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Who owns IP/Patent rights in a General Joint Venture Agreement?

Dallas, TX |

1. Is a JV agreement null and void if one Managing Member intentionally lets the JV got into forfeiture without notification to the other JV partners?
2. Who owns IP/Patent rights that resulted from the General JV Agreement if said JV only details distribution of investment funding, debts and profits, saying nothing about product assets?
3. If a Managing Venturer that asks for a greater percentage of ownership in the JV in exchange for greater investment, but does not document it or reveal the JV LLC is in forfeiture, does that agreement stand?
3. Can a Managing JV with majority % give a percentage of his shares to a new investor without the knowledge of the other JV members?
4. Can a Managing JV partner with majority % block the other JV partners from the IP/Patent Pending assets?

Attorney Answers 4

  1. As far as the ownership of patents, there are many factors that can affect ownership. First, the inventor may own the patents, if she did not execute an assignment to the JV. If the patents were properly assigned to the JV, they will remain the property of the JV until it is wound down and the assets are disposed of. Generally, the JV will have provisions in its operating agreement that address how it is to be wound down, and the majority member [block] will have control of the wind down process. However, minority members must receive fair market value for their stakes - I have handled a number of cases where a majority partner attempted to transfer patents out of a partnership or LLC without paying fair compensation, and obtained some nice settlements. It is almost always easier for the majority holders to deal fairly with the minority from the get go.

    As far as the other issues you raise, you have a number of detailed issues that, quite honestly, would take many hours to research and provide a clear answer for. You will need to speak with an attorney that is well versed in partnership issues in Texas.

    Good luck!

    This answer is not a substitute for professional legal advice. This answer does not create an attorney-client relationship, nor is it a solicitation to offer legal advice. If you ignore this warning and convey confidential information in a private message or comment, there is no duty to keep that information confidential or forego representation adverse to your interests. Seek the advice of a licensed attorney in the appropriate jurisdiction before taking any action that may affect your rights. If you believe you have a claim against someone, consult an attorney immediately, otherwise there is a risk that the time allotted to bring your claim may expire.

  2. You ask a number of very complicated questions that cannot be answered simply by email. Since we are both in Dallas, and my firm has a lot of experience with these issues, I would welcome the opportunity to set up a no fee consultation to give you guidance and set forth your options. We would be happy to represent you once we are certain that we don't already represent another party to these transactions, as is required for any ethical lawyer before answering these questions.

  3. While I cannot give you legal advice in this forum, I believe your question is far to complex to handle is they type of forum. The answers will depend upon many factors, including the exact language of the JV Agreement and the type of IP involved. The answer could vary and differ if dealing with copyrights or transcripts or patents.

    Your really should discuss this with a local IP attorney.


  4. It sounds like you have many claims for breach of fiduciary duty against the managing member. You need to consult with legal counsel as soon as possible. You may believe that you do not have sufficient funds, but there may be lawyers who are willing to take on a project like this on a contingent fee basis. Further, if the managing partner has wrongfully converted assets of the joint venture, you may wish to report this to the State attorney general's office or, if the managing partner is a lawyer, the Texas bar association. There is simply no substitute in a situation like this for retaining and consulting with counsel.

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