When you are creating a piece of work for a company or individual, you will need to consider the ownership of those ‘works’. This means you will need to decide whether the work is going to be licensed or assigned to the company or individual upon completion.
This can be easily overlooked and the parties may end up in a dispute about who owns what. In other instances, it is actually dealt with contractually but the type of license granted is wrong.
Assignments verses licenses
An ‘assignment’ is the transfer of outright ownership from the Assignor to the Assignee. If the Assignor has no intention of retaining any rights or property over the Work then this is the way to go.
With a licensing agreement, there is much more to consider. It is vital the terms used are correctly defined and that the restrictions contained within the licence appropriately and clearly stated leaving no room for misinterpretation.
The grant of the licence should specify if it is an ‘exclusive licence’, a ‘non-exclusive licence’ or, a ‘sole licence’. The differences are crucial:
- An exclusive licence grants rights to the licensee to the exclusion of all others, including the licensor.
- A non-exclusive licence leaves the licensor free to exploit the rights itself and to grant licences to others.
- Under a sole licence, the licensor may exploit the rights itself but may not grant licences to any others.
The term “sole and exclusive” is sometimes seen in licences, but this should be avoided as the two terms are contradictory and should therefore not be used together.
The grant of the licence should further specify the rights granted, purpose for which the rights can be used, territory/geographical restrictions and the duration of the licence.
The type of license chosen will of course depend on the nature of the Works and arrangement between the licensor and licensee. These details are set out in the License Specifications. Control of the Works, exclusivity or usage rights in respect of the Works are some of the things that need to be considered.
Licensing works can be extremely daunting and it is always a good idea to consult with experts. Even the prospect of contacting a legal expert can be off-putting. At CloudLegal, we are ready to help and keep things simple – we’re not saying it’s easy but it doesn’t have to be stressful.
Let us know if we can help you!
Author: Yvonne Morris
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