1. Are Your Intellectual Property Rights
Illusory
Cloud Service Providers

2. Nate Roberts
IT professional and attorney
VP Global Transformation
Austin Tele‐Services
nate_roberts@me.com
214‐763‐9990
@nroberts_prime

3. Projected Cloud Growth
• Bulk of new IT spend by 2016 will be on cloud computing
(Gartner)
• Cloud computing market is projected to soar from $40.7
billion in 2011 to $241 billion in 2020 (KPMG)
• 85 percent of the new software being built today is for
cloud (IBM).
• By 2016 over a quarter of all applications (around 48
million) will be available on the cloud (IBM)
• 50 percent of enterprises will have hybrid clouds by 2017
(Gartner).

4. The Cloud Dilemma
Data Security Concerns
Convenience /Lower Costs (TCO )

5. Typical Licensing Agreements
• All Cloud Storage Providers Have Some Form
Licensing Agreements
– End User Licensing Agreement (EULA)
– Terms of Service
– Privacy Policy
• Contract Execution
– “USE OF SOFTWARE INDICATES YOUR ACCEPTANCE OF THE
TERMS OF THIS...”
– “BY CHECKING THE ACCEPTANCE BOX OR INSTALLING OR
USING ALL OR ANY...”

6. Legal Protections
• Protections Embodied in Two Legal Concepts
• Intellectual Property (IP) Protections
– Copyright,
– Trademark,
– Patent,
– Trade Secrets
• Data Privacy Protections (Hundreds)
– Federal Laws
• Example: Federal Information Security Management Act (FISMA)
– State Laws
• Texas: Data Breach Notification Law (Amended 2012)

7. An Illusory Contract
(Illusion)
“An agreement to do something
(contract) that is so indefinite one
cannot tell what is to be done or
whether performance is required.”

8. Warning

9. Amazon Web Services (AWS)
“Fine Print
“[…] You may specify the AWS regions in which Your
Content will be stored and accessible by End Users.
We will not move Your Content from your selected
AWS regions without notifying you, unless required to
comply with the law or requests of governmental
entities. You consent to our collection, use and
disclosure of information associated with the
Service Offerings in accordance with our Privacy
Policy, and to the processing of Your Content in,
and the transfer of Your Content into, the AWS
regions you select.”

10. Dropbox “Fine Print”
[…] “Dropbox uses certain trusted third parties
to help us provide, improve, protect, and
promote our Services. These third parties will
access your information only to perform tasks
on our behalf and in compliance with this
Privacy Policy.”

11. “Some of our Services allow you to upload, submit, store, send or
receive content. You retain ownership of any intellectual
property rights that you hold in that content. In short, what
belongs to you stays yours.
When you upload, […], you give Google (and those we work with)
a worldwide license to use, host, store, reproduce, modify,
create derivative works (such as those resulting from
translations, adaptations or other changes we make so that your
content works better with our Services), communicate, publish,
publicly perform, publicly display and distribute such content. “
Google “Fine Print”

12. More Google “Fine Print”
The rights you grant in this license are for the
limited purpose of operating, promoting, and
improving our Services, and to develop new
ones. This license continues even if you stop
using our Services (for example, for a business
listing you have added to Google Maps). […]
Make sure you have the necessary rights to
grant us this license for any content that you
submit to our Services.

13. Conclusion
Illusory? “YES!”
• Cloud Storage Providers Licensing Agreements
represent a significant erosion of IP and Data
Security Protections
• Significant thought and planning should go
into what and how data is sent to the cloud.
• Well drafted contracts to preserve IP and Data
Security Protections.

14. References
• http://www.informationshield.com/usprivacylaws.html
• https://www.dropbox.com/terms
• http://aws.amazon.com/agreement/
• http://www.google.com/intl/en/policies/terms/
• http://www.gartner.com/newsroom/id/2613015
• http://thoughtsoncloud.com/2014/05/future‐cloud‐
computing‐5‐predictions/