Patents and bankruptcy

[ExtraSlow]

Hey guys, anyone know what happens to patents owned by a company when that company goes bankrupt?

[Buster]

They will likely be sold as an asset by the receiver.

[ExtraSlow]

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They will likely be sold as an asset by the receiver.

Does anything change if it's a private company owned by a group of shareholders? Do they get any kind of first rights?

[Buster]

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Does anything change if it's a private company owned by a group of shareholders? Do they get any kind of first rights?

Secured creditors get first crack at proceeds. Unsecured creditors are next, and then shareholders are last. Doesn't matter if it's private or not.

Assets are sold so that these stakeholders can get the proceeds from a liquidation in an orderly fashion. Anyone can bid on the assets, so if there is a patent you want, just make sure you are talking to the receiver.

[ThePenIsMightier]

The patents I've been involved with are all registered to an individual within the company (I imagine) to protect it from an insolvency sale. I imagine there's a side agreement with that individual to play ball and not claim infringement of he/she leaves the company.

[Buster]

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The patents I've been involved with are all registered to an individual within the company (I imagine) to protect it from an insolvency sale. I imagine there's a side agreement with that individual to play ball and not claim infringement of he/she leaves the company.

that wasn't his question, though...lol

[ExtraSlow]

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The patents I've been involved with are all registered to an individual within the company (I imagine) to protect it from an insolvency sale. I imagine there's a side agreement with that individual to play ball and not claim infringement of he/she leaves the company.

That seems like it would cause more problems than it would solve. What's to stop the individual from selling the patent either while employed, or if they ever left that company? Seems really risky for the company to allow that.

I mean, the ones I've seen have individuals listed as "Inventors" but the "Applicant" and "Owner" are corporations. I guess either way is possible. I'm clearly not an expert, but trying to learn.

[ThePenIsMightier]

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that wasn't his question, though...lol

True, but it might be relevant in terms of who he thinks actually owns it with respect to Applicant, Inventor etc

[ExtraSlow]

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True, but it might be relevant in terms of who he thinks actually owns it with respect to Applicant, Inventor etc

Well Canadian patents have a named "owner". I think US patents use a different word, which escapes me right now.

[RX_EVOLV]

I can't imagine a company would invest in a technology based on patent(s) and they do not own. That's so high risk.

In most cases, the inventors would transfer the ownership to the company. Their name would still be associated was the patent application as inventors, but the owner would be the cooperation. Although the arrangement could also be a license agreement rather than ownership transfer. In that case the cooperation would not show up as owner in the patent application.

Getting a patent application to a granted status is very expensive, especially if it has relatively broad claims. The one patent we just got granted in the US took us 5 years and >$100K.

[ExtraSlow]

Anywhere that publishes patents (or other assets) being sold by the receiver? Canada or the USA? A couple competitor and supplier companies to my company are probably going bankrupt here in the next few months. Would be great to buy some distressed assets.

[ExtraSlow]

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Anywhere that publishes patents (or other assets) being sold by the receiver? Canada or the USA? A couple competitor and supplier companies to my company are probably going bankrupt here in the next few months. Would be great to buy some distressed assets.

Going to bump this thread because there are two companies in the USA that formerly supplied my business that I think will be entering some form of bankruptcy or creditor protection very soon. We are considering attempting to purchase the assets of these companies, but not sure the best way to monitor the situation so we are notified of the assets are being liquidated. In this case it's a mix of physical assets as well as some IP.

Any suggestions?

[The_Rural_Juror]

ExtraSlow turned corporate raider.

[ExtraSlow]

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ExtraSlow turned corporate raider.

The last 12 months have been a wild ride bro, and the wheels are still turning.....

[austic]

you could attempt to buy assets from them before they enter receivership? Once a receiver gets involved their options become more limited in how you can structure a deal. If the deal fails you can take a second crack at them once they are attempting to liquidate the assets which could take some time if its the states as I bet there will be a huge demand for receivers and the related legal services.

My advice would be get a NDA signed and try to get an accurate valuation done if they are interested in selling, If not it is going to take allot longer.

[Disoblige]

Isn't this just the corporate version of the happy hopping Honda dealer belly up thread?

[ExtraSlow]

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Isn't this just the corporate version of the happy hopping Honda dealer belly up thread?

Totally is.

[pheoxs]

I read the title as Parents and Bankruptcy and the only read the last few messages and was like. Fuck how'd you go from parents broke to lets scoop up some companies.

Much confusion was had.

[ExtraSlow]

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I read the title as Parents and Bankruptcy and the only read the last few messages and was like. Fuck how'd you go from parents broke to lets scoop up some companies.

Much confusion was had.

Well that's bringing up some awkward memories of my broke parents....

[pheoxs]

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Well that's bringing up some awkward memories of my broke parents....

Well this is awkward...