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Five Legal Issues Not-for-Profit App Developers Should Remember

By TMCnet Staff

Mobile apps serve as a more convenient and feature-laden method of accessing Internet content and tools, and at their core they are simply a specialized form of software. As a result non-profit app developers must consider many of the same issues that other software developers do, with the addition of several legal considerations that are unique to mobile apps.

One such consideration is intellectual property, as the various parts of an app must be protected from appropriation. Trademark rights must be maintained for identifying the app, related services or the not-for-profit itself, and odds are a good portion of the content is copyrightable. The code used to build the app should also be copyrighted and the functionality and development of the app are protected under trade secret rights. Some apps may even contain patentable subject matter.

The dissemination of an app’s intellectual property rights is highly dependent on the contracts held between the not-for-profit and any third parties that assist with the development process, even if the work is volunteered. Third parties should sign a work-for-hire agreement or a contract containing a work-for-hire provision so that the work is legally considered a “work made for hire.” This means that the intellectual property rights associated with work completed under the scope of employment are assigned to the not-for-profit and the third party has no claim to them.

Once an app is completed, the not-for-profit must consider how it plans to distribute the app to its target audience. Most importantly it must be decided what pricing model will be used (free, freemium, paid, etc.) and which app stores and mobile platforms will be supported. An agreement must be made between the not-for-profit and each app store, but the requirements differ from one to another and many agreements include additional usage or compliance policies that may have a significant effect on development and distribution of the app. Platforms and app stores often require liability insurance and include a clause reserving the right to adjust terms and conditions at any time, with which the not-for-profit must maintain compliance.

Privacy and security regulations are another important concern. Issues arising in this area generally pertain to: the kind of personal information being collected and manner of collection, the subject of the collection (including whether the subject is under/over age 13), the need for and ability to comply with an opt-in or opt-out mechanism, the country of origin or residency of end users, the freedoms or restrictions on use of the collected data and requirements to provide notice and a summary of data collection and use practices. Certain types of data, such as financial information and health records, are uniquely and more heavily regulated, and other technical information unique to mobile apps may be as well.

The last important thing to consider is advertising regulations. Not-for-profits must maintain compliance with laws governing solicitation practices as well as contests and sweepstakes, and it is mandatory that all information about the app is truthful and complete. Communications carried out through the app are subject to the Telephone Consumer Protection Act and all related Federal Communications Commission rules, and The Controlling the Assault of Non-Solicited Pornography and Marketing Act of 2003 regulates email and text message communications between the not-for-profit and customers.

The benefits of developing an app are almost unanimously agreed upon, but it is important that not-for-profits remain committed to thinking about the many legal considerations that govern it. These issues, especially pertaining to development, marketing, licensing and distribution of the app, are an essential step in avoiding potential liability risks.