Document type: Checklist Practice area: Intellectual Property — Technology Transactions Jurisdiction: United States, with cross-border notes Last reviewed: 5 September 2026

Section 1 — Before the term sheet

  • The four questions asked of the technical leads:
    • What are we likely to invent, in categories?
    • For each category, whose technology does it belong to more naturally?
    • What will each of us need to practise the result?
    • Where might our fields overlap?
  • The allocation drafted into the term sheet — before someone writes "IP developed jointly will be jointly owned"

Section 2 — Own-side diligence

Assignment chain:

  • Employment agreements use "hereby assigns," not "agrees to assign"
  • Contractors and consultants under written agreements with present assignments
  • Seconded personnel covered, including for inventions made at the other's site
  • Academic collaborators: institutional IP policy read
  • Prior assignments recorded with the patent office
  • Gaps fixed before the project starts

Background IP:

  • Free to license what you will contribute — no conflicting exclusive grants, field restrictions, or upstream limits
  • Third-party components identified, and their licences permit this use
  • Open source in software contributions identified, with obligations assessed
  • Sublicensing rights confirmed

Freedom to operate:

  • Preliminary assessment run on the intended field

Section 3 — Allocation structure

  • Structure chosen deliberately: sole ownership plus licence / field of use / subject matter / co-ownership with a full agreement
  • Default to sole ownership plus licence where the facts permit
  • If co-ownership, every default addressed:
    • Consent to license
    • Accounting and revenue sharing
    • Agreement to join any enforcement action — without this the patent is unenforceable
    • Prosecution: who files, where, who pays, who controls
    • Abandonment: offer to the other before abandoning
    • Transfer restrictions and a right of first refusal
    • Whether each may practise without accounting
    • Maintenance fees, marking, administration
  • Deadlock-breaking trades considered: ownership for exclusivity; breadth for term; ownership for royalty; allocation by subject matter

Section 4 — Field definitions

  • Defined on multiple axes: application, product, customer type, regulatory classification, territory
  • Exclusions stated expressly, naming the adjacent applications
  • Overlap rule for inventions or products in both fields
  • Characterization mechanism: joint IP committee, then an independent technical expert on a defined timetable
  • Definitions tested against three plausible future products, with the engineers

Section 5 — Background IP (three provisions, not two)

  • Identification schedule per party — patents, applications, know-how, software, materials, data
  • Licence to use in the project: non-exclusive, royalty-free, limited to the collaboration, terminating with it
  • Licence to exploit the result: sufficient to make, have made, use, sell, offer, and import products embodying the licensee's foreground IP, in its field, surviving termination other than for the licensee's uncured material breach
  • Improvements to background IP: ownership and licensing addressed
  • Third-party components in background IP, and whether the licence reaches them
  • Know-how included as background IP

Section 6 — Commercial terms

  • Funding structure: each bears its own / one funds the other / shared with a budget and overrun mechanism
  • Funding not equated with ownership — exclusivity considered instead
  • Milestones defined technically and objectively: measurement, threshold, test protocol, who tests
  • Milestone failure addressed: cure, renegotiation, termination, or reduction in rights
  • Resource commitments: named personnel or defined FTEs, replacement, shortfall consequence
  • Exclusivity: may either party pursue the technology alone or with a third party, during and after?
  • Royalties: base, rate, term, stacking, minimums, reporting, audit, combination products
  • Publication review period where a research party is involved: 30–60 days, right to delay for filing, right to remove confidential information
  • Payment terms and acceptance criteria workable for the smaller party

Section 7 — Governance

  • Joint IP committee constituted, meeting monthly during active development
  • Standing agenda: disclosures; inventorship; allocation; filing decisions; prosecution review; third-party developments; patent-versus-trade-secret decisions
  • Invention disclosure form capturing the invention, conception date, every contributor and what each contributed, background IP used, and the allocation category
  • Patent counsel instructed to flag every substantive claim amendment for inventorship review before filing
  • Project steering committee for technical direction, budget, and schedule, with escalation

Section 8 — Warranties, indemnities, liability

  • Ownership and authority warranty
  • Knowledge-qualified non-infringement warranty on background IP
  • No conflicting exclusive grants
  • Personnel under assignment and confidentiality obligations
  • Open source disclosure for software contributions
  • Export control and legal compliance
  • Indemnity for third-party claims arising from a party's background IP, by that party
  • Foreground infringement handled by shared cost, cooperation, and a right to license or design around
  • Product liability follows the manufacturer and seller
  • Liability cap with carve-outs: confidentiality, IP indemnity, gross negligence and wilful misconduct
  • Breach of field restrictions carved out of the cap, or a separate remedy including acknowledged injunctive relief

Section 9 — Term, termination, and survival

  • Licences survive, except on the licensee's uncured material breach
  • Prosecution and maintenance continuation, with an offer mechanism if one party declines a jurisdiction
  • Confidentiality survival period adequate for genuine trade secrets
  • Data: who keeps it, who may use it, for what — including regulatory data and rights of reference
  • Post-termination non-compete and exclusivity
  • Payment, reporting, and audit obligations
  • Materials and samples
  • Change of control: what happens if one party is acquired by the other's competitor — suspension, termination, or buyout

Section 10 — Counterparty-specific

University: IP policy read; publication review negotiated; research and teaching rights expected; federal funding and reporting obligations checked; institutional ownership of researcher inventions confirmed.

Government contractor: rights in technical data and software under acquisition regulations analyzed before the work starts.

Customer: counter the standard assignment form — customer owns deliverables and application-specific work; supplier owns its underlying technology and improvements to it; customer gets a broad use licence.

Competitor: narrow scope documented; information protocol and clean teams; antitrust counsel review before signing.

Startup counterparty: whether your form makes them unfinanceable; their assignment chain, open source, and freedom to operate diligenced.

Cross-border: inventorship and ownership rules by jurisdiction; first-filing and foreign filing licence requirements; mandatory employee invention compensation; export control classification before technical data crosses a border.

Section 11 — The document set

  • Joint development agreement
  • Background IP schedules, one per party
  • Statement of work with milestones, deliverables, acceptance criteria
  • Budget, where costs are shared
  • Named personnel schedule
  • Field definitions
  • Approved subcontractors
  • Confidentiality agreement, or confirmation an existing one governs
  • Material transfer agreement
  • Software licence terms
  • Secondment agreement: direction of work, benefits, invention assignment, confidentiality, site rules
  • Quality or technical agreement, in regulated industries
  • Supply agreement or binding term sheet — negotiated now, not after development
  • Commercialization or distribution terms

Section 12 — Ongoing administration

Month one:

  • First IP committee meeting held; cadence set
  • Disclosure form distributed; engineers trained
  • Every project participant confirmed under a present-tense assignment
  • Background IP reference process established
  • Project record repository established
  • Engineers briefed on confidential information, open source, and publication

Ongoing:

  • Disclosures reviewed and inventorship recorded contemporaneously
  • Every substantive claim amendment reviewed for inventorship before filing
  • Each invention allocated to a field at disclosure, with reasoning recorded
  • Open source scanning for software deliverables
  • Publication requests routed through the review process
  • Milestone certifications documented at the time
  • Resource compliance tracked

Annually:

  • Background IP schedules updated
  • Assignment coverage confirmed for new participants
  • Field definitions reviewed against actual products
  • Licence provisions checked against commercial reality

Six months before termination:

  • Survival provisions reviewed and each party's continuing needs confirmed — licences, data, patents, materials

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