Licensing Agreements & Intellectual Property

Licensing agreements are a common way for businesses to commercialise their intellectual property, giving the licensee the right to use their intellectual property, in exchange for benefits, such as royalties and licence fees.

Licensing agreements can be complex and require careful negotiation and drafting to ensure that both parties' rights and obligations are adequately protected.

 
Austin Blackburn

What is a licensing agreement?

A licensing agreement is a legal contract between two parties, the licensor and licensee, that allows the licensee to use the intellectual property owned by the licensor for a specific purpose, product, or service. The licensee typically pays the licensor a fee or royalty for use which may be based on volume of sales, level of turnover or profits, or a fixed fee.

The terms of a licensing agreement will vary depending on the type of intellectual property being licensed and the specific needs and requirements of the parties involved.

IP

What is intellectual property?

Intellectual property (IP) refers to creations, including inventions, guides and templates, software, trade marks/brand, art, and music. These can be protected by law to ensure the creator has exclusive rights to use and monetise them.

Protecting intellectual property is important because it can prevent others from using it without permission or copying it without giving credit to the original creator.

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What types of intellectual property can be licensed?

Licensing agreements can be used to allow others to use a wide range of types of intellectual property generally or on very specific terms and for free or for a fee. The terms of a licensing agreement will vary depending on the type of intellectual property and the specific needs of the parties involved.

The types of intellectual property that can be licensed include:

  • Patents: protect inventions from being made, used or sold without permission from the inventor

  • Trademarks: protect brand names, logos and symbols from being used or imitated

  • Copyright: protects original works of authorship, including software, artwork, literature and music

  • Designs: protect the appearance of a product to prevent other selling products with similar or identical appearances

  • Trade secrets: protect confidential information, e.g. chemical formulae and recipes, that give a business a competitive advantage

Why choose Nash & Co?

Our team have a wealth of experience in representing and working with rights holders to license intellectual property. We can advise on exclusive and non-exclusive agreements, warranties, liability provisions, sub-licenses, renewals of IP licenses and resolving disputes.

From drafting licensing agreements to enforcing their terms and resolving disputes, we offer a complete service for our clients.

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Frequently asked questions

In this comprehensive video series, our experienced corporate and business law experts will tackle a wide range of topics and questions that commonly arise in corporate and business environments. From legal structures and contracts to intellectual property and employment law, we've curated this series to empower you with practical information and valuable insights to help your business thrive.

  • If you have created or own intellectual property that others may want to use, a licensing agreement can be a useful tool to protect your rights while allowing others to use your IP and generating an income for you from this. Situations where this may be necessary include:

    • You have created a product or service that uses patented technology or copyrighted materials, but you do not have the resources or expertise to exploit this and you want to license that technology or materials to others in exchange for a fee or royalty

    • You have developed a brand, logo, or trademark that others want to use to market their products or services, and you want to control how it’s used

    • You have developed a software application or other digital product that others want to use, and you want to ensure that your product is used only in accordance with your terms

    • You have developed a trade secret or confidential information that you want to share, perhaps as part of negotiations for a joint venyture, and you want to protect your competitive advantage.

    It is important to consult with an experienced lawyer to determine the specific terms and conditions of the licensing agreement that will work best for your situation and to have these properly documented.

  • If someone infringes on your licensed intellectual property, there are several steps you can take to protect your rights and seek compensation for any damages you have suffered, including:

    • Contacting the infringing party to instruct they stop, e.g. cease-and-desist letters

    • Consider alternative dispute resolution: if the infringing party is willing to negotiate, you can use mediation or arbitration

    • Issuing a claim: you may be able to seek an injunction and/or damages for losses or to require the infringer to hand over any undeserved profits

  • The duration of a licensing agreement varies depending on the terms negotiated between the licensor and the licensee and the duration of the intellectual property. Typically, a licensing agreement will include a clause that specifies how long the license is valid, whether it can be renewed at the end of this term and on what conditions, and provisions of early termination such as in the event of a breach by the licensee.

    In some cases, a licensing agreement may have a fixed term, such as one year. In other cases, the agreement may be indefinite, meaning that it continues unless and until some defined termination event occurs. It's important to note that the duration of a licensing agreement can have significant implications for both the licensor and the licensee, and the parties should carefully consider the duration of the license when negotiating the terms of the agreement and how the licence fee is determined and whether it is subject to periodic review.

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