Your Legal Epitaph: Why the Standard Will Fails Your Intellectual Property Legacy

So why is the standard will, drafted by a general attorney, insufficient to properly transfer patent and trademark ownership?

It comes down to three legal concepts:

1. Bequest vs. Assignment: A will can bequeath (give) property, but patent, registered trademark, and registered copyright transfer require a specific Assignment Document filed with the USPTO or the Copyright Office. Without the specific authority granted to the executor or a named successor to file that document, the transfer can be delayed or rejected. Worse, if the executor or heir doesn’t know the assignment document needs to be filed, the ownership is stuck in legal limbo.
2. The LLC Operating Agreement (and Partnership Agreements and Corporation Bylaws): These are the documents that truly dictate the fate of a business. If the IP is owned by the LLC, the Operating Agreement dictates what happens with the IP upon your death. Specifically, it determines who inherits your share of the company and its assets. The will cannot override the Operating Agreement. If that agreement is silent, your heirs could be forced into a partnership with people they don’t know, or worse, the business could be legally dissolved. These principles apply to partnership agreements and corporation bylaws as well.
3. The License: If you own the IP personally and license it to your business or another business, who inherits the rights to the IP when you die? Does the license provide that your heirs inherit it, does it say the management of renewal transfer to the licensee and your heir just receives royalties, or does it state that the IP ownership will transfer to the licensee? If the license rights go to your heirs, will they know how to manage the IP properly, and will they be willing to renew the license as needed? The license needs to address these issues so the IP ends up in the right hands.