PPC Patent Licensing & Assignments 2

Question 1

What is a royalty in a patent license agreement?

Accepted Answer

Compensation paid by the licensee to the licensor for the right to practice the patent

Answer

A government fee assessed for maintaining patent rights in force

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A penalty imposed by the USPTO for late filing of documents

Answer

A one-time payment that automatically transfers patent ownership

Question 2

What is a cross-licensing agreement?

Accepted Answer

An arrangement in which two parties grant each other licenses to their respective patents

Answer

An agreement in which a single patent is co-owned and jointly licensed by two companies

Answer

A government-mandated licensing arrangement imposed by the USPTO

Answer

A license structure where multiple non-exclusive licensees share a single royalty pool

Question 3

What is a patent pool?

Accepted Answer

An arrangement where multiple patent holders aggregate their patents and license them as a package to interested parties

Answer

A USPTO-maintained database of all issued and pending patents

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A consortium of companies that jointly own a single foundational patent

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A reserve fund established to cover patent maintenance and annuity fees

Question 4

What does 'running royalty' mean in a patent license?

Accepted Answer

An ongoing royalty calculated as a percentage of sales or per-unit fee based on actual use of the licensed technology

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A single lump-sum payment made at the time the license is executed

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Royalties paid only during periods when the patent is being actively enforced in litigation

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Annual maintenance fees remitted to the USPTO to keep the patent in force

Question 5

What did the Bayh-Dole Act primarily establish regarding federally funded inventions?

Accepted Answer

It allows universities and small businesses to retain patent rights to inventions arising from federally funded research

Answer

It requires all patents resulting from federal funding to be licensed royalty-free to the public

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It prohibits exclusive licensing of any patent that received federal research funding

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It mandates open-source licensing for all software patents developed with government grants

Question 6

What is the doctrine of patent exhaustion (first sale doctrine)?

Accepted Answer

Once a patent owner makes an authorized sale of a patented item, patent rights in that item are exhausted and downstream purchasers may use or resell it freely

Answer

A patent's enforceability is exhausted after the owner fails to assert it for five consecutive years

Answer

A licensee's royalty obligations are exhausted after a contractually defined payment cap is reached

Answer

Patent rights are exhausted when the patent is licensed to more than ten independent parties

Question 7

What is a 'most favored licensee' clause in a patent license?

Accepted Answer

A provision guaranteeing the licensee terms at least as favorable as those granted to any other licensee

Answer

A clause granting the federal government priority licensing rights over all other parties

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A term giving the licensee the first right of refusal on future patents owned by the licensor

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A provision requiring the licensor to continuously offer the lowest possible royalty rate to all parties