What Happens to Intellectual Property When Someone Dies?
The Technical Expert Solution for IP Teams
This is one of the major questions people have about intellectual property rights. Are they treated in the same way as other assets when somebody dies or are there different laws at play?
In general, when somebody dies their personal belongings are inherited by family members in accordance with the applicable laws of inheritance in each country. In this context, intellectual property rights, such as patents and trademarks, that the deceased person has filed for or registered continue to exist after death even though they belong to a separate legal entity. They will be considered part of the estate like the rest of your assets and distributed accordingly.
It is important to note that if a patent application is pending at the time of death then an official request needs to be submitted to a national authority responsible for patents in order for it to pass on to other family members. Once it does so these family members will not only inherit the right but also any responsibilities associated with it such as filing renewal fees or managing lawsuits.
The specifics of what happens to your intellectual property and who takes ownership of it depend on the measures put in place before your death. There are a number of different ways to pass your intellectual property rights on.
Dying in intestacy means that a person dies without a valid will. In this case, your assets including intellectual property rights pass from you to other family members according to the laws of intestacy.
It is important to point out that if you have registered an intellectual property right as a company then ownership of these rights will pass on to the surviving owners or shareholders of the company instead of being inherited by family members. On the other hand, if there are no surviving owners or shareholders then ownership passes on to family members.
A court-appointed judge will decide who inherits what. In this instance, the intellectual property may not go to the person you intended, which is why it is important to make prior arrangements.
You can specify who you want your intellectual property rights to go to in your will. This is a valid and widely used way of distributing your intellectual property rights. This allows you to decide what happens with them after your death and makes it easier for those who will receive them as they do not have to go through a lengthy decision process in court. However, it is important that specific language is used so the intellectual property is transferred to specific people. Otherwise, it may become part of your residuary estate and be divided up generally amongst all of your beneficiaries.
You can also transfer ownership of your intellectual property while you are still alive. This is often the best option for businesses. For example, companies will often include clauses in employment contracts to make sure that any inventions made by an employee during their work become the company’s property and not the employee’s. Additionally, it may be possible to safeguard intellectual property rights through trust arrangements such as family trusts and charitable trusts.
The benefit of using a trust is that you can specify who has access to the intellectual property and who will benefit from it. This way, your family members are not automatically entitled to your assets but have to follow the terms of the trust which you created. The courts do not need to be involved here, making the process much easier for everybody.
When transferring ownership of intellectual property rights, it is important to notify the relevant government body (USPTO or USCO) of the transfer to avoid any complications down the line. If you have simply assigned ownership of your intellectual property rights or transferred them to another person without making prior arrangements then this may not be valid according to the rules governing patents and copyright. This is because, by default, whoever creates an invention owns it unless they specify otherwise.
When transferring any assets, it is always important to consider the potential tax implications. For example, when transferring intellectual property rights in the course of a business transfer you may need to pay Capital Gains Tax or Inheritance Tax. If you are unsure what the best option is for your intellectual property rights, you should seek the advice of a legal specialist. Different options are more suitable depending on the situation, but it is always advisable to make some kind of arrangement for your intellectual property rights while you are still alive.