FROM CONTRACT TO CONFIDENCE: MANAGING TECH DISPUTE RISKS IN 2025 AND BEYOND
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Technology as a source of value – and risk
Technology, software, and data are now among the most valuable assets of any business, especially those operating at scale or across borders. As a result, some of the most critical and high-value commercial relationships are now between tech suppliers and their customers, particularly where (as is often the case) the services provided require the management of customer data. Unsurprisingly, when things go wrong, disputes can quickly become business critical. The frequency, value, and complexity of technology disputes are therefore all on the rise.
Technology as a source of value – and risk
Technology, software, and data are now among the most valuable assets of any business, especially those operating at scale or across borders. As a result, some of the most critical and high-value commercial relationships are now between tech suppliers and their customers, particularly where (as is often the case) the services provided require the management of customer data. Unsurprisingly, when things go wrong, disputes can quickly become business critical. The frequency, value, and complexity of technology disputes are therefore all on the rise.
Complex systems, complex disputes
As technology evolves, so does its complexity. The same is true of the contractual frameworks that govern technology procurement and delivery. Many disputes occur because contracts fail to accurately reflect the parties’ true intentions or capture key assumptions and dependencies. Common pitfalls include vague or shifting requirements, poorly defined deliverables, and gaps between commercial and technical understanding. With the growing procurement of AI tools either as standalone solutions or as part of traditional IT procurements, the gap between expectation and delivery is being severely tested due to the common misconception that AI is a cure-all, and as such, not subject to the same realities of any digital implementation. These risks are amplified in agile development environments, where projects are delivered iteratively and scope can change rapidly.
While agile methods offer flexibility and speed, they require constant attention to contractual hygiene – ensuring that each new statement of work or backlog adjustment maintains appropriate protections on liability, risk allocation, and change control. For large-scale technology projects, early collaboration between the project and legal teams is essential. We often see disputes rise when lawyers design the contractual structures in isolation, only for practical delivery issues to emerge later. A robust, well-informed contractual foundation is the best insurance against costly disputes down the line. Once disputes arise, they are seldom straightforward. The combination of technical evidence, the common requirement for expert evidence, and the fast-moving nature of technology can make resolution lengthy and expensive. Getting it right from day one remains the most effective form of risk management.
Choosing the right forum: Arbitration or technical courts?
Most technology disputes are resolved before reaching litigation or arbitration. However, where pre-action attempts to resolve the dispute are unsuccessful, forum choice is increasingly strategic. Arbitration continues to play a significant role in cross-border technology contracts. Global suppliers favor it for its confidentiality, enforceability under the New York Convention, and the ability to appoint arbitrators with sector-specific expertise. It is particularly suited to high-value, multi-jurisdictional disputes involving complex systems and long-term commercial relationships. That said, specialist domestic courts, such as the Technology and Construction Court (TCC) in England and Wales, remain attractive.
The TCC’s judges possess deep technical understanding and are adept at managing large, document-heavy cases requiring expert evidence. The Hague Convention of July 2, 2019, entered into force in the UK on July 1, 2025, marking an important shift in cross-border enforcement. Under Hague 2019, English judgments will be recognized and enforced in EU member states and other contracting states, even where jurisdiction clauses are nonexclusive. This expansion of recognition, beyond the narrower scope of the 2005 Hague Convention, enhances the predictability of choosing English law and English courts for international technology contracts. Together with the TCC’s technical expertise, this development reinforces the courts of England and Wales’ position as a leading global forum for resolving technology disputes.
Navigating AI regulation and compliance in the US
From a US-focused, cross-border perspective, one of the top issues facing tech suppliers and their customers in 2025 has been navigating the vexing landscape of AI regulation, establishing internal oversight and governance, and addressing the contractual challenges associated with identifying, procuring, and efficiently rolling out AI enterprise solutions in a responsible fashion. Many states and local municipalities continue to regulate AI through a patchwork of laws and regulations that create a maze of obligations, required disclosures, and prohibitions that vary widely depending on the jurisdiction. Meanwhile, customers often struggle to verify supplier compliance, determine which AI enterprise tool is right for their organization, negotiate contract terms, and create effective oversight and training mechanisms that appropriately account for IP and data protection. Meanwhile, the Plaintiff’s bar continues to be on the hunt for headline-grabbing AI class actions.
As AI adoption continues to grow, companies operating across borders are placing greater emphasis on regulatory preparedness, including compliance with frameworks such as the EU AI Act, which takes effect in August 2026.
Key takeaways
Technology disputes will continue to rise as digital assets become more central to business value
Contract clarity will be critical, especially with the growing complexity of AI and agile development
Legal teams will need to be involved earlier in tech projects to prevent costly disputes
Arbitration and specialist courts will remain key forums for resolving complex tech issues
Regulatory compliance, especially around AI, will be a major focus for cross-border businesses through 2026
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© Eversheds Sutherland. All rights reserved. Eversheds Sutherland is a global provider of legal and other services operating through various separate and distinct legal entities. Eversheds Sutherland is the name and brand under which the members of Eversheds Sutherland Limited (Eversheds Sutherland (International) LLP and Eversheds Sutherland (US) LLP) and their respective controlled, managed and affiliated firms and the members of Eversheds Sutherland (Europe) Limited (each an "Eversheds Sutherland Entity" and together the "Eversheds Sutherland Entities") provide legal or other services to clients around the world. Eversheds Sutherland Entities are constituted and regulated in accordance with relevant local regulatory and legal requirements and operate in accordance with their locally registered names. The use of the name Eversheds Sutherland, is for description purposes only and does not imply that the Eversheds Sutherland Entities are in a partnership or are part of a global LLP. The responsibility for the provision of services to the client is defined in the terms of engagement between the instructed firm and the client.
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