August Meeting. The Model Intellectual Property Security Agreement (MIPSA) Joint Task Force will have its next teleconference meeting on Wednesday August 20, 2014.
•Date: August 20, 2014 (third Wednesday of each month)
•Time: 4:00 pm Eastern/3:00pm Central/2:00pm Mountain/1:00pm Pacific
•Toll Free Dial-in: 866.646.6488
•International Dial-in: +1.707.287.9583
•Conference Passcode: 9101063640
The Task Force met most recently by teleconference on Wednesday July 16. At that meeting, we discussed the revised Working Draft of the model agreement (dated 7/8/14), focusing on the default and remedy sections.
Special thanks go to Howard Darmstadter (Editor) and Elaine Ziff (Vice-Chair) for their time, expertise and diligence in working on interim drafts between official Task Force meetings!
New Working Draft. At the August teleconference meeting, we will be discussing the current revised Working Draft (dated August 11, 2014). This draft includes proposed language to address some of the issues raised at the July meeting and other pending issues.
We will continue to focus on (and maybe finish) the default and remedy provisions (now combined in Section 4) and the powers of attorney, indemnities and costs provisions (now combined in Section 5). Many of the provisions in these sections have been rearranged and consolidated. Here is the latest structure:
4 Events of Default; remedies
4.1 Events of Default
4.2 Enforcement, collection and disposition of Collateral
4.3 Non-disturbance of Permitted Licenses
4.4 Grant of IP License to Secured Party to use Intellectual Property
4.5 Access to Debtor’s expertise
4.6 Debtor waivers
4.7 General remedy provisions
4.7.1 UCC Remedies
4.7.2 Reasonable notice
4.7.3 Application of Proceeds
4.7.4 No marshaling
5 Power of attorney, indemnity, expense
5.1 Power of attorney
5.3 Costs and expenses
Other Changes. This draft also includes a number of changes to Sections 1, 2 and 3. Many of these are stylistic but some are substantive. For instance, we revised Section 3.6.2 (Protection of Collateral) to deal with some of the default and remedies issues.
Footnotes. The current draft includes placeholders for many footnotes (temporarily shown as endnotes.) The footnotes will explain particular provisions and give examples of negotiation practices. The footnotes and the accompanying report/introduction will be easier to draft when the body of the agreement is final (or at least close to final.) Let me know if you want to help prepare the final notes.
U.S. Limitation. You will see one major change in the revised draft immediately: the model agreement is now limited to the U.S. We have been revisiting this issue repeatedly since the Task Force was initially formed in 2010. As the Task Force moves closer (I hope) to the completion of a model agreement, we have made an editorial decision to limit the scope of the model agreement to a US transaction involving a single U.S, debtor with only U.S. intellectual property collateral. I realize that this is an artificial limitation, that most IP secured transactions will at least contemplate the possibility of future IP collateral governed by the laws of non-US jurisdictions and that there are various arguments supporting the inclusion of language to reach foreign intellectual property and to address the related concepts and issues. Nevertheless, I believe that the most effective way to finalize at least the first part of the Task Force's work is to expressly exclude foreign IP from this model agreement. If someone wants to undertake the work to add foreign IP, I am sure that a task force could be reconstituted to create a supplement to (or replacement of) the original work.
Please try to call in to the meeting if you can, and let me know if you have any comments, questions or suggestions. Thanks for your participation in this project.