What is a Licensing Agreement?
In any instance in which a person or entity would like to utilize the property of another, a licensing agreement is necessary. A license agreement involves a written contract stating that one party has legal permission to use the property of the other under a certain set of terms and conditions. Licensing agreements protect and are intended to prevent the infringement of intellectual property while ensuring that the licensor’s property is only used for the permitted use in accordance with the agreement.
How Does Licensing Work?
In many cases, licensing agreements concern intellectual property. It is important to note that a licensing agreement contract does not give or transfer ownership to the licensee. Instead, it grants permission to use a mark or person’s likeness or property within the contracted guidelines.
Generally, a standard licensing agreement will require royalty payments or licensee’s fees (“fees”) for continued use.
Types of Licensing Agreements
Depending on the type of intellectual property, different types of licensing agreements will be appropriate. Some examples are:
- Patent Licensing Agreements concern the manufacturing and distribution of already patented products.
- Trademark Licensing Agreements deal with how the licensee may use a trademark such as a logo or slogan or name.
- Copyright Licensing Agreements outline how the licensee may reproduce and sell artwork, films, songs, or characters.
- Trade Secret Licensing Agreements are relevant when a company’s unregistered secrets are being licensed (i.e. a recipe), and often include an accompanying non-disclosure agreement to protect the trade secrets from disclosure to other parties.
In addition, each of these types of licensing agreements may fall into three categories of exclusivity. Any licensing contract may be considered either:
- Exclusive: The licensee becomes the only entity that is allowed to use the property.
- Non-exclusive: The Licensor may license their property to an unlimited number of licensees.
- Sole: Only the licensor and licensee are able to use the property.
The Value of a Professional Legal Opinion
Regardless of the type of license, a licensing agreement’s terms and conditions can be complex and confusing, especially for individual licensors as it is their property being licensed. For this reason, the attorneys at The Saade Law Firm, P.A. always recommend bringing all legal documents to our experienced attorneys to ensure fair and legal agreements are drafted and executed. We want to ensure every licensor has access to a fair licensing agreement, and our team of proficient attorneys can provide specialized legal advice and guidance.
Contact The Saade Law Firm, P.A. or give us a call at 786-633-1114 to learn more about the specifics of licensing agreements.