home *** CD-ROM | disk | FTP | other *** search
- Newsgroups: misc.jobs.contract
- Path: sparky!uunet!gumby!wupost!emory!tridom!mwr
- From: mwr@eng.tridom.com (Mark Reardon)
- Subject: Re: What to do about indemnification clause?
- Message-ID: <Bxz4oK.3E3@tridom.com>
- Sender: news@tridom.com
- Nntp-Posting-Host: tridom.eng.tridom.com
- Reply-To: mwr@eng.tridom.com (Mark Reardon)
- Organization: AT&T Tridom; Marietta, Georgia
- References: <721623613snx@crynwr.com>
- Date: Thu, 19 Nov 1992 17:31:31 GMT
- Lines: 60
-
- In article <721623613snx@crynwr.com>, nelson@crynwr.com (Russell Nelson) writes:
- |> I don't like the following indemnification clause in a contract I'm
- |> looking at:
- |>
- |> Seller agrees to defend, indemnify and hold Buyer harmless
- |> from and against any and all liabilities, claims, penalties,
- |> forfeitures, suits, and the associated costs and expenses ...
- |> caused, in whole or in part, by ... any negligent or willful
- |> acts, errors or omissions by Seller ...
- |>
- |> This means (IANAL) that if I use a technique in my software that
- |> later turns out to be patented, *I* get stuck paying the patent
- |> license. This sucks. I'm thinking that I should bill them for a
- |> patent search plus some kind of insurance against patent violations.
- |> Any ideas on this?
-
- This is a standard clause in most contracts now days. I am not a
- lawyer either so I discussed this with one. He stated that it is
- more scare than reality. The key words are negligent and willful.
- he said that as long as I was prudent and truely intended to create
- software for the customer that was perform as specified I was pretty
- safe. He also suggested that I keep records of my efforts (a journal)
- that would show that I hadn't just copied someone elses work and sold
- it. Lastly, he explained that this was standard in most contracts and
- that he would not allow any company he represented to enter a contract
- without this clause.
-
- You have to decide if you can live with the clause. If not, strike
- it and see if the company will accept the new contract. Most won't
- nor will they pay for your patent search or insurance. After all,
- you will just make yourself more expensive than the next consultant.
-
- One last point. Even if this clause is not in the contract and
- you do violate a patent or willfully omit critical information,
- you can still be held liable. Think about it. There are three
- parties involved. The patent holder, the company selling the
- violating product, and the consultant. The agreement above is
- not binding upon the patent holder and they will most likely sue
- both of the other parties. The company will most likely also sue
- the consultant because when they payed for the consultants expertise
- it was reasonable to assume that (s)he would sell them something they
- could use. Even without the clause above most courts would consider
- the consultant as an expert should have known that what was sold
- did not belong to the consultant.
-
- |>
- |> -russ <nelson@crynwr.com> What canst *thou* say?
- |> Crynwr Software Crynwr Software sells packet driver support.
- |> 11 Grant St. 315-268-1925 Voice | LPF member - ask me about
- |> Potsdam, NY 13676 315-268-9201 FAX | the harm software patents do.
-
- --
- Mark
-
- ---------------------------------------------------------------------
- | Mark Reardon | AT&T Tridom |
- | mwr@eng.tridom.com | 840 Franklin Court |
- | | Marietta, GA 30067 |
- ---------------------------------------------------------------------
-
-