Ocean Tomo’s Garrett Glover and Hon. Randall R. Rader, discuss their published article “Why Every Company Should Have a Written IP Licensing Policy” at the Licensing Executives Society International les Nouvelles Live!
Mr. Glover has been involved in quantifying economic damages arising from intellectual property disputes for over 10 years, and in almost every case that he can recall questions arise as to the plaintiff’s and defendant’s licensing policies. Through all those cases, he could not recall a single instance where a documented corporate IP licensing policy was produced during discovery. Through a series of conversations Garrett and Judge Rader explored the value and risks of a written corporate IP licensing policy resulting in a published article on the subject.
By way of background for the group of licensing professionals participating in the webcast, they shared several metrics supporting the role of IP within organizations.
- Intangible assets account for nearly 90% of the S&P 500 market value.
- Patents in force have nearly doubled over the last decade.
- Trademarks in force have approximately doubled over the last decade.
- S. litigation involving IP has almost doubled over the last 20 years.
- Global litigation involving IP has increased.
IP Licensing Policy Benefits
Their article explores the benefits, both within the context of litigation and during normal operations, of having a formal IP licensing policy. Among them, a written set of policies provide a roadmap or framework approach to licensing IP that helps navigate the myriad of complex terms, conditions, and other clauses parties must consider, resulting in more efficient and effective licensing. These IP licensing policies enable a company to leverage the collective wisdom across its entire organization, and even allow for the opportunity to hire outside consultants such as licensing professionals and/or attorneys, adding to the company’s knowledge base. The article explores other benefits including IP management efficiencies and as a potential deterrent to litigation. Mr. Glover referenced a report that one in four U.S. companies expect its IP to be infringed over the next two years and that in 2020 alone, there were over 4,000 patent cases filed in the United States. It is important to also note that licensing policies can serve an important role in assessing reasonable royalty damages, which represent 81% of damages awards in U.S. patent cases, surpassing the billion-dollar mark on multiple occasions.
Challenges and Considerations
Considering the importance and benefits of having a written IP licensing policy, it begs the question why companies have not already done this. The article goes in depth exploring certain challenges associated with creating an IP licensing policy.
Due to the complex nature of licensing IP, there are many factors to consider including operating strategy (meaning manufacturer, researcher, service provider), the competitive landscape, technical application of the IP, type of IP, and/or the expected application of the IP. With these intricacies, a simple “either/or” option is often not available; making the development of these policies an investment of time, resources, and expertise, potentially requiring outside consultants such as licensing professionals and attorneys.
To explore this topic further, please contact Garrett Glover at firstname.lastname@example.org or +1 (312) 327-8160.
Garrett H. Glover is a Director in Ocean Tomo’s Intellectual Property Disputes Financial Expert Testimony practice. He works in the firm’s Chicago headquarters, where he is responsible for quantifying economic damages arising from intellectual property disputes and providing general litigation support.
Hon. Randall R. Rader is member of the Ocean Tomo Board of Advisors where he contributes to the creation of new products and services for the firm. He is former Chief Judge of the United States Court of Appeals for the Federal Circuit, appointed by President George H. W. Bush. He was appointed to the United States Court of Federal Claims in 1988 by President Ronald Reagan.