Contract Red Flags: Liability, Audit Rights, and Hidden Use Rights

Contract Red Flags: Liability, Audit Rights, and Hidden Use Rights

Red-flag clauses

  • Vendor disclaims all liability for breaches or failures
  • Customer grants broad rights to use data for training
  • No audit rights, no notice of subprocessor changes
  • Exit terms that are expensive or vague

Action

Escalate to counsel early; treat these as deal-structure issues, not “legal fine print.”

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