Q.What is an exclusive license?
A.An exclusive license prevents the party granting the rights (the "licensor") from giving those same rights to others. During negotiations, the party receiving the license (the "licensee") should try to obtain the exclusive rights so as to prevent the licensor from granting those rights to the licensee's competitors. The licensor, on the other hand, will want to arrange for a non-exclusive license. Some compromises that may result include:
- a license that is exclusive only within a specific geographic territory,
- a license that is exclusive only within a given field of expertise, or
- a license that is exclusive only for a limited period of time (e.g., several months or years).
Any license that contemplates exclusivity must be prepared carefully so as not to prevent the Licensor from being able to use the intellectual property for his, her or its own internal purposes.