PRACTICAL TIPS CPAs can assist creditors and debtors in taking several practical steps to protect their positions: Conduct thorough due diligence. Verify the type of intellectual property involved, whether it is registered with or issued by a governmental office, and whether existing liens or encumbrances apply. For copyrights, confirm registration status. Use precise descriptions in both the security agreement and UCC-1 financing statement. Vague language like “all intellectual property” may be insufficient. Instead, identify specific patents by number, trademarks by registration, and copyrights by title and registration number. Employ a “belt and suspenders” approach. For patents, trademarks registered with the USPTO, or copyrights registered with the Copyright Office, file both the UCC-1 financing statement and record the security agreement with the applicable federal office. The cost of an additional filing is minimal compared to the risk of losing priority. Revisit filings periodically. Intellectual property portfolios change over time, and emerging asset types (such as AI-generated content) may require updated filings as the legal landscape evolves. CONCLUSION Perfecting a security interest in intellectual property is not a one-size-fits-all process. Parties should carefully identify and classify intellectual property assets before entering into secured transactions. Security agreements should describe collateral with specificity, and filings should be made in all appropriate locations to avoid gaps in protection. CPAs play a critical role in advising clients on the financial implications of these decisions and ensuring that secured transactions are properly reflected in financial reporting. When questions arise about novel asset types or complex portfolios, consulting with legal counsel familiar with secured transactions and intellectual property law is advisable. Kayla Helgoth and Roberta Christensen lead the Intellectual Property Practice Group at Koley Jessen, where they help clients establish, protect, and maximize the value of intellectual property assets. With experience ranging from trademark law and global brand management to intellectual property due diligence in M&A transactions, drafting and negotiating IP agreements, and perfecting security interests in both traditional and emerging IP assets, they advise businesses across the intellectual property lifecycle. They can be reached at kayla.helgoth@koleyjessen.com and roberta.christensen@koleyjessen.com. Banking tools backed by expert guidance Manage accounts, improve cash flow, and sharpen daily operations with tools backed by experts like Jan. She’s been helping businesses streamline their processes for decades, providing friendly, personalized service along with her knowledge. How can Jan help your business find the right tools and learn how to implement them effectively? Scan the QR code below or visit ubt.com/toolkit to learn more today. Jan > ubt.com/toolkit jan.sheridan@ubt.com | 402.323.1519 Member FDIC 15 nescpa.org
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