Licensing your intellectual property is a great way to take advantage of your rights and make money off your creation. However, these agreements are not always beneficial.
Issues can come up with the licensing process that could end up causing you trouble with your IP rights.
Lacking details
The key to a good licensing agreement is that it is full of details. You should specify everything from how the other party can use your IP to where and when they can use it. You can not have too much information, so include everything possible to make the agreement as specific as it can be.
Confusing royalty calculations
It is important to make sure you get paid the proper amount from the agreement. But that cannot happen if the royalty calculations are not clear. Make sure that you write out a straightforward and easy-to-understand calculation within the agreement that leaves no room for guessing or creative bypassing of payments.
Complicating clauses
If you have clauses within your licensing agreement, make sure they do not contradict anything else and that they are clear. You do not want a clause that will confuse the royalty payments or make it unclear what rights the licensee holds.
Being clear, concise and straightforward in a licensing agreement can help you to bypass many of the common issues. It is important to protect your rights to the IP, but if your agreement is not up to par, you may end up with problems that rival those of not having the agreement in the first place.