Monetizing IP Rights: Licensing In and Out

• Author: Kelly M. Slavitt, Esq.
• Profession: Reckitt Benckiser LLC
• Pages: 139-150

C0809/02/201112:52:33Page 139

CHAPTER 8

Monetizing IP Rights

Licensing In and Out

Kelly M. Slavitt, Esq.

Reckitt Benckiser LLC

Alicense is a contract

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between the owner of the intellectual property (licensor)

and the party that wishes to use the intellectual property (licensee).

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Intellectual

property (IP) owners license ‘‘out’’ their IP to increase revenue and reap the rewards

of its earlier efforts: the research and development (R&D) has already been done, the

goodwill has already been generated, and/or the content has alreadybeen created. In

contrast, companies license ‘‘in’’ IP owned by a third party to save on R&D expenses

and leverage another company’s expertise by combining it with its own brand.

A poorly constructed license agreement can damage a company’s reputation

with customers (current and potential) and put a company in the headlines and

possibly the courtroom. Examples in recent years were the licensing disputes be-

tween (1) the makers of the Blackberry and the owners of patented IP used in the

Blackberry

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; (2) retired NFL players and their union over licensing their names,

images, and biographies, and claims of failure to pursue licensing opportunities

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;

(3) New York City and its licensee for the sale of New York City Police Department

(NYPD) and Fire Department, City of New York (FDNY) merchandise

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; (4) Topps

and their exclusive South American bubble gum manufacturer, seller, and distribu-

tor

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; and (5) the owner of Martha Graham’s choreographic works and her non-

profit dance center.

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There are many types of licenses for IP in many different industries,

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since there

are many types of IP with their own special concerns. Types of IP include copyrights

(including for music,

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application service providers,

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and software), trademarks,

patents,

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trade dress, and trade secrets. Types of IP licenses include for use, sale

(including retail), promotion, manufacturing, and distribution. The common formats

for a license are a license agreement, a clickwrap,

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a browsewrap, a shrinkwrap,

and terms and conditions on a web site. This chapter describes licenses broadly and

notes issues to be considered in all licenses.

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