A JDA sets forth terms for collaborative product or technology development, addressing ownership, confidentiality, and IP outcomes. This playbook highlights best practices for defining contributions, milestones, and dispute resolution.
Why This Matters: Robust representations reduce the risk of hidden defects or infringements and establish a clear basis for claims and corrective actions.
Negotiation strategy
If you're the Company A:
Ensure that the representations cover all necessary aspects of the transaction, including authority and IP validity. Negotiate for a survival period that aligns with the expected duration of potential risks.
If you're the Company B:
Limit the scope of representations to what is strictly necessary and ensure that any survival period is reasonable and does not extend liability indefinitely.
Essential elements
1
Authority Assurance
Confirms party's legal power.
2
IP Validity
Ensures IP rights are valid.
3
Compliance with Laws
Adherence to applicable laws.
Action framework
ACCEPT
Propose edits if the representations are too broad or lack specificity.
EDIT
Reject if the representations impose unreasonable or unmanageable risks.
ADD
Add clauses if any key representation is missing, such as IP validity.
PRO TIP
Always tailor the survival period of representations to the specific risks and duration of the agreement.
Example clauses
FAVORABLE
Comprehensive Authority Representation
"Each Party represents and warrants that it has the full right, power, and authority to enter into this Agreement and to perform its obligations hereunder."
NEUTRAL
Standard IP Validity Clause
"Each Party represents and warrants that it owns or has the valid right to use all Intellectual Property necessary for the performance of its obligations under this Agreement."
UNFAVORABLE
Overly Broad Compliance Clause
"Each Party represents and warrants that it is in compliance with all laws, regulations, and ordinances worldwide."
Fallbacks
High-Risk Projects
In high-risk projects, ensure that representations are detailed and include specific survival periods to cover potential long-term liabilities.
Cross-Border Transactions
Consider jurisdiction-specific requirements and adjust representations to comply with local laws and regulations.
Technology Licensing
Focus on IP validity and non-infringement representations to protect against technology-related disputes.
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WEEK 1
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WEEK 2
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WEEK 3
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WEEK 4
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