What is intellectual property?
“Intellectual” property refers to creative works used in business that have economic value. The four most common types of intellectual property (“IP”) are trademarks, copyrights, patents, and trade secrets. Trademarks protect words, names, symbols, and logos that are identified with a brand; copyrights protect artistic works like books, music, and photographs; patents protect inventions; and trade secrets are property that are valuable and have been kept secret and out of the public domain.
We’ll be starting a series explaining each of these types of property in detail over the next few weeks. As the word “property” signifies, intellectual property is an asset. Thus, it is important for both business planning and estate planning. In the business context, it is crucial to determine who owns the IP. Is it the individual who brought it into the business (and will take it with them when they leave) or does the business itself own it? If there is a possibility for litigation, it may be worthwhile to form a separate LLC to own IP so the other business assets stay separate and protected. Next time you look at fast food packaging, you’ll probably see that the company’s trademarks are owned by a separate business.
For estate planning purposes, we want to know about IP just like any other asset – how much is it worth? Who inherits it? So make sure to share this information with your estate planning attorney.
The next blog article will go into trademarks. Stay tuned!
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