Sponsorship contracts and Intellectual Property

Written by Darlis Gordon, Consortium Legal  

In today’s business world, where innovation and creativity are key pillars for success, intellectual property (IP) protection becomes an essential aspect of sponsorship agreements. A sponsorship agreement is an agreement in which a company (the sponsor) provides financial support or resources to an event, activity or person (the sponsored) in exchange for the promotion of its brand. This type of agreement involves a symbiotic relationship between sponsors and sponsors, where each party seeks to benefit from the notoriety and resources of the other.

In the context of the sponsorship agreement, the intellectual property involved may include, among others:

1. 1. Trademarks: company logos and names that are protected to prevent unauthorized use.
   2. Copyrights: Creative content generated such as videos, images, and advertising materials.
   3. Designs: Visual elements that may also be subject to legal protection.
   4. Trade secrets: Confidential information that provides the company with a competitive advantage.

In this type of agreement, it is relevant that intellectual property is protected from the following perspective:

• Clarity of use: contracts must specify the scope of how the intellectual property can be used by the sponsored party; this includes limitations on the use of the sponsor’s logo, use of images, and any material created jointly. On the other hand, it is critical to define who has the rights to the creations arising from the sponsorship. For example, if a promotional video is produced, the parties must agree on who owns the exploitation rights over this material.

To mitigate the risk of litigation arising from the interpretation and execution of the contract, clear wording on the exploitation of the parties’ intellectual property, as well as that created within the framework of these contracts, helps to prevent future legal disputes. In addition to this, in accordance with the fact that the correct protection and definition of the scope of use of the intellectual property guarantees that the image, good will or value of the sponsoring brand is not compromised by the improper use by the sponsored party. Remember that misuse of the brand can damage the reputation and perception of consumers.

Finally, apart from the special stipulations that may be agreed on contracts of this nature, we identify the following essential clauses to be included in a sponsorship contract:

1. 1. The definition of the scope of the rights of use of intellectual property.
   2. Specific considerations regarding the responsibilities of each party in the event of IP infringement.
   3. Clauses known as “Joint Creativity” clauses, which define the proprietary rights of any content created within the framework of the sponsorship.
   4. Confidentiality clauses with the objective of protecting sensitive information that may be shared between the parties.

In conclusion, the protection of intellectual property in sponsorship contracts is not only a formality, but a strategic necessity and becomes a highly relevant issue for the success of commercial collaborations. The correct management and protection of Intellectual Property not only safeguards the interests of the parties involved, but also strengthens commercial relationships by providing a clear framework for the use of trademarks and other intangible assets. When drafting these contracts, it is advisable to have legal counsel to ensure that all intellectual property implications are adequately addressed, thus mitigating risks and maximizing opportunities.