crosslicense

A cross-license is an agreement in which two or more parties grant each other rights to their intellectual property, typically patents, but also knowledge, copyrights, or trade secrets. The licenses are usually mutual, ensuring reciprocal access, and may be limited to a specific field of use or geography, or be broad and ongoing. Cross-licenses may cover existing portfolios as well as future improvements, and they can be exclusive or non-exclusive, temporary or perpetual. Some agreements are silent about terms, while others include detailed schedules of licensed IP.

Terms commonly address scope, duration, sublicensing rights, and whether royalties or royalty-free terms apply. They may include covenants not to sue, handling of improvements, and conditions for termination or modification on events such as a change of control. Cross-licenses can be bilateral or multi-party and are sometimes integrated into broader licensing arrangements or patent pools.

Rationale and considerations: Cross-licensing reduces the risk of patent infringement and litigation, and can accelerate product development by enabling collaboration between entities with complementary portfolios. It is common in high-tech sectors such as semiconductors, networking, software, and automotive tech. However, there are antitrust or competition-law risks if used to suppress competition or stifle innovation. Negotiations typically balance mutual value, enforcement mechanisms, and potential consequences for future rights and market dynamics.