Intellectual Property in Corporate Agreements

In every business transaction, whether readily apparent or not, there exists an element of intellectual property (IP). The Intellectual Property Group at Crain Caton & James works closely with our colleagues in the Corporate, Business Transactions, and Tax Groups to identify and address potential IP issues that may arise in the course of a deal.

In the context of mergers and acquisitions, it is common for assets such as patents, trademarks, copyrights, and trade secrets to be involved, often spanning both domestic and international markets. Identifying these assets, understanding ongoing maintenance obligations, addressing chain of title concerns, and assessing the transferability and scope of any licenses are essential steps in the process. Properly drafted documents—such as assignments or amendments—may be necessary to facilitate the transfer of IP, ensuring that all rights are properly recorded with the appropriate governmental authorities.

Franchising, by its nature, involves the licensing of trademarks and protection of trade secrets. A franchise agreement’s core purpose is to grant the franchisee access to the franchisor’s brand and proprietary information. Our Intellectual Property Practice Group is adept at addressing these needs, ensuring that the IP provisions in such agreements are comprehensive and enforceable.

Agreements with vendors, sellers, and other third parties require careful consideration of IP ownership. In particular, it is critical to ensure that any intellectual property resulting from the agreement is clearly allocated and that indemnity provisions are in place to protect against potential infringement claims. Without clear ownership of any resulting trademarks, know-how, inventions, or other intellectual property, the client risks not securing the full value of the transaction. Moreover, in transactions involving patented technology, the end user may face liability for infringement, even when using that technology as part of a larger system. Thus, ensuring that indemnification provisions are carefully crafted is essential to limit potential exposure.

Similarly, employment agreements and contracts with independent contractors must be carefully structured to ensure that any intellectual property created during the course of employment is properly assigned to the business. Our Intellectual Property Practice Group works with clients to establish clear ownership and protection of intellectual property, whether it be trade secrets, brands, artistic works, or patented technologies. Establishing sound practices for IP protection before it is created is always preferable to trying to rectify ownership or protection issues later.