Virtually here today, virtually gone tomorrow
I came across a really fascinating legal issue the other day that I had never stopped to think about and thought that I should share it with you – the inheritance of digital assets. If like me, you have a library at home where you can retreat with a drink in the evening, sit in your comfy chair by the fire, and delve into a good book, there will be no question that these books will eventually be inherited by whoever you have in mind (or rather in your will) (whether or not they then end up in a charity shop).
But today, things like books, music and photos are increasingly stored in electronic form by users if they are not streamed in the first place. The notion of digital assets goes further and also includes ‘things’ such as social media, games and e-mail accounts and profiles, or virtual identities and credits in games worlds. Some of these assets can have (sometimes significant) monetary value, sometimes they are of purely sentimental interest to friends and family. What happens to these Kindle books, i-tunes music collections and other digital assets if the ‘owner’ passes away? Are the executors (and ultimately the beneficiaries) entitled to access the deceased’s Facebook account or photos stored in the cloud?
Many of these assets, in particular, music, e-books and videos, do not actually form ‘property’ of the deceased in the first place, do not fall into the estate, and therefore cannot be transferred on death. As the licence agreements, end user licence agreements or terms and conditions of use of these platforms invariably make clear, you do not acquire ownership rights in such content but only a personal non-transferable user licence which (as a matter of IP law) ends on death. Indeed, most user agreements do not even mention transmission on death. For the lawyers amongst you, there will be interesting legal and jurisdictional issues, such as the question whether English or Californian law applies as lex situs to the digital assets held by an English person who passed away in England but which are located on a server in Silicon Valley, and whether they are moveable or immovable, tangible or intangible property but that all gets a bit technical.
Gregor Kleinknecht, Partner
Read the full article in Discover Germany’s February 2018 issue on page 89 here and a PDF here.