Silicon Valley Digital Health Law Blog’s Kristie Prinz recently sat down for an interview with Beau Fernald, Fractional COO and Principal of Aware Insights LLC to discuss the topic of software implementation. One of the most common drafting mistakes in digital health and software contracts is failing to sufficiently define the parties’ mutual expectations for a software implementation.  Most digital health and software contracts, in fact, are completely silent on the issue, regardless of the time, financial or other requirements of the implementation, which may be extensive.  While Beau is not a digital health or software lawyer and brings a different operational perspective to the issue of software implementation, he offers some additional insight on software implementation mistakes that digital health, SaaS, and software companies make, the consequences of those mistakes, and best practices on how to avoid them altogether.  Beau strongly agrees the contention that software implementation understandings need to be articulated and memorialized in a writing to avoid subsequent misunderstandings that may result in a legal dispute. For more information on Beau Fernald, you can view his professional profile at:  https://www.linkedin.com/in/beaufernald/.   The Aware Insights LLC website is at: https://awareinsights.com.

The digital health industry has exploded during the COVID-19 pandemic, resulting in an increasing number of digital health SaaS transactions. However, given the relative youth of the industry, few business lawyers or businesspeople negotiating digital health SaaS transactions are familiar with the best practices to pursue in negotiating and drafting digital health contracts.

Silicon Valley Digital Health Lawyer Kristie Prinz has been practicing in this field as it has emerged and will present a webinar looking at what you need to know if you are negotiating and drafting digital health SaaS contracts to add and retain customers. In this presentation, she will explore:

• What is digital health?
• What constitutes a digital health contract?
• What are the essential terms in a well-drafted digital health contract?
• What are the key considerations you need to have in negotiating digital health contracts?
• What are the common issues that arise in digital health contract negotiations?
• What are the problems with digital health clauses that are most likely to cause a dispute?

Kristie Prinz is the founder of The Prinz Law Office, which is based in Silicon Valley. Her digital health practice focuses on advising mid-market and early-stage digital health companies on the negotiation and drafting of complex commercial transactions.

Kristie is a regular speaker, media contributor, and author on digital health and SaaS transactions issues. She founded the Silicon Valley Software Law Advisors Group and the Life Science Advisors Group and she is the author of the Silicon Valley Digital Health Law Blog. Kristie is also a graduate of Vanderbilt Law School and is licensed to practice law in the states of California and Georgia. For more information about Kristie, check out her digital health blog at siliconvalleydigitalhealthlaw.com and her personal website at kristieprinz.com.  To register, please sign up at this link:  https://www.eventbrite.com/e/best-practices-in-drafting-digital-health-saas-contracts-tickets-369548929797

The Federal and Trade Commission (“FTC”) announced today a settlement with Twitter, Inc. (“Twitter”) in which Twitter agreed to pay $150 million for its alleged misuse of user account security data, specifically email addresses and phone numbers, for advertising purposes.  The government alleged that the misuse of account data was in violation of a 2011 FTC Order against Twitter, which prohibited the company from misrepresenting the extent to which it maintains and protects the security, privacy, confidentiality, or integrity of any nonpublic consumer information.  The government alleged that the misuse of consumer data also violated the EU-US Privacy Shield, and the Swiss-U.S. Privacy Shield.

The FTC press release is attached here.  The complaint is attached here, and the stipulated order is attached here.

In addition to the paying a $150 million fine, the government announced that Twitter has agreed to the following:

• Twitter will not profit from deceptively collected data;
• Users will have other options to multi-factor authentication such as apps or security keys that do not require the provision of phone numbers;
• Notify all users that Twitter misused the phone numbers and emails collected for targeted advertising and to provide users with information about Twitter’s privacy and security controls;
• Implement and maintain a comprehensive privacy and information security program which requires an assessment of the potential privacy and security requirements of new products;
• Limit employee access to users’ personal data; and
• Notify the FTC if it experiences a data breach.

With this enforcement action against Twitter, the FTC is clearly making a statement to companies in the business of collecting consumer data that they need to truthfully disclose the purposes for which data used for advertising purposes is collected, and that failure to disclose this information will have potential federal regulatory consequences.   Digital health companies should take note of this particular enforcement action, and ensure that they avoid engaging in the same practices that were the subject of this enforcement action.

 

 

 

I was recently asked by a client whether arbitration or litigation was “better.”  The issue had been raised by an attorney on the other side of the contract, who had not only tried to persuade my client to revise the specific clause in that case, but had also provided my client the unsolicited advice that “he should prefer litigation over arbitration” in all cases.

My client, who had elected to include an arbitration clause in his company’s standard contract terms, was unsure what to do and how to respond, and so he reached out to me for guidance.

While the debate over whether selecting arbitration or litigation as the preferred dispute resolution option for a particular organization is not a dilemma specific to the digital health industry, it is one that clients often raise with me in frustration, hoping that I can advise them that one option is definitively “better” than the other.   The answer, like many things in the law, is not so black and white, and it should not be decided without considering the pros and cons of each option and the specific contract scenario you are addressing.

First of all, let’s assume you have no arbitration clause in your contract and a dispute arises, then the only contractually available forum to hear the dispute will be a courtroom.  If your company does not have an in-house legal department with litigators on staff, then you will need to hire a litigation support to handle the litigation process, either from the plaintiff side or the defense side.  You will incur costs every time a motion is filed or defended, and you will incur costs for discovery, depositions, mediation, and the trial preparation, all until the case is either settled or a judgment is reached.  This process could take years to go through.

On the other hand, let’s assume you have an arbitration clause in your contract and a dispute arises, then the contractually available forum to hear the dispute will be a courtroom.  However, your opponent may not want to arbitrate the case, and so your opponent may file in court first, in which case you will have to file to compel the case to arbitration.  Alternatively, your opponent may be unwilling to participate in the arbitration, so you may have to file a motion to compel your opponent participate in the arbitration.  Once you win any motion in court, you will then have to initiate the arbitration with the private organization that will handle the arbitration, which will generally be AAA or JAMS in the US, but there are other organizations that handle commercial arbitration internationally.  This will require you to pay the filing fees, which are often far higher than is required to initiate a case in a court.  Once the case is initiated an arbitrator will be appointed to hear the case, and the parties will decide on the format for the case, and the case will proceed outside of court within the private dispute resolution process of the organization selected.

What are the advantages?  Well, arbitration is intended to be a commercial process rather than a legal process, so it is much less formal.  It also can be faster, as there is no judicial backlog to slow down the process.  There are fewer rules governing the process, so it often viewed as less predictable.  But fewer rules also means that the process is more easily managed by business-people who are not litigators.  The goal of arbitration is generally to get to a rendered decision as quickly as possible, which may be advantageous.

In contrast, the court option is very formal.  It can be slow, which may be a negative in some situations and a positive in other situations.  And it is governed by rules and precedent, which will require knowledge and familiarity with both to proceed through.  Most litigated cases settled, so the goal of litigation may not be to get to a judgment.  Instead, the goal may actually be to get to a settlement.

Is one option necessarily cheaper than the other?  Arbitration is generally perceived in the business world to be cheaper, due to the faster process and the relaxed rules, but because the process is a private commercial process, the fees for the administration of the case can be higher in some situations and it is still possible to incur legal fees during the process.  In contrast, discovery, depositions, and motion hearings can drive up the cost of a litigation process, both in terms of legal hours billed but also in terms of other costs.

It is important to recognize that getting an arbitration award may not actually be better than a mediated settlement to the party owed an award, since a voluntary settlement may be easier to enforce than a decision.  On the other hand, the process is private and stays completely confidential and outside of court records, which may be preferred by both parties, and the informality may be less stressful on both sides of the dispute.

In the end, the choice between arbitration vs. litigation is one of personal or commercial preference.  You have to expect that a commercial litigator who spends his career in the courtroom is going to prefer to stay as far away from arbitration as possible.  In contrast, transactional lawyers are generally going to prefer to stay as far away from litigation as possible.

I generally recommend to clients that they should contemplate the type of dispute that would arise from a particular set of contract terms before deciding how they prefer to resolve that dispute.  For example, if a dispute arises, would an informal private solution to resolving the dispute be better than the formality of litigation?  Will the other side have significantly more resources to apply towards the dispute?  Would the other side benefit from delaying the resolution of the dispute and causing you to invest significant resources in the process?  What will be the anticipated filing fees for each side in the dispute?

All in all, arbitration vs. litigation is not a decision that should be made without some careful consideration of the underlying issues and the consequences of each decision.  There are valid reasons why parties gravitate to one option or the other.  It is up to your business to decide what should be your organization’s preferred standard with respect to a particular type of contract, and whether or not you will be willing to concede your position upon request by a particular client.  You may realize that your preferred position is going to be the same in every case, or alternatively, that your position may require review on a scenario by scenario basis.

Date: June 17, 2022
Time: 10 a.m. PST
Price:  $175.00  Register

How are SaaS agreements unique from other technology contracts? What do you need to know to negotiate and draft them?

Silicon Valley SaaS lawyer Kristie Prinz will present an introductory webinar on “Introduction to Negotiating & Drafting SaaS Contracts,” on June 17th at 10 a.m. PST, which will provide an overview of the basic concepts that you need to know before attempting to negotiating and draft a SaaS contract. In the webinar she will address

• Key differences between SaaS contracts and other technology contracts
• Essential SaaS contract terms
• Where SaaS relationships can go wrong

Ms. Prinz is a SaaS, software and technology transactions attorney in Silicon Valley who has been representing early stage, small, and mid-market software companies for more than 22 years. Ms. Prinz is a nationally-recognized speaker, media contributor, and author of the Silicon Valley Software Law Blog. Ms. Prinz has developed particular expertise in the fields of SaaS and digital health transactions. She graduated from Vanderbilt Law School and is licensed to practice in the states of California and Georgia.

This event is intended for developers, entrepreneurs and software company executives who do not have a law degree but are actively negotiating and draft SaaS agreements for their companies

To register to attend, please sign up here.

Date: May 21, 2022
Time: 9:00 a.m. PST
Price: $699    Register

Are you a lawyer who would like to expand your practice niche into the software transactions area? Would you like to know the basics about negotiating and drafting these types of agreements?

Join Silicon Valley Digital Health Lawyer Kristie Prinz in an introductory software transactions workshop intended for lawyers looking to expand into this practice niche. The virtual workshop will be interactive and students will be invited to participate in shaping the course content.  Participation will be limited to a maximum of 20 people.

Kristie Prinz is a Software, SaaS and Technology Transactions Attorney based in Silicon Valley, who has been representing software & SaaS companies in technical transactions for 22 years. Prior to arriving in Silicon Valley, Kristie practiced law in Atlanta, Georgia. Kristie is a frequent speaker and media contributor, and is also the author of the Silicon Valley Software Law Blog. Kristie is a graduate of Vanderbilt Law School and licensed to practice law in the states of California and Georgia. For more information on Kristie, check out her website.

To register for this workshop, please click here.

Date: May 23, 2022
Time: 9 a.m. PST
Price: $699  Register

How are software contracts unique from other business contracts? What do you need to know to negotiate them?

Silicon Valley Digital Health Lawyer Kristie Prinz will be teaching an introductory workshop on software contracts negotiation for nonlawyers. The virtual workshop will be interactive and participants will be invited to help direct the focus of the workshop.

In this workshop, she will address:

What are the key considerations you need to have in negotiating software contracts?
What are the key terms that need to be addressed in a software contract?
What are the primary causes of disputes in software contracts and how do you avoid them?
This workshop is intended for entrepreneurs and other non-lawyers who are negotiating software contracts and need a practical, interactive overview on how to negotiate these contracts.

Kristie Prinz is a Software, SaaS, and Technology Transactions Attorney based in Silicon Valley, who has been representing software and SaaS companies in technical transactions for 22 years. Prior to arriving in Silicon Valley, Kristie practiced law in Atlanta, Georgia. Kristie is a nationally-recognized speaker, media contributor, and author of the Silicon Valley Software Law Blog. Kristie is the founder of the The Prinz Law Office and the Silicon Valley Software Services Advisors Group. Kristie is also a graduate of Vanderbilt Law School and licensed to practice law in the states of California and Georgia.

This event is intended for developers, entrepreneurs and software company executives who do not have a law degree but are actively negotiating and draft SaaS agreements for their companies.

To register, please sign up here.

Date: June 6, 2022
Time: 9 a.m. PST
Price: $699 Register  

Are you a lawyer who would like to expand your practice niche into the digital health area?  Would you like to know the basics about negotiating and drafting these types of agreements?

Join Digital Health Lawyer Kristie Prinz in an introductory digital health contracts workshop intended for lawyers looking to expand into this practice niche.  The workshop will be interactive and students will be invited to participate in shaping the course content.

The course will be taught by Silicon Valley Digital Health Lawyer Kristie Prinz.   Kristie Prinz is a Digital Health, SaaS and Technology Transactions Attorney based in Silicon Valley, who has been representing life sciences companies in technical transactions for 22 years. Prior to arriving in Silicon Valley, Kristie practiced law in Atlanta, Georgia. Kristie is a frequent speaker and media contributor, and is also the author of the Silicon Valley Digital Health Law Blog. Kristie is a graduate of Vanderbilt Law School and licensed to practice law in the states of California and Georgia. For more information on Kristie, check out her website.

To register for the workshop, please sign up here.