AI and software: Crafting cutting-edge contracts for the digital frontier | DLA Piper
Summary
Simply speaking and to freshen up your mind, AI is a technology that imitates human cognitive intelligence such as machine learning and problem-solving, posing multiple different legal challenges. Think about the typical hurdles like clauses concerning exclusivity, liability, warranties, service levels, IP and third-party software, personnel, customer data, security, escrow and indemnities. Appropriate clauses may need to be included to address this and mitigate any risks involved (eg the obligation for the customer to make the generated output publicly available). For example, this will be the case in the absence of an indemnification obligation for the provider of the AI tool in the event of third-party IP infringement by the generated output. This will not only force both suppliers and customers to thoroughly review their current standard software contracts, but also to come up with creative, out-of-the-box solutions, where both parties will inevitably have to compromise.