Recommended
More Related Content
What's hot
Viewers also liked
Viewers also liked (18)
Similar to Protecting Preserving and Passing Your Digital Estate (2)
Similar to Protecting Preserving and Passing Your Digital Estate (2) (20)
Protecting Preserving and Passing Your Digital Estate (2)
- 1. KC Marie Knox, Esq. (818) 501-5800 ext. 150 kknox@ahslawyers.com Protecting, Preserving and Passing Your Digital Estate
- 2. Do Digital Assets Have VALUE? Financial Value Average estimated value = $55,000 Emotional Value Avoid losing the decedent’s story Administrative Value Avoid loss to the estate (unclaimed assets, late fees, penalties)
- 3. What IS a Digital Asset? Information created, generated, sent, communicated, received, or stored by electronic means on a digital device or system that delivers digital information. The term includes a contract right.
- 4. OK, Really? What IS a Digital Asset? Intellectual Property The internet allows authors and artists to communicate their work digitally and at death, the original work (or works in progress) may only be available as a digital file on a computer. Blogs – Many bloggers have transformed their “virtual” popularity into book deals, television shows and even movies Audio & Video – The 25 billionth song was downloaded from iTunes in 2013 Books – Authors can bypass publishing houses and publish exclusively online Twitter, Facebook, Myspace Business Accounts
- 5. OK, Really? What IS a Digital Asset? Online Accounts A third party allows the account-holder to maintain an individual account containing personal information.
- 6. OK, Really? What IS a Digital Asset? Virtual Currency Definition from the Financial Crimes Enforcement Network “A medium of exchange that operates like a currency, but does not have all the attributes of real currency. For instance, virtual currency does not have legal tender status in any jurisdiction. Convertible virtual currency either has an equivalent value in real currency, or acts as a substitute for real currency.” 1. Cryptocurrency 2. Videogame Currency 3. Online Sales 4. Loyalty Program Benefits
- 7. 1, 2, 3, 4…Plan 1. Identify 2. Appoint 3. Grant 4. Instruct
- 8. Identify the Digital Assets Make a list of locations where digital assets may exist Computer Which computer and which drive External Media Storage Devices CDs, DVDs, Flash Drives, External hard drives Online Email accounts Social Media/Networking/Photo/Hobby accounts Online bank accounts Online/Cloud Storage accounts Make a list of the passwords for each digital asset
- 11. Finances
- 13. Debts
- 14. Utilities
- 16. Shopping/Loyalty
- 17. Other
Editor's Notes
- 2011 United States Census – 75.6% of all Americans own a computer (89.9% of Americans with bachelor’s degrees or higher own a computer) 85% of all American adults use the internet…of that 72% use social networking sites and 46% post photos or videos Financial Value – Digital currency, scientific data, personal blogs, advertising revenue, unpublished works of art, trade secrets Emotional Value – Example (Mother wanted access to her son’s blog and email after he passed away…he was stationed in Afghanistan and would regularly post…huge memory for her) Administrative Value – Example (Our client…mother of son who “went green”…the digital files may be all there is to see where her son banked, held stock, owed creditors, etc.)
- Importance of including digital assets in your estate plan: Privacy concerns (there may be some data, files, photos, that you do not want to be placed in the wrong hands after your death) Preservation concerns (valuable items may be lost forever) Access concerns (fiduciaries can access information that may be difficult if not impossible to recreate after death…gives ability for seamless management of business and financial accounts) Fraud concerns (according to AARP, almost 800,000 deceased persons are deliberately targeted for identity theft) Digital device: an electronic device that can receive, store, process, or send digital information
- -Digital information may include works subject to copyrights, trademarks, patents and rights of publicity. This is not to say that there may not be restrictions on these digital assets…many are governed by some “License to Use” -iTunes, Kindle, World of Warcraft have a box to click that you agree with the terms and conditions, which everyone clicks, but no one reads…typically the terms and conditions provide a right to use the property for specific purposes -License agreements may not include the right to gift or bequeath the licensed property (e.g. Kindle prevents users from selling, renting, leasing, distributing, broadcasting, sublicensing or otherwise assigning any rights to the Kindle content Business Accounts may store customer information databases (names, addresses, credit card numbers, order history, pending orders); Inventory; Client records; Patient records
- Restricted ownership rights – the account-holder owns the rights to the content within the account, but there are limits by the third party as to the manner of access to the account. Domain Names – webservers are identified by an IP address, the domain name is linked to the IP address and is used as an easy to remember alternative -unused domain names can be registered and resold Vacationrentals.com – sold for $35 million in 2007 Insure.com – sold for $16 million in 2009 Sex.com – sold for $14 million in 2010 Beer.com – sold for $7 million in 2004 Giftcard.com – sold for $4 million in 2012 Toys.com – sold to Toys R Us in 2009 for $5.1 million Fb.com – sold to Facebook in 2010 for $8.5 million
- Examples of cryptocurrency – created in 2008, Bitcoin is a form of decentralized currency maintained by peer-to-peer transactions. Initially sold for 10 coins for a $1…recently climbed to a value of close to $700 per coin Videogames – videogame currency allows a gamer to enhance the game playing experience by acquiring assets or benefits in the game world… Online – any account in which a person sells items over the internet (e.g. eBay, Craigslist, Amazon) Loyalty – frequent flyer points, credit card cash back or reward points, business points, discounts or vouchers
- Make things easier for your family when you die or become disabled Death – 100% guarantee Disability – 60% chance of becoming disabled for greater then 90 days Before getting to the plan, there are obstacles that will stand in the way of planning digital estates 1. Safety (computers and documents can be stolen, encryption can be broken and internet storage can be hacked 2. Hassle (information changes rapidly, accounts are opened and closed, passwords changed, new computers bought and sold 3. Uncertainty (afterlife companies, websites may not be reliable or exist in the future) 4. Potential legal or contractual limitations
- Location of information and whether passcode protected Email – Google, Yahoo, Outlook Social Networking – Facebook, Google+, LinkedIn MicroBlogs - Twitter Photography – Instagram, Shutterfly, Picasa Hobby – Pinterest, Myspace Online banks – not all banks are brick and mortar (e.g. ING, Ally Bank, Bank of Internet USA) – make a list of these and the brick and mortar banks that you access online Cloud storage – Dropbox, JustCloud.com, myPCBackup.com Ignore the little voice in your head that says to never write down a password for fear of someone else finding them and accessing all your accounts. Without the passwords, a fiduciary will be forced to guess (which may lead to a lock-out) or go to a potentially expensive security consultant to override the protections The password list should be kept in a safe location, but accessible to fiduciaries or family members…this may be the time to use that safety deposit box Can store on-line …upside – only need to know one password that would then allow access to the entire list downside – the sites holding the information may not be around forever, can be hacked Examples – PasswordCaptain, RoboForm, PasswordSafe, Keepass, LastPass Don’t forget to update the list as additional digital assets are acquired or passwords are changed Don’t put the user names and passwords directly in the document…changes too often…DO NOT put this information in a Will (public record)