Feedback clause: who may use the suggestions a customer makes

Sample clause

a subscription agreement between Tallowood Rostering, a fictional scheduling software supplier, and Coralbay Aged Care, a residential care provider in Townsville that uses the rostering platform across three sites

9. Feedback 9.1 Feedback means any suggestion, idea, enhancement request, bug report or other comment about the Platform that the Customer or its Users give to Tallowood Rostering, whether in writing, in a meeting or through the Platform. 9.2 The Customer grants Tallowood Rostering a perpetual, irrevocable, worldwide, royalty free licence to use, copy, modify and incorporate Feedback into any product or service, and to sublicense those rights. 9.3 Feedback does not include the Customer's Confidential Information, resident records or Personal Information, and clause 9.2 does not permit Tallowood Rostering to disclose any of them. 9.4 Tallowood Rostering is not required to act on Feedback, to credit the Customer, or to pay any amount for it. 9.5 Nothing in this clause transfers ownership of any intellectual property the Customer owns apart from this clause.

Sample wording, not legal advice.

Variants

What to negotiate

• Keeping confidential material out

  A customer describing a problem often explains how its business runs, and that explanation can be confidential. A feedback licence with no carve out can be read as permission to use it. Customers ask for Confidential Information and Personal Information to be excluded expressly, and for the confidentiality clause to prevail if the two conflict. Suppliers rarely resist, because the ideas are what they want.

• Licence or assignment

  An assignment gives the supplier ownership, which some customers dislike on principle. A perpetual, irrevocable licence gives the supplier everything it practically needs without a transfer. Many negotiations settle on the licence, sometimes with a promise from the customer not to assert any rights it has in a feature built from its suggestions.

• Who counts as giving feedback

  Feedback usually arrives from users, not from the signatory. The clause should say that suggestions from the customer's staff and authorised users are covered, otherwise the supplier holds rights over the contract manager's emails but not over the hundred tickets its users actually lodged.

The risk of leaving it out

Without a feedback clause the supplier relies on the general position that ideas are not property. That position is sound for a bare idea but weak for a detailed written specification, a mock up or sample code, which copyright can protect, and for suggestions given in confidence. A customer could then argue it owns or controls part of a feature sold to others.

Why an idea needs a clause at all

Australian copyright law protects the form in which an idea is expressed, not the idea itself, so a customer who says a report should group shifts by ward has handed over nothing a court would call property. Feedback is rarely that thin. It comes as annotated screenshots, spreadsheets showing the calculation a customer wants, and occasionally code written by the customer's own developers. Those are works in which copyright can exist. Information shared in confidence can also be protected by the equitable duty of confidence. The clause converts an uncertain position into a written permission.

Where the clause usually sits

Feedback wording belongs in the intellectual property section of a software licence, a subscription agreement or a master services agreement, next to the clauses on background material and ownership of deliverables. It should be read with the confidentiality clause, since the two overlap whenever a customer explains a problem. Beta programme terms and pilot agreements carry it too, often in a stronger form, because gathering feedback is the reason the pilot exists. Consulting and design agreements rarely need it, since the client is paying for the ideas and the ownership clause already deals with them, so adding a feedback licence there can quietly hand back rights the client expected to hold.

Where it sits in a generated document

A description of a subscription or licence agreement produces numbered clauses, so feedback can be asked for as its own clause under intellectual property, with the definition and the licence as separate sub clauses. The generated text comes from the description alone and prints no citations. Naming the carve out for confidential and personal information in the description is the simplest way to make sure it appears.

Documents that carry this clause

Software licence agreement template with seats, term and supportA software licence agreement has to answer three questions before anything else: what a seat is, what happens when the software is down, and who gets the data at the end. This one licenses a hosted practice management suite to a medical practice for 25 named users at $9,600 a year, with a support table, uptime credits and a 30 day export.Master services agreementA data consultancy and an insurer sign this once and then buy work under it for three years. It is the rare contract whose whole purpose is to make the next twenty contracts short.

Questions people ask