I’m pretty sure everyone has ideas – What should I do today? What’s for dinner tonight? What’s the best way to get to work this morning? For everyone, there’s a “laundry list” of ideas every day.
But are those ideas “assets”?
Thomas Edison invented the lightbulb.
Alexander Graham Bell invented the telephone
Henry Ford invented the assembly line.
Those inventions are “ideas”. But those inventions, in and of themselves, are not businesses. Tom, Alex and Henry were the “businesses”. Like most entrepreneurs, they sold themselves and built mostly-successful industries (GE, AT&T and Ford Motor Company). However, it’s important to note their successes was based on their ideas. So, while their ideas are intangible (you can’t touch or feel them), their ideas were the assets from which Tom, Alex and Henry built their legacies.
If you were in their shoes, don’t you think those ideas should be protected?
As an example, what would happen if Alexander Graham Bell stepped into the late 1970’s and invented the Commodore 64? He originally got a lot of investors involved (“this will revolutionize home entertainment”) but the Commodore 64 never really takes off. His investors are understandably upset, want their money back and sue Bell for everything he has, including the telephone. Without proper planning and protection, he loses his rights to the Commodore 64 ANDhis original invention, the telephone – his creditors now own it.
Now what?
This situation could have been averted with PROPER PLANNING.
In my previous life, I was an attorney in Portland, Oregon. We represented a very well-known author who had published multiple works in the 1970s. I can’t disclose the name of the author but the works were famous during that time. We recommended and implemented a plan so that the author was able put each title into separate limited liability companies for liability protection and potential tax savings.
But WHY?
Well, what happens if the book includes a statement or thought that one person, several people or a multitude of people disagree with? The First Amendment may protect the book (‘freedom of speech”), but you may still have defend against a lawsuit. Or, what happens when one of the titles gets made into a movie? If the movie does well at the box office, then everything’s OK – the stars, movie studio, and investors are more than happy. But what if the movie doesn’t do well? The studio’s investors get involved and they want their money back.
Nowadays, people take the “shotgun” approach to litigation – shoot at every target and we’ll see what sticks.
Is it fair to the author? NO! But it happens (far more than you realize). So, how do you protect the idea?
With PROPER PLANNING.
Businesses succeed or fail based on how the business of producing or promoting a product (tangible or intangible) is operated. However, the IDEA is still there. How do you protect something that directly comes from you? E-mail me at info@browntaxplanning.com or call me at (360) 292-4556 for details on how to protect your valuable intellectual property.
