IP Licensing Attorney

Intellectual property (IP) is often a company’s most valuable asset, and a license is how that value moves. A well-structured IP license decides who may use a patent, trademark, copyright, or trade secret, on what terms, and what happens when royalties stop or the deal breaks down in court. An IP licensing attorney negotiates and structures those license agreements and litigates them when a dispute over royalties, scope, breach, or termination arises. Keyhani LLC works on both sides — structuring and negotiating agreements for companies licensing IP in or out, and enforcing or defending those agreements when a disagreement becomes a case. The terms chosen control the royalty stream, the exhaustion risk, and the cost of any later dispute.

What an IP Licensing Attorney Does

IP licensing sits between transactional work and litigation, and the two sides inform each other. On the transactional side, counsel negotiates and structures the license — defining the licensed rights, the royalty formula, the audit and reporting mechanics, and the exit provisions that govern termination and wind-down. On the dispute side, counsel enforces or defends the agreement when a party stops paying, exceeds the licensed scope, or claims the licensed rights are invalid or exhausted.

Keyhani LLC handles both. The firm structures and negotiates license agreements for companies moving technology, content, and brands in or out, and it litigates the disputes those agreements produce. Drafting a license with the eventual fight in mind — clear scope, a defensible royalty base, a workable audit clause, and unambiguous termination triggers — is different from drafting for the deal alone, and it is where litigation experience changes the document.

Structuring an IP License: Terms That Decide the Deal

Most license disputes trace back to a term that was left vague at signing. The grant clause is the center of the agreement: whether the license is exclusive or non-exclusive, what field of use it covers, what territory it reaches, and whether the licensee can sublicense. For example, a field-of-use limit that is precise for one product line can become contested when the licensee expands into an adjacent market.

Whether a licensee can sue on its own to enforce the patent turns on how much of the patent right the license actually transferred, measured by the substance of the rights conveyed rather than the label the agreement uses: a licensee holding all substantial rights can sue in its own name on the patentee’s statutory right of action, 35 U.S.C. § 281, an exclusive licensee holding less than that generally must join the patent owner, and a bare non-exclusive licensee cannot sue for infringement at all.

The economic terms deserve the same care. The royalty structure — running royalties on a defined base, a lump-sum payment, minimum annual royalties, or a milestone schedule — sets the revenue and the audit rights that police it. A most-favored-licensee clause promises one licensee terms no worse than a later licensee receives, and it has to be drafted so the comparison is administrable. Termination provisions, cure periods, and the treatment of sublicenses after termination decide what the parties are left with when the relationship ends.

One structuring limit applies no matter how the royalty is framed: under Brulotte v. Thys Co., 379 U.S. 29 (1964), reaffirmed on stare decisis grounds in Kimble v. Marvel Entertainment, LLC, 576 U.S. 446 (2015), a patent licensor cannot lawfully collect royalties for use of the invention after the patent expires — a royalty provision that charges for post-expiration use is unlawful per se. Kimble left several structures intact: where the agreement covers multiple patents, royalties may run until the latest-running patent covered by the agreement expires; a royalty may be tied to a non-patent right licensed alongside the patent, such as a trade secret or a trademark; payment for pre-expiration use may be deferred into the post-expiration period; and Brulotte poses no bar to non-royalty business arrangements, including joint ventures, that achieve similar economics.

License Term	What It Controls	Where Disputes Arise
Exclusivity	Whether the licensee is the only user (exclusive) or one of several (non-exclusive), and who may sue infringers.	Whether the licensee holds enough of the patent right to sue on its own, and whether the licensor retained rights it later grants to others.
Field of use and territory	The markets, applications, and geography where the license operates.	Use outside the defined field or territory, and adjacent-market expansion.
Royalties and audit	The payment formula, the royalty base, minimums, and the licensor’s right to audit the books.	Underpayment, base-calculation disputes, and blocked or contested royalty audits.
Sublicensing	Whether and how the licensee may extend rights to third parties.	Unauthorized sublicensing and the survival of sublicenses after termination.
Most-favored-licensee	A promise of terms no less favorable than those given to a later licensee.	Whether a later deal triggered the clause and how the comparison is measured.
Term and termination	Duration, cure periods, termination triggers, and wind-down obligations.	Whether a breach was cured in time and what rights survive termination.

Patent Exhaustion and the Limits of Post-Sale Control

A patent license cannot always control what happens to a product after it is sold. Under the patent exhaustion doctrine, an authorized sale of a patented item ends the patent rights in that item. In Quanta Computer, Inc. v. LG Electronics, Inc., 553 U.S. 617 (2008), the Supreme Court held that exhaustion applies to method patents and that the authorized sale of a component substantially embodying a patent exhausts the patent as to the finished products the component is later built into.

A component substantially embodies the patent where its only reasonable and intended use is to practice the patent and it embodies the essential features of the patented invention — in Quanta, components that all but completely practiced the patent. The opinion explains that a patentee cannot avoid exhaustion through careful claim drafting. That result shapes how a licensor structures a grant when licensed components move down a supply chain.

The Court went further in Impression Products, Inc. v. Lexmark International, Inc., 581 U.S. 360 (2017), holding that a patentee’s authorized sale exhausts patent rights in the item sold as to everyone — the immediate purchaser and any downstream purchaser alike — regardless of post-sale restrictions the patentee tries to impose, and that a sale abroad exhausts U.S. patent rights as well. As the Court explained, once a patentee decides to sell, whatever rights it tried to retain afterward are “a matter of the contracts with its purchasers, not the patent law,” 581 U.S. at 370.

A post-sale restriction may still bind the purchaser who agreed to it as a matter of contract, but patent-infringement enforcement is unavailable against any purchaser — immediate or downstream — as to that item once the sale is authorized.

That is different from a limit on a licensee’s authority to sell in the first place: a sale a licensee makes outside the field of use, territory, or customer class the license actually grants was never an authorized sale, so it does not exhaust the patent, the narrow principle Impression Products preserved from General Talking Pictures Corp. v. Western Electric Co., 304 U.S. 175 (1938), aff’d on reh’g, 305 U.S. 124 (1938) — though the patentee’s reach against a purchaser then depends on that purchaser’s own participation in the licensee’s infringement, which is why notice and downstream flow-down terms matter as much as the grant clause itself.

Building the licensing and distribution structure around that line — and around the field-of-use and territory limits set at the grant — is central to preserving the value of a patent portfolio.

Copyright and Trademark Licensing Issues

Copyright licensing runs into a parallel limit. The first-sale doctrine in 17 U.S.C. § 109(a) lets the owner of a copy lawfully made under the Copyright Act resell or otherwise dispose of that copy without the copyright owner’s permission. In Kirtsaeng v. John Wiley & Sons, Inc., 568 U.S. 519 (2013), the Supreme Court held that first sale reaches copies lawfully made abroad, not only copies manufactured in the United States. The Court explains that a lawfully made copy keeps its first-sale protection regardless of where it was manufactured.

First sale has its own limits: under § 109(d), the privilege does not extend to someone who acquires possession from the copyright owner by rental, lease, or loan without acquiring ownership. § 109(b)(1)(A) goes further for phonorecords and computer programs, barring commercial rental, lease, or lending of those copies without the copyright owner’s authorization — so for those categories, distribution structure, not just the license text, decides how much post-transfer control a licensor keeps. A content licensor has to price and structure a license knowing that authorized copies can re-enter the market through resale.

Trademark licensing carries a different obligation. A trademark owner that licenses its mark must exercise reasonable quality control over the licensed goods or services; a bare or “naked” license — one with no meaningful quality control — can support an argument that the owner abandoned the mark under 15 U.S.C. § 1127, which defines abandonment to include “any course of conduct of the owner, including acts of omission as well as commission,” that causes the mark to lose its significance. Licenses also commonly address licensee estoppel, which limits a licensee’s ability to challenge the licensed mark while operating under and benefiting from the license.

Royalty Audits, Breach, and Termination Disputes

Many licensing disputes are, at bottom, payment disputes. A royalty audit clause gives the licensor a contractual right to inspect the licensee’s records and confirm that the royalty base and the reported sales are accurate. For instance, when an audit surfaces underreporting, or when the licensee reads the royalty base more narrowly than the licensor intended, the disagreement can move quickly from the accounting to the courtroom.

Breach and termination raise their own questions. Whether a licensee cured a payment default within the contractual cure period, whether a licensor terminated properly, and what happens to inventory, sublicenses, and confidential information after termination are recurring flashpoints. A licensor usually wants a clean exit and the return or destruction of licensed materials; a licensee usually wants time to cure and protection for good-faith investments. Keyhani LLC litigates these royalty, breach, and termination disputes and works the accounting and the contract language together rather than in isolation.

Termination is not the only way a license ends. When a licensor files for bankruptcy and rejects the license, that rejection operates as a breach rather than a rescission, so the licensee generally keeps the rights the agreement already conferred — the rule of Mission Product Holdings, Inc. v. Tempnology, LLC, 587 U.S. 370 (2019). For licenses of patents, copyrights, and trade secrets — among the categories the Bankruptcy Code defines as intellectual property, 11 U.S.C. § 101(35A) — 11 U.S.C. § 365(n) also gives the licensee an election to retain its rights; trademark licenses sit outside that definition, which is why the Mission Product rule matters most there. Which side that outcome favors depends on how the agreement is drafted before any of it happens.

Declaratory-Judgment Jurisdiction in Licensing Disputes

A licensing relationship can produce a lawsuit without a breach. In MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007), the Supreme Court held that a patent licensee in good standing need not stop paying royalties and expose itself to an infringement suit before seeking a declaratory judgment (DJ) that the licensed patent is invalid, unenforceable, or not infringed. The question is whether the facts show a substantial controversy of sufficient immediacy and reality between parties with adverse legal interests. The decision explains that a licensee’s coerced choice to keep paying does not, by itself, defeat a real controversy.

MedImmune‘s holding is jurisdictional: the Court applied the Article III case-or-controversy standard from Aetna Life Insurance Co. v. Haworth, 300 U.S. 227 (1937), and Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270 (1941), building on Altvater v. Freeman, 319 U.S. 359 (1943), and it expressly reserved whether a nonrepudiating licensee is relieved of its obligation to keep paying royalties during a successful validity challenge — the licensee-estoppel question on those facts.

The substantive backdrop for a patent licensee’s ability to challenge validity at all is Lear, Inc. v. Adkins, 395 U.S. 653 (1969), which overruled the contrary estoppel holding of Automatic Radio Mfg. Co. v. Hazeltine Research, Inc., 339 U.S. 827 (1950), and held that a patent licensee is not estopped from challenging the validity of the licensed patent. Trademark licensee estoppel is a separate doctrine that generally still limits a trademark licensee’s ability to challenge the licensed mark while it continues to operate under the license.

That rule matters to both sides of a license. A licensee that doubts the strength of the licensed rights may be able to test them in court while continuing to perform, and a licensor needs to understand that a royalty-paying licensee is not necessarily a settled one. How the agreement is drafted — including any covenants, forum-selection, and dispute-resolution terms — affects where and how such a challenge can be brought.

IP Licensing Matters We Handle

Both Sides: Licensor and Licensee

An IP license reads differently from each chair, and representing both sides sharpens the work for either one. A licensor wants a broad, well-policed grant, a defensible royalty base, and clean termination rights. A licensee wants defined scope, predictable costs, room to operate, and protection for its investment. The same clause that looks like a safeguard to one party looks like exposure to the other, so the negotiation and any later dispute turn on precise drafting rather than goodwill.

Issue	Licensor	Licensee
Grant scope	Keep the field of use, territory, and exclusivity tightly defined and retain unlicensed rights.	Secure enough scope to operate and expand without a later breach claim.
Royalties and audit	Define a broad, verifiable royalty base and a real audit right.	Limit the base, cap audit burden, and keep the payment formula predictable.
Validity and exhaustion	Preserve the value of the rights against invalidity and exhaustion arguments.	Retain the ability to raise exhaustion, first sale, or a declaratory-judgment challenge.
Termination	Obtain a clean exit and return of licensed materials.	Protect cure rights, surviving sublicenses, and good-faith investment.

Where We Handle IP Licensing Matters

IP licensing crosses state and national borders because the rights and the products do. Keyhani LLC negotiates and litigates licensing matters nationwide and serves U.S. and international clients, appearing with local counsel where a court requires it.

A license is itself a contract, and a dispute over royalties, breach, or termination is usually a state-law claim rather than a federal one. Federal court typically enters a licensing dispute a different way — through diversity jurisdiction, through a companion claim for patent or copyright infringement or trade secret misappropriation, or through a federal issue embedded in the contract claim that is necessarily raised, actually disputed, substantial to the federal system, and resolvable without disrupting the federal-state balance — the test of Grable & Sons Metal Products, Inc. v. Darue Engineering & Mfg., 545 U.S. 308 (2005), as restated and applied in Gunn v. Minton, 568 U.S. 251 (2013).

Gunn itself found the test unmet, holding that substantiality turns on the importance of the federal issue to the federal system as a whole, not to the parties in the case — which makes the embedded-issue route a narrow one for an ordinary licensing contract claim. The underlying IP right being federal in character is not, by itself, enough to put a contract dispute in federal court; where the claim is genuinely one of patent or copyright infringement rather than contract, 28 U.S.C. § 1338(a) places it in federal court exclusively.

The firm litigates in the District of New Jersey, the Southern and Eastern Districts of New York, Northern Virginia, and Washington, DC, as well as wherever the deal and the dispute require. For related enforcement work, the firm’s trade secret litigation practice often overlaps with licensing where confidential information travels under an agreement.

Why Keyhani LLC

Keyhani LLC is a litigation-led intellectual property boutique that also handles IP consulting, IP licensing, transactional work, and mediation and arbitration. Having served both licensors and licensees in patent, trademark, and copyright licensing matters, the firm’s work centers on the terms that decide value and risk: how the grant is scoped, how royalties are measured and audited, and how the agreement performs if it ends up in court.

Founder Darius Keyhani has more than 20 years of intellectual property litigation experience and has served as lead counsel in 80+ federal cases, with federal appellate experience and admission to the U.S. Supreme Court bar. Frances Stephenson, a Member of the firm admitted in New York, focuses on intellectual property litigation, including patent claim construction, infringement analysis, and related disputes. Together they handle licensing from negotiation through enforcement and defense.

IP Licensing FAQ