I prepared this presentation to use at the INTA ADR Zone at the recent INTA Meeting in Seattle. I hope you find these clauses and the information useful.

1. ADR Clauses For IP
Agreements
J William Frank III
McCRACKEN & FRANK LLP
t: +1 312.263.4700
f: +1 312.263.3990
May 19, 2009
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2. Mediation Clauses
• Because Mediation is non-binding, there is less
risk in using a broad clause.
• Even without a broad mediation clause,
mediation can include a wide range of topics,
including things beyond the scope of the
agreement, to attempt to settle a dispute.
• The clause should include a time limit so that
it is clear when litigation can be used.
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3. Mediation Clauses – Samples
• Broader Clause
– Any dispute, controversy or claim arising under, out of, or relating to
this contract and any subsequent amendments of this contract,
including, without limitation, noncontractual claims ancillary to such
claims, shall be submitted to mediation in accordance with the
mediation rules established by the International Trademark
Association (INTA) Mediation Procedures. Unless otherwise agreed,
the parties will select a mediator from the INTA Panel of Neutrals.
The place of mediation shall be [Insert location]. The language to be
used in the mediation shall be [Insert Language]. If, and to the extent
that, any such dispute, controversy or claim has not been settled
pursuant to the mediation within [Insert number of days] days of the
commencement of the mediation, either party may seek whatever
relief from the courts deemed appropriate.
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4. Mediation Clauses – Samples
• Narrower Clause
– The parties shall attempt to resolve any dispute arising out
of or relating to this Agreement by mediation under the
rules established by the International Trademark
Association (INTA) Mediation Procedures. Unless
otherwise agreed, the parties will select a mediator from
the INTA Panel of Neutrals. Mediation shall begin within
[Insert number of days] days after one party provides a
notice of a dispute to the other party. Only if the
mediation has not concluded within [Insert number of days]
from the notice of dispute shall a party have the right to
seek relief from the courts. The mediation shall occur at
[Insert Location] or at such other location on agreement of
the parties. The mediation shall occur in [Insert Language].
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5. Arbitration Clauses
• Because Arbitration is binding on the parties,
make sure that the arbitration clause only
includes subjects that you want arbitrated.
• Many U.S. Courts, particularly Federal Courts,
tend to interpret arbitration clauses broadly.
• If there are specific subjects that are not to be
subject to the obligation to arbitrate, these
subjects should be expressly listed as
exceptions in the Agreement.
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6. Arbitration Clauses – Narrow vs. Broad
• Narrower Clause
– “Any dispute or difference between the parties
directly arising under the agreement ...”
• Broader Clause
– “Any dispute or difference between the parties
arising out of or relating to this agreement ...”
• If there are specific topics the parties do not
want to be subject to arbitration, to be safe
these should be specified in the agreement.
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7. Arbitration Clauses – Sample
A. Any dispute arising out of or relating to this contract, including the
breach, termination or validity thereof, shall be finally resolved by
arbitration in accordance with the CPR Institute for Dispute Resolution
Rules for Non-Administered Arbitration then currently in effect, by
[number of arbitrators and method of appointment] arbitrator(s). The
arbitration shall be governed by the Federal Arbitration Act, 9 U.S.C. §§ 1
et seq., and judgment upon the award rendered by the arbitrator(s) may
be entered by any court having jurisdiction thereof. The place of
arbitration shall be [Insert Location].
B. The arbitration clause of Section A shall not apply to the following
disputes, which will be litigated in a court of law: any dispute concerning
the validity, ownership or control of the trademarks, any action in equity
necessary to preserve the status quo between the parties.
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8. Multi-step ADR Clauses
• Many Agreements provide for a series of ADR
procedures in a particular order. Typically these
escalate from less binding to more binding:
– Direct Negotiation then Mediation
– Mediation then Arbitration
– Direct Negotiation then Mediation then Arbitration
• Make sure the time period between ADR types is
long enough to provide a reasonable time to settle,
but short enough to minimize “game playing.”
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9. Multi-step ADR Clauses – Samples
• Mediation and Arbitration
– The parties shall endeavor to resolve any dispute
arising out of or relating to this agreement by
mediation [Continue with balance of Mediation
Clause]. Any controversy or claim arising out of
or relating to this contract or the breach,
termination or validity thereof, which remains
unresolved [45] days after appointment of a
mediator, shall be settled by arbitration [Continue
with balance of Arbitration Clause].
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10. Multi-step ADR Clauses – Samples
• Negotiation, Mediation, and Arbitration
– The parties shall attempt to resolve any Dispute promptly by
negotiation between executives who have authority to settle the
Dispute and who are at a higher level of management than the persons
with direct responsibility for administration or performance of this
Agreement. Any party may give another party written notice of any
Dispute (“Notice”). If the Dispute has not been resolved by
negotiation within [45] days after delivery of the Notice, then the
parties shall endeavor to settle the Dispute by mediation [Continue
with balance of Mediation Clause]. If the Dispute has not been
resolved by mediation within [45] days after appointment of the
mediator, then either party may submit the Dispute to arbitration
[Continue with balance of Arbitration Clause].
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11. Questions or Comments?
J. William Frank III
Of Counsel
+1 312.263.3804
jwfrank@mccrackenfrank.com
MCCRACKEN & FRANK LLP
311 South Wacker, Suite 2500
Chicago, IL 60606
t: +1 312.263.4700
f: +1 312.263.3990
www.mccrackenfrank.com
These materials should not be regarded as legal advice or
opinion, nor do they create an attorney-client relationship. 11
© 2009 McCracken & Frank LLP