"I'm sorry, Dave, I'm afraid I can't do that. Your license only applies on Earth, not outer space."

Pierce Brosnan declared the plot of his 1999 James Bond film The World is Not Enough convoluted and mystifying, a suitable description of Cold War villain-based movies more than a decade after the Cold War had effectively expired from hypothermia. At first glance, “convoluted and mystifying” is also an apt description for licensing deals. The beauty of a license is also its curse. You can make the license look almost any way you want, granting virtually unlimited rights or giving only the slimmest of rights to use the covered invention in Palatka, Florida on the 3rd Tuesday of every month. It is extremely important to consider each and every word in a license agreement in terms of how the technology involved will actually be used. For example, consider the following language that might appear in an R&D contract for the development of a new type of RCS thruster for satellites: the Satellite Manufacturer “shall retain a nonexclusive royalty-free license [to the developed technology] throughout the world.” What good does a merely worldwide license for a new RCS thruster do a satellite manufacturer? They need a license that actually applies to where they will use the developed technology: outer space. Read the rest of this entry »