IP transfer question

[Walter Harley]

If I manufacture a product under license from its designer, I unavoidably
learn aspects of its design which I may then, intentionally or not, use in
my own subsequent designs.

Suppose that over time, I evolve the product's design, perhaps to the point
that it is no longer recognizably derivative. Typically, how is the
question of "when do I stop paying royalties" addressed in contracts?

That is, what contractual terms are generally used to protect the other guy
from me just tweaking his design, calling it my own, and selling it without
paying royalties; and, on the other hand, to protect me from him claiming
that any vaguely-related product I ever subsequently design is really his
and I owe royalties on it?

 

[Ben Bradley]

On Sat, 2 Apr 2005 15:20:33 -0800, "Walter Harley"
<walterh@cafewalterNOSPAM.com> wrote:

If I manufacture a product under license from its designer, I unavoidably
learn aspects of its design which I may then, intentionally or not, use in
my own subsequent designs.

Suppose that over time, I evolve the product's design, perhaps to the point
that it is no longer recognizably derivative. Typically, how is the
question of "when do I stop paying royalties" addressed in contracts?

That is, what contractual terms are generally used to protect the other guy
from me just tweaking his design, calling it my own, and selling it without
paying royalties; and, on the other hand, to protect me from him claiming
that any vaguely-related product I ever subsequently design is really his
and I owe royalties on it?

IANAL, but I understand they make huge amounts of money for
answering such questions, and even more once one party contacts
another with a claim of infringement.

What's the best law school in the Atlanta area?
-----
http://mindspring.com/~benbradley

 

[richard mullens]

Walter Harley wrote:

If I manufacture a product under license from its designer, I unavoidably
learn aspects of its design which I may then, intentionally or not, use in
my own subsequent designs.

Suppose that over time, I evolve the product's design, perhaps to the point
that it is no longer recognizably derivative. Typically, how is the
question of "when do I stop paying royalties" addressed in contracts?

That is, what contractual terms are generally used to protect the other guy
from me just tweaking his design, calling it my own, and selling it without
paying royalties; and, on the other hand, to protect me from him claiming
that any vaguely-related product I ever subsequently design is really his
and I owe royalties on it?

This is sci.electronics.design.

Here, people give of their time and experience in the furtherance of the spread electronic design knowledge to those with a
genuine interest in electronics (rather than freeloaders who just want a shortcut).

Your question, which is more about restricting the freedoms of others, is liable to get short shrift from the commies on this
group (I count myself among them) - but doubtless there will be a few who sympathise with you.

If you have to ask a question like this, then my advice would be that you do it elsewhere.

 

[Walter Harley]

"richard mullens" <mullensdeletethis@ntlworld.com> wrote in message
news:fQI3e.3642$p71.3204@newsfe3-gui.ntli.net...

This is sci.electronics.design.

Here, people give of their time and experience in the furtherance of the
spread electronic design knowledge to those with a genuine interest in
electronics (rather than freeloaders who just want a shortcut).

Your question, which is more about restricting the freedoms of others, is
liable to get short shrift from the commies on this group (I count myself
among them) - but doubtless there will be a few who sympathise with you.

If you have to ask a question like this, then my advice would be that you
do it elsewhere.

You seem to have misunderstood both me and my question. I apologize if that
misunderstanding was due to a lack of clarity on my part.

But I confess, I do not see what part of my question was unclear. Are you
under the impression that contracts are bad? Or that licensing another's
designs is bad? Or that evolving someone else's design is bad? Or that
asking opinions is bad?

If I may clarify:

I know a fellow who, after an illustrious career as an engineer himself, is
retiring. I am considering taking over the manufacture of some of his
products. Admittedly I could simply have designed competing products
myself; but I have always felt that if a good product is on the market at a
reasonable price, I would be serving the public and the industry better to
focus my efforts elsewhere. So, I waited until an opportunity came up to
license his products.

That opportunity has arisen, and I am trying to pursue it. I am happy to
pay him a fair royalty. However, I want to be fair to both of us; and so I
want to write a contract that deprives neither of us of our due. He should
be entitled to royalties on his design; I should be entitled to ownership of
my own designs, and to my improvements on his design.

This is a common situation, and a common problem. I am simply wondering
what the customary solution to it is. I could pay an IP lawyer a large
amount of money to get a single opinion, which I might or might not trust;
but thankfully I also have this forum as a recourse, where there are many
skilled engineers who have probably encountered this problem at one time or
another and who are willing to share their opinion.

 

[John Woodgate]

I read in sci.electronics.design that Walter Harley
<walterh@cafewalterNOSPAM.com> wrote (in
<m42dncjN5YBIH9LfRVn-rw@speakeasy.net&gt about 'IP transfer question', on
Sat, 2 Apr 2005:

That opportunity has arisen, and I am trying to pursue it. I am happy
to pay him a fair royalty. However, I want to be fair to both of us;
and so I want to write a contract that deprives neither of us of our
due. He should be entitled to royalties on his design; I should be
entitled to ownership of my own designs, and to my improvements on his
design.

Write in your contract that his rights (carefully enumerated and
described in excruciating detail in a schedule to the contract) expire
after n years (n to be agreed, maybe 5 or 10 depending on their nature)
unless extended by agreement at that time. In the event of failure to
agree, the matter shall be put to binding arbitration under an
arbitrator appointed by an independent third party, such as the
President of the IEEE.

You can vary this a bit to suit your particular case, without violating
the principles. You should check that such terms in a contract are
allowed by US law.
--
Regards, John Woodgate, OOO - Own Opinions Only.
There are two sides to every question, except
'What is a Moebius strip?'
http://www.jmwa.demon.co.uk Also see http://www.isce.org.uk

 

[Fred Bloggs]

Walter Harley wrote:

"richard mullens" <mullensdeletethis@ntlworld.com> wrote in message
news:fQI3e.3642$p71.3204@newsfe3-gui.ntli.net...

This is sci.electronics.design.

Here, people give of their time and experience in the furtherance of the
spread electronic design knowledge to those with a genuine interest in
electronics (rather than freeloaders who just want a shortcut).

Your question, which is more about restricting the freedoms of others, is
liable to get short shrift from the commies on this group (I count myself
among them) - but doubtless there will be a few who sympathise with you.

If you have to ask a question like this, then my advice would be that you
do it elsewhere.



You seem to have misunderstood both me and my question. I apologize if that
misunderstanding was due to a lack of clarity on my part.

But I confess, I do not see what part of my question was unclear. Are you
under the impression that contracts are bad? Or that licensing another's
designs is bad? Or that evolving someone else's design is bad? Or that
asking opinions is bad?

If I may clarify:

I know a fellow who, after an illustrious career as an engineer himself, is
retiring. I am considering taking over the manufacture of some of his
products. Admittedly I could simply have designed competing products
myself; but I have always felt that if a good product is on the market at a
reasonable price, I would be serving the public and the industry better to
focus my efforts elsewhere. So, I waited until an opportunity came up to
license his products.

That opportunity has arisen, and I am trying to pursue it. I am happy to
pay him a fair royalty. However, I want to be fair to both of us; and so I
want to write a contract that deprives neither of us of our due. He should
be entitled to royalties on his design; I should be entitled to ownership of
my own designs, and to my improvements on his design.

This is a common situation, and a common problem. I am simply wondering
what the customary solution to it is. I could pay an IP lawyer a large
amount of money to get a single opinion, which I might or might not trust;
but thankfully I also have this forum as a recourse, where there are many
skilled engineers who have probably encountered this problem at one time or
another and who are willing to share their opinion.

You sure as hell sound more and more like Larry Brasfield each time you
post, chickensh_t pseudo-intellectual and pseudo-sophisticated scum of
the earth , coward , liar, and thief. Why don't you go FY, phony- your
kind is not wanted around here- you are a trouble making maggot and
every thread you enter will be disrupted- whether you have it killfiled
or not- Google and every other archive will show you as exposed for the
low life scum that you are. First you take a stab at impersonating an
engineer- now you want a shortcut to impersonating a lawyer. What's the
matter, big shot, don't have much cash on hand? Geez, wonder why that
could be...

 

[richard mullens]

Walter Harley wrote:

"richard mullens" <mullensdeletethis@ntlworld.com> wrote in message
news:fQI3e.3642$p71.3204@newsfe3-gui.ntli.net...

This is sci.electronics.design.

Here, people give of their time and experience in the furtherance of the
spread electronic design knowledge to those with a genuine interest in
electronics (rather than freeloaders who just want a shortcut).

Your question, which is more about restricting the freedoms of others, is
liable to get short shrift from the commies on this group (I count myself
among them) - but doubtless there will be a few who sympathise with you.

If you have to ask a question like this, then my advice would be that you
do it elsewhere.



You seem to have misunderstood both me and my question. I apologize if that
misunderstanding was due to a lack of clarity on my part.

But I confess, I do not see what part of my question was unclear. Are you
under the impression that contracts are bad? Or that licensing another's
designs is bad? Or that evolving someone else's design is bad? Or that
asking opinions is bad?

In the scheme of things, there is a place for all creatures, even the vultures that wait for the opportunity to pick over the
carcasses of those weakened by age.

 

[James Meyer]

On Sat, 2 Apr 2005 21:45:04 -0800, "Walter Harley"
<walterh@cafewalterNOSPAM.com> wroth:

........ and so I want to write a contract .......

That's your major problem. Just because you're a smart engineer, it
doesn't follow that you are qualified to write a contract.

Someone who acts as his own lawyer has a fool for a client. That's a
trite saying, but like many, is true.

Find one lawyer that both you and the other guy can trust, split the
fees, and sit down with him so both of you can explain what you want the
contract to cover and not cover. If the two of you can't work that out, then no
contract, even one *you* write, will be worth the paper it's written on.

Jim

 

[Larry Brasfield]

"Fred Bloggs" <nospam@nospam.com> wrote in
message news:424F4817.1010606@nospam.com...

Incredibly this "Walter Harley" flake also locates to Mercer Island, Washington-

"Incredibly" is the operative term here. A quick look at
Walter's post headers, then an inferrable website,
http://www.cafewalter.com/cafewalter/whatiscwa.htm
shows a claim of Seattle residence and a Seattle phone.
One Walter Harley is in the Seattle phonebook, having
that same phone number, with a Seattle address.

For those unfamiliar with local geography here, Seattle
and Mercer Island are disjoint areas.

same as the pseudo-intellectual, Larry Brasfield. Looks like a match- good for nothing parasite riffraff garbage people...Hey,
aged hippie, GFY and drop dead at your earliest convenience.

A lot of electronic development happens around here,
at the hands of people enjoying the normal range of
competence. Fred's delusion to the contrary denotes
nothing beyond his own sickness of spirit.

[OP's post left to show what triggered Fred's spew.]

Walter Harley wrote:
If I manufacture a product under license from its designer, I unavoidably learn aspects of its design which I may then,
intentionally or not, use in my own subsequent designs.

Suppose that over time, I evolve the product's design, perhaps to the point that it is no longer recognizably derivative.
Typically, how is the question of "when do I stop paying royalties" addressed in contracts?

That is, what contractual terms are generally used to protect the other guy from me just tweaking his design, calling it my own,
and selling it without paying royalties; and, on the other hand, to protect me from him claiming that any vaguely-related product
I ever subsequently design is really his and I owe royalties on it?

--
--Larry Brasfield
email: donotspam_larry_brasfield@hotmail.com
Above views may belong only to me.

 

[Walter Harley]

"James Meyer" <jmeyer@nowhere.net> wrote in message
news:g8qv41heaviputq398s0hvha32nkn1ferr@4ax.com...

Someone who acts as his own lawyer has a fool for a client. That's a
trite saying, but like many, is true.

I have a lawyer. I'm trying to gain additional points of view.

Someone who acts as his own lawyer does indeed have a fool for a client.
But someone who assumes that his lawyer (or other professional) knows
everything there is to know, isn't doing due diligence. If I were sick, I'd
look up the side effects of the medicine my doctor prescribed. If my pipes
were leaking, I'd get a bid from more than one plumber.

All I'm trying to do is learn more about the customary, fair solutions to a
common engineering business situation. My interest is in forming an
agreement that will be a win for both parties and will not blow up in our
faces later on. A contract based on a bad agreement is a liability, not an
asset. To have a good contract, you need to have a sensible, fair
agreement, based on clarity, shared values, and practical experience.

It seems reasonable to ask what agreements folks here have used in this
situation. There is a range of solutions, some with hidden gotchas that I
would like to avoid. Asking for the experience of others seems a good way
to do that, if they are willing to share those experiences.

Jim (or others), in your experiences with IP licensing, what was your
solution to the problem of defining when royalties are no longer due?
(Thanks, John W., for your answer.)

 

[John Woodgate]

I read in sci.electronics.design that Walter Harley
<walterh@cafewalterNOSPAM.com> wrote (in
<heOdnUQ7gP3s083fRVn-oQ@speakeasy.net&gt about 'IP transfer question', on
Sun, 3 Apr 2005:

But someone who assumes that his lawyer (or other professional) knows
everything there is to know, isn't doing due diligence.

Absolutely. Part of the reputation that lawyers have for creating chaos
is due to people not telling them all the facts. I've experienced some
of this when acting as an expert witness. You get a brief from the
lawyer and send back around 20 key questions that the brief simply
doesn't address.
--
Regards, John Woodgate, OOO - Own Opinions Only.
There are two sides to every question, except
'What is a Moebius strip?'
http://www.jmwa.demon.co.uk Also see http://www.isce.org.uk

 

[Walter Harley]

"Larry Brasfield" <donotspam_larry_brasfield@hotmail.com> wrote in message
news:Z1Y3e.46$D53.668@news.uswest.net...

"Fred Bloggs" <nospam@nospam.com> wrote in message
news:424F4817.1010606@nospam.com...
Incredibly this "Walter Harley" flake also locates to Mercer Island,
Washington-

Thanks. I don't see Fred's posts, myself; although he often has good
information, I found the level of vitriol higher than I was willing to pay
attention to, so he's in my blocked senders list.

One Walter Harley is in the Seattle phonebook, having
that same phone number, with a Seattle address.

The very same. Feel free to visit or call.

 

[Fred Bloggs]

You're a worthless p.o.s. and fraud- please drop dead at your earliest
convenience.

[...snip usual garbage...]

 

[Fred Bloggs]

Larry Brasfield wrote:

A point missed by the "Let the lawyer(s) do it" crowd is that
the lawyer's charter is to effect the intentions of the parties in
a legally enforcable way. A good lawyer may advise clients
as to terms that should be present, but it is ultimately up to
the parties to determine what their agreement achieves. That
job cannot be simply handed over to some lawyer(s).

That's a crock of manure- guess you have no understanding of the concept
of fiduciary responsibility. So you continue to shoot your mouth on
subjects about which you know zilch..

 

[James Meyer]

On Sun, 3 Apr 2005 13:44:15 -0700, "Larry Brasfield"
<donotspam_larry_brasfield@hotmail.com> wroth:

"Walter Harley" <walterh@cafewalterNOSPAM.com> wrote in
message news:heOdnUQ7gP3s083fRVn-oQ@speakeasy.net...
"James Meyer" <jmeyer@nowhere.net> wrote in message news:g8qv41heaviputq398s0hvha32nkn1ferr@4ax.com...
Someone who acts as his own lawyer has a fool for a client. That's a
trite saying, but like many, is true.

I have a lawyer. I'm trying to gain additional points of view.

There was no evidence in your original post that you intended
to act as your own lawyer.

Walter said, "I want to write a contract..." That was what I was
replying to.

Mr. Meyer's reproach was both
premature and irrelevant to the clear questions you raised.

My original reply also included this, which you might have missed...

Find one lawyer that both you and the other guy can trust, split the
fees, and sit down with him so both of you can explain what you want the
contract to cover and not cover. If the two of you can't work that out, then no
contract, even one *you* write, will be worth the paper it's written on.

Jim "not premature, but full term" Meyer

 

[Rich Grise]

On Sat, 02 Apr 2005 21:45:04 -0800, Walter Harley wrote:
....

That opportunity has arisen, and I am trying to pursue it. I am happy
to pay him a fair royalty. However, I want to be fair to both of us;
and so I want to write a contract that deprives neither of us of our
due. He should be entitled to royalties on his design; I should be
entitled to ownership of my own designs, and to my improvements on his
design.

This is a common situation, and a common problem. I am simply wondering
what the customary solution to it is. I could pay an IP lawyer a large
amount of money to get a single opinion, which I might or might not
trust; but thankfully I also have this forum as a recourse, where there
are many skilled engineers who have probably encountered this problem at
one time or another and who are willing to share their opinion.

I don't know if it's "customary," but the logical thing to do is to sit
down with your client, and talk and take notes until you have something
that you're both happy with.

Then have a lawyer look over it for legalities, but if you've written
your agreement in plain English, using declarative sentences, and
spelling out in excruciating detail exactly what's protected, and
a paragraph about derivative works, you should be covered. If you've
got proprietary information in the contract, then declare the contract
itself to be covered under the same intellectual property agreement.

Look up "non-disclosure agreement".

The secret to a contract is that it's balanced - both people are
satisfied with the deal, and both agree on what should happen if
something goes wrong.

Good Luck!
Rich

 

[John Woodgate]

I read in sci.electronics.design that Rich Grise <richgrise@example.net>
wrote (in <pan.2005.04.04.18.05.51.824601@example.net&gt about 'IP
transfer question', on Mon, 4 Apr 2005:

Look up "non-disclosure agreement".

I tried that; I can't see it because it seems to be covered by an 'NDA',
whatever that is.
--
Regards, John Woodgate, OOO - Own Opinions Only.
There are two sides to every question, except
'What is a Moebius strip?'
http://www.jmwa.demon.co.uk Also see http://www.isce.org.uk

 

[Walter Harley]

"Rich Grise" <richgrise@example.net> wrote in message
newsan.2005.04.04.18.05.51.824601@example.net...

I don't know if it's "customary," but the logical thing to do is to sit
down with your client, and talk and take notes until you have something
that you're both happy with. [...]

I do appreciate everyone's efforts to help, but it really would be most
helpful if someone who's been party to a technology licensing agreement
would share with me specifically what the exit clause determining when to
stop paying royalties was.

I can sit down with this fellow and work things out from scratch (though it
will involve an expensive plane trip, especially if I bring the lawyer
along, so I'd like to do my homework in advance), but I'd feel a lot better
going into it with some solid ideas. A few real data points would be very
useful.

John Woodgate's suggestion to put a time limit on the royalty agreement with
an arbitration clause at the end does seem like one reasonable approach.
I'm wondering if there are other approaches that have been successfully used
by folks here.

Thanks!

 

[Walter Harley]

"Frank Raffaeli" <SNIPrf_man_frTHIS@yahoo.com> wrote in message
news:1112847750.033575.60990@l41g2000cwc.googlegroups.com...

If you want to seriously negotiate business, don't bring a lawyer.
(That's just me).

I do a lot of royalty agreements. One I'm doing right now:
Royalty runs out after 10,000 units are built.

Some royalty agreements don't run out. What does this guy want? There
is no single formula you can apply.

A long-term royalty provides an incentive for long-term support and
improvements. Suppose an improvement can increase sales or margin ... I
guess it depends who you are dealing with.

Thanks, Frank! In this case, it's more likely the improvements will be
coming from me, rather than from him; he's trying to get out of the
business.

Have you done any agreements where the exit clause had to do with changing
design? E.g., "royalties drop by 1% with each design revision" (although
that particular example is too vague to be useful). Or is that just not
done, in practice?

It's a good idea to start with a presumption of trust and good faith.
There is no agreement you can put in place that makes it worthwhile to
work woth someone who lacks integrity.

Rich's face-to-face meeting suggestion is SOP.

I totally agree. I need to be prepared before that meeting, though - it's
hard to book time with him and he's a couple thousand miles away.

 

[Fred Bloggs]

Incredibly this "Walter Harley" flake also locates to Mercer Island,
Washington- same as the pseudo-intellectual, Larry Brasfield. Looks like
a match- good for nothing parasite riffraff garbage people...Hey, aged
hippie, GFY and drop dead at your earliest convenience.

Walter Harley wrote:

If I manufacture a product under license from its designer, I unavoidably
learn aspects of its design which I may then, intentionally or not, use in
my own subsequent designs.

Suppose that over time, I evolve the product's design, perhaps to the point
that it is no longer recognizably derivative. Typically, how is the
question of "when do I stop paying royalties" addressed in contracts?

That is, what contractual terms are generally used to protect the other guy
from me just tweaking his design, calling it my own, and selling it without
paying royalties; and, on the other hand, to protect me from him claiming
that any vaguely-related product I ever subsequently design is really his
and I owe royalties on it?