Trademarks are valuable representations of the goodwill of your business that connects a specific product to your brand for your consumers. As your startup or business matures (or if you acquire a company) you will likely need a trademark assignment agreement. This is a type of agreement for transferring ownership that provides a variety of business benefits necessary for protecting purchased or transferred trademark rights.
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What Is Trademark Assignment?
A trademark assignment is the formal process for transferring the ownership of a trademark and the associated rights that ownership provides (e.g., use, licensure, further assignment, etc.). Often, a trademark assignment is part of a larger transaction such as an asset purchase agreement or a corporate reorganization.
When Is the Assignment of Trademark Procedure Necessary?
You will need an assignment of trademark any time you are transferring trademarks permanently. Such transfers can be within a larger corporate structure (e.g., from a parent company to a subsidiary), to a family member (e.g., via an estate administration), or to an outside party via sale.
For situations that don’t involve the owner of the trademark transferring to a new owner, you may consider a trademark licensing agreement. Unlike a trademark assignment, a license does not transfer ownership, and instead, gives the rights commonly associated with ownership. For example, you typically see trademark licensing in the context of franchise agreements, merchandising, endorsement deals, etc.
Here’s How to Transfer Trademark Ownership
The process for transferring a trademark via assignment may vary depending on the context of your situation. Relevant to determining the process will be the nature of the transaction along with the relationship between the assignee and assignor. Your checklist will also vary depending on if you are the buyer or seller of the trademark. That said, you will generally consider the following steps for a complete assignment:
- Due diligence
- Determine authority to transfer the trademark
- Execute trademark assignment agreement (What should be included in a trademark assignment form)
- Complete ancillary agreements necessary to give effect to trademark transfer
- Notify the U.S. Patent and Trademark Office (USPTO) of change of ownership
1. Due Diligence
Not all trademarks are created equally because of their rights that exist in common law and through statutory law at the state and federal levels. As a result, it’s important to research the trademark status before taking possession. Primarily, you will want to search for its registration number with applicable state and federal agencies (i.e., the USPTO). Having a registered mark improves your ability to enforce against trademark infringement and protect its value after acquisition as part of the goodwill of the business.
2. Determine Authority to Transfer the Trademark
Another integral part of transferring a trademark through an assignment is verifying that the assignor has the authority to transfer the title to the assignee. Your Florida trademark lawyer will be able to help you verify that authority, but you will generally check in two ways. The first will be confirming ownership reflected on trademark registration documents recorded with the USPTO. However, you will also want to confirm that ownership and authority via the business entity organizational documents.
3. Execute Trademark Assignment Agreement
After completing proper due diligence, you will need to execute a trademark assignment agreement. The purpose of the agreement is to provide evidence of the transfer and to allocate rights and obligations among the assignor and assignee.
What Should Be Included in a Trademark Assignment Form?
The contents of your trademark assignment agreement will also depend on the nature of the transaction and the relationship between the original owner and the new owner of the mark. Typically, you will see the following elements with a trademark assignment form contract:
- Names of the parties and the agreement’s effective date
- Recitals explaining the circumstance for the trademark transfer (e.g., gift, reorganization, purchase asset agreement, etc.)
- Consideration for the intellectual property transfer (e.g., value exchanged such as cash, real estate, or other personal property
- Representations and warranties surrounding past use, current owner, etc.
- Indemnity surrounding past or future claims related to the use of the trademark
- Conflict resolution provisions (e.g., mediation, arbitration, governing law, choice of venue, etc.)
4. Complete Ancillary Agreements
As mentioned above, transferring ownership of the trademark is likely part of a larger transaction such as the sale of a company. This fact usually means you will need to complete other contracts and documents for the assignment to be enforceable. To name a few, such documents might include:
- Asset purchase agreement
- USPTO forms
- Assumption of liability agreement
- Intellectual property licensing agreements
- Corporate consent resolutions
5. Notify the USPTO of Change of Ownership
Part of a complete assignment of a trademark will require finishing the USPTO application process for a name change on the trademark registration. It’s important to notify the USPTO of the change in ownership and to update contact information for future correspondence related to your trademark. Additionally, maintaining accurate information with the USPTO for your registered trademark is necessary for protecting your trademark rights against infringement, dilution, and other legal issues.
What Are the Implications if a Trademark Transfer Is Not Done Properly?
Failing to properly transfer a trademark from one party to another can lead to exposure and create unnecessary risk. Most of the consequences stem from the fact that improper trademark transfers create confusion about who actually owns the mark. If uncertainty exists about proper ownership, it can make it more difficult to enforce your trademark rights and protect against future trademark infringement or track trademark infringement statute of limitations.
When it appears multiple parties have rights to a trademark, it can also create a risk of trademark dilution (i.e., its use becomes more in the public domain, weakening its proprietary value). As a final point, trademark transfers are usually part of a broader transaction, and failing to properly execute the assignment may jeopardize the success of the whole transaction or, at the least, substantially add to the closing costs.
What Should Be Included in a Trademark Assignment Form?
As detailed above, a trademark assignment form should provide all of the information surrounding the transfer (e.g., party names, effective date, value transferred, warranties, etc.). Additionally, the assignment should provide for more general contract terms related to termination rights, conflict resolution methods, indemnities, and necessary cross-references with any simultaneously entered into agreements.
Need Help with a Trademark Assignment Agreement?
If you are in the process of buying, selling, or otherwise transferring a trademark, then a trademark assignment agreement will be a key document for establishing and protecting those trademark rights. The trademark attorneys at our firm help clients draft and negotiate these agreements along with related legal advice and services such as representations in front of the USPTO.
Contact Cueto Law Group today to properly transfer ownership of a trademark.
Trademark Assignment Template Sample
Below are a PDF and Word version of a trademark consent agreement template that you can review as a trademark assignment agreement sample. As a reminder, these are just sample forms and further modification is likely necessary to meet any particular assignment needs.
Trademark consent agreement sample PDF | Trademark consent agreement sample Word |
| Coming soon | Coming soon |
Key Takeaways on How to Transfer a Trademark
When transferring a trademark, two fundamentals will be essential for increasing the chances of a smooth transition. The first is having sound documentation and contracts (i.e., an assignment agreement) in place between the assignor and assignee. The second is confirming that all applications and registrations with the USPTO accurately reflect that new proprietorship.
FAQs
Can You Use an Asset Purchase Agreement in Place of a Trademark Transfer Agreement?
Depending on the complexity of the sale, you may be able to incorporate a trademark assignment into an asset purchase agreement (APA) rather than using a separate trademark transfer agreement. Generally, APAs are much more complex documents, and an assignment agreement is a better vehicle for transferring titles.
How Do I Submit a Trademark Assignment to USPTO?
The USPTO has an Electronic Trademark Assignment System (ETAS) where you can submit and record the transfer of the trademark or simply update name change in ownership (e.g., if you recently married or divorced). Alternatively, you can submit the information via mail using a Recordation Form Cover Sheet.
Do Patent Assignments Need to Be Recorded?
Yes, recording a patent assignment with the USPTO is recommended and sometimes necessary for many of the same reasons why recording a trademark assignment is worthwhile. You can record a patent assignment through a similar USPTO system as you would for a trademark, known as the Electronic Patent Assignment System.
