Mutual Limitation of Liability

What it is

The agreement caps each party's total aggregate liability at the amount paid or payable by the Customer in the twelve months preceding the incident, and excludes lost profits, indirect, special, incidental, consequential, and punitive damages for both parties.

Why it matters (compliance & governance perspective)

This provision establishes the maximum financial recovery available to either party in the event of a breach or claim, capping HubSpot's liability at twelve months of fees paid and excluding categories of harm such as lost profits and consequential damages that may substantially exceed direct fees in a data breach or service failure scenario.

Consumer impact (what this means for users)

Under this clause, the Customer's ability to recover damages from HubSpot in the event of a service failure, data breach, or breach of contract is limited to the fees paid in the prior twelve months. The agreement also states that neither party may recover lost profits or consequential damages, which may limit the practical recovery available to customers who suffer business losses resulting from a HubSpot service disruption or data incident.

Institutional analysis (Compliance & governance intelligence)

1) REGULATORY LANDSCAPE: Limitation of liability clauses are standard in commercial software agreements and are generally enforceable under both US (Massachusetts) and Irish law, subject to certain exceptions. Under Irish and EU law, liability limitations may not apply to claims arising from gross negligence, fraud, or willful misconduct. GDPR Article 82 preserves data subjects' right to compensation for data protection violations regardless of contractual liability limitations, and EU data protection authorities may impose fines on controllers independently of contractual caps. The FTC's authority over deceptive practices is not typically constrained by private contractual liability limitations. 2) GOVERNANCE EXPOSURE: Medium. The twelve-month fee cap may be substantially lower than the actual business impact of a data breach or prolonged service outage, particularly for customers managing large CRM databases or mission-critical marketing workflows. Legal teams should assess whether the cap is adequate relative to the organization's reliance on the platform and the volume of personal data processed. 3) JURISDICTION FLAGS: EU customers should note that GDPR Article 82 liability for data subjects exists independently of this contractual cap, meaning Customer organizations may face regulatory and civil claims from data subjects that exceed the amounts recoverable from HubSpot under these terms. Some jurisdictions may not enforce exclusions of liability for gross negligence, fraud, or death and personal injury. 4) CONTRACT AND VENDOR IMPLICATIONS: Procurement teams should assess whether the twelve-month fee cap is commercially appropriate given the scale of data processing and operational dependency on the platform. For high-value or high-risk deployments, negotiating a higher liability cap or specific carve-outs for data breach scenarios may be warranted. The exclusion of consequential damages is standard in enterprise SaaS agreements but should be flagged for organizations where downstream business losses from a service failure could materially exceed direct fees. 5) COMPLIANCE CONSIDERATIONS: Organizations should ensure that their cyber insurance and vendor risk management frameworks account for the liability cap when assessing potential exposure from a HubSpot data incident. The interaction between this cap and GDPR Article 82 data subject compensation rights warrants review by privacy counsel, particularly for EU-based Customer organizations.

Applicable regulations

Provision details

Other risks in this policy

• Non-Cancellable Subscription Fees medium
• Customer Responsibility for Contact Data Legality high
• Service Suspension Rights medium
• Customer Indemnification Obligation medium
• Terms Modification with 30-Day Notice medium
• Intellectual Property and License Grant medium