How Do Digital Assets Get Divided in a Divorce?

digital-asset-world.jpgDuring a divorce, a judge, a mediator or the parties will make decisions regarding how to divide the marital property, like the residence, the vehicle, savings accounts, and stocks accounts. But what about the couple’s digital assets, like their iTunes music library, MP3s, Kindle eBooks library, etc.? These assets aren’t exactly tangible, yet they may still be considered martial property subject to division during a divorce.

Digital assets are comprised of intangible goods such as digital books, music and movies. These are most typically stored in iTunes accounts or other MP3 storage accounts and Kindle eBook accounts. Digital assets can even include digital storage, social media accounts and blogs. These digital assets raise the question of whether they are subject to division during a divorce and whether or not they can be valued.

Although there is not much law on this subject, when it comes to the division of digital assets, many states will divide the digital assets using an “equitable distribution” system to divide, allocate and value these assets. The “marital property” will be assigned a value and then it will be distributed equitably, or fairly, between the spouses. Such division does not always result in a 50/50 split, but rather it is what is considered a fair split.

digital-asset-division.jpgHowever, just like a car cannot be split in half, neither can many digital assets. Additionally, unlike the ownership of a car which can typically be transferred quite easily to the other spouse, transferring ownership of digital assets is not always feasible. In fact, some user agreements do not even allow for transferring ownership. A judge’s ruling will not even supersede these user agreements. To resolve the issues that division of digital assets pose, the spouse who owns the iTunes and Kindle libraries may be awarded them, while the other spouse may be awarded a different asset in leui. Another option is for the spouse who is awarded the asset to “buy-out” the other spouse based on the value of the asset awarded to him/her.

Although the division of digital assets is a relatively new area of the law, as more digital products continue to develop, I suspect that divorce attorneys will see a lot more issues involving digital assets and thus a lot more law on the topic.

If you are considering a divorce from your spouse or have questions regarding the divorce process and your options regarding the division of digital property that you and your spouse have acquired, please contact one of our experienced attorneys. Nancy J. Bickford is the only attorney in San Diego County representing clients in divorces, who is a Certified Family Law Specialist (CFLS) and who is actively licensed as a Certified Public Accountant (CPA). Call 858-793-8884 in Del Mar, Carmel Valley, North County or San Diego.

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www.bickfordlaw.com