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Richard Thalheimer’s Intro to Intangible Assets

Pressures Continue to Grow in the Ag, Logistics Industries

During my senior year at Highland Park High School in north suburban Chicago, I worked as a floor salesman at S. Mitnick Sharper Image retail store at a local mall. Every Tuesday and Thursday afternoon, I’d subject myself to Richard Thalheimer’s (Sharper Image’s founder) droning and recorded enthusiasm, on repeat, for the Ionic Breeze and other overpriced and oft-returned gadgets. In February 2008, long after my tenure with the gimmicky tech retailer had concluded, Sharper Image filed for bankruptcy. Thalheimer’s reign as the king of air purifiers, massage chairs, and portable DVD players had come to its end.

But while Sharper Image’s brick-and-mortar existence was no more, its soul would live on. A 2009 New York Times article entitled, “Sharper Image Stores are Dead, but the Brand Goes On,” celebrated the company’s new existence as a brand licensor. The company, pared down to less than a dozen employees, contracted with third parties to manufacture and sell its products going forward.

Sharper Image’s metamorphosis into an online catalog and third-party licensor begs important questions:

  1. What is a company? Is it the people who work there? Is it the products or services they sell? Is it their brand?
  2. If push comes to shove, what part of the company has the greatest value?

For Sharper Image, its soft assets (trademarks, etc.) were apparently worth more than its CD shower radios or floor salespeople.

As guest editor of this month’s Journal of Corporate Renewal, I asked a few industry experts to help explore the nuances of a company’s intangible assets. These articles were extremely interesting.

Kevin Morse and Joseph Archambeau of Clark Hill PLC explore recent 8th Circuit precedent that allows for the sale of Chapter 5 bankruptcy causes of action. The Simply Essentials case could have a meaningful impact on modern U.S. Bankruptcy law. Kevin and Joseph, renowned for their creativity and sophistication, provide a valuable explanation of this significant legal development.

Brandon Lewis, a partner at Reid Collins & Tsai LLP, writes about the preservation and valuation of litigation claims. Brandon is regarded as a leading industry expert in contingency litigation and, as such, has a unique ability to value this subsect of intangible property.

Richelle Kalnit and Stella Silverstein, both with Hilco Streambank, discuss the sale of intangible assets, such as trademarks, patent portfolios, and more. Richelle and Stella have played, and continue to play, an essential role in developing the market for intangible assets across the country. Although not discussed in the article, Hilco Streambank’s work in the Johnson Publishing Company’s bankruptcy is worthy of a quick internet investigation.

Elizabeth B. Vandesteeg, Heidi Hockenberger, and Lauren Wiley of Levenfeld Pearlstein LLC speak to privacy laws and related implications inherent in customer data acquisitions. These evolving guidelines create challenges that a buyer must navigate when purchasing a company’s assets. Lisa, Heidi, and Lauren are at the forefront of this developing industry.

Finally, TMA Global President Jane Mitnick of SM Financial Services Corporation and Mark Miceli of S. Mitnick Law PC investigate the world of remnant assets—the debtor’s property that is left behind after all other assets have been sold or liquidated. Jane and Mark are two of the best at finding and monetizing those intangible assets that may have metaphorically fallen between the couch cushions.

These are topics I have long found tremendously fascinating. I encourage you to reach out to the authors with any relevant questions (or referrals). Enjoy!

Michael A. Brandess

Michael A. Brandess

Husch Blackwell LLP

Michael A. Brandess is a bankruptcy attorney with Husch Blackwell LLP, focusing on financial services and capital markets. He focuses on all areas of corporate restructurings, crisis management, and transactions involving financial distress. Brandess routinely counsels debtors, creditors, asset purchasers, assignees, creditors’ committees, and trustees, among others, who require sound judgment and a deep knowledge of how to navigate the U.S. Bankruptcy Code.

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