Tech & Sourcing @ Morgan Lewis

With the recent onslaught of ransomware attacks, it’s time to revisit force majeure clauses (again). Earlier in the pandemic, we reviewed how COVID-19 could impact force majeure provisions. Since then, there has been a flurry of analyzing, renegotiating, and testing contractual language, as parties work through, or anticipate, pandemic-related difficulties. While contracting parties focus on striking a balance of when, and to what extent, a party’s performance will be excused due to pandemic-related circumstances, a different threat could follow a similar trajectory.

Exceptions to confidentiality obligations are largely standardized, but in some contracts a copy-and-paste approach could, at best, lead to uncertainty and, at worst, undermine key aims of the transaction.

A recent judgment by the High Court of England and Wales in the case of Jamp Pharma Corp v. Unichem Laboratories Limited has held that agreements reached as part of contract negotiations for contracts governed by English law may be impliedly “subject to contract” without the need to expressly state that the discussions and documents are “subject to contract” prior to a formal executed agreement.

Planning for major service disruptions and disasters, such as prolonged power failures, fires, flooding, and other extreme weather events, is an important element of strategic technology and service agreements.

Changes to complex commercial contracts are inevitable. These contracts, such as large outsourcing agreements, typically include a master services agreement (MSA) and a high number of exhibits and attachments describing the scope, performance standards, financials, and other contractual requirements in detail. Some deals can end up containing over 50–75 documents (or more!) in total. Given their strategic importance, these agreements often require numerous amendments as the relationship evolves over time and changes need to be formally documented.

Autorenewal provisions (sometimes referred to as evergreen provisions) are common in commercial agreements for the provision of technology and related services. Vendors may want their agreements to autorenew to save time negotiating new contracts and to continue the customer relationship. Customers often desire to terminate an agreement, thinking they have the right to do so, only to realize the term of the agreement has been automatically renewed for another year or number of years.

There are often misconceptions in connection with negotiating intellectual property (IP) development agreements with developers located in Russia. This post details five common misconceptions and provides tips for complying with applicable laws in connection with such agreements.