Ellen Lambrix assesses pitfalls and key considerations when drafting royalty clauses in patent licence agreements.
On 8 October 2021, His Honour Judge Hacon handed down his decision in Royalty Pharma Collection Trust v Boehringer Ingelheim GmbH [2021] EWHC 2692 (Pat)). The case included a claim by Royalty Pharma for underpayment of royalties by Boehringer under a patent licence and a counterclaim by Boehringer for overpayment of royalties under the same agreement.
The licence at the centre of the dispute was unusual in that it was governed by German law but provided for the courts of England and Wales to have jurisdiction over disputes. Issues of German law interpretation are beyond the scope of this article but the case nevertheless delivers an important lesson for practitioners on drafting and applying patent royalty clauses, irrespect...
“Patent licence royalty provisions can be complex, often with multiple sub-clauses and relevant definitions which all need to work together.”
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