5. Is there a risk in transferring licensed IPR to a third party in anticipation of an insolvency?
Any time that an entity transfers assets to a third party prior to or in anticipation of a bankruptcy filing, there exists a risk that the transfer can be avoided (clawed back) as either an actual or constructively fraudulent transfer under U.S. bankruptcy or applicable state law. Avoiding (or clawing back) a transfer of property as a constructive fraudulent transfer requires a formal legal proceeding in which the plaintiff debtor (or trustee or, in certain circumstances, a creditor or creditors' committee) proves that the debtor (1) did not receive reasonably equivalent value in return for the assets transferred or obligations incurred and (2) either was (a) insolvent at the time of the transfer or the incurring of the obligation, (b) became insolvent as a result of the transfer or the incurring of the obligation, (c) intended to incur, or believed it would incur debts beyond its ability to pay as such debts matured, or (d) was engaged in a business or transaction for which any property remaining with the debtor was an unreasonably small capital.