Bankruptcy of Authors, Artists and Musicians

The bankruptcy of authors is not any different from any other bankruptcy except for the fact that authors have intellectual property rights to books.

Unless the book is selling, it has no significant value to a bankruptcy trustee, so the intellectual property rights are normally abandoned. Conversely, if the book is selling, the author does not have to file bankruptcy.

The same is true for artists and musicians whose work is not selling: file before it starts to sell. Of course with artists, each new work is a separate asset, and no painting that is painted after the filing of a Chapter 7 will be lost to the bankruptcy estate.

Otherwise, intellectual property rights and paintings that cannot be exempted will be lost. The trick is to know in advance what will be lost and what will not - and how to preserve as much assets as possible.

Charles Chesnutt