UC Berkeley OTL Licensing Process

Goals

A goal of UC Berkeley’s Office of Technology Licensing (OTL) is to establish license agreements that lead to the fast and broad commercialization of Berkeley technologies to: (1) benefit the public, (2) fund research and education on the campus, and (3) reward inventors for their ingenuity. Therefore, we are motivated to expeditiously negotiate licenses with reasonable terms that consider business plans, market economics, and technology stage.

Timing

The OTL closely monitors the cadence and time it takes to complete a license. Please see below for tips on how to expedite the process.

Process

The main steps for licensing a technology from UC Berkeley.

1. Expression of Interest: A company informs the OTL that it wants to establish a license agreement that enables the commercialization of specific Berkeley technology. This notification could also include additional details such as a request for exclusive and field-of-use rights.
2. Commercialization Plan: If the technology is available for licensing, then the OTL requires the company to submit a commercialization plan (download a template).
3. Term Sheet: Term sheet: After the company submits the commercialization plan, the OTL studies the plan, conducts licensing market research, and applies licensing industry best practices to develop a term sheet with the key terms of a license agreement. The OTL can also explain the reasoning that underlies the key terms.
4. Term Sheet Negotiation: The company is welcome to propose changes to the OTL’s term sheet and explain its reasoning for those changes. These proposals may include changes to key financial terms such as fees, royalty rates, and stock equity. The OTL responds to any proposals expeditiously and in good faith. This proposal and response step might go through more than one iteration and consequently may be time consuming.
5. License Agreement: After the key terms are agreed upon, the OTL incorporates those terms into its corresponding license agreement template, and if appropriate, share issuance agreement (SIA) template.
6. Agreement Negotiation: The company is welcome to propose changes to the license agreement template along with a rationale for the suggestions. These proposals may include changes to boiler plate legal terms. The OTL responds to any proposals expeditiously and in good faith. This proposal and response step might go through more than one iteration, and consequently may be time consuming. See suggestions below for expediting the process.
7. Other Parties: If the license includes IP rights that are jointly-owned or jointly-managed with another entity, then the OTL might need to get approval of the license terms from that party.
8. Execution: The OTL and company sign the license agreement (and if appropriate the SIA).

Post Execution

The OTL collaborates with the licensee on patenting and also monitors license agreement compliance and milestone progress. The licensee is welcome to propose amendments to the agreement due to unforeseen changes in market conditions or business models. The OTL responds to any amendment proposals expeditiously and in good faith.

Tips to Expedite the Licensing Process

1. Expectations: At the onset of the process, key people from the OTL and company (including the company’s legal counsel), meet to discuss expectations and potential issues.
2. Good Faith: All counter proposals should be submitted together, not serially. That way the issues can be addressed holistically to find opportunities for mutual compromise.
3. Status Check Ins: OTL and the company check in with each other once every two weeks regarding status and progress.
4. Legal Counsel: The company tightly manages its legal counsel’s perspective and approach as follows:
   • Set your expectations with counsel on the pacing for term sheet and draft exchanges, particularly if you are accepting pro bono work.
   • Suggest redlines to the term sheet or license be kept at a minimum and should only be done to address the key business needs.
   • Suggest the key issues be addressed early on, so that we can be as efficient as possible at resolving the issues.
   • Discuss whether a more junior associate, who may have a lower billable rate but an incentive to redline any issue to impress, or a more experienced attorney who can focus on the key business issues, can provide a workable license and at a lower expense in total.
   • Read the Nine Points to Consider When Licensing University Technology to better understand the OTL’s need for development milestones, reservation of rights and other clauses that will be in the license agreement. Understanding those 9 considerations can help you address the university's needs while also meeting your business objectives.
   • Aim for a win-win outcome. The negotiation is the beginning of a long-term relationship. For the agreement to be successful, all parties need to be satisfied with the agreement reached.