As I sit here writing this blog article, I’m listening to the songs on my iTunes account, and it reminds me how far we have advanced technologically since I was a kid when there was no iTunes in existence.  Instead, at that time, everyone collecting music had vinyl records. I started my own record collection at age 11 with the purchase of the Kiss Destroyer album – to the dismay of all of my neighbors within earshot.  These days, however, record collections are a novelty and many things, such as music, books, movies, games, and pictures, are owned in digital form. The transformation over the years of tangible assets to intangible (digital) assets raises the issue of what happens to your intangible assets when you die.  Can intangible assets be transferred to your loved ones upon your death in the same manner that you could transfer your treasured collection of hard bound books or vinyl records?  The answer is that it depends.

It depends on the terms of the license agreement that you agreed to when you established your on-line music account, on-line book account, on-line picture account, etc.  For example, the iTunes license agreement (last updated August 7, 2013) does not contain specific verbiage stating that “upon the death of the account holder, he or she may provide copies of the content of his or her account to his or her designees” or, alternatively, “upon the death of the account holder, all rights to the content in the account cease.”  The iTunes license agreement is clear that the content of the account is for the personal, non-commercial use of the account holder.  Furthermore, it provides that the account holder may burn an audio playlist from the music on his or her account to a CD up to seven times; but, the account holder may not burn any video iTunes Products or tone iTunes Products. Thus, it appears that an account holder may transfer the seven audio CDs to loved ones upon the account holder’s death.

What happens if the account holder does not burn the audio CDs during his or her lifetime?  The iTunes license agreement is silent on the act of posthumously burning audio CDs from the account holder’s account. If a beneficiary of the account holder’s estate is entitled to the residue of his or her assets, does that include the seven audio CDs that the account holder did not burn during his or her lifetime? The answer is not clear. The account holder could authorize the Executor of his or her Will or the Trustee of his or her revocable living trust to burn the seven CDs in order to make the gifts of the account holder’s music collection upon his or her death. To do so, the account holder must make his or her user name and password for the account (and other digital accounts) available or accessible to his or her personal representative. Since the post-death transfer of the account holder’s music collection is not specifically authorized or prohibited by the iTunes license agreement, it is a better idea to burn the audio CDs before the account holder’s death.

If you would like to discuss this or other trusts and estates issues, please contact the attorneys at Drucker Law Offices, 468 North Camden Drive, 2nd Floor, Beverly Hills, CA 90210, 310.285.5375 Tel, 310.444.9754 Fax, www.druckerlaw.com