Depending on sectors, intellectual property (IP) can often be one of the biggest, if not the biggest, asset of a business and it is important that rights attaching to IP are utilised correctly.
The licensing of IP (including copyright, trademarks, patents and design rights) is very complicated and ensuring you have the right agreements in place is key.
It may be that financial or staffing restraints are making it difficult for you to develop the IP you own with a view to bringing it onto the market, so you may be considering licensing out this valuable asset to other parties.
These parties would pay the IP owner an agreed variable or fixed fee or royalties on the revenue generated, while the licence holder would be free to use the IP to make, sell and distribute the services and products.
Before granting a licence it is important to have full discussions and reach agreement with the party to whom you are entrusting your IP so everyone is clear about what is required.
These talks should include details of indemnities and insurance cover needed by each party, how and when the royalties or fees should be paid, specifics of what the licence allows the holder to do, how long any agreement lasts, on what grounds it can be ended and by whom.
Before pressing ahead it is important to consider the options and ensure you choose the licence best suited to your needs.
An exclusive licence grants the licensee exclusive rights in the use of your IP, meaning you no longer have any say over how it is used. But it also generally means you will be entitled to a higher financial return.
A non-exclusive licence means you are not restricted to granting permission to just one party and can agree to grant as many licences as you wish. But this path typically results in a lower financial return and potential problems in managing a number of licence holders.
You can keep possession of your IP with a view to using it yourself by granting a sole licence - similar to an exclusive licence, these are not totally dependant on the licensee. While they can be safer than going down the exclusive licence route, the financial gain will not be so great.
The most important thing is to make sure you name the right licensee to suit your requirements. This should be someone who is going to use your IP to its fullest potential and bring you the benefits you are looking for.
You will need to appoint someone who has the skills and infrastructure in place to bring the maximum reward, someone highly respected, capable with a proven track record and who won’t adversely affect your product or business.
Lanyon Bowdler has a wealth of experience in this field and works closely with trusted IP lawyers to ensure our client receives the right legal advice. We often advise on software licence agreements, trademark and copyright licence agreements.
We can also assist with other commercial contracts dealing with the creation and ownership of IP rights, including employment contracts, sub-contractor agreements, consultancy agreements and supply of services agreements.
We have offices in Shrewsbury, Telford, Oswestry, Ludlow, Hereford, Bromyard and Conwy, where our friendly, knowledgeable staff will be happy to welcome you for an initial chat about your requirements. We work with businesses across Shropshire, Cheshire, Herefordshire, The Marches, Mid & North Wales, Birmingham, and the Midlands. As a leading national corporate & commercial law firm, we have a dedicated team of commercial agreements solicitors ready to help and advise your business wherever you are based throughout England, Wales & Northern Ireland
For more advice about how we can help you please use the online enquiry form and someone will get in touch with you.