Conducting or Defending a Royalty Audit: A Practitioner's Guide to Audit Clauses, Scope, Findings, and Settlement
By Casey Scott McKay ·
A working guide to running a royalty audit as licensor or defending one as licensee. It opens with the clause review that determines what is possible, since everything achievable is defined by a provision most parties have not read since signature. It then covers triage, auditor selection and engagement, the records request that decides whether the audit works, and the reconciliation and testing sequence. Later steps address the licensee's legitimate defences, the draft report and response cycle, and the settlement structure in which forward terms matter more than historic recovery. It closes with variations by rights type, three worked engagements, a portfolio programme, and the drafting lessons every audit produces.
IP and Technology > General IP | Guide | Published 23 February 2024 - Updated 25 August 2025 | Casey Scott McKay - marksy.us
Start from the clause, not the relationship
Everything that is possible in a royalty audit is defined by a provision most people have not read since signature. Read it first, on both sides, before any conversation about the substance.
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