B2B software developers have embraced agile development methods to deliver quality applications more quickly, while taking customer feedback into account and dealing with changes more easily. But agile development can create challenges when it comes to protecting your intellectual property (IP).
In 2014, the Supreme Court ruling Alice Corporation v. CLS Bank stated that an abstract idea implemented on a generic computer isn’t eligible for a patent. This minimized interference from patent trolls whose primary goal was to profit from litigation rather than taking an idea to market. But the Alice ruling can also make life more complicated for your intellectual property (IP) attorney, who is trying to figure out if your team’s work after each agile sprint needs to be protected.
How IP Protection Worked in the Days of Waterfall Development
Waterfall software development, what most people refer to as traditional software project management methodology, follows sequential steps:
- Gathering information
- System design
- Implementation
- Testing
- Deployment
- Maintenance
A downside to waterfall project management for many B2B software developers is that it doesn’t allow your team to catch errors as quickly or manage changes as development takes place. It’s something you deal with in the testing phase or when it’s deployed. And if the change or correction is significant enough, it may mean going back to the drawing board. But from your lawyer’s perspective, there is a point where the innovation is complete and a unique application exists.
Agile Software Development Can Complicate IP Evaluation
Agile software development, on the other hand, takes an incremental approach. Agile teams build the project in sprints, creating iterations that add functionality, creating opportunities for feedback and input, and implementing necessary changes until the customer approves the final product.
The American Bar Association says the pace of agile software development doesn’t give you and your IP attorney a lot of time to evaluate each iteration of the application during development. In addition, as your team develops B2B software via the agile method, they’re producing only a part of what will be the finished product — and it may not be clear whether early iterations need to be protected.
When agile software development is involved, the ABA suggests that IP lawyers consider taking legal measures to protect IP such as personnel agreements, third-party nondisclosure agreements, marking files with copyright notices, treating code or design as trade secrets, and filing patent applications (possibly for each agile sprint).
Data IT Law also points out that with agile development of a custom application, it’s difficult to decide who the owner is at any given point in the process. When does the developer transfer ownership to the customer? And if the developer is working with the customer’s data and ideas, how is that protected throughout agile development?
What about Outsourcing?
Many B2B software developers outsource work — so in addition to using agile development in faster-paced sprints than waterfall development, you are also revealing ideas to professionals who aren’t a part of your organization. Software development company DA-14 says once you define your IP, obtain necessary documentation of all intellectual property, be strategic about what you will disclose. This will lay the groundwork for the agreements you make with outsourced developers or other professionals. DA-14 also advises that if you work with offshore developers, to look into the IP laws in the countries where they are located and make sure the IP protection you have in place applies globally.
More Questions than Answers
If thinking about how you can protect IP — given the specific agile software development methods your business uses and collaboration with outsourced developers — raises questions you, as a B2B software developer, can’t answer, you aren’t alone. You should seek — and follow — legal advice for measures to take to protect your unique IP and the investments your business has made to develop it. 
