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A Sole License and an Exclusive License Are Not the Same

When drafting a license agreement, be sure to understand the difference between a “sole” license, an “exclusive” license and a “non-exclusive” license. A sole license means the owner of the rights is providing a license to the grantee, and no one else, although the owner may also exercise the rights being licensed to the grantee. In an exclusive license, the grantee is the only one who can use the rights described in the license, and even the owner cannot exercise those rights being granted in the license. Often a licensor does not realize that with an exclusive license, the licensor is precluding itself from acting. The grant of a “sole and exclusive” license is ambiguous. A non-exclusive license means the grantee is one of many, including the owner, who can take the action described in the license. With any license, the grantor can ultimately get back the rights being granted. In an assignment, the grantor irretrievably gives up its rights.

Ned T. Himmelrich
410-576-4171 • nhimmelrich@gfrlaw.com