End-User License Agreement (EULA)

End-User License Agreement (EULA)

Drafts an enforceable EULA protecting licensor IP, limiting liability, and satisfying consumer protection standards across jurisdictions.

Intake Checklist

Gather before drafting:

1. Software — product name, version, deployment model (desktop / mobile / SaaS / cloud / embedded)
2. License model — perpetual, subscription, usage-based, freemium, or trial
3. User population — B2C, B2B, or mixed; users under 13 (COPPA trigger)
4. Geography — US-only, EU, or global (drives GDPR, CCPA applicability)
5. Data collected — personal data categories; PHI (HIPAA), financial (GLBA), student (FERPA), payment (PCI-DSS)
6. Third-party components — open-source (copyleft vs. permissive) or proprietary
7. App store — Apple App Store, Google Play, or direct distribution
8. Risk posture — arbitration/class-action waiver? IP indemnification? Benchmark restrictions?

Drafting Workflow

1. Header & Acceptance

• Title: "END-USER LICENSE AGREEMENT" prominently displayed
• Specify triggering act: install / account creation / first use
• Click-wrap required: scrollable full text, accept button active only after scroll opportunity (ProCD v. Zeidenberg; avoid browse-wrap per Specht v. Netscape)
• Mobile: present in app-store listing + first launch; must not contradict platform terms
• Version date + 30-day advance notice for material amendments; affirmative re-acceptance for paid-tier changes reducing rights

2. Definitions

3. License Grant

• Non-exclusive, non-transferable, revocable for breach, [perpetual / subscription-term]
• Specify device count or concurrent user cap
• Permitted use: internal business / personal; per Documentation
• One archival backup copy; proprietary notices intact
• SaaS: frame as access right, not installation right
• Trial: evaluation-only, non-production, time-limited with end date; auto-terminates at expiry

4. Restrictions

5. IP Ownership

• Licensor retains all rights — copyright, patents, trademarks, trade secrets
• License, not a sale; first-sale doctrine inapplicable
• User data: user owns; licensor gets limited processing license for service delivery
• Aggregated/anonymized data: licensor owns derived insights
• Feedback: user assigns all rights; moral rights waived to extent permitted
• Third-party components: designated as intended third-party beneficiaries; confirm no GPL copyleft contamination
• Trademarks: no right to use licensor marks except to identify Software

6. Payment & Renewals

• State fees in specific currency (not by reference to pricing page)
• Auto-renewal: conspicuous pre-purchase disclosure per Cal. Bus. & Prof. Code § 17600 et seq. [VERIFY]; easy cancellation; advance renewal reminder
• Non-payment: notice + 5–10 day cure → suspension; 10–15 day cure → termination
• Refunds: state terms explicitly; app-store refunds per platform policy
• Taxes: exclusive of taxes; user bears sales/use/VAT; EU VAT reverse charge for B2B

7. Term & Termination

• For cause: immediate upon material breach (IP violation, non-payment, export violation, insolvency)
• Without cause: free licenses — 30 days notice; paid perpetual — generally not permitted
• User termination: cancel per stated procedure; cease use; destroy all copies
• Post-termination: uninstall all devices; destroy copies (including backup/cached); written certification on request; SaaS — 30-day data export window then deletion
• Survival: IP ownership, restrictions, confidentiality (3–5 years / indefinite for trade secrets), disclaimers, liability caps, indemnification, dispute resolution

8. Warranty Disclaimer

MUST BE ALL-CAPS OR BOLD (conspicuousness requirement)

• Limited warranty (if offered): Software substantially conforms to Documentation for [30/60/90] days; excludes modified software, misuse, unauthorized combinations
• Exclusive remedy: patch → replacement → pro-rata refund + termination
• Disclaimer: SOFTWARE PROVIDED "AS IS" AND "AS AVAILABLE." LICENSOR DISCLAIMS ALL WARRANTIES — EXPRESS, IMPLIED, STATUTORY — INCLUDING MERCHANTABILITY, FITNESS FOR PARTICULAR PURPOSE, NON-INFRINGEMENT, TITLE, QUIET ENJOYMENT, ACCURACY. NO WARRANTY OF UNINTERRUPTED OR ERROR-FREE OPERATION.
• Savings clause for jurisdictions prohibiting full warranty exclusions
• Magnuson-Moss Warranty Act compliance for consumer products [VERIFY applicability]

9. Limitation of Liability

MUST BE ALL-CAPS OR BOLD

• Consequential damages exclusion: NO LIABILITY FOR INDIRECT, INCIDENTAL, CONSEQUENTIAL, SPECIAL, EXEMPLARY, OR PUNITIVE DAMAGES INCLUDING LOST PROFITS, LOST DATA, BUSINESS INTERRUPTION, REGARDLESS OF CAUSE OR FORESEEABILITY.
• Aggregate cap: fees paid in prior 12 months; free software — $[50–100] or max permitted by law
• Cap is collective across all claims; does not reset per claim
• Carve-outs (narrow): gross negligence / willful misconduct; death/personal injury; fraud; mandatory statutory rights
• Claims must be brought within 1 year of accrual
• Savings clause for jurisdictions limiting damage exclusions

10. Indemnification

Licensor → User (IP, if offered):

• Defend/indemnify for claims that unmodified Software infringes registered patents, copyrights, or trademarks
• Conditions: prompt notice (≤10 days); licensor controls defense; user cooperates
• Exclusions: user modifications; unauthorized combinations; non-current version; out-of-scope use
• Remedies: procure license → modify → replace → pro-rata refund + terminate (exclusive remedy)

User → Licensor:

• Defend/indemnify for: breach of agreement; law/third-party rights violations; user content/data; user negligence/misconduct
• Not subject to aggregate liability cap

11. Governing Law & Disputes

• [State] internal law; exclude conflict-of-law principles and CISG
• Exclusive jurisdiction: [County, State] state and federal courts
• Arbitration (if included): AAA Commercial Rules; [city]; 1 arbitrator (<$100K) / 3 (≥$100K); licensor pays costs for consumer claims
• Class action waiver: individual capacity only [enforceability limited in CA consumer contexts — confirm]
• Carve-out: equitable/injunctive relief for IP or confidentiality violations
• Consumer savings clause: unenforceable forum selection defaults to user's jurisdiction

12. Data Protection

Include provisions for each applicable regime:

• Disclose: data collected, purpose, retention, third-party sharing, security measures
• No absolute security guarantees; user responsible for credential security
• If software not designed for sensitive data: explicit prohibition + liability disclaimer

13. Export Controls

• Software subject to EAR (15 C.F.R. Parts 730–774 [VERIFY]); ITAR if defense application
• User represents: not in embargoed country (Cuba, Iran, North Korea, Syria, Crimea/Donetsk/Luhansk — verify current OFAC/BIS lists); not on SDN, Denied Persons, or Entity List
• No export/re-export without required licenses
• Violation = material breach → immediate termination; user indemnifies

14. General Provisions

Pitfalls & Checks

• Conspicuousness: warranty disclaimers and liability caps MUST be ALL CAPS or bold — never buried in body text
• Click-wrap over browse-wrap: require affirmative acceptance; no pre-checked boxes
• EU consumer contracts: Unfair Contract Terms Directive prohibits significant-imbalance provisions; user's habitual-residence law applies (Rome I) — disclaim only what is permissible
• Class action waiver: may be unenforceable in CA consumer contexts — confirm before including
• Open-source audit: confirm no GPL/AGPL copyleft that would require disclosing proprietary code
• App store overlay: Apple/Google impose payment, refund, and content terms — EULA must complement, not contradict
• Do not include: specific hypothetical damages amounts; representations about unlicensed third-party products; absolute security guarantees