Unlocking the full value of your intellectual property rights

Here are the top 5 considerations every business must keep in mind when entering into an Intellectual Property License Agreement:

• Scope of the License: Agreements should clearly define where the IPR can be used (geography), how it can be used (industry or field of use, whether sublicensing is permitted), and how long the license granted under agreement lasts. Any ambiguity in these areas can lead to the agreement failing to reflect the parties’ intentions and unintended breaches.
• Exclusivity vs. Non-Exclusivity: Is the licensor granting the licensee exclusive rights to use the IPR, or will the licensor retain the right to license the IPR to third parties and exploit the IPR themselves? The parties should sure the exclusivity terms of the agreement align with their commercial strategy and requirements.
• Payment Terms: Agreements should specify whether compensation involves upfront fees, milestone payments, or ongoing royalties. If the fees are royalty-based, it should be explicitly defined how net sales are calculated and it is advisable to include audit rights.
• Ownership of Improvements & Derivative Works: What happens if the licensee improves the IPR or creates a derivative work based on it? The agreement should clearly establish who owns future iterations, and the treatment of pre-existing “background IP” belonging to one party.
• Infringement & Indemnification – The agreement should clearly specify who will be liable if a third party claims the IPR infringes or violates their rights. The parties should also agree who is responsible for policing infringement of the IPR, prosecuting violations, and handling defence costs and liabilities.

The Commercial and Corporate Team at Angular Legal can assist you with drafting, negotiating and reviewing IP licensing agreements to ensure that your commercial intentions are achieved, whilst also mitigating any potential legal exposure.