The Importance of an End User License Agreement - Klein Moynihan Turco LLP

The Importance of an End-User License Agreement (EULA)

Any business that offers mobile applications (“apps”) or other software programs over the Internet needs an End-User License Agreement (“EULA”) that end-users must agree to, in full, prior to downloading the applicable software/apps. EULAs are essential in establishing developers’ ownership rights, while setting forth the limited, conditional license terms that end-users acquire in the underlying software/app. Only when such intellectual property protections are memorialized should businesses permit third party end-users to access their valuable software/mobile app.

License-Plus

At minimum, an EULA should establish the ownership rights of the software/app developer and the limited rights of use granted to the end-user. However, EULAs can serve multiple important purposes. 

Generally, the EULA (together with the privacy policy, as recommended) is often the only agreement in place between the software/mobile app developer and the consuming public. Therefore, it is essential that the EULA address many of the other contingencies that can arise pursuant to the underlying commercial relationship.

Depending on whether the EULA serves as the primary agreement with end-users, the EULA should address some or all of the following (which is by no means an exhaustive list): 

  1. a description of the functionality of the software/mobile app; 
  2. the installation and uninstall process associated with the software/mobile app; 
  3. how updates to the software/mobile app, if any, will be provided; 
  4. ownership in and to any end-user generated content; 
  5. disclaimers of warranties and limitations of liability; 
  6. any fees associated with use of the software/mobile app and the process for cancellations/refunds; 
  7. Digital Millennium Copyright Act safe harbor language; and 
  8. a dispute resolution section, including choice of law and arbitration provisions.

Make Your EULA Personal

The specific terms contained in EULAs will vary depending on the type of software program/mobile app and underlying commercial relationships. For example, some EULAs will have strict limitations on end-users use and sharing of the content generated by the software program/mobile app, while others might permit end-users a wider latitude. Further, where an EULA covers a software program/mobile app that end-users must pay a fee to access, there are numerous payment-related provisions that must be included.

It is highly recommended that you retain qualified legal counsel to ensure that your software/mobile app EULA provides adequate levels of protection to safeguard your intellectual property, while anticipating other important contingencies.

If you are interested in learning more about this topic or require the preparation of an end-user license agreement for your business needs, please e-mail us at info@kleinmoynihan.com, or call us at (212) 246-0900.

The material contained herein is provided for informational purposes only and is not legal advice, nor is it a substitute for obtaining legal advice from an attorney. Each situation is unique, and you should not act or rely on any information contained herein without seeking the advice of an experienced attorney.

This article was originally published in 2013 and updated on December 30, 2021.

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