Due diligence is paramount in any transaction involving intellectual property (IP), whether dealing with the buying, selling, licensing or franchising of IP. ELO recognizes the critical importance of conducting thorough due diligence investigations to assess the intellectual property assets and liabilities of target companies, particularly those in technology-intensive sectors.
A proper due diligence analysis involves a comprehensive examination of various aspects of intellectual property, including ownership, validity, and potential encumbrances. These results can be very useful in determining the propriety of a transaction and can often highlight potential issues that may require further analysis. ELO focuses on identifying any issues that could impact the transaction and work to address them proactively. This approach not only helps clients make informed decisions but also facilitates the formation of optimal business relationships.
ELO prioritizes several key due diligence considerations:
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1. Defining Critical Transaction Goals: Clearly defining the objectives of the transaction is essential to ensure alignment between the parties involved.
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2. Identification of Assets and Obligations: Meticulously identifying the intellectual property assets being acquired or sold, as well as any associated obligations or restrictions these may impose on the parties.
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3. Ownership and Validity: Conducting thorough searches to verify IP ownership and determine the validity of IP rights is crucial to protecting clients' interests.
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4. Assessment on Licensing and Restrictions: Assessing the presence of any cross-licenses or restrictive conditions that may impact the intended use of the IP assets in question.
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5. Evaluation of Patent Portfolio: Analyzing the target company's patent portfolio helps uncover any improvement patents or potential infringement issues.
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6. Litigation and Third-Party Involvement: Investigating whether the IP is subject to any ongoing litigation or infringement disputes, and assessing the involvement of significant third parties.
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7. Confirmation of Seller's Rights: Ensuring that the seller has the prerequisite legal authority to sell the IP rights in question is essential for a valid transaction.
Each transaction is unique, and ELO’s approach to due diligence is tailored to meet the specific needs and objectives of each client. Some IP assets may require more in-depth evaluation due to factors such as complexity, specific market competitiveness, or foreign registration.
ELO strives to provide clients with comprehensive due diligence services. From conducting searches and opinions to reviewing agreements and undertaking further investigative activities, ELO ensures that clients have the information they need to make informed decisions – contact the office directly for more information or schedule a consult today!
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