Digital Assets During Divorce

Digital assets are a huge part of our everyday lives.  The pictures on your iPhone, your Netflix account, documents saved in Dropbox, your Kindle library, and your Instagram page are all examples of digital assets.

While it may seem that digital assets are inconsequential when it comes to a divorce, that may not always be the case.  Technology has become such a significant part of our daily lives that digital assets may have significant monetary value beyond just the sentimental value.

A digital asset is intangible content that is stored in various types of digital formats.  Examples of common digital assets include: e-mail addresses, social media accounts, web sites and domain names, digital media (photos, videos, e-books, movies, and videos), blogs, reward points, data storage accounts (Dropbox, OneDrive), digital storefronts, and virtual currency (such as Bitcoin).

If these digital assets were acquired during the marriage, they will be considered part of the community estate and will be subject to a just and right division by the court.  When going through a divorce, each party should take an inventory of all digital assets that are considered community property.  If a digital asset was acquired prior to marriage, was a gift, or was inherited, it will be considered separate property and not subject to division in the divorce.

Once the digital assets have been identified as part of the community estate, they will be valued.  Valuing these assets is highly case dependent and will often require negotiation between the parties.  For example, a party’s personal social media page may have no monetary value.  However, if a couple has a social media page or website that generates revenue (such as a blog or Instagram account), the parties will want to give it a monetary value and determine who will be awarded the account.  There will certainly be some digital assets that have no value and you should focus on those digital assets that are most important.

When the parties divide the digital assets, the final decree should include language that allows the party who has been awarded the account the ability to change the password.  Additionally, the decree should include language that the party who is awarded the account is responsible for any fees associated with the account.  For example, if one party is awarded a domain name, that party will be required to pay the fees associated with the domain moving forward.

Some digital assets can be “shared,” which a great way to avoid conflict during divorce.  In many cases, digital assets can be copied and re-created so that both parties can have family photos or videos.  In some instances, digital libraries can be copied, but you cannot violate licensing agreements.

It may be a pain to divide these digital assets, but it should be dealt with during the divorce proceedings, particularly any income-generating assets or virtual currencies.  You do not want to deal with this after your divorce has been finalized.

You should not change passwords or block access to a digital asset until you have agreements with your spouse or a court order allowing you to do so.  Preemptively removing a spouse’s access can create bigger problems for you in the long run and in many instances would be a violation of the county’s standing orders.

When going through a divorce, take the time to discuss your digital assets with your attorney.  These are as important as ever and the attorneys at The Draper Law Firm are ready to help.

Blog Post by Samantha Mori, Associate Attorney

0