Lee, an appraiser specializing in the valuation of intangible assets (such as intellectual property), says “It is illegal for patent attorneys to value intellectual property (patent rights, etc.)."

▲ Samil Appraisal intangible assets division manager / appraiser Sangyong Lee

When people think of appraisers, they often think that they only assess the value of real estate. However, the valuation of intangible assets (intellectual property), such as patents, trademarks, copyrights, goodwill, and securities, is also a major focus of appraisers. Samil Appraiser Sangyong Lee has gained prominence and attention in the new specialized valuation field of intangible assets valuation in Korea.

 

Appraisers are economic judges!

Samil Appraisal intangible assets division manager/appraiser Sangyong Lee was the first in the domestic appraisal industry to establish an intangible assets division (patent rights, trademark rights, design rights, utility model rights, copyrights, goodwill, mining rights, fishing rights, securities, etc.) within an appraisal corporation in 2015. It was launched as an independent business unit, and he was the first head of the division and still holds that position to this day. Since taking office, Lee has achieved numerous domestic and overseas intellectual property (IP) appraisal results across a variety of industries, from cutting-edge IT and BIO industries to traditional manufacturing and construction industries.

Lee not only worked to improve the socio-economic status and awareness of appraisers by coining the catchphrase “Appraisers are economic judges!” but also developed an intangible assets valuation model that was approved by the Korea Association of Property Appraisers. Last year, he was appointed as a member of the ‘Appraisal Standards Committee’, a legislative body within the association, and is expected to contribute to the establishment and revision of intellectual property appraisal standards in the future. He acquired membership in the American Society of Appraisers (ASA), and starting this year, he will become an appraiser of the ‘Seoul High Court’. He is also an engineering student (master’s program) at KAIST to enhance his expertise in valuation of intangible assets (intellectual property, etc.). 

 

Patent (trademark) applications should be handled by patent attorneys and patent (trademark) valuations should be handled by appraisers!

Recently, Lee has been working to prevent patent attorneys from claiming to be experts in IP and performing IP valuations. “Patent (trademark) application should be handled by patent attorneys, and patent (trademark) valuation should be handled by appraisers!” Lee has been running several public service announcements on social media, using his own money. Lee says “The reason I am doing this is to point out the illegality and harm of IP valuation by patent attorneys under the Appraisers Act.”

Lee adds “Valuation of intellectual property, including patent, is the exclusive purview of appraisers. It is illegal for patent attorneys to perform this service. It is a criminal offense for a patent attorney to apply for and register a patent, and then value the registered patent himself, causing serious economic problems.”

Lee cited the case of “a construction company directly valuing the building and then using it as collateral to obtain a loan from a bank.” In particular, general companies are often unaware of this situation and ask patent attorneys to value patent rights.

Lee says “What would happen if a car, ship, or airplane manufacturer does the valuation personally because it is familiar with the manufacturing technology and manufacturing costs of the car, ship, or airplane? If the same person produces (goods, services) and values them, it is impossible to ensure fairness, objectivity, and reliability. For this reason, the appraisal system exists under the premise of ensuring independence.” 

 

Korea Patent Attorneys Association’s illegal activities must be stopped!

Lee has worked to raise awareness of the illegality of patent valuation by patent attorneys. Since 2019, Lee has given dozens of lectures across the country, spreading the word about the importance of valuing intangible assets (such as intellectual property) by an appraiser.

Lee collected evidence of the problems caused by patent attorneys’ valuation of patent rights and shared it on social media, interviewed in professional magazines, and filmed YouTube videos. According to Lee, the Korea Patent Attorneys Association has taken the lead, illegally offering a 30-hour education course on IP valuation, issuing a certificate (IP valuation specialist), and encouraging patent attorneys to conduct valuations, which has led to public confusion in various parts of society. 

 

What happens when you value your technology and judge yourself?

Lee says “This is not to represent the interests of appraisers, but to stop the corruption and absurdity of the socio-economic system and prevent further disruption of the national economy. Patent attorneys are a small number of people to be certified (about 200 every year), so they know each other well, so if they value their own technology themselves (demanding the right to value), and judge themselves (demanding the right to represent), the national economy will become lawless. Appraisers are independent of production, which guarantees their independence for fair and objective valuation.”

Last year, Lee represented the appraisal industry at an intellectual property conference held at the National Assembly in response to a bill to amend the Patent Attorneys Act to allow patent attorneys to value intellectual property rights. “If they are allowed to value their own technology, they will do at their own discretion and the socio-economic system will be corrupted by various absurdities,” Lee argued in the National Assembly.

 

Intangible assets will become more important as industries change!

Lee says “Developed countries have a very high proportion of intangible assets in their balance sheet assets. It is expected that Korea will follow the same trend as the 4th industrial revolution advances. To ensure the fairness, objectivity, and reliability of intangible assets value, including IP, each professional must fulfill his or her responsibilities in good faith based on professional ethics. A mutual verification system that is filed by patent attorneys, valued by appraisers, recorded by tax accountants, and audited by accountants is the only way to ensure the financial soundness of corporate accounting (intangible assets) in Korea.”