- Licensee’s creations
- Licensor will often require right to Licensee’s creations
- Try and resist an outright transfer (i.e. an Assignment of Rights)
- The more high-end and bespoke the Licensed Products, the more likely that the Licensor will insist on an outright assignment
- Licensee to consider whether in reality it will want to use the designs in respect of other brands/goods
“Following the expiry of this Agreement (otherwise than as a result of unilateral termination by either party) the Licensor shall have a non-exclusive, royalty free licence without limit in time to use the creations in respect of the manufacture and supply of products the same as or similar to the Licensed Products, provided always that the Licensor shall have no right to assign or grant sub-licences without first obtaining the written consent of the Licensee such consent not be reasonably withheld or delayed.”
- Infringement Actions
- Licensor will always want initial control – this is fairly standard
- Licensee should ensure that it has the right to take action itself if the Licensor fails to take reasonable action
- Ensure the Agreement deals with how any sums awarded are to be treated – Licensor should not miss out on royalties.
“1.1 Licensor shall in its sole discretion decide what action (including litigation, arbitration or compromise) if any to take in respect of any infringement or threatened or alleged infringement, or any other claim or counterclaim brought or threatened in respect of the Rights and shall have the conduct of all related proceedings. Licensor shall not be obliged to bring or defend any proceedings whether for infringement or otherwise in relation to Licensor if it decides in its sole discretion not to do so.
1.2 If Licensor decides not to take any action as provided for in clause 1.1, it will within a reasonable time notify Licensee of such decision and in any event within 30 Working Days of the date on which the Licensor first had knowledge of the relevant infringing activities or proceedings.
1.3 Following any notification under clause 1.2 or in the event that Licensor fails to take the action referred to in clause 1.1 within 30 Working Days of any notification under clause 1, whichever is the earlier, Licensee may commence proceedings at Licensee’s own expense (“Proceedings”) but may not settle or compromise any the Proceedings without the prior written approval of the Licensor who may at any stage reassume control at its own expense.”
“1.4 Either party (“Assisting Party”) shall at the request of the other (“Requesting Party”) give full co-operation to the Requesting Party (including the provision of documentation and making relevant people available) in any action, claim or proceedings brought or threatened in respect of the Rights and the Requesting Party shall meet all reasonable expenses incurred by the Assisting Party in giving such assistance.
1.5 In any infringement proceedings which are brought by any party, that party shall be entitled to receive and retain all amounts awarded or secured by way of settlement or damages, profits or otherwise in connection with such claims save that in respect of any sums awarded to Licensee such sums shall be deemed to be Net Distributor Costs and accordingly subject to a Royalty.”
- Licensor’s Assurance
- As a minimum, warranty protection for non-infringement should be given
- Licensee’s preference is to obtain an indemnity – if giving and indemnity Licensor will want conduct of the claim
- Licensee may also seek to cap its liability
“The Licensor will indemnify and keep indemnified the Licensee against any and all loss, claims, damages, costs, expense and any other liability it may suffer, sustain or incur in connection with any claim by third party that the use by the Licensee of all or any of the Licensed Materials in accordance with this Agreement infringes any right of such third party.”