Most of the examples of intellectual property holding companies I've
seen via web searches utilize a wholly owned subsidiary of a parent
company to hold IP and then lease it back to the parent company (e.g.,
Dunkin' Donuts with DD IP Holder, LLC). What prevents the IPHC
subsidiary from being included in a judgement against its parent
The IPHC is not going to have direct liability in most cases because usually intellectual property does not itself generate liability, usually it is a relatively "cold" asset from a liability perspective (meaning it doesn't carry much liability risk).
Instead, usually liability is generated by an operating company that may also be a subsidiary of the master company. So, only if the corporate veil of the operating company is pierced can the assets of the parent company, including the IPHC be reached.
Typically, what this means is that long term bond creditors, who typically invest in the company at the parent company level, potentially have access to the IP assets if the bonds are in default, but the trade creditors from the day to day operations of the operating subsidiary and tort creditors of the operating subsidiary are not in a good position to access the IP assets of the parent company.
Of course, if the operating company is insolvent, the future is not bright in any case, since even in IP heavy industries, the operating company is typically the sole or primary licensee of the IPHC's IP, so the value of the IPHC assets would plummet if the operating company went out of business.
In a hypothetical scenario, would utilizing a parent company as the IP
holder and a subsidiary as the operational entity provide better IP
asset protection than the reverse? Would creating an entirely separate
entity provide even more protection?
From a liability perspective, a parent company as an IP holding company, and an operational entity subsidiary would provide comparable protection (and as noted above, a company with an IP holding company would usually also have one or more operational entity subsidiaries), and would be better than a parent company as an operating company (a less common arrangement in this kind of firm) and an IP company as a subsidiary.
A separate entity, such as a sister company with not quite an identical ownership structure would provide even more protection, but that analysis defeats the purpose of forming an IPHC in a large firm, a purpose which is not primarily to limit liability, as I discuss below.
If the IP is in a separate entity, it is harder to use that valuable asset as loan collateral or to reduce the interest rate the company pays to borrow money because it has a lower debt to asset ratio. And, ultimately the parent company wants to use the IP assets to increase value for the parent company's shareholders, which can't be done with a sister company in a publicly held entity.
The reality is that the main purpose of an IPHC isn't to limit the exposure of those assets to liability. Instead, it is to create a "hot asset" from a tax perspective (meaning it is easily moved from one jurisdiction to another with few operational consequences), which can be located in a tax haven (like Ireland), so that the license fees earned from the IP that are paid by the operating entity to the IPHC are not paid to the jurisdiction that taxes the parent company or the operating subsidiary, which may need to be located in a high tax jurisdiction for operational reasons or to gain access to financial markets needed to raise investment capital.
A separate entity is created to hold IP assets primarily so this entity can be formed under the laws of a different country than the parent company or operational subsidiary where the tax environment is more favorable. This is particularly true in the United States where a corporation incorporated in the United States is taxed on its worldwide income, while a corporation incorporated outside the United States that is owned by Americans is taxed only when the income from the foreign incorporated subsidiary is repatriated to the United States. (The Tax Cut and Jobs Act of 2017 modifies this analysis somewhat, but was not in place when these organizational decisions were made in the first place.)