Go Daddy 2015 Annual Report Download - page 38

Table of Contents
technology that had not been asserted prior to our acquisition or license. We currently face, and expect to face in the future, claims by third parties that we infringe
upon or misappropriate their intellectual property rights.
Many companies are devoting significant resources to obtaining patents that could affect many aspects of our business. This may prevent us from deterring
patent infringement claims, and our competitors and others may now and in the future have larger and more mature patent portfolios than we have.
Furthermore, because of the substantial amount of discovery required in connection with intellectual property litigation, there is a risk that some of our
confidential information could be compromised by disclosure. In addition, during the course of any such litigation, there could be public announcements of the
results of hearings, motions or other interim proceedings or developments. If securities analysts or investors perceive these results to be negative, it could have a
substantial adverse effect on the trading price of our Class A common stock.
Regardless of whether claims we are infringing patents or infringing or misappropriating other intellectual property rights have any merit, these claims are
time-consuming and costly to evaluate and defend, and can impose a significant burden on management and employees. The outcome of any litigation is inherently
uncertain, and we may receive unfavorable interim or preliminary rulings in the course of litigation. There can be no assurances that favorable final outcomes will
be obtained in all cases. We may decide to settle lawsuits and disputes on terms that are unfavorable to us. Some of our competitors and other third parties have
substantially greater resources than we do and are able to sustain the costs of complex intellectual property litigation to a greater degree and for longer periods of
time than we could.
Any intellectual property litigation to which we might become a party, or for which we are required to defend or to provide indemnification, may require us
to do one or more of the following:
• cease selling or using products incorporating or relying upon the intellectual property our products allegedly infringe;
• make substantial payments for legal fees, settlement payments or other costs or damages;
• subject us to indemnification obligations or obligations to refund fees to, and adversely affect our relationships with, our customers;
• divert the attention and resources of management and technical personnel;
• obtain a license, which may not be available on reasonable terms or at all, to sell or use the relevant technology; or
•redesign the allegedly infringing products to avoid infringement, or make other technology or branding changes to our solutions, each of which could
be costly, time-consuming or impossible.
If we are required to make substantial payments or undertake any of the other actions noted above as a result of any intellectual property infringement claims
against us, our business or operating results could be harmed.
Our use of open source technology could impose limitations on our ability to commercialize our products.
We use open source software in our business, including in our products. It is possible some such open source software is governed by licenses containing
requirements that we make available source code for modifications or derivative works we create based upon the open source software, and that we license such
modifications or derivative works under the terms of a particular open source license or other license granting third parties certain rights of further use. By the
terms of certain open source licenses, we could be required to release the source code of our proprietary software, and to make our proprietary software available
under open source licenses, if we combine our proprietary software with open source software in certain manners.
Although we monitor our use of open source software in an effort to avoid subjecting our products to conditions we do not intend, we cannot be certain all
open source software is reviewed prior to use in our proprietary software, that programmers working for us have not incorporated open source software into our
proprietary software, or that they will not do so in the future. Any requirement to disclose our proprietary source code or to make it available under an open source
license could be harmful to our business, operating results and financial condition. Furthermore, the terms of many open source licenses have not been interpreted
by U.S. courts. As a result, there is a risk that these licenses could be construed in a way that could impose unanticipated conditions or restrictions on our ability to
commercialize our products. In such an event, we could be required to seek licenses from third parties to continue offering our products, to make our proprietary
code generally available in source code
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