WHAT IS AN INTELLECTUAL PROPERTY AGREEMENT? by ResearchCopyright.com

You worked hard on creating an invention that is not only new and useful, but also not obvious. You filed for, and received, a patent. Everything is great. But then someone approaches you and wants to license your patented invention. You can either tell them "no" or grant them a license to use your Intellectual Property in a license agreement.

An Intellectual Property License Agreement is just that. You agree to let someone use your Intellectual Property. Such license agreements could be for anything.

Most agreements also denote how much of the new property is jointly owned by the two people (or corporations) as well as how they will split the royalties from the new work. Part of that agreement would be how much of each sale both of you receive.

Of course, for this to work, the two parties have to find each other. If the patent owner of the original work cannot be found, then the other party cannot proceed with their idea, of using the item they wished to license. The person who wishes to license the work can conduct a search at the Patent and Trademark Office to find the owner of the patent they wish to license. If the patent owner is found, then the would-be licensor can contact the patent owner as they will.

Such licenses typically denote who owns what, how it will be used, how long the license will last, how to end the agreement early, and several other caveats.

Many such agreements feature a small list of definitions in which several of the terms are explained for the average lay person to understand. For example, the word "Government" could be defined as being "The United States of America" and "Party A" could be defined as "The Inventor, owner of the Patent" and "Party B" is the "Person that wants to license the patent."

Some agreements could stipulate that the product must be manufactured in a certain location or jurisdiction, that the patent owner might have other obligations like they should inspect every 50^th item produced to make sure it stands up to the rigors of mass production.

There could also be a clause that states that the original licensor could sub-license the patent to a third-party. There could be a clause denying the original inventor from being able to license the same patent to another group as well during the life of the agreement, thus giving the licensor exclusive use of the patent.

An anti-shelving clause could also appear in the contract. This stipulates that the licensor must use the patented material in a commercially viable product within a set period of time, and not just sit on the patent to prevent other parties from being able to utilize the patent.

Such agreements have no real set structure other than they have to name the inventor and the licensor, to what ends the license agreement is being made, how the money will be split, how long the agreement lasts or how to end the agreement.

If the patented device utilizes some aspect (either in execution or construction) that is protected as a trade secret, care must be taken to ensure that the trade secret does not become public knowledge. To this end, Non-Disclosure Agreements are often created and signed by those who are to work with an item protected by a trade secret.