Who actually owns it
The most common problem found in IP due diligence is a gap in ownership. Founders may have written the first code before the company existed, contractors may have built key features without signing an assignment, and employees may have worked under agreements that never transferred their inventions. In the United States, copyrightable work by an outside contractor is usually owned by the contractor unless there is a written assignment, because the categories of work made for hire are narrow. Registrations can also be in the wrong name, lapsed, or still pending. Many gaps can be fixed before closing, but only if they are found early enough to obtain signatures from the people involved.
Licenses, open source, and data
Inbound licenses for software and content may prohibit assignment or terminate on a change of control, which matters especially in an asset sale. Outbound licenses can grant customers or partners rights that limit what the buyer can do with the technology. Open-source components are nearly universal, and most raise no issue, but some licenses impose obligations on how combined code is distributed, so a scan of the codebase and a review of how the product is delivered are standard steps. Where the business depends on data, diligence also covers where the data came from, what permissions allow its use, and whether privacy commitments restrict transfer to a new owner. Trade secret protection depends on reasonable confidentiality practices, so diligence asks what those practices actually were.
Turning findings into the deal
Findings feed into the purchase agreement as specific representations, closing conditions requiring missing assignments, special indemnities, or price adjustments. Pending or threatened infringement claims, demand letters, and disputes with former founders or contractors deserve particular attention, because they often reveal ownership problems as well. For sellers, a pre-sale review of assignments, registrations, and open-source use can prevent late surprises that slow the deal. We begin with the IP schedule the seller provides, the employment and contractor agreements, and a description of how the core product was built.
