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Like most areas of law, Intellectual Property can appear daunting and complex. There are a great many practice areas, subjects and procedures. The SH&P “A-Z” Intellectual Property glossary is a free and easy to use glossary of legal terms commonly used and associated with IP. We hope that it will help you better understand this topic. All of the entries include contact details for SH&P expert advisers. Alternatively, you can request a free, no obligation, IP Consultation and Review here if you require more information or have a particular issue you would like us to help you with.
The term lawsuit refers to proceedings brought by one party (the plaintiff or claimant) against another party (the defendant) in a civil court of law. A lawsuit may also be known as an “action”.
The process of conducting a lawsuit is called “litigation” and the parties may be collectively referred to as the “litigants”.
A “letter before action” (also known as a “cease and desist letter” or “warning letter”) is a letter addressed to an individual or business which puts them on notice that court proceedings may be bought against them. In the field of intellectual property, a party may write to another if they consider their IP rights are being breached, for example, if the potential “infringer” is using a patent or trade mark without the owner’s permission.
Litigation resulting from the infringement of IP rights is almost always taken as a last resort since court proceedings can be expensive to bring, as well as the fact that a court will always expect the parties to have made every attempt to resolve their dispute before taking it any further. Parties are always encouraged to settle their disputes at an early stage by communicating directly with each other or by using alternative dispute resolution procedures such as mediation.
Great care must be taken when drafting a letter before action because it must be very carefully-worded. Stevens Hewlett & Perkins have great expertise in preparing letters of this nature and we are equally very adept in handling responses to these letters sent from an aggrieved party.
In essence, a licence grants permission to do something (to a Licensee) which would otherwise infringe the rights of the IP owner (the Licensor). Since unregulated use of IP by a third party will undermine the IP itself, it is important that any such arrangement is covered by a properly constructed legal agreement (the licence) which sets out the terms of such use and meets the legal requirements of the territory in which it is to have affect.
A licence will provide benefits to both the Licensor and Licensee. In exchange for the right to use the Licensee will normally pay a consideration or a royalty based on the income generated by the activities associated with the use of the IP. The Licensor may save production and marketing costs, gain access to otherwise inaccessible markets and benefit from the Licensee’s local market expertise and knowledge. For the Licensee, the saving on research and development costs by buying in the IP may be substantial. The parties may wish to combine their respective IP to produce a wholly new product or process from which they can both benefit. Licence arrangements between related companies may provide opportunities for tax efficiency.
The value of IP for the purposes of licensing will reflect its importance to the marketing or production process and the extent to which it is properly protected. The IP has to be protected in the geographical location where it is to be licenced. Poorly protected IP may obviate the need for a licence and/or reduce the price attaching to it.
The extent of the rights granted under a licence fall into three main categories. Under an “exclusive licence”, the Licensee will be the only party that can use the IP within the terms and conditions set out in the Licence itself. This excludes use by the IP owner as well. A “sole licence” will prevent the IP owner from granting the same rights to any other Licensees but will allow the IP owner himself to operate alongside the sole Licensee. In the last scenario a “non-exclusive” licence will enable the IP owner to licence the same rights to others and to operate alongside those licensees himself. The value of these different types of licence will of course vary but the most suitable in any situation will depend on a variety of factors, not least the relative bargaining position of the parties.
A single licence may include different types of IP. It may be limited territorially and/or limited to certain products or market sectors. Licences can be granted for an indefinite period, a fixed period or a fixed period extendible by agreement. The licence might permit the licensee to further licence the IP rights via a sub-licence. A licence may be a single stand-alone agreement or may form part of a distributorship, franchise or other business agreement.
The actual terms of an IP licence will be a matter of negotiation and the legal position in the licenced territory but both parties will want to include provisions intended to safeguard their own position. Certainly a well constructed agreement will specify how the IP can be used and in relation to which products, processes or platforms. The licence will also include quality standards and the means by which that can be monitored and regulated. You would also expect provisions clarifying the ownership of any new IP in future product developments.
As owned and protected IP is an important business asset, so the right to use another’s IP can form the cornerstone of a licensee’s business and add significantly to its value. Before entering into a Licence Agreement both parties would want to conduct due diligence exercises to satisfy themselves as to the veracity of the IP in question and the efficacy of the potential partner. As discussions commence a non-disclosure agreement will provide the confidentiality necessary to engage in open and frank pre-contractual talks.
This is a term usually used in relation to copyright protection. Literary works are one of the types of original works protected by copyright.
A literary work can be written, spoken or sung. This type of work includes for instance books, articles, letters, tables, computer programs and even newspaper headline provided they are creative to some extent. Single words on their own on the other hand, such as a name or a title, are usually not considered to be literary works.
The lyrics of a song for instance are considered to be a literary work, whereas the music itself is a musical work.
In order to be protected by copyright, this type of work needs to be recorded or fixated on some medium and requires originality. For a work to be original, it needs to be its author’s own creation rather than the copy of someone else’s work or dictated by technical functions.