1. PLS 780
Week 5

2. Agenda
• Contracts overall
• Contracts and the internet
• The importance of defensible agreements in online
environments
• Licenses
• Joint ventures, partnerships and
manufacturing/supply chain agreements
• Proprietary contracts for software

3. Contract
• Agreements, alliances, deals
• Based upon the idea that two parties need to work
together—cant do it alone!
• Premised upon negotiation
• Roadmap for rights and duties between two
agreeing parties
• Ultimately a bet. Why?

4. Elements of a Contract
• Offer (must be defined and limited)
• Acceptance (expressed or implied)
• Consideration (something of value that each party
gets---not one sided!)
• Cannot be unconscionable (so one-sided that it
shocks the conscience)
• Legal Capacity

5. Performance
• Conditions: Contracts are oftentimes premised upon
outside events taking place that are required under
the terms of the contract; These are called
conditions
• They can be preceding (precedent) or succeeding
(subsequent)
• Think complicated processes that depend upon
certain things happening before parties can act…

6. Discharge, Termination, B
reach & Remedies
• Contracts can end in a number of ways
• Discharge (being fully completed)
• Terminated by both parties due to conditions not
being met or by clauses that called for termination
based upon specific events
• Breached when one of the parties fails
• Remedies are provided in case of breach either by
the terms of the contract or a judgment—can be
complicated!

7. Rockland Trust v
Computer Associates
• Facts
• Issue
• Holding
• Rule: What does this case stand for?

8. Contracts Relevant to
Internet and Technology
Users/Providers
• Tons!
• All facets of operations can and should have some
contractual elements
• Think about a company like Apple, Google or
amazon.com and review the graphic on page 269 of
text

9. Licensing
• Extremely important in technology
• The idea that you can control technology or
intellectual property owned while getting others to
use and pay for it
• Android is a licensing success for Google
• Even competitors license each other’s technology
(Apple and Samsung for example)
• Usually incorporate some type of NDA

10. Bayh-Dole Act
• Prior to 1980 federal funds given for research meant
the government had ownership of new technologies
• After the act the research (or sponsoring entity
usually) has ownership in order to promote
innovation, creativity and commercialization of new
technology
• Is this good policy?
• Worked for Google. What do I mean by that?
• Can you think of instances where this act might stifle
innovation or creativity?

11. Pitt v Townsend
• Facts
• Issue
• Holding
• Rule

12. Forms of Licenses
• Technology transfer agreements
• In-licensing agreements
• Outbound licensing
• Cross-licensing
• Exercise: In small groups consider the pros and
cons of each of these for 10 minutes and report
back to the group

13. Partnerships
• Sometimes the relationship goes deeper and
licensing is insufficient to the task
• Partnerships are useful vehicles for technology
companies to cement relationships (again, all about
defining rights and duties!)
• Joint ventures (project based agreements)
• Contract Manufacturing/Supply chain Agreements
(production based)
• Barter contracts (startups prefer these
arrangements)

14. Government oversight of
contracts in technology
• What are the concerns?
• Why would government inject itself into this space?
• What policy goals are being pursued?
• Pp 284-85

15. Proprietary agreements
• Agreements that require user to act in a certain way
as a condition of use (software of website)
• Site license agreements (how users interact with
websites)
• Software Developer Kits (SDK’s) (how developers
develop products within an OS environment)
• Is unconscionability an issue?

16. Feldman v Google
• Facts
• Issue
• Holding
• Rule

17. Davidson & Blizzard v
Internet Gateway
• Facts
• Issue
• Rule
• Holding

18. Free and Open Source
Software Agreements
• Permissive licenses--completely open from source
code to use of the software; no conditions attached
to use
• CopyLeft licenses—more “restrictive” or conditional
in that derivative works are also made to be freely
available

19. Policy issues and
software licensing
• Piracy, copyright infringement and more
• Software and intellectual property law are oftentimes at
odds
• Traditionally software was copyrighted (problems?) as
well as patented (difficult and limited) or protected under
trade secrets law
• Digital Rights Management is making this irrelevant?
• Policy issues? Should intellectual property law be the
main force for protection? Is it adequate to the task of
protecting software?