January 23, 2018
Assets are subject to division between spouses in a divorce, as a skilled divorce attorney Collin County TX relies on can attest. Generally, people may seek to classify certain property as separate from the marriage which is not subject to division. What remains in the marital estate is divided based on the family code and common practice where you live. While it is simple to divide cash accounts and investments, tangible property such as car or boat cannot be divided and is allocated to one of the spouses.
Intellectual property division in divorce requires a valuation of the intellectual property, a determination of ownership, a decision whether it is subject to division in the divorce and how one spouse may compensate the other for the share to which they are allocated in the intellectual property.
Intellectual property has value as an intangible asset
Intellectual property, such as a trademark, copyright or patent is an asset with value. Intellectual property may be the work or invention resulting from the knowledge and creative expression of the owner. The intellectual property owner applying for a trademark, copyright is really seeking legal recognition of the work or invention. When the intellectual property ownership is recognized as a trademark, copyright or patent, it has value.
Intellectual property is an intangible asset because it is not physical in nature. Therefore, the only way to measure the asset is by assigning it monetary value. Just as you would order the valuation of an acre of land in a divorce, you can order the valuation of intellectual property.
Using offsets to divide intellectual property in divorce
In divorce, accepting the value of intellectual property could be its own contested issue. Competing experts might disagree about the value of a trademark in commerce or the viability of a patent in the marketplace. Once the intellectual property has a value, it can be divided, if it is community property subject to division in the divorce.
Offsets are used to make things even when dividing assets in a divorce. For example, assume the husband and wife are dividing assets equally. If the intellectual property is to be divided as an asset, you simply take its decided asset value and where one spouse keeps ownership of the asset, the value the other spouse should receive is computed into an offset payoff. So, if husband keeps the patent and owes wife for half its value, husband can pay cash or cash equivalent to satisfy what he owes to the wife in the divorce.
Thanks to our friends and contributors from Scroggins Law Group for their insight into intellectual property division in divorce.