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Required IP audits will make in-house lawyers pull their SOX up

How much legal work for in-house IP lawyers does SOX mandate? I have paraphrased from a recent Metropolitan Corp. Counsel article by Marc Friedman, a partner at Sills Cummis Epstein & Gross:

All publicly held companies must conduct regular audits – at least annually – of their IP assets, and report material changes. They must determine what intellectual property exists, what its strengths and weaknesses are, and what changes have transpired since the last reporting period. IP assets include not only granted patents, trademarks, URLs, and copyrights, but also trade secrets and, arguably, IP or know-how not yet subject to governmental certification.

I am reminded of the SEC’s requirement that oil companies recalculate the viability of their reserves each year. Likewise, monitoring the IP inventory and all its difficult estimations of change in value portends burdensome work for in-house IP lawyers and higher fees to IP external counsel. [See my post on March 11, 2005 about SOX and law department structure.]