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3 common misconceptions about IP licensing

On Behalf of | May 22, 2024 | Licensing

Intellectual property protections are crucial for modern businesses. Companies can obtain patents to protect original concepts and inventions, copyrights to protect original creative works and designs, and obtain trademarks to protect their brand.

While many discussions about intellectual property protection focus on either how to obtain enforce intellectual property rights, there is another aspect of intellectual property rights that businesses should be knowledgeable of: licensing.

Licensing is the process by which the owner of a certain patent, copyright, trademark, or other protected intellectual property permits another party to use that intellectual property. Many companies fail to explore fruitful licensing opportunities, either as the licensor or the licensee, because of misconceptions about the licensing process. To dispel these myths, the following are the most common misconceptions about intellectual property licensing.

Licensing Leads to Infringement

Every few years, there are high-profile cases where a company that previously licensed the intellectual property of another company or individual allows the license to lapse and then engages in infringing activities. While it is true that an organization given access to trade secrets or other intellectual property might abuse that knowledge after the licensing agreement ends, a well-crafted licensing agreement can prevent misconduct by establishing mechanisms for protection and providing substantial remedies in the event of breach of the agreement.

Licensing is Only for Major Corporations

It is a common misconception that licensing is only worthwhile for large, multi-million-dollar business entities, or for high-value patents or huge portfolios of intellectual property. However, organizations of all sizes can benefit from licensing intellectual property, and licensing agreements can be a major source of income for small businesses and individuals, either as the licensor or the licensee.

Licensing is Too Complex

Parties that might benefit from an intellectual property license frequently choose not to explore their options because they believe the process is too complex. With the right legal support, negotiating a licensing agreement could be a relatively straightforward and inexpensive process.

In conclusion, almost all businesses and individuals may benefit from exploring intellectual property licensing, whether as the licensor or the licensee. If you are interested in licensing, or obtaining a license for, certain intellectual property, our firm can assist you in doing so. To schedule an initial consultation, please send an email to [email protected] or give us a call at 626-269-6753.