Also known as: incorporeal properties · intangible property
Written by attorneys — see sources below.
A category of property consisting of intangible rights and interests rather than physical objects. Such interests include contractual rights, intellectual property, publicity rights, and unclaimed financial assets that carry economic value.
Infinity Bank approved issuing shares to Igor Ito for partially completed software modules, a six-month maintenance contract, and an unsecured promissory note. The board determined the package adequate before issuance. Igor received fully paid shares because the statute treats the intangible items as valid consideration.
Isabella Ingram's estate claimed that Universal Pictures exploited her late father's distinctive Dracula portrayal without consent. The court recognized the right of publicity as a transferable property interest that survived death and could be enforced against unauthorized commercial use.
Bela Lugosi and Universal Pictures Company, Inc. concluded an agreement in September 1930 for the production of the film Dracula in which Lugosi contracted to and did play the title role. Paragraph 4 of the agreement granted Universal the right to photograph and exploit in connection with the photoplay any and all of the artist's acts, poses, plays and appearances and the right to use and give publicity to the artist's name and likeness in connection with the advertising and exploitation of the photoplay. Lugosi died in 1956. Commencing in 1960 Universal entered into many licensing agreements which authorized licensees to use the Count Dracula character in connection with the sale of commercial merchandising products such as plastic model kits, masks, posters, candy dispensers, T-shirts, and beverage stirring rods. The licensing agreements specifically authorized the use of Lugosi's likeness from his portrayal of Count Dracula in Dracula and Dracula's Daughter. On February 3, 1966, Lugosi's widow Hope Linninger Lugosi and surviving son Bela George Lugosi filed a complaint against Universal alleging that they were the heirs of Bela Lugosi and that Universal had appropriated property which they had inherited from Lugosi and which was not embraced in paragraph 4 of the 1930 agreement. The complaint sought damages, an accounting of profits, and an injunction against further licensing without their consent. The trial court found that the essence of the thing licensed by Universal was the uniquely individual likeness and appearance of Bela Lugosi in the role of Count Dracula. It concluded that Lugosi had a protectable property right in his facial characteristics and individual manner of likeness and appearance as Count Dracula that descended to his heirs under his will. The court awarded plaintiffs $53,023.23 in damages for licensing agreements executed after February 3, 1964, and issued a permanent injunction against further unauthorized licensing of Lugosi's likeness as Count Dracula on commercial products. Universal appealed. The Supreme Court of California granted a hearing, conducted an independent study of the issues, and adopted the opinion of the Court of Appeal, Second Appellate District, as its own after appropriate deletions and additions.
View caseWest River Bridge Company held a toll franchise granted by the state. When the state condemned the bridge and franchise to build a free crossing, the court treated the franchise as incorporeal property subject to taking with just compensation.
In 1795 the Vermont legislature created the West River Bridge Company as a corporation. It granted the company the exclusive privilege of erecting a bridge over West River within four miles of its mouth together with the right to collect tolls for one hundred years. The company constructed the bridge, maintained it, and collected tolls until the proceedings that gave rise to this litigation. On November 19, 1839, Vermont enacted a general statute empowering county courts to lay out highways and assess damages to landholders. A companion statute declared that the Supreme and County Courts could take any real estate, easement, or franchise of any turnpike or other corporation when the public good required a public highway. The same compensation rules used for private property applied to such takings. Joseph Dix and others petitioned the Windham County Court. That court entered judgment establishing a public road that passed over the West River Bridge. The judgment converted the bridge into a free public highway and awarded compensation to the company for the appropriation and extinguishment of its franchise. The company removed the judgment by certiorari to the Supreme Court of Vermont, which affirmed the county court's decision. While the law proceeding was pending, the West River Bridge Company filed a bill in the chancery court of the first judicial circuit seeking an injunction against the highway proceedings. The chancellor sustained a demurrer and dismissed the bill. The Vermont Supreme Court affirmed that decree on appeal. The company prosecuted two writs of error to the United States Supreme Court from the Vermont Supreme Court's judgments, one arising from the law proceeding and one from the equity proceeding, both brought under section 25 of the Judiciary Act.
View caseDelaware and New York disputed custody of unclaimed securities dividends held by brokers. The Court held that the state of the owner's last known address may escheat the intangible property because it is located at the owner's domicile.
Delaware initiated this original action against New York in 1988 after New York escheated substantial sums from unclaimed securities distributions held by intermediaries. The Supreme Court granted Delaware leave to file its complaint and appointed a Special Master to oversee the proceedings. Texas subsequently moved to intervene as a plaintiff, and all remaining states along with the District of Columbia sought leave to participate as intervenors. The property in dispute consists of unclaimed dividends, interest, and other distributions on securities that intermediaries such as banks, brokers, and depositories hold in their own names as record owners for beneficial owners who cannot be identified or located. These street name arrangements allow for efficient book-entry transfers and customized financial services, with most New York Stock Exchange equity securities immobilized in depositories. Between 1985 and 1989, New York took custody of $360 million in such funds from intermediaries doing business within the state, applying its abandoned property law without regard to the beneficial owners' last known addresses or the intermediaries' states of incorporation. On January 28, 1992, the Master filed his report and recommendation. Delaware and New York both filed exceptions to portions of the report, as did several other parties whose intervention motions remained pending at that time. The Master’s report concludes, first, that the issuer of securities is the relevant “debtor” and, second, that the State in which the debtor’s “principal executive offices” are located should be considered the debtor’s State. The procedural history includes the Court's grant of intervention to Texas in 1989 and the subsequent filing of exceptions by multiple states after the Master's report. All pending motions to intervene were ultimately granted by the Court in conjunction with its resolution of the exceptions.
View caseIncorporeal property consists of intangible rights such as contractual obligations, intellectual property, and publicity rights. Corporeal property consists of tangible physical objects. Prescription creates title to incorporeal rights while adverse possession creates title to corporeal land.
Yes. A board may authorize shares for any tangible or intangible property or benefit to the corporation, including contracts for future services and intellectual property, provided the board determines the consideration adequate.
Yes. Courts recognize a protectible property interest in the commercial value of a person's likeness that can be assigned and enforced against unauthorized exploitation even after death.
Intangible property such as unclaimed securities is located at the domicile of the owner, so the state of the owner's last known address holds the right to escheat.