Attorney
Knowing what assets you have on your balance sheet is part of being a business owner. You could probably do a back of the envelope estimate of your company’s current value in just a few minutes if you really needed to.
But if you are like many of the Albuquerque area business owners that Attorney Bob Matteucci has had the honor of representing during a divorce or other family law dispute, there may be one significant asset you are overlooking: your intellectual property.
Intellectual property or IP — like patents, trademarks, copyrights, trade secrets, proprietary processes, or even client lists — are, in many cases, the most valuable things you have never thought about putting a price on. If you are getting divorced, that’s about to change because your soon-to-be-ex is about to demand their fair share.
An Invisible Asset
Unless you have gone to the trouble of obtaining a patent or trademark, you may not realize you own any intellectual property. But there are few businesses in this world that do have some IP sitting on the back shelf.
It could be your brand — a name, a logo, a voice. The one potential customers recognize before they even need your services. Maybe it’s a medical practice with a reputation that took fifteen years to earn. Or it could be the methodology and business practices your firm uses. The ones that keep clients coming back. These things have market value even if you have never included them on your balance sheets.
This oversight often crops up in divorce cases thanks to New Mexico’s community property laws. These laws presume that assets acquired during the marriage, or that have increased in value during the marriage, belong equally to both spouses.
That presumption doesn’t stop at the tangible. If your brand was built during the marriage, if your proprietary process was developed while you were married, if the patent you obtained before marriage increased in value during the marriage, it’s likely community property, and it must be divided 50/50 during a divorce.
How Do You Divide Up an Idea?
Dividing up your IP 50/50 sounds daunting. Are you going to take the trademark while your ex walks away with the logo? No. Physically dividing these assets is typically impossible. And when it is possible, the division often diminishes their utility.
So, what usually happens is the IP is valued as part of the business, and that amount is divided 50/50 while the business assets remain intact. One spouse often retains full ownership of the IP and the business it anchors, while the other receives an offset elsewhere in the marital estate: a larger share of retirement assets, ownership of the family home, or a structured buyout akin to one any other business partner who wanted to walk away from a company might be offered.
Putting a Price on All Your Hard Work
Valuing IP is not simple. It typically requires working with a forensic accountant or IP valuation specialist, and the methodology varies depending on what kind of IP is involved. A trademark is valued differently than a patent. A proprietary client management system is valued differently than a trade secret embedded in a manufacturing process.
This is where Attorney Matteucci’s background as a business owner (and his MBA degree) come in handy. Bob knows what questions need to be asked to identify IP, and what methods are typically used to put a dollar figure on it. He’s not afraid to get into the financial weeds, and he’s not going to be pushed around by assessors or accountants who think they are on an episode of The Price is Right.
Serving Families With Dignity & Compassion
If you own a business, hold a professional license, or have built something with lasting value during your marriage, you have intellectual property. Bob is ready to help you figure out what it is and how to put a price on it so you don’t get caught off guard at the negotiating table.
There is a way to divide IP up that preserves its usefulness while allowing you and your spouse to move forward. Contact the Matteucci Family Law team today to schedule a meeting and start taking an inventory of this valuable hidden asset.