Introduction to Software Licensing

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Software licensing combines knowledge and practice from three different areas:

  • Contract law
  • Intellectual property law
  • Computer technology

to create arrangements and agreements which permit the exploitation of computer software to promote business or strategic results.

Often, the result being sought is the maximization of the profit which can be obtain from the use of the software by others, but there are sometimes other considerations (open source software being one example).


  1. What is the course about?
    • Understanding how to properly acquire rights use to use computer software
    • Understand how to provide (license) computer software to others
  2. Overview of class mechanics
    • Exam
    • Website
    • Book
    • Participation in class
    • Contacting me
    • My background
    • Who has what kind of background in class
      • Patent
      • Technology
      • Contracts
      • UCC
  3. Understanding of Computer Technology as it relates to Licensing
  4. Understanding of intellectual property
    • We will discuss certain concepts of intellectual property in order to understand their impact on software licensing.
      • Examples: Whether software is best protected under patent, copyright or trade secret
    • We will not, however, discuss many important intellectual property issues. For example, we will allude to but not discuss:
      • Criteria relating to whether something is patentable
      • How to copyright something
      • Whether something can be protected by trademark law
  5. What is Intellectual Property?
    • Four major types:
      • Patent
      • Copyright
      • Trade Secret
      • Trademark
    • Other types:
      • Publicity
      • Databases
  6. What is protectable
    • What is not protectable
    • How is it protected
      • Legal steps
    • The scope and limits of copyright protection, patent protection, trade secret protection
    • Reason for protection
  7. Understanding underlying technology to ensure intellectual property is recognized and adequately dealt with
    • Term of protection
    • Cost of protection
    • Trade-offs (i.e. disclosure of formula balanced against patent rights)
    • Value of trademarks even though they don't necessarily protect innovation
  9. Why is licensing needed?
    • How can you control the use of intellectual property without a license?
    • How can you make money from intellectual property without a license?
    • What do you have without a license
      • What is Fair Use?
      • What is the difference between a license and a sale?
      • What is First Sale and what is Patent Exhaustion?
  10. Why are the terms of a license important?
    • What terms are implied if you don't put them in?
  11. What should you put in a license?
    • What is being licensed
    • What are the usage rights and limitations
    • What is the payment (if any)
  12. What can you put in a license?
    • Limits on liability
    • Ownership of improvements
    • "Commercial Terms" -- such as payment!
  13. What should you omit from a license
    • Copyright Misuse
    • Patent Misuse
    • Antitrust Issues
  14. What can be unenforceable in a license
    • Limiting Doctrines
  15. Talk about/questions re EULA
  16. How can you extend intellectual property and licensing concepts
    • Copy protections schemes and the Digital Millenium Copyright Act
    • Converting Intellectual Property into something usable by others, and setting the terms and conditions of that use
    • Lexmark
  17. Business models
    • (great technology vs. great business)
    • Industry paradigms (and buzz-words) (ISP's, VAR's, OEM's)
    • GPL, open software
    • Consortia
  18. Distribution channels and conflicts (antitrust law)
    • Complex products (OEM's)
  19. Development teams and process
  20. "Commercial" aspects of contracting, and the impact of the uniform commercial code
    • Warranty
    • Limitation on liability
    • Negotiation and drafting strategy
  21. Contractual rights "systems" and intellectual property rights audits
  22. Case law compared to commercial practice
  23. Overall objective
    • Understand IP in context of licensing so you can decide whether licensing is necessary
      • Understand technology so as to identify IP and how it can/should be protected
    • Understand common licensing arrangements and why they are necessary
      • Understand what can/should be in them
      • Understand vocabulary
      • Give advice about the terms and conditions of existing license, recognizing why some terms are necessary and some should be avoided
      • Be able to write them
    • Be able to give strategic advice about the method of exploiting IP
    • Be able to give tactical advice about the method of present licensing agreements so as to maximize client interest
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