This post is adapted from my answer to a Quora question from a prospective patent licensee. Q. How do I propose a licensing agreement with a patent holder?
A. In my experience, the most important thing that a prospective patent licensee needs to bring to the table is a successful track record.
This post is based on a LinkedIn question that I answered recently. (The Q&A no longer are available at LinkedIn, which has discontinued that feature.) Q. What is a sublicense agreement?
A. A license is an agreement by which the owner (the licensor) of something (in the case of the LinkedIn question, a trademark) grants, to someone else (the licensee), rights that are less that all of the rights to that thing. “Licensing 101“, and the download to which it refers, provide basic information about licensing. (more…)
After months of effort, you have successfully negotiated a nonexclusive license under an important patent. The license agreement allows you to make, use, sell, offer for sale, and import products that are covered by the patent. Much to your horror, your arch-competitor starts making and selling competing products that use the licensed technology, pricing its products substantially below your planned price. When you inquire, the licensor says that the competitor does not have a license. What can you do to stop this “third-party” infringement of the patent?
You examine the license agreement but see nothing about third-party infringement of the licensed technology. Can you stop your competitor from using the technology? Can you force your licensor to stop the competitor? The short answer is “no”.