Many companies contract out the development of their Web sites to third party developers.
Companies should ensure that the contract with the Web site developer address several key areas, including ownership and intellectual property rights, the development process, functionality of the end product, problems that may arise and corrective measures required to be undertaken, covenants of the developer, confidentiality, and other provisions. The development agreement should clearly address the issue of ownership of and intellectual property issues related to the content, screens, software, and information developed. The development agreement can address various issues associated with the development of the site, progress payments, and acceptance procedures. The company will want to obligate the developer to keep all confidential or proprietary information that it learns about the company or its customers strictly confidential, and not use such information other than in connection with the developer's obligations under the development agreement. The agreement may also require that the developer's employees and consultants working on the site development project execute a Confidentiality and Invention Assignment Agreement, as discussed in 15B below.