Analysts will find IPmetrics review of valuing IP in a bankruptcy context useful. As we have witnessed with other recent developments, using simple ratios and “rules of thumb” simply isn’t going to cut it anymore. “A specific audit” of the IP at issue is now required.
In corporate bankruptcy, many times the IP is the most fungible asset set for creditors. Sometimes IP is the only substantive asset. We are reminded of the bankruptcy of Tavern on the Green in New York City a while back. Auction sales of tangible assets yielded $3.5M, as over 1,000 bidders (collectors) participated. What is left, of course, is the name, which analysts at one time valued at nearly $20M! (The ownership of the name is being litigated.)