Channel Attorney Discusses Analyzing Agent Agreements

By Cara Sievers

Agreements between telecom agents, resellers and carriers are critical to the success of those business relationships. Determining and scrutinizing contact details on the front end will help agents avoid being ruled by poorly drafted, unbalanced contracts.

In today’s session, “Analyzing Agent Agreements,” led by Neil Ende, attorney with Technology Law Group LLC, attendees can find out how carefully drafted agreements not only protect agents and resellers from unscrupulous conduct by carriers, but also help to avoid unnecessary conflicts that arise out of legitimate misunderstandings over the terms of agreement.

Unfortunately, said Ende, the onus to address problems in agent contracts generally falls on the agent. He said although contracts almost always are presented by carriers to agents with the suggestion that changes are not permitted, this actually is rarely the case. After all, both parties have an economic incentive to reach an agreement. “The key is to identify the issues that are most critical and to present alternative language that properly addresses issues in an intellectually sound and balanced manner,” Ende said.

“As a general matter, agreements drafted by carriers unfairly allocate most of the responsibilities and risks onto agents while leaving the primary opportunity for reward, and the control over the nature and substance of that reward, in the hands of the carrier,” continued Ende. “This imbalance in risks and rewards, along with the absence of discussion of key issues, can be a recipe for disaster. Indeed, not only is the imbalance in risks and rewards of fundamental concern to agents, it also can encourage bad behavior by carriers out of a false sense of invulnerability; e.g., the often-heard axiom that you cannot sue or recover damages from a carrier.”

Ende also said he plans to discuss the workability and flexibility of agent agreements. Since, oftentimes, forging parties come and go, or even as the business relationship naturally evolves, flexibility must be built into the contract at the outset to ensure necessary fluidity.

Ende said the session will cover the negotiating process and go over some tactics and steps that will help agents avoid and/or resolve disputes both through careful contract drafting and ongoing, proactive management of the contractual relationship.