Understanding intellectual property (IP) is challenging. Understanding IP ownership is even more difficult. Regardless, it is imperative that purchasers have a firm grasp of the core principles surrounding IP ownership. A lack of understanding can, among other things, result in a failure to receive exclusive IP rights, overpayment for such IP, or even worse, receiving no rights to the IP. While a purchaser may have a cause of action against a seller for a breach of representations and warranties or fraud, it may be a costly or time-barred effort. Whether a startup or a well-established company, understanding IP ownership is critical for any business.
There are many ways to define IP rights. Generally speaking, however, IP rights are rights given to a person to protect their creations and are subject to ownership throughout the world. IP is protected most commonly with patents, copyrights, trademarks and trade secrets, each having their own unique ownership criteria. This article provides an overview of each category, with ownership criteria and practical considerations for purchasers.