Can You Sell Intellectual Property?

Intellectual property (IP) can be a valuable asset. The World Intellectual Property Organization (WIPO) notes that the “value of an IP asset essentially comes from the right the owner of that asset has to exclude competitors from using it.” As with tangible property, the owner of IP has the right to sell it and/or license it to another party. Indeed, people, businesses, and organizations often sell or license their IP. The ability to transfer IP is a valuable legal right that comes with ownership. Here, our Florida brand protection lawyer explains key points to know about your right to sell IP.

Intellectual Property Can Be Bought and Sold 

Intellectual property—innovations (patents), creative works (copyrights), brand identifiers (trademarks) and confidential business information (trade secrets) —holds real, often substantial, commercial value. Like any other type of property, IP can be sold or transferred. In fact, businesses and organizations often buy and sell patents, copyrights, trademarks, and trade secrets in order to leverage competitive advantages. These are complex transactions that require careful negotiation and a proper agreement.

 Key Considerations When Selling IP Rights 

Are you considering selling your IP rights in Florida? If so, it is crucial that you are properly prepared and that you have a full understanding of the advantages and disadvantages. Here are four considerations to keep in mind when selling IP rights:

• Valuation: Does a sale of IP rights make sense? As with any type of physical asset, the answer depends, in large part, on the price. For this reason, determining the value of IP assets is crucial and should reflect their market potential, existing revenue streams, and strategic importance. You need a comprehensive market analysis of IP.
• Licensing: Exploring licensing options before opting for a complete sale can provide ongoing revenue streams while still maintaining some control over the IP. With licensing, the original owner of the IP can grant rights to use, produce, or even sell the IP under pre-specified conditions. Notably, it happens without the transfer of full ownership and must be done in a particular way to safeguard IP rights. It is an approach that can be highly commercially beneficial in certain circumstances.
• Transfer Agreements: Contracts matter with IP sales and/or IP licensing. A detailed transfer agreement is critical to specify what rights are being sold, to whom, and under what conditions. Along with other things, an agreement should clearly outline the scope of the rights transferred, any limitations, and the responsibilities of both the buyer and the seller. An agreement should be drafted and reviewed by a Florida brand protection lawyer.
• Legal Due Diligence: Conducting thorough legal due diligence is essential to uncover any encumbrances, existing agreements, or potential issues associated with the IP. Due diligence is crucial for both buyers and sellers. For a seller, proper due diligence minimizes the risks of future legal challenges which could undermine the value of the transaction.

 Have Questions About Selling IP Rights? We Can Help

At Perkins Law, our Florida brand protection lawyers have the experience that you can trust. If you have any questions about selling IP rights, we are here as a legal resource. Contact us now for your fully private appointment. From our office in Boca Raton, our team handles IP law matters across South Florida, including in Miami. Fort Lauderdale, West Palm Beach, and Jupiter.

Source:

wipo.int/sme/en/ip-valuation.html#:~:text=The%20value%20of%20an%20IP,with%20which%20it%20is%20associated.