Patent licenses can mark the beginning of a fruitful relationship for both the patent owner and the licensee, but patent owners that focus only on the instant deal, waste time trying to pocket a little more money and draft a vague agreement may wind up going from the bargaining table to the courtroom.
Just recently, a major technology group involved in the production of cell phones has dropped two patent infringement lawsuits based on a new patent license agreement that has been entered into which continues the making of payments from the one company to the other. At the time of the dispute, it was alleged that multiple patents were being used without permission and the patent pertained to the proprietary technology in commercial mobile devices.
The agreement has an ongoing agreement between the companies, so as to ensure that the payments do not stop. Settlement was contingent upon withdrawal of litigation and the reaching of terms by which both parties could agree. The financial structure of the terms ensured that this would be the case. As the terms were reached privately, it was a matter of complete confidentiality. The fact that this occurred, perhaps, changes the way in which other litigation can be viewed. Attorneys may now suggest that new terms of agreement be reached prior to even filing suit, unless, of course, sometimes filing suit becomes strategy to bring an opposing party to settlement terms when a compromise situation seems unlikely. Continue reading