1. Eric J. Pritchard One Liberty Place, 46 th Floor 1650 Market Street Philadelphia, Pennsylvania (215) 496-7241 EPritchard@Kleinbard.com

2.  The following information is not intended as, or to be understood as legal advice.  Consult an attorney for legal advice with respect to subject matters of this presentation.

3.  2011 – U.S. smartphone sales surpass PC sales for 1 st time  2013 – 320 million mobile subscribers in U.S.  110 million use smartphones  55% use mobile device to access the Internet  2014 – Mobile web usage predicted to overtake PC usage  Trends likely to continue

4.  Software program for targeted task on mobile device  Provide new platform for delivering services and information  Key to Apps:  leverage mobile devices – camera, voice capabilities, telephone transmissions, GPS, Bluetooth technology, to provide uniquely, mobile functionality.  Mobile technology essential for companies where digital communications critical to business  Slow adoption limits security providers, essential for industry to monetize apps

5.  Companies should use Apps.  Companies should address legal issues prior to and during development of App to protect rights and minimize risk  Areas of concern for security industry ◦ End User Privacy ◦ Location Based Services ◦ Intellectual Property Rights ◦ Advertising and Promotions ◦ Risk Allocation

6.  Privacy possibly single most important legal consideration for app development.  Sources of Law  FTC  FCC  State Attorney Generals  State Legislatures  White House  Class Action Lawyers .

7.  Types of information: ◦ Personal ◦ Personally Identifiable ◦ Location Based ◦ Financial ◦ Healthcare Information

8.  Include clear privacy policy that accurately and completely discloses information protocol, including: ◦ Collection, Usage & Storage  Take into account state and federal laws, industry standards and best practices ◦ Not only mobile laws but also state Burglar and Fire Alarm laws  Are you insured for this type of breach? ◦ CGL, E&O and D&O will not help ◦ There is cyber liability and cyber risk ◦ Consult an insurance professional!

9.  Guidelines for LBS Providers  Mandatory Disclosure ◦ How users’ location information is used and shared with third parties ◦ How user may terminate the LBS and the implications of termination  Mandatory Consents ◦ Consent for provider to use or disclose location information prior to using LBS app  Security Measures ◦ Employ reasonable administrative, physical and/or technological safeguards to protect LBS information  LBS information should be retained only as long as necessary

10.  Apps are original works and may give rise to Intellectual Property (“IP”) Rights in course of development  Examples of IP Rights include: ◦ Content - The original software code, textual/graphic, database elements, GUI, images and artwork may be protected through COPYRIGHT ◦ App developer may treat source code as TRADE SECRET ◦ App name and terms developed with the app may qualify for TRADEMARK protection ◦ Process or method embodied in app may be PATENTABLE.

11.  Define and secure ownership through contracts including work for hire and invention assignment provisions  Execute non-disclosures & restricted use agreements before disclosing confidential information  Address 3 rd party IP issues ◦ Apps may incorporate 3 rd party IP ◦ Is a license required to use the IP?  DON’T assume existing licensing agreement provides right to use!  Geographically defined rights  Rights limited by distribution platform ◦ Potential risk of infringement

12.  Legal issues may arise as a result of: ◦ 3 rd party ads on app, advertising or promoting the app, the app itself especially if it promotes your brand  Apps present same legal issues as websites, e-mail and other on-line communications ◦ Commercial text messages regulated by Telephone Consumer Protection Act (“TCPA”) and FCC rules ◦ Law provides private right of action and high statutory penalties  Recent settlement by ADT is evidence of this  App may constitute advertising ◦ Descriptions and public statements about App ◦ Content and advertising must comply with applicable federal and state laws

13.  Is small print enforceable in an app?  Drive subscribers to website?  Is risk allocation covered by other agreements?  Is the risk allocation enforceable?