As a standard rule of thumb, you should not propose or agree to a legally-binding licensing agreement without consulting a lawyer first. While you may think you know what you want from this license and what you are signing up for, you can never be too confident. And the last thing you may want is to be stuck in an agreement you are unhappy with or that is hurting your business, or worse, that results in litigation proceedings. And so with that being said, please read on to discover the most important considerations you should make with a licensing agreement and how a seasoned New Jersey licensing agreement lawyer at The Ingber Law Firm can help you think this through.
What are the different types of licensing agreements?
First of all, you should consider the different types of licensing agreements you can choose to enter. Namely, the main ones are exclusive, non-exclusive, and sole licenses. For exclusive licenses, a licensor may grant a single licensee the right to use, produce, or sell the intellectual property within a specified scope. Constrastingly, as you may assume in a non-exclusive license, a licensor may give this privilege to multiple licensees simultaneously. Lastly, in terms of a sole license, a single licensee may use the intellectual property, but the licensor may retain the right to use it for the same purposes during the agreement term.
That said, the arguably more niche types of agreements may be considered limited licenses and cross-licensing. As the name suggests, limited licenses restrict a licensee’s use of the intellectual property to a specific field, industry, territory, or application. Then, cross-licensing is when two or more parties agree to grant each other rights to their respective intellectual properties. For more context on these different types, please talk to your lawyer.
What are the main considerations I should make with my licensing agreement?
Now, regardless of which type of licensing agreement you land on, you must ensure that yours covers critical considerations. That is, you must work to ensure that the following elements are defined:
- Exclusivity: please define whether the licensee has sole rights to the intellectual property or if others have been granted the same.
- Territory: please define the geographic region in which the licensee(s) can use, produce, and sell your intellectual property validly.
- Duration: please define the times the licensee’s right to use, produce, and sell your intellectual property will be activated and deactivated.
- Scope: please define the products, services, and markets where the licensee(s) can use your intellectual property.
- Compensation: please define the method in which the licensee must compensate you for licensing your intellectual property (i.e., upfront fees, royalties, revenue-sharing, etc).
To conclude, when it comes to your licensing agreement, you should not settle for anything less than spectacular legal assistance. So please hire us to help with your legal contract. A competent Essex County, New Jersey intellectual property lawyer at The Ingber Law Firm looks forward to working with you.