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Research and Technology Transfer | Office of General Counsel

 

Indemnification Clauses Checklist

for Sponsored Research Agreements and Clinical Trial Agreements

Use this Checklist to analyze a Sponsor-offered indemnification clauses, determine what problems, if any, the clauses contain, and determine the editorial changes necessary to conform the clauses to the requirements of the Regents’ Rules and Regulations related to Intellectual Property. Because no two deals are identical, the best language for one transaction may not be the same as that for another transaction. If in doubt, please contact the Office of General Counsel with any questions.

 

There are four types of indemnifications we routinely encounter in health-related sponsored research agreements. They are listed below in order from the least comprehensive (least coverage) to the most comprehensive (most coverage):

 

      1. Use of Results (Clause 4)

      2. Sponsor Negligence (Clause 3)

      3. Product Liability (Clause 12)

      4. Full Indemnity (Clause 1)

 

A full indemnity contains language that is either broad enough to cover or expressly covers all the other possible lesser types of indemnification; similarly, the product liability and negligence indemnities expressly cover the lesser use of results indemnity. The three aspects of this Checklist are:

 

      1. What kind of indemnification do you need? (What is the scope of coverage?)

      2. Does Sponsor want the University to indemnify Sponsor?

      3. What other problems unrelated to scope are posed by a Sponsor-offered clause?

 

Please open or print the following sample clauses for this Checklist: Indemnification Sample Clauses.

 

Please check the boxes below if the answer to the question is YES.

 

1. Does the protocol belong to the Sponsor?

If the answer is YES, are human subjects involved?

If the answer is NO, will we be using Sponsor's materials, devices or drugs? If not, Protocol belongs to the University not the Sponsor. Include language that will cover a broad array of damaging events (Clause 3).

 

If the answer to Question 1 is NO, will we provide Sponsor with the results?

 

IF YOUR ANSWERS HAVE BEEN "NO" TO THIS POINT, STOP. YOU DO NOT NEED TO ASK SPONSOR FOR ANY KIND OF INDEMNITY. YOU ARE FINISHED WITH THE ANALYSIS OF YOUR INDEMNIFICATION CLAUSE.

2. Does Sponsor want the University to indemnify Sponsor?

3. Does Sponsor’s indemnification cover the proper parties?

4. Does Sponsor’s clause have broad claim coverage?

 

Look for words like "claims," "demands," "costs," or "judgments."

5. Are the number and/or scope of conditions reasonable?

 

In each case, conditions are reasonable if they are things we would normally do anyway. For example, it is reasonable to expect us to follow the protocol, written instructions, and laws and regulations that govern clinical research. Similarly, it is reasonable to expect that we will promptly notify the Sponsor if we learn about a claim.

6. Are the carve-outs reasonable?

 

In each case, carve-outs are reasonable if they logically relate to things for which we should be responsible. For example, if we are negligent, Sponsor’s obligation to indemnify us should not apply. Similarly, if we don’t follow Sponsor’s protocol, or if we willfully harm a patient, then Sponsor should not have to indemnify us.

7. Is there a notice provision?

 

Sometimes Sponsor makes its obligation to indemnify us contingent upon our giving prompt written notice. Occasionally such notice will be required to be given within too short a period, e.g. 10 days.

8. Does the clause require us to cooperate fully with the defense of the claim or turn over the defense to the Sponsor?

9. Does Sponsor’s clause address any issues other than the ones discussed here?

 

Even a long indemnification provision should address only certain issues: identifying the parties, setting out the scope of coverage, stating conditions and carve-outs, and discussing notice and defense of claims issues, etc. An example of an unusual item in the clinical trial context would be a clause that obligates us to indemnify the Sponsor against harm it may suffer if intellectual property we give the Sponsor (as we might be required to do pursuant to the intellectual property clause) turns out to infringe a patent.

 

Please direct questions or comments regarding this page to BethLynn Maxwell.

 

Last Updated: September 25, 2011