Where two organisations or individuals want to transfer IP between them, carrying out an assignment, it is tempting to assume that all that is needed is to “fill in the blanks” on a one-page template. This can be a dangerous assumption to make because there are a number of pitfalls to be aware of.
A common problem is that, contrary to what the parties may think, the assignor may not actually own the IP in the first place – even if it may think it does, looking back down the chain of ownership, title may never have been passed to it. This might be because a patent was applied for in the inventors’ names and the transfer of their rights to the company they set up was overlooked. Alternatively, that company may have acquired another business and hived up its assets but forgotten to put the assignments in place necessary for it to take legal ownership of those assets.
The assignee also needs to be aware of any third party rights over the IP. Is it actually co-owned? Is it subject to any licences or legal charges? Even if the assignor does not admit to any third party rights over the IP, they should warrant that the assignment is free from all such encumbrances.
Is any money changing hands? Even if the assignment is for no consideration, because IP rights are valuable assets there could be Capital Gains Tax liability or transfer pricing implications.
Finally, a common problem is that the parties sign an agreement providing that “X will assign Y to Z”. This, however, is not an operative assignment, only a statement of intent. The parties will still need to execute a further document to implement this agreement.
Seeking professional advice is therefore advisable even for seemingly simple transactions. Few people are cavalier when it comes to selling a house. Intellectual property rights can be even more valuable and deserve the same level of care.