IP Licensing Outline with Spolyar Fall 2008
I. Licensing Generally
a. A way of monetizing an IP right.
i. What is a license?
1. A transfer of limited rights
2. A promise not to licensee for use of that right.
ii. Can be express or implied
1. Express = spelled out in K
a. Where licensor tries to derogate right (harm the benefit of the bargain)
iii. Components of a license agreement
1. Heading – parties,- date
2. Recitals – Background
a. Aid to aggt interpretation
4. Grant of license
a. Identities of the Parties
i. Corp entity
ii. Subsidiaries (who qualifies?)
iii. Do subsequently acquired subsid’s get auto license, or not?
b. Identify of licensed IP
d. Right to sub-license
e. Territory/Field of Use
f. Defines scope of licensed activities
i. Contractual obligations (covenants) v. license scope
ii. both affirmatively (verbs) and negatively (restrictions)
iii. Field of use, etc.
g. Conditions and Restrictiosn
i. Royalty vs Fully Paid up.
j. Verb Language
5. Payment Provisions
a. Royalty Rates, etc
6. IP ownership terms
a. Reservation of rights, recognition fo license & no assignment
b. Rights to improvements (Grant backs, joint ownership)
a. Releases for past infringement
b. Enforcement provisions to address 3rd party infringement
c. Warranties and indemnities directed to 3rd party claims of infringement.
a. In capitals, warranty disclaimers
9. Term and termination
a. Regarding aggmt terms and technology and other confidential disclosures.
11. Miscellaneous licensee obligations
a. Patent marking, quality of products or services
i. if don’t require licensee to mark patent, lose proof of notice for infringers, etc
12. Bankruptcy and insolvency provisions
a. What happen if a party goes bankrupt?
b. Source code escrow provisions.
i. If you’re out of business, or breachs support obligations, liceness wants access to source code to use to hire someone else later
And any inventions that arose out of development work.
2. Device was not patented, but AMP had purchased previously unknown dominating patent, then sued.
3. A licensor cannot take actions that will destroy the benefit of the bargain for the licensee.
a. Licensee has an affirmative right to use
iii. De Forrest Radio v. US (D grants license to W. Elec, who transfers to AT&T, who makes stuff for US. D sues US)
1. US has a license to use tech.
a. ATT had right to sub-license
b. License terms do not necessarily have to be as definite as required for K’s.
iv. Siedel v NASD (S clicked, downloaded and sold N data, license said not for commercial use)
1. License was enforceable
2. Clear language of license said commercial uses banned
3. Public policy did not require unenforceability.
a. Facts and data normally not protected.