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Resistance is futile: all paths lead to co-ownership of IP

Golden oldie number something – comments on co-ownership of IP

IP Draughts

You have probably encountered this scenario.  A university, a small company and a large company are engaged in a research collaboration.  The parties have entered into a written collaboration agreement.  As one might expect, the agreement addresses the question of which of them will own any intellectual property arising from the collaboration, which is defined as Foreground IP.

During the negotiation of the agreement, various proposals were made on the ownership of Foreground IP.  The university suggested that a party would own any IP in improvements of the technology that it brought to the collaboration.  Unfortunately the parties couldn’t agree what would happen if the improvement related to more than one party’s technology.  The large company suggested that it would own all the Foreground IP and license the other two parties.  The small company’s investors wouldn’t accept this solution.  The small company suggested that the three parties should be joint…

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Don’t sign a binding letter of intent!

Golden oldie number 5 – don’t sign it!

IP Draughts

Last week this blog had a posting, Don’t Sign the Term Sheet, in which we discussed some dangers of signing term sheets, even if they are stated to be non-binding.

We called the document a term sheet, although we could have used any number of alternative names that are often used interchangeably with term sheet, including:

  • heads of terms
  • heads of agreement
  • memorandum of understanding
  • letter of intent

Which term is used seems to depend largely on commercial practice in a particular country or industry. We are not aware of any legal distinction between these terms. Under English law, the document’s title is far less important than whether the parties intend the document to be legally binding, which should be stated in the document itself. As we discussed last week, parties usually prefer the document to be non-binding, although sometimes a hybrid solution is agreed, under which certain…

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Standard royalty rates? Ain’t no such thing.

blackburnGolden oldie number 4. Should IP Draughts hire Tony Blackburn to introduce them…?

IP Draughts

what's it worthFor the inexperienced businessman, it is the most natural question in the world.  How much, he asks his advisers, should I be charging for this IP licence?  His opposite number, the inexperienced licensee, may similarly want to know: how much should I pay for this licence?  Unfortunately, there is rarely a simple (and unarguably true) answer to this question.

If you sell cabbages in a street market, it is important to know the market price of your goods. Sell at too high a price, and you are left with perishable stock at the end of the day.  Sell at too low a price, and you may be able to go home early, but you haven’t maximised your profits.  You can go round the other stalls and see what price is being charged there.  You can compare your prices with those in the local supermarket.  You can remember what price you…

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When is a licence not a licence? When it’s a covenant not to sue?

Golden oldie number 3 – this subject prompts much discussion!

IP Draughts

alligatorsDear reader, IP Draughts needs your help with some research.  He has volunteered to give a short talk  on the differences (if any) between an intellectual property licence and a covenant not to sue. The talk will be held at the London offices of Olswang on Tuesday 19 February at 5pm.  Registration details here.  IP Draughts is sure that the readers of this blog will be able to shed light on this puzzling subject.

The expression covenant not to sue is sometimes seen in IP agreements, but when you examine the detailed wording of the clause in which the term appears, it often looks very much like a licence.  The expression seems to originate in US agreements to settle IP litigation, but it has spread to some non-contentious agreements.  Here is an example, taken from Drafting Patent License Agreements (Brunsvold et al, BNA Books, 6th edition at page…

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