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How to Protect Your Intellectual Property and Copyright Ownership in a Divorce

Ryan R. Bauerle | December 5, 2023

One of the most complicated aspects of divorce is the division of assets. This can include tangible items like houses and cars, as well as intangible assets such as intellectual property (IP) and copyrights. If your marriage included a business partnership, and together you’ve spent years creating original content or building a business, you might wonder, “Are there any specific legal strategies to protect my intellectual property and copyrights during a divorce?” Fortunately, the right legal strategy can allow you to navigate the divorce proceedings and the division of any intellectual property included.

What Constitutes Intellectual Property in a Divorce?

Intellectual property includes patents, trademarks, trade secrets, and copyrights. If either spouse has created something original, such as a book, music, software, or a patented invention, that piece of work falls under the umbrella of “intellectual property”. Unfortunately, it’s also presumed to be community property (assuming it was created during the marriage), meaning that it could be subject to consideration in the asset division in any divorce.

What Legal Strategies Can I Use to Protect My Intellectual Property During the Divorce?

Potentially losing the rights to your creations can be an emotional and frustrating experience. Our knowledgeable and compassionate family law attorneys can help you explore your options and provide guidance during this difficult time. There are several strategies that you can employ to protect your intellectual property and copyrights during a divorce:

• Prenuptial or Postnuptial Agreements: One of the most straightforward ways to protect IP is through a prenuptial or postnuptial agreement (also known as a “partition agreement”). These legally binding contracts can specify which assets remain separate and which will be subject to division in the event of a divorce.
• Professional Valuation: Get a professional business valuation of your intellectual property. Understanding its value will help you make informed decisions during property division negotiations.
• Document Everything: Ensure that you have proper documentation showing the IP’s creation and development timeline. This documentation can help prove whether you created the asset before or during the marriage, which can significantly impact the allocation.
• Legal Representation: Work with an attorney who specializes in both family law and intellectual property as it applies to business owners facing an imminent divorce. They can guide you through the intricacies of protecting your assets during the divorce.

How Can I Ensure That Proprietary Information Associated With My Business Remains Mine After the Divorce?

A proactive approach can help to ensure that any intellectual property or proprietary information associated with your business will remains solely yours during and after the divorce.

• Separate Business and Personal Finances: Make sure you keep your business finances separate from your personal finances.This separation can prevent claims that you used marital funds to support or grow your business.
• Explore Different Ownership Structures: Establishing a trust, corporation, or limited liability company (LLC) to hold your intellectual property can add a layer of protection and help ensure that the IP is considered separate from marital assets.  However, be warry of putting any separate property asset into any LLC, lest you give away your separate property. However, exercise caution when placing a separate property asset into an LLC, as it may inadvertently result in relinquishing your claim to that separate property.
• Maintain Clear Records: Keep thorough and dated records of all business activities, especially those related to the IP. This can be crucial in proving ownership and value during divorce proceedings.
• Consult With an IP Attorney: Working with an intellectual property attorney can help ensure that you take the necessary steps to protect your business-related IP during and after the divorce.

Contact Goranson Bain Ausley to Protect Your Intellectual Property

Divorce is a complicated and emotionally charged experience, but it’s even more so when intellectual property and copyrights are at stake. At Goranson Bain Ausley, we understand the intricacies of family law and put our deep knowledge to work for each one of our clients, prioritizing what means most to them as we work towards helping clients secure their future. Our team of family law professionals is committed to providing solutions that protect your assets and ensure a fair resolution during divorce proceedings. Contact Goranson Bain Ausley today for a consultation and take the first step in securing the future of your hard-earned assets.

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About the Author

Ryan R. Bauerle is a skilled litigator and strong negotiator; he regularly obtains favorable settlements without ever stepping foot in the courthouse. Ryan works with clients to evaluate the pros and cons of their options, including costs, to make sound and efficient decisions about moving forward. Ryan is Board Certified by the Texas Board of Legal Specialization in Family Law. He is a Fellow of the prestigious American Academy of Matrimonial Lawyers and the International Academy of Family lawyers.