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« Residuals: License to Steal?
Hereinafter defined as "Celery" »


Comment from: John W. Caldwell [Visitor]  
John W. Caldwell

Your comments, Larry, are exactly correct for licensors. The situation is somewhat simpler when a nonprofit is the licensor, however. The right to enforcement is one of a number of terms an academic institution just cannot tolerate. The counterbalance, of course, is the price of the license. In the academic case, policy issues attending these issues at least gives them a "place to stand."

As for licensee, however, I invariably advise that specific, clear and unavoidable enforcement provisions be placed into an exclusive license. This is, in my view, the very essence of exclusivity. If nothing else, a right to sue may be granted the licensee with the licensor agreeing to be an involuntary plaintiff.

If this right is not included, then the license is not really exclusive.


06/17/14 @ 10:39
Comment from: Larry Schroepfer [Member]  

Absolutely agree in the case of an exclusive license. This is particularly important in the pharma/biotech space, where the exclusive licensee will spend a significant amount developing the product, and has diligence obligations to the Licensor to do so.

06/17/14 @ 13:15
Comment from: Stephen Juge [Visitor]
Stephen Juge

Many thanks for the helpful insights. Many years of consumer products trademark and copyright licensing legal work at Disney prove your points.

06/19/14 @ 11:07
Comment from: Stephen Juge [Member]  
Stephen Juge

Thanks for the perceptive insights. My years of consumer products trademark and copyright licensing legal work at Disney prove your points in that context also.

06/19/14 @ 11:09
Comment from: admin [Member]  

As a non-lawyer, one question I would have is what is a common
amount (percentage of original licensing fees) to be granted in
the case of a royalty reduction to offset infringements made
by competitors ?

07/06/14 @ 16:02
Comment from: drllau [Visitor]

Litigation insurance is an option but they only cover small scale infringers. For larger firms, putting some teeth into the contractual enforcement, even against non-licensees who are not strictly infringing but may need freedom to operate is part of the cost of doing business.

10/30/14 @ 01:47
Comment from: Ross Vincenti [Visitor]
Ross Vincenti

Great article Larry. Litigation as you note is fraught with risks not to mention the costs. Very easy for the licensee to say "go get em", but the upside for the licensor is questionable.

01/13/16 @ 11:12