
• RT @doctorow: Another reason you can’t outsource your kids’ online safety to spyware companies: http://tinyurl.com/n934fh < Read the EULAs!!
• RT @gtiadvisors @GregBufithis @BrettTrout Proposed U.S. patent law reforms would stifle innovation and injure entrep’s http://is.gd/2ZXza
• RT @OmarHaRedeye: Blawg Review #228 is live http://bit.ly/11D50J/ < Thanks for the inclusion!
• Sometimes is pays to see how the software sausage is made: http://bit.ly/S3b5p

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

I also realized that many of you might have no idea what you’re seeing below.  Sorry.  These are “tweets”, 140 maximum character messages sent via Twitter.  Within the Twitterverse individual users follow others and have followers (think of it like overlapping Venn diagram circles).  To read a tweet, you have to wade through a bit of jargon used to make the most of the 140 character limitation.  “RT” for example, is shorthand for “Re-tweet” and the @____ is the username of some other individual on Twitter.  Combined together, then, “RT @_____” means that someone else wrote a tweet that I found important and I now want to forward along to my followers.  The URL’s are then also shortened by shortening services like bit.ly to make the most of the character limitation, too.  Lastly, you might see “hash” identifiers “#______” which are ways to tag tweets of a particular flavor for easy searching later and “<” which means that I am commenting on what came before it.

• RT @LeighMonette @cyberlaw: Microsoft can still sell Word, at least until the appeal is decided – the stay was granted. http://is.gd/2StlM
• New blog post: The Prisoner’s Dilemma http://bit.ly/3pXV37
• It only takes 1 person who knows your purchasing system to bilk you. http://bit.ly/pBmcI Wanna’ chat about better processes? Call me.
• RT @harrymccracken: Amazon gives Kindle owners their copies of 1984 and Animal Farm back: http://wp.me/pg9un-4iW
• Remember the story about a music label paying artist’s education from early this summer? They didn’t. http://bit.ly/hhf1a
• Because I love words: http://bit.ly/rN6v0
• RT @bobambrogi: LawSites blog: New Site for Sharing Legal Documents http://bit.ly/1SXQGf < Just remember you get WHO you pay for.
• RT @wallybock: RT @ericdbrown: Blog post: The Dangers of Hidden Talent – http://bit.ly/170Yk
• RT @gtiadvisors @GaryHonig: The SBA has a new online federal procurement training site http://www.sba.gov/fedcontr…
• RT @gtiadvisors @constructionlaw: Insurance, Guarantees and Performance–Oh my! http://su.pr/1aFG69 < Glad 2 C this is more than an IP prob
• RT @blawgreview: Is there a looming trust crisis in the “social media expert” space? http://tinyurl.com/lfc9bn via @CharlesHGreen
• New blog post: Brittle Contracts http://bit.ly/2Qo5hE
• RT @Licensing_News: TSO3 enters into exclusive negotiations with 3M http://cli.gs/dNPJ7 < Wondering about benefits of this announcement.
• RT @SusanEJacobsen:“Small talk” is just that–small & insignificant. Say something meaningful. Give folks something to think about. Be real.
• Fifth of Five Fundamental Skills for Effective Negotiation (Communication): http://bit.ly/2GfAel
• RT @CloudAve: Free Sometimes Comes at a Huge Cost http://bit.ly/x2f5O < Excellent!
• RT @gtiadvisors: @negot8or (trusting SM) I would suggest the old fashion way – Trust, but Verify… the verify part is where we help.
• DOJ announces $1.9M+ in grants for criminal IP enforcement: http://bit.ly/11MMWZ
• Is breach of contract a good use of taxpayer dollars? http://bit.ly/d7kgE
• One reason I don’t like press releases for deals: http://bit.ly/12rE0o
• 4th of Five Fundamental Skills for Effective Negotiation (Perception of Power): http://bit.ly/Fi64Z
• I’m excited to announce that my wife and I are expecting in March, 2010. http://twitpic.com/g17r0
• Seth Godin on “wanting”: http://bit.ly/1mvLJ8 < Apply this before negotiating to clarify your needs vs wants.
• RT @LeighMonette @internetcases: Interesting email privacy case that could be relevant in cloud computing context: http://is.gd/2JxpU
• Thanks to Sheryl Schelin (@theinspiredsolo) for including the LicensingHandbook Blog in this weeks’ blawg review: http://bit.ly/YULSx
• RT @gtiadvisors @BurgessCT: Alliance Against IP Theft http://ow.ly/nnke – their new website is full of useful data & easy to navigate
• RT @SuperBuyer: How are vendors like a Big Eighties band? Find out here: http://tinyurl.com/m3m9y2
• RT @jod_writer @caseywright: Girl’s science project disproves advertiser’s claims, results in multi-million $ lawsuit http://bit.ly/14iTan
• RT @jod_writer @chucknewton @BlawgTweets: Ave Maria School Of Law Prepare Student’s For Law School By Scrubbing Toilets http://bit.ly/17DcKc
• RT @gtiadvisors @gaconsultants Not first time, had case 3 yrs ago, Marriot and Radisson Customer Data Breached http://bit.ly/ZP6dv
• RT @fscavo: heheh RT @yourdon For software ppl, today’s Dilbert is hilarious! http://bit.ly/LSuwW
• RT @iasta: Poor Communication = Poor Supplier Performance, Part V http://bit.ly/2jMoQV

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

To illustrate my point, think about the last contract you reviewed.  Did it have a definition section?  How about references to external documents (a spec list, a set of documentation, a “missing” Exhibit or Appendix)?  Was it full of cross-references or have noticeable gaps (such as missing language for standard terms)?  Was the contract obviously written for a different type of product or service?  In all of these situations, I believe you have a brittle contract.

Contracts are “incorporated” documents.  This means that all of the various sections have to work and play together to form a cohesive end-product.  When you’ve identified gaps, errors or problems, these mistakes can cause cascading failures throughout the entire agreement.  A poorly-defined term, for example, could ripple through the contract, causing errors in judgment regarding expectations, or could even create legal problems with regards to intellectual property.  In other words, the poorly-defined term doesn’t hurt itself, it hurts the entire document.

The same is true for commonly overlooked sections on subjects such as term, termination and scope.  When a lack of attention results in an incomplete picture of the relationship, the net impact can be extremely detrimental (ever had a perpetually-renewing contract for poor services that was hard to get out of because termination was only for breach, yet the services weren’t defined well enough to hold the vendor to performance standards? I have.).

You can also look at brittle contracts from another perspective, one my friend D.C. Toedt might appreciate.  D.C. seems to love language portability – drafting contract sections that can be used in a plug-and-play format to craft the appropriate document (you should check out some of his work in his clause library).  This type of drafting is a part of the holy grail of contracting – the complete automation of the contract creation process based on a wizard-style interface which asks questions and assembles an appropriate finished product from such a library of contract clauses.

The inherent problem with document assembly is brittleness – that you insert a clause into the agreement that has to properly “work” with all of the other sections.  If the clause has a faulty cross-reference, for example, the contract breaks.  On the flip-side, however, document assembly fixes one of the aforementioned brittleness issue with current contracts – having a completely appropriate document for the specific product or service being offered under the agreement.

So… how brittle are your contracts (especially your templates)?

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

I also realized that many of you might have no idea what you’re seeing below.  Sorry.  These are “tweets”, 140 maximum character messages sent via Twitter.  Within the Twitterverse individual users follow others and have followers (think of it like overlapping Venn diagram circles).  To read a tweet, you have to wade through a bit of jargon used to make the most of the 140 character limitation.  “RT” for example, is shorthand for “Re-tweet” and the @____ is the username of some other individual on Twitter.  Combined together, then, “RT @_____” means that someone else wrote a tweet that I found important and I now want to forward along to my followers.  The URL’s are then also shortened by shortening services like bit.ly to make the most of the character limitation, too.  Lastly, you might see “hash” identifiers “#______” which are ways to tag tweets of a particular flavor for easy searching later.

• RT @ferrusi: RT @procurement: 10+2 Strategies for Managing Suppliers http://bit.ly/wIbFn #sourcinginnovation
• @gtiadvisors Even better is the ToS: http://bit.ly/12Pupt <They’ll narc on you if they believe you’re attempting to commit fraud.
• Lego “rejects” Spinal Tap’s request to use minifig stopmotion video: http://bit.ly/j4AnX < I think Lego is outside the lines on this one.
• NC passed a recent law banning texting while driving. NC DOT started Tweeting traffic updates this week. Where’s Alanis now?
• New blog post: My Lego Love is Fast Fading http://bit.ly/wncA9
• Stephen Guth on whether RFI’s are Ethical: http://bit.ly/iKzP9
• RT @DreamSimplicity: RT @SIIA_Software:#SIIA Announces Appointment of New VP of Comm http://bit.ly/4oCzQJ <could explain new pirate video
• Madisonian on the Ninth Circuit’s decision on computer searches and the plain view doctrine. http://bit.ly/wFpic
• RT @nikiblack @DougCornelius @brucecarton @complianceweek: Oops. Important: Remove “Fudge This” from Financials. http://tinyurl.com/m9t9w6
• Ongoing discussion on FOSS license types: http://bit.ly/30u595 < Really good commentary from Shlomi.
• RT @LeighMonette: RT @AdamsDrafting: Blog Update: When to Provide for Indemnification http://bit.ly/gno5Q
• RT @russellbesq: RT @LawProf: “Second Degree Murder and Six Other Crimes Cheaper than Pirating Music” http://tinyurl.com/ns8y78
• RT @russellbesq: RT @PrivacyLaw: “Alaska Data Protection Law” http://tinyurl.com/kvfudu
• 3rd of Five Fundamental Skills for Effective Negotiation – Time Management: http://bit.ly/q7Z2b
• RT @glambert: Unpredictable Playlist Dooms Sound Recording Copyright Holders’ Infringement Claim – http://bit.ly/OcufG (Mintz Levin)
• RT @nikiblack: “You didn’t learn that in law school either?” Legal Antics http://bit.ly/Ps1EF (via feedly)
• New blog post: Jeff Gordon on Supply Excellence http://bit.ly/2GnCAi
• 2nd of Five Fundamental Skills for Effective Negotiation – Strategic Thinking: http://bit.ly/11Nyof
• RT @gtiadvisors @idexperts: Feds Issue New HIPAA Data Breach Rules: http://tinyurl.com/n5sx3g < Important for your contract lang on confid.
• Layaway is back… I didn’t realize for school supplies. Anyone wanna’ see if together “we” can pay some off? http://bit.ly/3fXxPK
• RT @nikiblack: Great comments from @LeighMonette: “Should lawyers be wary of cloud computing and SaaS?” http://bit.ly/WbS6m < Agreed!!
• RT @nikiblack: Very interesting discussion re: lawyers use of cloud computing in the comments to this post: http://bit.ly/iyYyV Join in!
• RT @nikiblack: “Should lawyers be wary of cloud computing and SaaS?”: http://bit.ly/WbS6m < Note my concerns in the comments.
• RT @hitchandplow: New blog entry: Google Book “Settlement” is Bad for Law, Copyright owners and Users http://bit.ly/3IFdZv
• New blog post: More on Trust http://bit.ly/1D8f9Y
• 1st of Five Fundamental Skills for Effective Negotiation – Information Gathering: http://bit.ly/15a3Hn
• . @ontechcontracts “In praise of short, simple contract clauses” : http://bit.ly/fikJn < Perfectly succinct.
• Speed limit raised b/c “radar speed checks show … already “safely traveling” at that speed: http://bit.ly/um1k5 < chicken & egg problem
• RT @stephenodonnell: New blog post: Vendor Consolidation http://bit.ly/1s38Br < Here, here!
• RT @TheAntiGuru Playing games during negotiations can be costly… http://bit.ly/6tpK #negotiation < great story, demos all 5 Fund Skills!
• RT @francois_ A Decision-Making Perspective to Negotiation: A Review of the Past and a Look into the Future http://bit.ly/ODRX6
• @benpobjoy If you need help with contract negotiations… some of us out here are willing to do so.
• RT @glambert: New on 3 Geeks: Are Blogging and “Thought Leadership” Compatible? – http://bit.ly/WoKFa
• RT @mental_floss: Students at Occidental College can take a course in stupidity (CTSJ180) offered by the Critical Theory/Social Justice dpt.
• Baby lawyer just risked $475K on Millionaire and lost it. I wouldn’t use him as my attorney – in his own words, he wasn’t risk adverse.
• Fatal negotiation mistakes made by copyrighters (or any other service professional): http://bit.ly/gxgJv (from zeriously.com)
• Interview w/ managing partners @ Raleigh firms: 70% don’t use ANY social networking sites. Wow.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

• no one wants money but everyone wants something that money can buy: http://bit.ly/KGzyN (@vpynchon – even if she’s on vacation)
• BSA softens anti-piracy msg: http://bit.ly/2027C Too bad there’s not an attempt-version of piracy yet … overstepping even in humor.
• RT @PeterKretzman @DavidLinthicum @dhinchcliffe: An Analysis of the Top Cloud Vendors’ cost: http://bit.ly/fIYJw.
• RT @jayshep: Lawyers are saving the world … with disclaimers: http://bit.ly/803Zp (via Client Revolution)
• New blog post: Library of Congress http://bit.ly/9Vrvl
• Just started a Twibe. Visit http://twibes.com/softwarel… to join.
• RT @vpynchon: Just joined a twibe. Visit http://twibes.com/attorney to join
• RT @gtiadvisors: RT @LexMonitor: RT @carmenhill: Social media policies critical for reducing legal, business risks http://bit.ly/uFfBU
• Just started a Twibe. Visit http://twibes.com/negotiation to join.
• Just joined a twibe. Visit http://twibes.com/Supply_Chain to join
• RT @dahowlett: Blogged: Friday rant: Software maintenance; it’s all Manny’s fault – http://bit.ly/AgmU7 – hat tip @monkchips
• RT @PeterKretzman @samj: Twitter’s trademark on Twitter is questionable http://bit.ly/MrI1q (PK: Twitter again shoots self in foot)
• RT @gtiadvisors: RT @jayshep: Great noncompete roundup from Trade Secret Noncompete Blog by @russellbesq: http://bit.ly/12VjKM
• RT @gtiadvisors: RT @GaryHonig: The 10 Stupidest Tech Company Blunders http://tr.im/wJI5
• RT @ManVsDebt: How to Deal with a Bad Deal – http://cli.gs/sR8uUR – (via @mattjabs on @fcn)
• . @vpynchon on Breaking through negotiation impasses. http://bit.ly/1yxhC5 If you’re not already reading Victoria, start now!
• RT @DreamSimplicity: Coupa SaaS Procurement offered Free to Government: http://tinyurl.com/l5hkco < dunno if it’s any good, though
• @SethGrimes @fscavo here’s another thought. Both OSI and FSF require freedom… both also require eventual free “beer” too.
• @SethGrimes @fscavo I think u should read GNU’s explanation first: http://bit.ly/AdeF an example OS isn’t necessary to prove one COULD exst
• RT @fscavo: Seth Grimes has it exactly backward: open source is free as in “free speech,” not as in “free beer” http://is.gd/2mRl1
• RT @iasta: Identifying and Controlling Hidden Costs: Why are inbound shipments unique? http://bit.ly/2uKggU
• RT @gtiadvisors: RT @BobWarren: 12 Negotiating Tips for Job Seekers http://tinyurl.com/l677wl
• RT @fscavo: Brian Sommer takes a humorous poke at vendors who are less-than-transparent in their public conference calls http://is.gd/2n5Y3
• Monetizing potential infringement instead of suing (or issuing takedown notices): http://bit.ly/yWy0n < good job Google and Chris Brown
• Mastering the art of everyday negotiations: http://bit.ly/JB3hU (from PsychologyToday) < always remember that everything is negotiable
• Maximizing value of software IP: http://bit.ly/eObWI < good info, esp for developers just starting out on their own
• (@spendmatters) on M&A due diligence in S/W world: http://bit.ly/s6Fo2 < thanks for the chance to share, Jason
• Ways consultants get burned in their contracts: http://bit.ly/QxSuL Call me for help if you’re in a similar situation.
• RT @SE_blog: Negotiating w/ Sole Source Vendor http://bit.ly/niu8g “Bring in the Heavies”

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

• RT @gtiadvisors: RT @AdvertisingLaw: Blog Post: Content Protection and Copyright http://bit.ly/1Q0CX
• New blog post: Confidentiality Exclusions versus Disclosures http://bit.ly/4qYdND
• Tech workaround could allow MS-Word sales to continue: http://bit.ly/haM2S
• If you buy/sell software, get your free copy of the Software License Risk Matrix: http://bit.ly/14AJ0E
• . @insurancecvg on Coverage Disputes over Data Breaches: http://bit.ly/zaK87
• RT @ManVsDebt: frugal misery… when people try to apply cost-cutting tactics in areas that have a high personal value: http://bit.ly/rUDJ3
• I have available time for a new client if anyone is looking for ways to save money on IT procurement-related spend. Give me a buzz for info
• You don’t get what you deserve, you get what you negotiate (@activegarage): http://bit.ly/vW2KU
• RE: @park3 Thanks Jay. I’m still not sure that the distinction you point out really changes the analysis. Even in a… http://disq.us/1szo
• Who do you think is the best negotiator? 10% say William Shatner. Seriously? http://bit.ly/tP1SA
• RE: @park3 I don’t know that there is a rule. In fact, after years of thinking about it, the only rule is that there i… http://disq.us/1sxz
• Microsoft software clampdown nets 11 firms (via ZDNetUK): http://bit.ly/fVRFs
• RT @gtiadvisors @taxgirl: http://bit.ly/rPlPd < Why I recommend negotiation experts over corporate lawyers.
• RT @skydiver: http://bit.ly/JetPass – all you can fly in one month on jet blue – $599. < Sourcing folks should watch how this plays out.
• RT @gtiadvisors @colleencunningh @CoreyVickers @BettyFeng CFOs ignoring supply chain risks http://bit.ly/qtgK8 < I knew it… crap.
• RT @drjimanderson: Classic Sales Negotiation Tactic – I’ve Got to Talk to My Boss: http://bit.ly/wYU4j < Power tactic, learn to respond
• RT @harrymccracken: Texas Judge tells Microsoft to quit selling Word: http://bit.ly/ybXzR < This doesn’t affect current owner/users of Word
• When describing calculations in contracts – SHOW AN EXAMPLE, it might save your butt later! (@ontechcontracts): http://bit.ly/NXrsr
• New blog post: Jeff Gordon Quoted on SpendMatters Today http://bit.ly/zPTbo
• Simon Cowell’s lessons in salary negotiation http://bit.ly/1Es4p
• Thanks to Jason Busch (@spendmatters) for an opportunity to talk about M&A wrt licensing deals: http://bit.ly/ANzzA
• RT @fscavo RT @rwang0 Hearing about how hard it is to leave some #saaS vendors. Automatic renewal may not be the way to go! < Same here
• Follow the Five Fundamental Skills for Effective Negotiation and this won’t ever be an issue: http://bit.ly/oKM7J
• RT @ontechcontracts 3-step way to ID contract contingencies: http://bit.ly/N7Ldu < I was just talking about this. Good article!
• RT @fscavo: Stupid contract clauses that hinder business partner relationships http://is.gd/2aOYc Good post by @Figliuolo
• RT @WieseLawFirm: Thoughts on developing leverage and why it’s important in negotiations: http://is.gd/2aE28 < I call it Power in the FFSfEN
• Privacy policies just got interesting in ME (and applicable to everyone doing anything online): http://bit.ly/FFtYn (HT to Deena Burgess)

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

• was in the public domain prior to, at the time of, or subsequently to disclosure;
• was in the lawful possession by recipient prior to disclosure and was not already covered by a confidentiality provision;
• is subsequently acquired by recipient through lawful means from a third party who is not under an obligation of confidentiality; or,
• is subsequently developed by recipient without use of or reference to the confidential information.

For these four items, information that was confidential now is not.

There’s a fifth reason which would allow for disclosure, but I argue, shouldn’t change the nature of the information from confidential to non-confidential: disclosure pursuant to court order or legal process.

In this fifth scenario, we’re talking about a situation where a court of competent jurisdiction orders the release of information, usually to the court, as part of a judicial (or extra-judicial, like arbitration) process.  The information is going to be disclosed because of it’s probative value – that simply because it’s confidential doesn’t mean that the court shouldn’t consider it as part of whatever is the subject of the litigation.

But that doesn’t mean that I want that information to change status to non-confidential information.  Rather, what I want is to keep that information confidential even AFTER the judicial review.  This is possible through the use of protective orders and other legal procedures.  But if your contracts say that a judicial process will change the information’s status to non-confidential, a single well-strategized lawsuit can unintentionally release a lot of otherwise-confidential information into the public domain.

The best way to handle this is to make sure that your confidentiality provisions clearly segment release of confidential information pursuant to a court order from the other four reasons by which confidential information becomes non-confidential.  Additionally, include language that requires the disclosing party (the one responding to the court order) to:

1. Notify the owner of the confidential information that such court order is being pursued/followed/responded to.
2. Reasonably assist the owner of the confidential information in obtaining any available legal protections.
3. Only disclose the specific confidential information requested by the court order (not just hand over everything).

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

At the end of the day, the time to think about M&A-related stuff is when you’re entering into each relationship… not when the vendor announces they’re getting bought or sold.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

• RT @rwang0 BlindSearch – the search engine taste-test. http://bit.ly/kEonM < I keep getting Google.
• Gerry Spence on The Great Gift of Rejection: http://bit.ly/TlTd5
• . @vpynchon on Negotiating the Power of Reciprocity: http://bit.ly/uCPuT
• Gamer – the 2000s version of The Running Man. Anyone check to see if Stephen King is getting royalties? http://bit.ly/3oUKxr
• RT @DreamSimplicity: 4 Advs to using SaaS for your Small Biz http://bit.ly/12RrXm –> 4 Disadvs by (@negot8or): http://bit.ly/pXwjX
• RT @DreamSimplicity: Microsoft Acquires Office.com from SaaS provider Contact Office to Use against Google! http://tinyurl.com/ls3t2a
• We’ll Know When We Get There… the story of John Hughes’ pen pal: http://bit.ly/13A5QC
• RT @gtiadvisors: RT @AdvertisingLaw: Top 10 Tactics for Negotiating with the Unethical and Untrustworthy | Lawline.com http://bit.ly/vnbr6
• 20 Salary Negotiation Techniques: http://bit.ly/1hjNm6
• An interesting instance of unexpected contract terms: http://bit.ly/3bkkv The reselling, I get. It’s the “distribute” that bothers me.
• Don’t Act Stupidly (from Stephen Guth): http://bit.ly/lzGD9
• RT @SE_blog: RT @tminahan: Dug from the supplyexcellence.com archives: Dirty Supplier Tricks and How to Combat Them http://bit.ly/13zoqI
• On needing “room” to negotiate: http://bit.ly/10htxb < Quick, but fun and accurate.
• New blog post: Quoted in New Article on Settling Out of Court http://bit.ly/f7R9d
• Someone finally sued over Amazon’s Orwellian behavior. I was wondering when this would happen: http://bit.ly/L1vrS (from THR, Esq)
• Bacharach on Bargaining vs Negotiation: http://bit.ly/ti7MR
• Basic Ethics of Business Negotiators recap of discussion from Chicago ABA Meeting: http://bit.ly/vujHU
• Dell CTO on management of virtual resources http://bit.ly/tl96W
• RT @gtiadvisors, @jimrobinsonlaw, @lawsocgazette: Apple iPhone app makers need legal advice, says Law Society http://tinyurl.com/m8ybhz
• RT @hitchandplow: New blog entry: The Post Vs. Gawker: When Does Linking Become Larceny? http://bit.ly/3UiLun
• New blog post: Cnet author advocates theft http://bit.ly/mVZIU
• Cnet author advocating breaching M$ software licensing. Unbelievable. http://bit.ly/19wiKu
• New blog post: Four Disadvantages to Using SaaS for Your Small Business http://bit.ly/12IGb
• HPC Survey – over 1/4 of IT Execs plan to intro private clouds in ’09: http://bit.ly/ezpN4
• @rwang0 @kitson @fscavo Yes, users DO outnumber the vendors. But they really suck at “unionizing”.
• RT @WieseLawFirm: RT @DougCornelius: Van Halen used the brown M&M’s clause to quickly check for contract compliance: http://bit.ly/qrjA7
• RT @gtiadvisors: RT @jimrobinsonlaw RT @venturehype When should startups incorporate the company? http://tinyurl.com/l2ygmf @TMMBA528
• Google to act slightly like a normal software company – advertising its apps: http://bit.ly/yA3fj
• RT @doctorow: Associated Press will sell you a license to quote Thomas Jefferson’s public domain speeches: http://tinyurl.com/lplnqp
• Woody Allen with a negotiation tale (HT to Sam Bacharach): http://bit.ly/4tPeBZ
• Wondering why negotiation opponents insist on complete document reversion as their response to a redline. Not good for anyone.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

1. You’re still small and probably have no leverage to negotiate the license.  Even SaaS vendors offer negotiable software licenses to customers who buy above a certain threshold.  As a small business, you’ll be less likely to meet that threshold and will be tied to their unmodified EULA.  Take the time to read this document carefully, it’s the setup for the next three issues.  Oh, and just because you’re small doesn’t mean you can’t TRY to negotiate.  ALWAYS ask for the changes you want – the worst they say is “no.”
2. The SaaS provider is going to have your data.  Building your business from the ground up within one of these platforms is terrific.  However, once you mature to the point where you consider switching, you might only now start to consider how to get your data out of the system.  If you think of this up front, you might be able to get a small change to your contract to allow you easy access to your information.  If not, do the research to see how you can export data.  Zoho, for example, is awesome.  But there’s almost no way to easily get all of the data from a fully-populated database out of ZohoCRM.
3. The SaaS provider is going to be storing your data.  Depending on your business, you might have certain regulations governing the acquisition, storage and use of the information you gather from customers.  Again, if you’ve clicked “I Agree” to the standard EULA, chances are, the vendor isn’t offering any real protection of data.
4. You have to consider the potential for your provider to go out of business.  With the SaaS model, you only have access to the application for so long as the provider is viable.  If the provider goes away tomorrow, so does your access to the application (not to mention your data).  As a small business, you probably won’t have access to some of the enterprise-class contract provisions here either – such as escrow, guarantees for unexpected terminations… heck, even termination notice.

So, while SaaS can offer extremely valuable opportunities, there are pitfalls, too.  Just be aware – for even if you can’t do anything about these issues from a contractual perspective, you can try to deal with it from a business planning perspective.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

RT @hitchandplow: Men At Work Loses First Stage Of Copyright Lawsuit http://bit.ly/12zSnJ < You betta’ watch, you betta’ take cover.

RT @vpynchon: RT @TradeSecretLaw: Negotiation Tip:Say No. http://bit.ly/1sqmHb < Liked it better when Jim Camp wrote it.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

While I’m a big fan of gadgets and tools, and yes, even templates, I worry a bit about what is being offered by way of these various forms companies.  Recently, I wrote about WhichDraft – a good service with templates that (while I didn’t review all of them) seem to at least have been written by someone with knowledge of what is supposed to go in them.  On the other hand, I see hundreds of software developers looking online to find a sample agreement that they can crib for their own use.

I’ve tried time and again to express to these developers (and my fellow contracts professionals) that templates are all well and good – if you wrote them yourself or if you know and/or trust the author.  If, however, you’re simply grabbing whatever you can find – or using a pay service who doesn’t put the author’s name on the template, you might want to think twice. [In fact, I recently inquired of one such company and they wouldn't even respond.]

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.  Follow me on Twitter if you want up-to-the-minute information on contracting, licensing, negotiation and the law.

AdamsDrafting

• Wal-Mart Case Raises Issues of Categories of Contract Language
• Another Instance of Semantic Ambiguity: “Buys”
• My Response to Someone Seeking Advice on Contract Drafting
• Contract Interpretation and Contract Drafting

Corporate Insurance Blog

• Insurance Coverage for Cyberattacks and Denial-of-Service Incidents

E-Sourcing Forum

• Poor Communication = Poor Supplier Performance, Part I
• Trust is the Key in Long Term Contracts

Firstdrafter

• Federal government is increasingly wanting unlimited rights in data, say commentators
• State law peculiarities – things to keep in mind in negotiating a choice-of-law clause
• Vendor sends its standard T&Cs after the deal is struck by e-mail – and later finds the T&C protections aren’t part of the contract
• An early-neutral-evaluation clause can help keep contract disputes out of court and protect business relationships

Madisonian

• Judge rules that a burrito is not a sandwich
• Our future as “parasitic aggregators” is in jeopardy
• How much of this do you think is copyrightable?
• Irony (Updated)

Settle It Now Negotiation Blog

• Negotiating Unity:  Gettysburg, Rhetoric and Poetry
• Mediation of Insurance Disputes in the London Market

The (non)billable Hour

• What Do Your Clients Think About You?
• A Legal Blogging Roundtable
• Twelve Truths About Time
• Ten Rules for Presenters

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

The WhichDraft tool is based on the concept that templates, while useful as a starting point, need to be modified based on a situational analysis of the deal.  They have created several forms (almost 80 of them!) to start from, and then use the wizard concept to guide the end-user through the customization of the form for the particular deal at issue.  If they don’t have the form you need or want, you can even create a free account and develop your own forms and wizard-ize them, too.  If you’re familiar with the old DealManager tool from CMSI and/or Procuri, WhichDraft will be 100% intuitive – but this isn’t your parent’s DealManager too, either.

The simple elegance (combined with its $0.00 cost) of this solution makes it an obviously useful tool to add to your contract management aresenal, especially for those folks who don’t have easy access to someone skilled in contract drafting.  I also see great potential for a contract or legal department’s creation of their own repository of custom templates with options built-in for the various legal-language swap-outs that are already legal-department approved.

Of course there are some weaknesses – the most important (and one common to any document assembly tool) being that templates used with this system have to be written in a way that makes language-swap possible.  The limitation of the current WhichDraft wizard process appears to be that a single question is tied only to a single paragraph/section of the contract.  So if you want to pull out ALL of the services-related language in the deal, you’d actually have to create a services-less template because a single question in the wizard couldn’t remove all of the associated language throughout the contract.  This isn’t a tool-killer, as some people love having clean templates in a variety of formats – and WhichDraft’s templates are already built in this manner.  But this could limit people intending to upload their own templates into the tool.

I also advise caution in using WhichDraft’s template language as a default starting point for any deal.  They’ve structured dozens of basic templates, but again, your contracts or legal department might have drastically different language interpretations, desires or phrasing.  So if you already have template documents, make sure that you log-in to the system to create your own WhichDraft templates.  Additionally, in talking with WhichDraft’s co-founder, Jason Mark Anderman, he fully supports WhichDraft’s use as a productivity enhancer, not as lawyer-replacement, recognizing the inherent risk of using any template as a one-size-fits-all solution (even with wizard capabilities).

Overall, WhichDraft makes a great leap forward in terms of usability, availability and flexibility.  I expect future versions of this tool will simply add onto its existing strengths and gradually wear down its weaknesses, too.  Thanks to WhichDraft for providing the contracting community with such a wonderful tool!

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

(Click on it to see it full-sized.)

The current economic situation is encouraging many organizations to reconsider their current contractual relationships. Contact me before your opponent does to find out how to make the most of your renegotiations. The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

This is such a simple thing to do when you have a good Contract Management System.  It’s merely another document you’d upload and track.  Heck, Novatus Contracts even allows you to create event notifications for certificate renewals.  Need to remember to ask that it’s expiring?  No problem – the system will automatically send the alert to the vendor (you can get cc’d if you wish) asking for a new one.  It’ll even take it one step further.  If you don’t “close out” the event after a certain date (such as when you receive the new certificate), you can re-route the alert to you (or whomever is in charge of managing that vendor) for handling.

Of course, this is also available for any other supporting documents you want to include or for any other trackable metrics (milestone due dates, payment dates, etc).

But you have to have a system that can handle it.  What would you rather have: the mild expense of a good contract management system?  Or the exhorbitant expense of an unexpected and uncovered personal injury claim?  Yeah, I thought so.  Tell Novatus I sent you or request information here.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

Once again, however, a lot of this issue can come down to a well-worded contract that spells out the costs, frequency and burden of the audit.  My template language typically says that the party requesting the audit has to pay for it (unless a major discrepancy is found – especially around license usage), and that the audit has to be performed after prior written notice (usually more than 10-15 business days in advance) and at a time that’s mutually convenient.  I suppose the “mutually convenient” language could allow for some wiggle room – some of the survey respondents said that they had received push back to audits in the form of delays, with suppliers saying that all slots for the year had been taken.  But generally speaking, this overall language should prevent the supplier from charging you for the privilege.

Another interesting wrinkle noted by Ms. Gordon’s other referenced article is the practice of a supplier offering an existing audit up at a cost to the other party.  Actually, this is probably not such a bad idea – again, as long as you discuss the practice beforehand and work out a few points for clarification.  These points would include the cost of the purchased audit, the name/quality level of the auditing firm, and responsibility for failures of audited processes/procedures/etc because the selected auditor wasn’t as good as hoped.  In other words, paying a fee to have access to an audit already completed isn’t a bad idea.  It saves time and should be EXTREMELY cost effective (ie: I would ask them how many customers they have that will get the audit report – ‘x’ … and then offer them 1/x of the actual cost of the audit).  But my real concern is that they would use Joe’s Auditing Shack to perform the audit – and that the quality wouldn’t even be worth the 1/x cost.

Oh, and just in case you were wondering… I would still want to know what any customer was going to do with an audit finding.  In many more cases than I would like, it ends up being treated like source code escrow or annual financial reports – an insurance policy that has no actual value and isn’t even reviewed by anyone on the requesting side.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

Mutuality is a key concern for me.  If a contract is supposed to be an apportionment of risk – a meeting of the minds as well – how would it be interpreted in the event that we had some sort of disagreement?  Would the courts find that we actually had an agreement at all?  Or, using the severability clause, would the court excise much of the agreement and leave only a few basic operable paragraphs?  However you might imagine it playing out, I simply don’t like the feeling that an agreement is all obligation for one side, and all benefits for the other.  So, in almost every clause, I look to make things mutual as much as I can.

This is especially important (and unfortunately starting to be more commonly seen) for Limitation of Liability language.  Make absolutely sure that your party is protected by LoL language.  There are, of course, exclusions to LoL, and those too should apply to both parties.  But do not let an agreement get signed that only caps the liability of the other party. (This happens to be one of the few areas where I’ll use every ounce of control I have to block a deal.)

On the flip side, each parties obligations (and thus, warranties) are at least slightly (and sometimes significantly) different.  Here, mutuality in spirit is what I’m looking for – not an exact duplication in language or deed.  For example a software provider might warrant that their product is four-digit-year compliant (yes, I still ask for this).  But the customer doesn’t have any control over this.  So I wouldn’t want it to be a mutual warranty.  However, the customer can warrant that any information provided to the vendor is accurate and reliable.

Overall, I just watch for balance.  When I don’t see it, I add it.  When I don’t ever feel it, I warn my business owner(s).  When I don’t get it, I suggest looking elsewhere.  Everyone should take this opportunity to review your template agreements.  Are they balanced?  Why wouldn’t they be?  I haven’t said this yet in this forum, but it seems to be turning into my favorite phrase of 2009:  “In negotiations, you can screw someone else.  Once.”  The cost for finding new customers, however, significantly outweighs the cost of keeping old ones.  Write your deals for the long-run (such as by being mutual) and you’ll both be happier.

The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

Of course, the original question wasn’t this simple.  The person asking the question had some interesting constraints.  Specifically, they were licensing software on an exclusive basis, with exclusivity carved out by geographic region.  So a prospective customer wanted to review the vendor’s contracts to make sure that they weren’t getting into an overlap situation.  My answer was still No!

First, contracts are, even at a fundamental level, based on trust and honesty, and not based on a lack thereof.  If you don’t trust the person you’re contracting with, the contract isn’t going to help you too much.  In other words, you can’t contract trust.  It just doesn’t work that way.  So if the vendor in this situation was going to be dishonest in overlapping exclusivities, what would make the customer think that they would allow the customer to actually audit all of the agreements?  A dishonest vendor would simply hide a portion of the contracts that they didn’t want discovered.

Second, with minor exception (such as during due diligence in a M&A transaction), I would never allow anyone to review my contract files.  There’s too much confidential information – and general poking around to see what’s in them isn’t a narrow enough reason to go looking.  In fact, even if the looking was just at license grant language, I still think you’re potentially revealing too much information (exclusivities for geographic regions aren’t the only way to restrict licenses and perhaps you also license based on user counts – allowing others to see the full license grant can give them a sense of pricing, perhaps).

Third, there’s a better way to handle the situation:  provide a warranty and a specific remedy for breach of this particular warranty.  Warrant that you are providing an exclusive license in exchange for specific consideration (probably money, but perhaps something else).  If you (vendor) breach this warranty, the sole and exclusive remedy could be the repayment of the specific amount of consideration provided for the exclusivity.  So, imagine a situation where you license exclusively by country (perhaps your product handles some sort of sales-related transactions).  In exchange for an exclusive license, the customer pays you an extra $1,000,000 in license fees and that this also adds into the annual maintenance costs.  If you later decide to break a previously-licensed country into smaller bits, you simply would have to pay back the $1M plus the accrued/paid maintenance fees for the breach.

Now, this sounds like it may provide you with license to later break the agreement – no, I’m not suggesting that, I am however suggesting that you promise not to and a specific penalty for doing so.

The current economic situation is encouraging many organizations to reconsider their current contractual relationships.  Contact me before your opponent does to find out how to make the most of your renegotiations.  The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

“For ten years, we’ve been driven by a simple vision: The End of Software.  Now it’s time to take on a new challenge: The End of Maintenance.

Let me tell you about a customer that I met on our Cloudforce tour. This customer currently uses Siebel software to run her call center.  She pays more than $15 million a year for the privilege of having to implement the updates that Siebel sends her.  That does not include backup. Or disaster recovery. And of course, it does not guarantee that she will be using the latest technology.  The maintenance agreement only assures her that her outdated software will continue to work.  She is paying tolls on a road to nowhere.

We can help her, and many other customers, and deliver much more for a fraction of what they currently pay in maintenance. It’s time to open up a new front in “The End of Software”– one that is long overdue.

It’s time for The End of Maintenance.

Every year, companies spend billions on maintenance fees and get relatively little in return. Maintenance fees cover updates that are mostly  patches and fixes, but they stop far short of the kind of innovation every that enterprise needs to survive.  Companies pay to keep the past working and they end up doubling down on technology that can never keep up with their needs.  The fees that companies pay have actually been rising, from something like 17% a few years ago to numbers more like 22% today. Every four or five years, companies are paying for their software all over again.

It’s time to set these businesses free and make them successful in the Sales Cloud,  Service Cloud and on our Force.com platform.

Our new mission begins at a critical time in the economy, when companies are questioning conventional wisdom as they never have before.  That, of course, extends to their IT budgets as well. The CIO is in a tough spot right now.  Corporate budgets are tightening.  And our rivals in the legacy client-server world are using this opportunities to extract more money from their customers by raising maintenance fees.  I call this phenomenon “the compression of IT” and it resonates with just about every CIO I speak with these days.

We have a better vision. We sell our customers a service and every customer is able to use the latest. Innovations are included. Upgrades are automatic and invisible. Customers’ intellectual property of customizations and extensions is rigorously preserved, and carried forward without disruption.

The service gets better, not just less buggy. That’s not what people are getting for all those fees that supposedly buy them “maintenance.”

It’s time to set these business people free: to give them the experience of being wildly successful in the Sales Cloud, the Service Cloud, and in their own unique applications that they can build on our Force.com platform. This is the time to do it, because this is when people need it: their IT budgets are tight, their business situations are critical, and their old-world software vendors are taking care of themselves instead of meeting the needs of their customers.

We’ve raised people’s expectations for better alignment of business value with IT cost. We’ve earned our leadership position in enterprise cloud computing. It’s time for us to set people free from paying more and more to get less and less. It’s time for The End of Maintenance.

Aloha,

Marc”

The current economic situation is encouraging many organizations to reconsider their current contractual relationships.  Contact me before your opponent does to find out how to make the most of your renegotiations.  The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.

1. Ordinarily, I suggest a quick once-over.  This is a perusal designed to see if the major sections of the contract are present.  Using a checklist like the Software License Risk Matrix will help you verify that all of the headlines are covered.  Not all contracts will contain the same sections, of course, and just because a contract has a stated Header doesn’t mean that the language in that section actually matches the Header’s description.
2. For any “missing” sections of the agreement that you would like to insert, create new sections in an appropriate place (as you read an agreement, you typically have a feel for where certain sections will need to go.  You’ll also have to make adjustments based on numbering schemes or sub-numbering schemes to match the original – so watch the blind copy-pasting.
3. Now, hopefully you’ve got the contract in Microsoft Word (or other word processing format) to facilitate an easy redline.  Enable Word’s “Track Changes” feature via the Tools menu.  Advanced users will also note that you can quickly turn Track Changes on and off via the green-light at the bottom of that document’s window next to the “TRK”.  If the other side has sent you a document via PDF and refuses or is otherwise unable to send you a Word version, use the free service at www.pdftoword.com run by the great folks at NitroPDF.  This service will convert your PDF almost flawlessly and e-mail you a converted Word file.
4. Read each section carefully.  Start with the definitions and make sure that all defined terms have a definition (many times this isn’t the case).  Now march your way through the agreement.
5. Where you do not like particular language, the Track Changes feature allows you to “delete” the language – but instead of actually removing the offending words, it changes the color and puts a strike-out line through the deleted language.
6. On the flip-side, when you insert language, Track Changes will insert your new words in the same color as the deleted text, only this time is underlined.
7. Where possible, suggest new language that you’d prefer to be in the agreement rather than just strike-out the language you find troublesome.  This will provide a great basis for a negotiation.  If you simply delete language, I would assume that you simply want the language removed and nothing else added.  When this is the case, I will sometimes make a note to tell the other negotiator why I made a particular change:  “[JeffNote:  I don't believe I should have to indemnify you for this.]“  This call-out makes it easier on the other reader to accept or reject your change, as your explanation might be all that’s needed for them to accept your modification.
8. Then, when you’re the recipient of a redlined document, your first task is to review the changes to see if any of them are acceptable without discussion.  If so, simply right-click on the change and select “Accept Deletion” or “Accept Insertion” from the pop-up menu.  HOWEVER, DO NOT SIMPLY REJECT CHANGES!  This would create a presumption on your part that you shouldn’t make without talking to the other side first.  Rather, leave unacceptable changes in redline format as open for discussion.
9. As the second reviewer (and the presumptive owner of the original), you might feel some initial pain at making any changes at all to your template.  Remember, however, that you’d do the same thing to someone else’s template.  Additionally, while I’m sure you wrote your template with every conceivable situation in mind, there might be a situation you didn’t conceive.  In other words, give the redline a chance.  Read it with the intent to accept as many changes as you possibly can.  This is a negotiation, afterall.
10. If you need to suggest language back to the first reviewer, Track Changes anticipates this and will (unless you make changes to the Preferences settings) automatically assign each individual reviewer a different color.  If you place your pointer over a particular change, Word will tell you the name (as set in Word’s preferences) of the editor for that change and the date/time of the change.  If your name doesn’t appear on changes, make sure that you’ve entered your name in the preferences settings and you’ve also unchecked the box that has Word remove the name of the reviewer as part of its security process.
11. So now you have a document that should have fewer redlines than when the first person was done, might have some additional redlines from the document’s original author and the document is now ready for negotiation.
12. Set aside plenty of time for negotiation – rushing is to neither party’s benefit.  You do not have to make it through the entire contract in a single session.
13. Once pleasantries are out of the way, discuss who will be the document owner (I typically volunteer… it keeps me alert and I feel much better about how the changes are completed).
14. During the negotiation, systematically review the agreement from the top on down.  Continue to make any new additions or deletions in redline.  But accept/reject prior changes as agreed during the negotiation.  Thus, when done, you’ve got a document that ONLY has points of contention or new language changes still in redline.  In rare cases, in a trusting relationship, you might agree to make “blackline” changes.  If so, never breach that trust.
15. OK, so after a few back and forth discussions, you should have resolved all open issues.  Take one more quick review to look for any open issues.  Use Track Changes to see if there are any unseen remaining edits (use the “Next Change” button to see if there are any you missed).
16. What you’re left with is a blackline document – everything’s in black and white.  GREAT JOB!
17. If you’ve got to do a redline by hand, here are a few additional suggestions:  a) Don’t.  Seriously.  Scan and use PDFtoWord.  b) But if you have to, learn to write very small in the margins with tiny arrows indicating where new language would go.  c) Actually strike through (with a single line) each word you don’t like.  d) Don’t waste time handwriting in entire new sections.  Just note what new ones are necessary – add new language electronically later.  e) If you must, create a separate document and create an amendment document where you describe each deletion and/or insertion.  Again, this method is HIGHLY outdated, but some organizations just can’t seem to get away from it.

Once you’re done, I sometimes also recommend using a tool called DeltaView (or even Word’s own Document Compare feature) to compare the original against the finished product.  This helps you check all of the redlines that were actually agreed upon and gives you a level of comfort that neither party tried to sneak in a change the other party didn’t accept.  However, unless I have reason to believe that the other party isn’t trustworthy, I typically have been diligent enough through each turn of the document to not require this final step.

All that’s left now is execution and managing post-contract obligations.  But that’s another day.

The current economic situation is encouraging many organizations to reconsider their current contractual relationships.  Contact me before your opponent does to find out how to make the most of your renegotiations.  The Licensing Handbook Blog is the companion site to the Software Licensing Handbook. Covering licensing topics on a regular basis, Jeffrey Gordon attempts to offer advice, add humor and sometimes even a bit of wit to a practice that most people find abhorrent – namely, reading a contract from start to finish.