Technology transactions - Managing risks arising from disputes

• Author: Alicia Blaya - Ignacio de Castro - Judith Schallnau
• Position: TransKnowlia Project at the University of Alicante, Spain - WIPO Arbitration and Mediation Center
• Pages: 31-33

Interests in R&D

collaboration

The decision to collaborate in R&D projects is often

driven by an interest in sharing knowledge and an

endeavor to reduce financial risks through the joint

development of products or processes. In some

cases, joint development is the only way to gener-

ate new technology or to further improve existing

products or processes particularly when one part-

ner does not have the technical expertise, financial

or human resources or when existing patents block

independent development activities.

Alternatively, companies award R&D contracts to

other companies, research organizations or univer-

sities to develop a product or component against

remuneration. Here, the principal party exercises

quality control by determining who develops and

delivers which products or components for its busi-

ness; the developer, in turn, is remunerated for the

work undertaken and as a consequence is able to

finance further activities, including other research.

A developer may also seek to obtain rights in the

technologies developed, if it is interested in using

these in the future.

In publicly funded research, parties invest consider-

able time, human and financial resources in pre-

paring bids to obtain financial contributions. Their

success in attracting these funds often determines

their ability to undertake R&D activities. These re-

sources are often limited in scope and duration and

often carry stringent compliance conditions. Fund

recipients are therefore keen to ensure the efficient

application and use of these resources and to avoid

any negative impact on their ability to commercial-

ize their research results.

IP issues and when to think

about a dispute resolution

strategy

Disruptions – such as disputes arising in relation to IP

assets as critical elements of economic value – can

cause serious damage. A strategy to manage such

risks and to resolve any potential disputes rapidly and

cost-effectively, therefore, is vitally important.

The IP created with contractual partners during the

R&D phase usually underpins subsequent commer-

cial agreements, including those outlined here.

While parties may have conflicting views on a wide

variety of IP issues, they need to agree on, in par-

ticular, the issues of (joint) ownership of IP and the

allocation of rights for commercial purposes.

Decisions relating to IP ownership and use of re-

search results in both the R&D and the subsequent

commercialization phases need to be taken at an

early stage. Option contracts, R&D contracts or con-

sortium agreements, should, for example, include

provisions regarding the possible use of IP rights for

commercial activities after the research has been

TECHNOLOGY

TRANSACTIONS

Managing Risks Arising from Disputes

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The successful development and commercialization of technology requires effective cooperation between

lawyers, technology transfer professionals and scientists. A carefully integrated dispute resolution strategy is

a key factor in securing the value of technologies and associated intellectual property (IP) rights developed

in research and development (R&D) collaborations and their subsequent commercialization. In this article

Alicia Blaya of the TransKnowlia Project at the University of Alicante, Spain, and Ignacio de Castro and Judith

Schallnau of the WIPO Arbitration and Mediation Center explore the advantages of mediation and arbitration

in managing IP and minimizing risks in an R&D context.

Letters of Intent

Non-Disclosure agreement

Memoranda of Understanding

Options

Contractual Stages for R&D

and Commercialization

Preparatory phase

of Research Collaboration/

Commercialization/

Technology Transfer

Consortium agreements

Research and development contracts

Material transfer agreements

Sub-contracts

Licensing agreements

Outsourcing agreements

Research service contracts

Consultancy agreements

Conclusion of Contract During the

Collaboration

Commercial contracts

(e.g. Purchase contracts,

supply Contracts,

licensing Agreements)

Outside/after

the Collaboration