Opposing Licensee Status

Generally, an intellectual property right has the nature of an exclusive right that can be asserted against all persons, but a license, right to use or exploitation right (excluding exclusive licenses and exclusive rights to use; the same shall apply hereinafter) for an intellectual property right that is established under a license agreement is essentially a relative right that can only be asserted against the other party to an agreement.

Therefore, if intellectual property rights that are the subject of a license are transferred to a third party by assignment or other means after the license is established, a situation may occur where the third party can assert its rights under the intellectual property rights against the licensee, while the licensee cannot assert its rights under the license agreement against the third party. In this case, the licensee is at risk of being subject to a demand for injunction or a claim for damages from the third party on the grounds of infringement of the intellectual property rights.

However, given that this leaves the licensee in too much of an unstable position and is also inconvenient from the standpoint of promoting use of the intellectual property rights, legal protections for licensees were devised. The following is a brief overview of this issue, focusing on Japan’s Trademark Act, Patent Act, and Copyright Act.