be an up-front fee and royalties, or
just royalties? Will those royalties be a
percentage of overall sales, or a xed
amount per product sold?
Whether you need to licence any knowhow,
and whether you will provide any
technical assistance to the licensee
What provisions relating to quality
control and marketing of the licensed
products are included
Whether both you and the licensee will
be required to disclose and grant licences
of improvements in the licensed products
Exclusivity. Will the licence be:
-exclusive (only the licensee can use the
licensed rights)
-sole (only you and the sole licensee can
use the licensed rights)
-non-exclusive (you and any number of nonexclusive
licensees can use the rights).
mark is licensed along with the relevant
technology
Your pro ts will increase through the
receipt of licensing fees and/or royalties
You gain potential rights in any
improvements the licensee might make to
the technology
Your licensee might be able to offer
you additional manufacturing capacity and
resources to manufacture and/or improve
the technology itself
You avoid potentially costly and longwinded
litigation
You develop a relationship with your
competitor by turning it into a partner.
PROTECT YOUR POSITION
However, for all the bene ts of
turning your infringer from poacher to
gamekeeper, you need to be aware of the
risks associated with licensing. These will
depend on factors such as the degree of
exclusivity of the licence: don’t grant an
exclusive licence without carrying out a
thorough due diligence exercise. If you
do not, you might nd that your proposed
licensee turns out to be an ineffective
marketer of your locking mechanism,
with the result that you receive few or no
royalties (although you can mitigate this
by including a minimum-royalties clause).
It might seem blindingly obvious, but
you must protect your position by putting
any licensing agreement in writing. That
should cover:
The duration of the licence
The amount of royalties and/or fees
that you will receive and how: will there
LEGALLY SPEAKING
When your day-to-day focus is on the
development, production, and marketing
of your patented technology, it is easy to
overlook what the competition is doing.
If you know that your asset is likely to
be attractive to others, make sure you
understand who your competition is and
make it very clear to the marketplace
that you have patent rights and will
exercise them if infringed. However, this
also gives you a great opportunity to
maximise revenue from your patented
assets by actively looking for prospective
licensees. This puts you rmly on the
front foot, sending a clear message to
your competitors: not only will you not
allow others to take advantage of your
technology, but also you are willing to
negotiate with them in a commercially
sensible way.
INTELLECTUAL PROPERTY RESEARCH
The UK’s Intellectual Property Of ce has also published a guide to
licensing intellectual property (available via www.is.gd/debezi). This
includes information, videos, checklists and examples. It also includes
a ‘skeleton licence’ to illustrate the kinds of language used in such
contracts, although the government recommends seeking professional
advice before making such arrangements. The guidance also points
out that IPO operates a database of patents that are available for
licencing, so called ‘licences of right’ (www.is.gd/canuyo).
Further advice is also available from one of 15 patent libraries in
the UK that offer assistance on intellectual property rights. There are
of ces in: Aberdeen, Birmingham, Exeter, Glasgow, Hull, Leeds, Liverpool, London, Manchester,
Newcastle upon Tyne, Northampton, Norwich, Plymouth, Portsmouth and Shef eld. For contact
details, see www.is.gd/osimic. In addition, the UK Intellectual Property Of ce has published a guide
to using patent research, ‘The Patent Guide’ (pictured; download a copy via www.is.gd/obavij).
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