California is what is known as a community property state. This means that family law judges are generally required to divide marital property equally in divorce cases even if doing so would not lead to an equitable outcome. This may seem particularly unfair when marital estates include intellectual property that was created by one of the spouses with little or no input from the other.
Separate property
Only assets acquired during a marriage are part of the marital estate and subject to division in a divorce. This means that the royalties from works that were created by one of the parties before the marriage are not divided as they are considered separate property. However, matters can become nebulous when separate assets have become comingled. This could happen when royalties were deposited into a joint bank account or marital funds were used to promote copyrighted works.
Future earnings
The issue of intellectual property in a divorce was addressed by the California Supreme Court in a 1987 case involving an author of trivia books. The royalties were divided because the books were written during the marriage. After the divorce was finalized, the author filed a lawsuit against a copyright infringer after learning that his work was being used without permission. His former wife then initiated litigation of her own to ensure that she received a share of the damages. The author lost his lawsuit, but his former wife prevailed.
Prenuptial agreements
Experienced family law attorneys could explain that entering into a prenuptial agreement gives a couple the opportunity to decide for themselves how their assets will be divided if their marriage ends in divorce. When drafting these agreements, attorneys could list separate assets that should not be divided and include provisions to ensure royalties and other future income is divided equitably.