Valuation of IP

I Have Been Focused On IP Valuation…

… A lot lately, especially when it comes to estates. (No, nothing wrong with me or Kris, just sort of waking up in this new indie reality.)

You see, when I came out of traditional publishing, the value of my couple hundred short stories and few novels (all the rest were work-for-hire or media) was not enough to hurt anyheir who got it when I died, even with a simple will situation.

So I didn’t give it much thought past putting all the basic estate stuff in place. Which we did. And updated it fairly regularly.

Then one day I sort of started playing with copyright valuation and realized my situation had changed a ton in the 15 years of indie. I now owned all my own copyright and had written a hundred more novels, published hundreds more books, and written three hundred more short stories, and all of it was in print and earning.

All of it had future value.

Plus the company I was half owner of had gained a lot of value in copyright (not mine or Kris’s) and the value was high enough with even a very conservative valuation that it would exceed both Oregon’s and the Federal levels if it had to go straight into probate if something happened to me and Kris. Oh, oh…

Nevada does not have an estate death tax, but Kris and I would be way over the Federal limits on our personal stuff if we didn’t act.

So we are fixing the problem, and don’t worry, we have a great IP attorney and great estate attorney and an accountant on the task. Not a simple task, but a fixable one.

But I was surprised at myself that even though I was paying attention to IP valuation overall, I had not applied it to myself and Kris and WMG until just lately. And not even counting the trademark and brand valuation either. That will take some expert advice there.

So indie writers, keep in mind we are in a new world. Unlike traditional, where basically books died quickly and had little to no IP valuation except on the corporate spreadsheets, we now keep all our own IP and future earnings valuation (most common for Copyright) can stun you if you have a lot of work, and it is all in print and earning. It might not be much per project, but wow does it add up.

And thus, if you don’t get it taken care of right, it can really hurt your heirs and more than likely kill any hope of your work earning anything after your death.

Just saying…


  • Vincent Zandri

    Thanks Dean. Everytime I see one of these posts it gives me agida since I haven’t done anything about IP. Hey, I just turned 59. I’m gonna live forever! Not! Right now under indie I have about 100 products half of which I can multiply by three considering eBook, paper, and audio. Plus by end of year I’ll add another 20 to 25 products. Next year I’ll easily hit 200. I have three kids and two ex wives. Time to see a lawyer!

      • C.E. Petit

        I somewhat disagree, Dean. An IP lawyer and an estate lawyer isn’t enough.

        They have to talk to each other. They can’t work completely independently. That way lies…

        Horadam v. Stewart (In re Estate of Norton), No. M2007-46-COA-R3-CV (Tenn. App. 06 Oct 2008) (PDF available at ; discussed in relevant part at )

        which epitomizes what happens when “lowest current tax burden” is allowed to overcome every other legal and business consideration (not to mention creative or, ya know, respect for coauthors).

        One of the fundamental problems with the legal profession is that it simultaneously (and rather arrogantly) proclaims that with a law license, one can practice any kind of law at all†, but in fact is far more specialized than even medicine (“ENT specialist who only works on the left side of the throad” is very much equivalent to “worker’s comp defense” and “DUI defense” and “plaintiff’s slip-and-fall”). And that de facto specialization often amplifies any failure to communicate — and having read Ms Norton’s “will” and the related documents, there was plenty of that to blame on ALL of the lawyers involved. It’s one thing, bad as it is, to have a “failure to communicate” through misunderstandings; it’s another entirely to not even try (which, as to several of the counsel involved in Ms Norton’s commercial/care/estate “plans,” is IMNSHO what happened‡).

        Last, and far from least, a follow-on from an implication of the conversation: Valuation for tax purposes IS NOT AND NEED NOT BE the same as valuation for commercial (or creative!) purposes. Just because the various tax authorities and probate courts demand a single, defensible valuation based on some evidence (almost entirely past performance, notwithstanding the SEC’s admonition that past performance does not predict future results for securities!) doesn’t mean that the intangibles of “good will” and relationship of past works to completed-but-not-yet-published works is meaningless for actual planning. Consider, for example, the “bump” that the first and second book in a series often receive upon publication of the sixth, as readers encounter good reviews/word of mouth for that sixth book and/or read it themselves and want to go back to the beginning: This would be utterly rejected in the tax valuation context, and utterly necessary to determining how much to charge a third party for a licensing fee.

        tl;dr There’s more than one “valuation” at issue. “Tax valuation” is a necessary one, but far from the only one.

        † Except patent applications, but that’s for another time. And if you think the slush pile at Pulphouse in the early 90s was filled with bad writing, try a patent application…

        ‡ I did not appear, but was consulted by several coauthors (and one counsel for an interested party who later pulled out) who were entangled in it. Further details are confidential; I will, however, say that this is far from unique. And far from the worst (how’s that going, Mr Clancy’s estate?).

        • dwsmith

          Thanks, CE… Well over 95% of the readers heads here, and I agree completely with different valuations for different reasons. (And pretty much everything else you said as well.) My goal is to just get writers paying attention, first, and second understanding that valuation even exists, with luck before it bites them.

          So thanks!! Great stuff.

  • Kate Pavelle

    Dean, I know youl have some courses on IP valuation but the legal landscape has changed a bit in this regard over the last few years. I’ll have to watch it again and see what I missed. I’d be curious whether you are seeing definite directions in these patterns yet?

    • dwsmith

      I am doing Bite-Sized Copyright class right now, all year, four videos per week, and a bunch on this topic.

      Trend is to be far, far more strict on the money side, meaning undervaluing is not happing much these days. And courts, all courts, especially estate courts now pay attention to value of copyright and don’t let it slip through.

      Also, in banks and other financial places, copyright and other forms of IP is being valued on company balance sheets.

      What has really changed is the indie movement in books. Books used to go to the bottom lines of major corporations and had little to no long-term valuation. Not now. A book even earning coffee money at the moment can have a massive longer term valuation because of the potential of movies and games and other forms of licensing.

      So all changing, and not so slowly.