IP Tech Knowledgy

Sometimes your Nondisclosure Agreement needs to cover more than just confidentiality. If you are showing anyone your proprietary product or service, and you are also asking the person to provide feedback about how your item works or might be improved, the agreement should address intellectual property rights and parameters of the usage. One common document for this situation is a “Beta Testing Agreement,” when it is clear the other person is – in a minimal or a significant way — helping you develop your offering by initially testing the item and providing feedback before you fully take it to market.  

A Beta Agreement should include provisions that the person assigns to you all intellectual property rights that relate to what comments, developments, or related creations the person may provide to you or conceive during the process. This assignment will protect against the person later claiming to have partial ownership in, or a right to receive royalties from, your final product offering that may incorporate some or all of what the person suggested. Also get an assignment of all related data.

The Beta Agreement also should include a license to the tester that defines the parameters of usage, including when the testing period ends; on what systems the tester can load the product, if it is some type of software; when and how the tester returns the item, if it is a physical product; and any other specifics that are important to the testing/reporting parameters or information sought. The Agreement should also be clear that the product may not work as intended and may be withdrawn or modified at any time. The tester should acknowledge that the item is still a work-in-progress.
  
Beta Testing Agreements are commonly used when companies allow potential customers or users to work with a product that is not fully completed to help work out the glitches and provide feedback on how the product operates, such as pre-release software or new devices.  

Ned T. Himmelrich
410-576-4171 • nhimmelrich@gfrlaw.com