Practice Test Geeks(CLP) Certified Licensing Professional Practice Test
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CLP Licensing Negotiations & Deal Structuring Flashcards

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  1. What is 'logrolling' in a multi-issue licensing negotiation?

    Answer: Trading concessions across different issues so each party gains on the issues it values most

    Logrolling involves trading off issues of differing priority—one party concedes on a lower-priority term in exchange for a gain on a higher-priority term.

  2. In deal structuring, an 'exclusive license with carve-outs' means:

    Answer: The licensee gets exclusive rights except for specific reserved uses retained by the licensor or other parties

    Carve-outs from exclusivity allow the licensor to retain or grant rights in specific fields, territories, or to government agencies despite the exclusive grant.

  3. What is the Zone of Possible Agreement (ZOPA) in a negotiation?

    Answer: The range between each party's reservation price within which a deal can be made

    The ZOPA is the overlap between the licensor's minimum acceptable terms and the licensee's maximum acceptable terms—any deal in this range is mutually acceptable.

  4. A 'covenant not to sue' (CNS) in IP licensing differs from a license primarily in that:

    Answer: A CNS is a promise not to assert IP rights rather than a positive grant of rights

    A CNS is the licensor's promise not to bring an infringement action rather than an affirmative grant of rights to use the IP.

  5. What is 'packaging' in the context of patent portfolio licensing negotiations?

    Answer: Bundling multiple patents or IP assets into a single license deal to increase leverage and simplify negotiations

    Portfolio packaging allows the licensor to offer a comprehensive bundle of IP rather than individual patents, often commanding a higher overall royalty.

  6. When should a licensor insist on an audit right in a license agreement?

    Answer: Whenever royalties are based on the licensee's self-reported sales or revenue figures

    Audit rights are essential in any deal where royalty payments depend on the licensee's own sales data, as the licensor otherwise has no independent verification mechanism.