Protection of licensee of general intangible and lessee of goods in ordinary course of business.
1. In this section, “licensee in ordinary course of business” means a person that becomes a licensee of a general intangible in good faith, without knowledge that the license violates the rights of another person in the general intangible, and in the ordinary course from a person in the business of licensing general intangibles of that kind. A person becomes a licensee in the ordinary course if the license to him comports with the usual or customary practices in the kind of business in which the licensor is engaged or with the licensor’s own usual or customary practices.
2. A licensee in the ordinary course of business takes his rights under a nonexclusive license free of a security interest in the general intangible created by the licensor, even if the security interest is perfected and he knows of its existence.
3. A lessee in the ordinary course of business takes his leasehold interest free of a security interest in the goods created by the lessor, even if the security interest is perfected and he knows of its existence.
Last modified: February 27, 2006