In this Insight, we explain the relationship between intellectual property (IP) and confidentiality terms in license agreements for nuclear and other energy technologies, paying special attention to highlighting how confidentiality restrictions may create a de facto vendor “veto” that can restrict your organization’s commercial decision-making and increase technology costs.
Nuclear and other energy technologies are valuable IP. The deployment of nuclear and other energy facilities generally involves a project owner (the “Owner”) licensing nuclear energy IP from a technology vendor (the “Vendor”) so that the Owner can use the IP to, among other things, construct and operate the nuclear or other energy facilities over their useful lives. The Owner’s license to use nuclear or other energy IP may be included in a project contract or in a stand-alone license agreement (each, a “License Agreement”).
Regardless of its form, a License Agreement will typically include two sets of closely related contractual provisions. On one hand, the IP provisions address the scope of the Owner’s license rights to use the nuclear or other energy IP. On the other hand, the confidentiality provisions may (and likely will) place restrictions on the Owner’s disclosure of the Vendor’s nuclear energy IP to third parties.
It is key to recognize how IP provisions and confidentiality provisions can impact one another, and in particular how confidentiality provisions can place significant practical limitations on what might appear to be broad IP license rights.
The Energy practice group at MLT Aikins has extensive experience and skill in drafting, analyzing and negotiating IP license agreements for complex industrial projects. We can give you the advice you need to identify key legal and commercial issues facing your nuclear energy deployment.
Note: This article is of a general nature only and is not exhaustive of all possible legal rights or remedies. In addition, laws may change over time and should be interpreted only in the context of particular circumstances such that these materials are not intended to be relied upon or taken as legal advice or opinion. Readers should consult a legal professional for specific advice in any particular situation.
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