Licensing Agreement #11 Indemnification
09-28-09
For the next few posts I will be breaking down a general Licensing Agreement clause-by-clause and giving brief explanations on what it all means. For the beginning of this series of posts, start at the first one dated Sept 14, 2009 (scroll down).
This is the next clause in a Licensing contract:
9. INDEMNIFICATION
9.1 The Licensor hereby agrees to defend, indemnify and hold the Licensee harmless against any claims, demands, cause of action and judgments challenging the authority of the Licensee to use the Property in ‘Schedule A’ by the Licensee as authorized by this agreement.
9.2 The Licensee hereby agrees to defend, indemnify and hold the Licensor and/or any of its related entitles harmless against any and all claims, demands, cause of action and judgments arising out of Licensee’s designs, manufacture, distribution, shipment, advertising, promotion, offering for sale and/or sale of the Licensed Products and/or Promotional materials with respect to the foregoing indemnity, the Licensee agrees to defend and hold the Licensor harmless at no cost or expense to the Licensor whatsoever including, but not limited to attorneys’ fees and court costs. The Licensor shall have the right to defend any such action or proceeding with attorneys of its own selection.
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The first clause of this section allows the Licensor to defend, indemnify and hold the Licensee harmless against any claims, demands, cause of action and judgments challenging the authority of the Licensee to use the Licensor’s Property expressed in ‘Schedule A’ by the Licensee as authorized by this agreement. Therefore allowing the Licensee to use the Licensor’s Property even if the Property is challenged in court or has other claims against it. Of course, a court could decide otherwise but in the event that the Licensor’s Property is being contested in some way, the Licensee can continue to use it unless a court decision deems otherwise.
9.2 The Licensee agrees that if a lawsuit or claim against them arises they will defend, indemnify and hold the Licensor and/or any of its related entitles (associates/entities) harmless. Since there are risks to the Licensee regarding intellectual designs, manufacturing procedures and process, distribution errors or problems, shipment mistakes, advertising and promotional liability, questionable techniques of offering for sale and/or sale of the Licensed Products and/or Promotional materials, Licensor wants to remain protected from Licensee in every way. Also the Licensee agrees to defend and hold the Licensor harmless at no cost or expense to the Licensor. Yet the Licensor shall have the right to defend any such action or proceeding with attorneys of its own selection (insert ‘at their own cost’).
My recommendation is to give the Licensee the same indemnification rights as the Licensor receives in both clauses above. Fair is fair.
Next – Licensing Agreement #12 PREMIUMS, PROMOTIONS & SECONDS
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As most of you know, I am not a lawyer or an accountant and I recommend everyone seek their own legal counsel, accounting and tax advice in all contractual matters. I provide consulting which is detailed on the ‘services’ page of this website.
Hope this contract breakdown helps you understand the intricacies of a Licensing Agreement. Should you have any questions contact me at info@Playdigm.com – please put ‘Your name & Licensing’ in the subject line of your email.
Thank you.
Sandford Tuey
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