When I left law school, people asked me what area of law I wanted to practice in. When I told them that I wanted to be a technology lawyer, I usually saw blank faces (even by some lawyers) and a moment of silence, followed by “What does a technology lawyer do?”
You see, as I have a background in technology – everything from web development, managing web and software development companies, e-Commerce site building, marketing systems and integration, to web and email server management. Before I entered law school, I knew the writing was on the wall: technology was growing at a furious pace. In fact, when I look back on it – I KNEW there was going to be huge legal challenges… and it was going to get even more challenging with AI, currency, banking, privacy – and the list goes on.
These days, people have a little more of an idea of what a technology lawyer does – the general consensus, I have found to be working at Amazon or Google. Which is correct, however, there is a little more to it than that. This article discusses what areas of law a technology lawyer works in.
Technology Lawyers’ Background
To work in technology law, it is best to have a thorough knowledge of technology – especially the logic that underpins technology. This may go without saying. However, there are now technology lawyers with no practical experience in working in tech. This can be disadvantageous for clients. I often hear software developers, software companies and technology clients say they talk to other lawyers who say they are technology lawyers, but after talking to them for 5 minutes, it is clear they don’t understand their software, systems, their strategies, objectives – and sometimes their business model. This means that the client not only has to take the time to explain their software, technology platform and business model to the lawyer (usually over numerous meeting and phone calls), they are charged for the lawyer’s time that they must explain it to.
Technology Lawyers provide a lot of advice around company structuring, IP, employee share schemes. Other advices to do with copyright of source code and general advices regarding intellectual property – particularly if there is a dispute on the horizon.
Other advices relate to how directors can leave a company, without losing their equity or rights in code – or otherwise related to how to remove a director or troublesome shareholder.
Technology lawyers draft contracts specifically for the technology sector. Oftentimes, such contracts have differences with more traditional types of businesses. For example, SaaS terms and conditions will be drafted very differently than a traditional services agreement. Also, employment contracts for tech companies will be different in many ways than traditional employment agreements. For example, traditional employment contracts may prohibit social media use. However, employment in a digital marketing agency may require it – and the type and purpose of social media use will be regulated. There are many, many other differences.
It is commonplace for technology lawyers to draft Shareholders’ agreements regularly – given the number of startups that spring up. In the tech world, it is common to have 2-4 founders – partly because there has been advice come out from Silicon Valley over the years to say that is the ideal number. The shareholders’ agreement sets the terms on which the founders will conduct themselves and how the company will operate. It is a very important document that should be thoroughly discussed.
Software licensing agreements provide a means by which one company can using anothers’ software and sometimes resell it. Additional provisions may be inserted into these agreements to allow the licensee to rebrand the software with their own brand. This is known as a white label license.
Deeds of assignment to assign intellectual property when companies merge. These documents assign. Special attention needs to be paid to capital gains tax (CGT) events when such assignments are made.
Non-Disclosure Deeds sometimes called Non-Disclosure Agreements – or NDA’s are agreements that one party provides to another that requires them not to disclose any information that is specified in the deed. Usually, people use NDA’s to provide to manufacturers or engineers to protect a concept to do with a patent or design that they must keep secret before registration.
Litigation in Intellectual Property
Disputes in technology are often tied to matters relating to trade marks and copyright. For example, there are often disputes over who owns computer code. This gives rise to litigation involving arguments around provisions in the Copyright Act. Again, having a background to understand how code is written can be vital in undertaking litigation on behalf of a client.
Litigation in Restraints
Disputes often occur around restraints of trade for employers. Some employers have non-compete versions that attempt to disallow employees from working at a particular firm, should they leave their place of employment. These are usually ineffective. However, restraints are in commercial contracts are usually effective. These types of restraints are commonly argued.
Litigation of Directors
Of course, in tech companies and startups, there are sometimes disputes between directors and sometimes shareholders. Disputes between directors are usually because one director is doing most of the work, and the other director is ‘taking it easy’. This often results in negotiations for one party to buy the other out. Therefore, technology lawyers must be good at structuring startups and creating practical agreements upon company formation to ensure everyone does what they promise.
Tech companies’ value is often contained in their intellectual property – for example, computer code, designs and technology. Therefore, technology lawyers are often tasked with registering and protecting technology companies’ most valuable asset – its IP.