 I’ve
negotiated many technology agreements lately. No matter how often I go through the
process, there is more to learn. Here is a hodgepodge of insights.A
contract negotiator in Florida told me that her company requires a choice-of-law
provision. While the company prefers New York, it will accept any state other than
Califor-nia. The reason: California commercial law is perceived as too unpredictable.
INSIGHT: The memory of Rose Bird’s Supreme
Court, and a perception of anti-corporation bias, still are fresh in the minds of lawyers
in other states.
Rethinking intellectual property
A developer of software that helps employees learn company policies
agreed to convert the software to HTML format for use on my client’s intranet. The
client wanted the right to add to and alter the application as policies changed over time.
The developer’s president objected, claiming that the company
does not provide source code and does not allow object code alteration or reverse
engineering. I pointed out that once the application is ported to HTML, source code and
object code no longer exist, and distinguishing between code and data is difficult, if not
impossible.
The parties agreed that the client’s changes would be limited to
altering text and links within modules. To maintain the architectural integrity of the
application, only the developer would have the right to add modules or change their flow.
INSIGHT: As developers move applications from
traditional operating systems to web-based networks, they need to rethink approaches to
protecting intellectual property.
Confronting bureaucracy
My client agreed to provide technical services to a large,
established company. In many regards, the company was forward-thinking. For example, all
suppliers submit invoices via its web site, and the company pays all invoices
electronically. The time and cost savings of electronic bill presentation and payment are
clear and immediately recognized.
On the other hand, when it came to contract negotiation, the company
was embarrassingly slow. Their negotiator had to take each round of issues to two
attorneys. One addressed commercial issues, while the other addressed intellectual
property. Also, a vice president entered the picture whenever business questions popped
up.
Whereas my client and I could make decisions in a day or two, the
other company took one to two weeks. For an agreement only five pages long!
INSIGHT: Technology is no match for an entrenched
bureaucracy.
Appreciating Microsoft
My client was selected to port a financial software package to a new
operating system. The client’s customer was a large, international company that uses
Lotus WordPro for word processing.
This company knew that it had to convert documents to work with my
client, who used Word.
Unfortunately, WordPro’s exports in Rich Text Format (.RTF) lost
section numbering, and exports in Word format (.DOC) sometimes caused Word to crash.
INSIGHT: As obnoxious as Microsoft’s dirty
tricks have been, the company is right when it says that a standardized operating system
(Windows) and application (Word) have benefits for users.
If your practice includes contract negotiation, pay careful attention
and look at the big picture. I suspect that you, too, will gain insights that you never
expected.
 Dana Shultz is an
Oakland-based attorney and certified management consultant specializing in computer
technology and the internet. He may be reached by at dhshultz@ds-a.com
and on the web at www.ds-a.com.
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