7 steps to consider before licensing intellectual property agreements
Here is a breakdown of the top seven guidelines and best practice tips for protecting your intellectual property when licensing.
January 16, 2014 at 03:53 AM
7 minute read
The original version of this story was published on Law.com
When drafting and signing agreements regarding licensing or claims against intellectual property, there are a number of elements that must be considered to ensure the right measures are being taken. A recent Supply Management report explores best practice tips to protecting your intellectual property when licensing. Here is a breakdown of the top seven guidelines.
Be specific. Trademark licenses can be complicated since they include the ability to grant limited rights to the appropriate parties. Therefore, the language used in trademark agreements needs to be very precise and detail who and what those rights entail. Enlisting in the help of your legal team will ensure that you are not leaving any important details out and are always protected against future claims.
Site examples. By including specific examples of the businesses that the license is intended for and equally importantly, unintended for, you can eliminate the chance of confusion down the road. The more information you can provide the better, to mitigate risks and legal issues down the road with companies who may have misunderstood your licensing agreement.
Chose the right wording. As with any legal agreement, its important to eliminate any commonly used phrases that can appear vague or unclear in your trademark policy. This is particularly important in regards to verbiage in relation to time. Avoid any wording that can be interpreted as too general such as “from time to time” or referring to times of the year without being specific to the exact month or date.
Determine what licenses are necessary. It is important that your licensing agreement is straight and to the point, free of any ambiguity. For example, Supply Management notes that if the licensee seeks an “exclusive” license, question whether granting an “exclusive” license excluding all parties is actually necessary.
Weigh anti-competitive risks. Confirming whether or not your license is anti-competitive is imperative to solidifying your agreement. By weighing your competitive risks early on, you eliminate the possibility of dealing with trademark litigation down the line. Keep in mind that the greater the degree of license exclusivity, the greater the risk that the license may be anti-competitive.
Evaluate the business strategy. Any legal and binding contract should be closely evaluated at the strategic level depending on the goals and objectives of a business before any paperwork is signed, but you'd be surprised how many organizations forgo that step in the preliminary stages. Use what you have learned in the past about your business to plan for now, but more importantly, plan for the future, by considering and including any other groups or companies that may be on the horizon for trademarks and licensing down the line.
Control IP development. Possibly one of the most important tips on this list revolves around maintaining control of the actual development of your intellectual property before licensing the agreement even begins; this can be done by adopting an IP policy to control how the IP is integrated across an entire organization. By implementing this policy, companies can take an organized approach to their intellectual property rights with minimized risks. IP policies lock down standard terms, royalty rates and greater consistency for third parties.
For related news on Intellectual Property and Licensing, read these recent reports on Inside Counsel:
When drafting and signing agreements regarding licensing or claims against intellectual property, there are a number of elements that must be considered to ensure the right measures are being taken. A recent Supply Management report explores best practice tips to protecting your intellectual property when licensing. Here is a breakdown of the top seven guidelines.
Be specific. Trademark licenses can be complicated since they include the ability to grant limited rights to the appropriate parties. Therefore, the language used in trademark agreements needs to be very precise and detail who and what those rights entail. Enlisting in the help of your legal team will ensure that you are not leaving any important details out and are always protected against future claims.
Site examples. By including specific examples of the businesses that the license is intended for and equally importantly, unintended for, you can eliminate the chance of confusion down the road. The more information you can provide the better, to mitigate risks and legal issues down the road with companies who may have misunderstood your licensing agreement.
Chose the right wording. As with any legal agreement, its important to eliminate any commonly used phrases that can appear vague or unclear in your trademark policy. This is particularly important in regards to verbiage in relation to time. Avoid any wording that can be interpreted as too general such as “from time to time” or referring to times of the year without being specific to the exact month or date.
Determine what licenses are necessary. It is important that your licensing agreement is straight and to the point, free of any ambiguity. For example, Supply Management notes that if the licensee seeks an “exclusive” license, question whether granting an “exclusive” license excluding all parties is actually necessary.
Weigh anti-competitive risks. Confirming whether or not your license is anti-competitive is imperative to solidifying your agreement. By weighing your competitive risks early on, you eliminate the possibility of dealing with trademark litigation down the line. Keep in mind that the greater the degree of license exclusivity, the greater the risk that the license may be anti-competitive.
Evaluate the business strategy. Any legal and binding contract should be closely evaluated at the strategic level depending on the goals and objectives of a business before any paperwork is signed, but you'd be surprised how many organizations forgo that step in the preliminary stages. Use what you have learned in the past about your business to plan for now, but more importantly, plan for the future, by considering and including any other groups or companies that may be on the horizon for trademarks and licensing down the line.
Control IP development. Possibly one of the most important tips on this list revolves around maintaining control of the actual development of your intellectual property before licensing the agreement even begins; this can be done by adopting an IP policy to control how the IP is integrated across an entire organization. By implementing this policy, companies can take an organized approach to their intellectual property rights with minimized risks. IP policies lock down standard terms, royalty rates and greater consistency for third parties.
For related news on Intellectual Property and Licensing, read these recent reports on Inside Counsel:
This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.
To view this content, please continue to their sites.
Not a Lexis Subscriber?
Subscribe Now
Not a Bloomberg Law Subscriber?
Subscribe Now
NOT FOR REPRINT
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
You Might Like
View AllClass Certification, Cash-Sweep Cases Among Securities Litigation Trends to Watch in 2025
6 minute readNLRB Blisters Skilled Care Home Chain That Terminated Nursing Assistant Who Complained About Wages
6 minute readJetBlue Airways Will Pay $2M to Settle DOT Charges of Chronically Delayed Flights
Trending Stories
- 1Restoring Trust in the Courts Starts in New York
- 2'Pull Back the Curtain': Ex-NFL Players Seek Discovery in Lawsuit Over League's Disability Plan
- 3Tensions Run High at Final Hearing Before Manhattan Congestion Pricing Takes Effect
- 4Improper Removal to Fed. Court Leads to $100K Bill for Blue Cross Blue Shield
- 5Michael Halpern, Beloved Key West Attorney, Dies at 72
Who Got The Work
Michael G. Bongiorno, Andrew Scott Dulberg and Elizabeth E. Driscoll from Wilmer Cutler Pickering Hale and Dorr have stepped in to represent Symbotic Inc., an A.I.-enabled technology platform that focuses on increasing supply chain efficiency, and other defendants in a pending shareholder derivative lawsuit. The case, filed Oct. 2 in Massachusetts District Court by the Brown Law Firm on behalf of Stephen Austen, accuses certain officers and directors of misleading investors in regard to Symbotic's potential for margin growth by failing to disclose that the company was not equipped to timely deploy its systems or manage expenses through project delays. The case, assigned to U.S. District Judge Nathaniel M. Gorton, is 1:24-cv-12522, Austen v. Cohen et al.
Who Got The Work
Edmund Polubinski and Marie Killmond of Davis Polk & Wardwell have entered appearances for data platform software development company MongoDB and other defendants in a pending shareholder derivative lawsuit. The action, filed Oct. 7 in New York Southern District Court by the Brown Law Firm, accuses the company's directors and/or officers of falsely expressing confidence in the company’s restructuring of its sales incentive plan and downplaying the severity of decreases in its upfront commitments. The case is 1:24-cv-07594, Roy v. Ittycheria et al.
Who Got The Work
Amy O. Bruchs and Kurt F. Ellison of Michael Best & Friedrich have entered appearances for Epic Systems Corp. in a pending employment discrimination lawsuit. The suit was filed Sept. 7 in Wisconsin Western District Court by Levine Eisberner LLC and Siri & Glimstad on behalf of a project manager who claims that he was wrongfully terminated after applying for a religious exemption to the defendant's COVID-19 vaccine mandate. The case, assigned to U.S. Magistrate Judge Anita Marie Boor, is 3:24-cv-00630, Secker, Nathan v. Epic Systems Corporation.
Who Got The Work
David X. Sullivan, Thomas J. Finn and Gregory A. Hall from McCarter & English have entered appearances for Sunrun Installation Services in a pending civil rights lawsuit. The complaint was filed Sept. 4 in Connecticut District Court by attorney Robert M. Berke on behalf of former employee George Edward Steins, who was arrested and charged with employing an unregistered home improvement salesperson. The complaint alleges that had Sunrun informed the Connecticut Department of Consumer Protection that the plaintiff's employment had ended in 2017 and that he no longer held Sunrun's home improvement contractor license, he would not have been hit with charges, which were dismissed in May 2024. The case, assigned to U.S. District Judge Jeffrey A. Meyer, is 3:24-cv-01423, Steins v. Sunrun, Inc. et al.
Who Got The Work
Greenberg Traurig shareholder Joshua L. Raskin has entered an appearance for boohoo.com UK Ltd. in a pending patent infringement lawsuit. The suit, filed Sept. 3 in Texas Eastern District Court by Rozier Hardt McDonough on behalf of Alto Dynamics, asserts five patents related to an online shopping platform. The case, assigned to U.S. District Judge Rodney Gilstrap, is 2:24-cv-00719, Alto Dynamics, LLC v. boohoo.com UK Limited.
Featured Firms
Law Offices of Gary Martin Hays & Associates, P.C.
(470) 294-1674
Law Offices of Mark E. Salomone
(857) 444-6468
Smith & Hassler
(713) 739-1250