MAPGuideⓇ
Equitable Access Toolkit
Dispute Resolution Mechanisms in License and Collaboration Agreements
While the partnerships formed through license, collaboration and technology transfer agreements may start with the best of intentions, the parties may need to address disagreements at some point during the project. Dispute resolution provisions provide a clear process to follow if disagreements arise, and can support the achievement of swift solutions so that work on product development and/or commercialization can continue.
Dispute resolution provisions often outline an escalation process, starting with informal ‘amicable’ or ‘good faith’ discussions in the first instance, followed by escalation to senior officials (for example, Chief Executive Officers) for each party, and finally formal arbitration if the informal process is unsuccessful. However, some agreements provide for fewer steps in dispute resolution, for example by requiring disputes to be referred directly to arbitration or to applicable courts.
Some dispute resolution provisions also provide for different processes depending on the nature of the dispute. For example, resolution of disputes related to general interpretation of the agreement may follow a formal arbitration process, whereas disputes related to product development-related decisions may fall within the remit of a governance committee, and/or disputes on specific specialist matters may be referred to independent experts. Provisions may additionally specify that all rights and obligations under the agreement will continue until the dispute is resolved.
Examples from the MAPGuide
This Agreement will be construed and enforced in accordance with the laws of the state of Delaware without regard to conflicts of laws provisions thereof. Any disputes arising hereunder will be resolved exclusively in Delaware state courts and United States federal courts located in Delaware.
Source: taken from a license agreement between Atreca, Inc (Licensor) and Gates Medical Research Institute (Licensee). Partner types: non-profit research institute, industry; Product type: prophylactic malaria mAb; Development stage at signature: pre-clinical. Read in context.
The Parties shall use all reasonable efforts to solve any dispute, controversy or claim that may arise under this Agreement through good faith negotiations. In the event that the Parties are unable to resolve a dispute within sixty (60) calendar days from the date such dispute is first brought to the other Party’s attention, the Parties agree, with express resignation to any other jurisdiction that could correspond to them, to solve the differences under the exclusive jurisdiction of the Courts of the city of Madrid, Spain.
If there are any disputes in connection with this Agreement, including its termination under Clause [x], all rights and obligations of the Parties shall continue until such time as any dispute has been resolved in accordance with the provisions of this Clause.
Source: taken from a license agreement between the Spanish National Research Council (“CSIC”, Licensor) and MPP (Licensee)(acting in its role as the “implementing arm” of the World Health Organization’s COVID-19 Technology Access Pool (“C-TAP”)). Partner types: multilateral, public research institution; Product type: COVID-19 vaccine; Development stage at signature: preparation for phase I clinical trial. Read in context.
[T]he Parties shall use reasonable endeavours to resolve amicably any dispute between the Parties arising out of or in connection with this Agreement by referral to the Executive Director of [PDP] and the Chief Executive Officer for [Company] who shall use reasonable efforts to meet in person within thirty (30) days from written notice of dispute received by one Party from the other. Should such matter remain unresolved at the end of that period, such dispute shall be finally settled under the Rules of Arbitration of the International Chamber of Commerce by one or more arbitrators appointed in accordance with such rules. The place of arbitration shall be Geneva, Switzerland and the language of the proceedings shall be English.
Notwithstanding the dispute resolution procedures set forth [above], in the event of an actual or threatened breach of this Agreement, the aggrieved Party may seek provisional equitable relief (including restraining orders, specific performance or other injunctive relief), without first submitting to any dispute resolution procedures hereunder.
Notwithstanding [the above], any dispute concerning the ownership or inventorship of any Patent Rights arising hereunder in any given jurisdiction shall be determined by the courts of the jurisdiction in question.
Source: taken from a collaboration agreement between Entasis Therapeutics and GARDP. Partner types: PDP, industry; Product type: gonorrhea treatment (zoliflodacin); Development stage at signature: Phase 3 clinical trials. Read in context.
The parties agree that any dispute arising out of or relating to this Agreement shall be resolved solely by means of the procedures set forth in this Article, and that such procedures constitute legally binding obligations that are an essential provision of this Agreement. If either party fails to observe the procedures of this Article, as may be modified by their written agreement, the other party may bring an action for specific performance of these procedures in any court of competent jurisdiction.
Equitable Remedies. Although the procedures specified in this Article are the sole and exclusive procedures for the resolution of disputes arising out of or relating to this Agreement, either party may seek a preliminary injunction or other provisional equitable relief if, in its reasonable judgment, such action is necessary to avoid irreparable harm to itself or to preserve its rights under this Agreement.
Dispute Resolution Procedures
(a) Mediation. In the event of any dispute arising out of or relating to this Agreement, either party may initiate mediation upon written notice to the other party (“Notice Date”) pursuant to Section [x], whereupon both parties shall be obligated to engage in a mediation proceeding. The mediation shall commence within [***] days of the Notice Date. The mediation shall be conducted by a single mediator in Boston, Massachusetts. The party requesting mediation shall designate two (2) or more nominees for mediator in its notice. The other party may accept one of the nominees or may designate its own nominees by notice addressed to the American Arbitration Association (AAA) and copied to the requesting party. If within [***] days following the request for mediation, the parties have not selected a mutually acceptable mediator, a mediator shall be appointed by the AAA according to the Commercial Mediation Rules. The mediator shall attempt to facilitate a negotiated settlement of the dispute, but shall have no authority to impose any settlement terms on the parties. The expenses of the mediation shall be borne equally by the parties, but each party shall be responsible for its own counsel fees and expenses.
(b) Trial Without Jury. If the dispute is not resolved by mediation within [***] days after commencement of mediation, each party shall have the right to pursue any other remedies legally available to resolve the dispute, provided, however, that the parties expressly waive any right to a jury trial in any legal proceeding under this Article.
Performance to Continue. Each party shall continue to perform its undisputed obligations under this Agreement pending final resolution of any dispute arising out of or relating to this Agreement; provided, however, that a party may suspend performance of its undisputed obligations during any period in which the other party fails or refuses to perform its undisputed obligations. Nothing in this Article is intended to relieve [Licensee] from its obligation to make undisputed payments pursuant to Articles [x] of this Agreement.
Source: taken from an exclusive license agreement between M.I.T. (Licensor) and Visterra (Licensee). Partner types: academic institution, industry; Product type: dengue monoclonal antibodies; Development stage at signature: pre-clinical. Read in context.
What are each party’s rights and obligations if unsuccessful dispute resolution results in agreement termination? How can the parties ensure continuity of product development and the access objectives of the agreement if dispute resolution is unsuccessful?
This toolkit has been built based on the data in the MAPGuide and the GHIAA team’s experience of negotiating and implementing agreements. We intend that the toolkit will evolve and expand over time based on input from MAPGuide users and availability of new agreements showing examples of alternative approaches. We welcome ongoing constructive dialogue around these materials and encourage you to contact us or fill in our feedback survey to share your thoughts, questions and suggestions.