“Software is the magic thing whose importance only goes up over time” – said Bill Gates.
The impact of COVID-19 and the need for businesses to work flexibly shows just how true these words are. In recent months, there has been an unprecedented increase in the importance of reliable IT solutions. With a significant increase in remote working and further expansion of online services offering, now more than ever, businesses are forced to rely on the help and support of their service providers. It is expected that businesses across the globe will continue to embrace this trend for the foreseeable future.
When things work well, the right software can be an unmatched tool to help businesses and staff to achieve their objectives. As IT systems are often outsourced, businesses are heavily reliant on their external providers to deliver a reliable service to meet their everyday needs. The relationship between them and their IT providers is often based on a contract. Such contract should provide clarity and certainty in terms of service levels required of the service provider. More importantly, it should serve as the first point of reference when things unexpectedly go wrong.
The issues that can arise, particularly in the absence of a suitable contract (or any contract), are wide-ranging: from software being unsuitable/not meeting the specification, service level shortfalls, other performance issues, unexpected system failures and loss of data, to inadequate maintenance or even security breaches. When issues such as these arise, they can have a catastrophic impact on business continuity, costing money, time and resources and causing risk of regulatory fines and liability to third parties. In the world of remote working and provision of online services, these types of problems can have severe consequences immediately.
Furthermore, ownership and scope of the licence of intellectual property rights in software (which can subsist at multiple different levels, such as IP rights in its source code, object code, interfaces, design materials etc.) can also be disputed, unless clearly agreed between the parties. Disputes involving intellectual property rights often arise at the point of termination of the relevant agreement, when questions over the ongoing rights to use, modify or licence the solution may become apparent.
How can we help you?
If you are concerned about a dispute related to your IT solution, whether a potential or an existing one, or if you are unsure about your legal position in that regard, we are here to help.
With a wealth of dispute resolution experience, we will be with you every step of the way and explain the legal complexities clearly and jargon-free. We will help you protect your business, minimise the risk of long-term damage and reach a favourable outcome as quickly as possible.
We can assist you with resolving early stage disputes and support you all the way through litigation proceedings should they prove necessary. We will also advise you on the range of Alternative Dispute Resolution options available.
If you require assistance, please contact Michael Lindsey or Gosia Evans of our Commercial Dispute Resolution team.
With special thanks to Al Hussain, Trainee Solicitor, for his contribution to this article.
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