GLOSSARY
What is IP Due Diligence?
Understanding IP due diligence—the process of evaluating intellectual property assets in business transactions.
Definition
IP due diligence is the comprehensive evaluation of intellectual property assets (patents, trademarks, trade secrets, copyrights) conducted during business transactions such as M&A, investments, licensing deals, or IPOs.
When IP Due Diligence is Needed
- Mergers & Acquisitions: Evaluating target company IP assets
- Investment rounds: Assessing startup IP for VC funding
- Licensing deals: Verifying licensor's IP rights and portfolio quality
- IPO preparation: Validating IP disclosures for public offering
- Joint ventures: Understanding IP contributions and ownership
Key Areas of Patent Due Diligence
- Ownership verification: Confirming clear title and chain of assignment
- Validity assessment: Evaluating patent strength against prior art
- Portfolio quality: Scoring patents for breadth, relevance, and remaining life
- Freedom to operate: Identifying third-party patents that may affect the business
- Litigation risk: Assessing exposure to assertions and pending disputes
- Maintenance status: Verifying all fees are current
How AI Accelerates Due Diligence
AI reduces due diligence timelines from weeks to days by:
- Automatically scoring patent quality across large portfolios
- Identifying validity risks and prior art challenges
- Mapping patents to products and markets
- Generating comprehensive portfolio assessment reports