All about Trademark Assignment Agreement: Explained

The Author, Arunabh Srivastava is a student of Symbiosis Law School, NOIDA and currently working as Campus Ambassador of LatestLaws.

ABSTRACT

The following legislative comment describes the need and legislation on Trademarks, Trademarks Assignment Agreement to be precise. The comment describes the need of having an explicit agreement for Trademark, plus what importance does this agreement carry out. The comment covers some landmark cases and the clauses which need to be explicitly taken care of while entering into such an agreement.

TRADEMARK ASSIGNMENT AGREEMENT

Intellectual Property Rights (IPR) has evolved over a period of time. Intellectual Property is not a new term, but has been in existence since 1850’s. The reason of its growth and evolution is because of its international applicability. Intellectual Property Rights focuses on providing ‘Inventor’ his exclusive rights for his distinguished invention. And to serve the criteria for protection of IPR, few convention and agreements were entered into. The best to elaborate legislative laws on security of IPR is Trade Related Aspects of Intellectual Property Rights (TRIPS) Agreement, which seeks to draw security of rights of ‘Invention’ to the ‘Inventor’.

Trademark: Trademark is the sign which distinguishes goods and services from other, such signs include names, design, signatures, etc. Trade Related Aspects of Intellectual Property Rights (TRIPS) agreement defines Trademark related laws from Article 15-21[1]. The agreement provides 7 years of minimum protection for trademarks which is renewable before the prescribed time ends.  Trademark Act, 1999 [2]helps us connect with the issues and solutions.

CASE LAWS:[3]

• YAHOO!, INC. V. AKASH ARORA AND ANR.[4]

In this case, defendant created a same domain as of Yahoo!, but was not associated with it in anyway. The court held that internet users could be confused and deceived into believing both the domains as same. The defendant took a defence that it had put a disclaimer on its website. But, it was not admitted by the court and hence, it was held that mere disclaimer cannot be sufficient as the nature of internet is such. Moreover, the name acquires unique and distinct possession and is mainly associated with the plaintiff.

• COCA COLA COMPANY V. BISLERI INTERNATIONAL PVT. LTD.

In this case, bisleri agreed, sold and assigned the trademark Maaza including formulation rights, know how rights, goodwill, etc. with respect to mango fruit drink Maaza to Coca Cola. After a period of time, defendant company filed registration for mark of Maaza in Turkey and started exporting such drinks. Coca Cola demanded permanent injunction and damages for infringement of trademark. Thus, the court granted an interim injunction against defendant for using the trademark Maaza in India as well as other nations.

WHAT IS A TRADEMARK ASSIGNMENT AGREEMENT[5]?

Trademark Assignment is the transfer of an owner’s title, rights and interest in trademark or service mark. The assignor (transferring party) transfers property rights in mark to the assignee (receiving party). However, an assignment differs from a license, as license is only the grant of permission to use a mark, but it does not transfer any rights of ownership, and is associated with Technology Transfer Agreements (TTA). Such Assignments are important to occur as an excess of intellectual property can put a company in burden. Moreover, assignment of a trademark is also an essential part of its monetization. It carries certain benefits, such as:

1. It helps inventor to know the real fair value of the brand.
2. Helps assignee use the brand value, rather than creating one
3. Might serve as a valid proof, in case a legal dispute arises

Trademark Assignment Agreement [6]focuses on following points to be considered before drafting deed[7]:

1. Jurisdiction:

This part specifies the Geographical Scope, i.e. it talks about the location wherein assets of the agreement would be possessed, and laws of which country shall stand binding.

2. Recording Requirements:

This section talks about

• Recording of trademark assignment in jurisdiction mandatory or not.
• Time Limit for submission of Trademark Assignment Agreement (TAA) for being recorded in Patent and Trademark Office (PTO).  If, the submission is late,  whether it would be recorded or not? Its effect if not recorded and effect if recorded after expiry of the said applicable period.
• Benefits associated with timely recordal
• Presenting Original Documents being necessary or not.
• Can the non essential information be edited from assignment or schedule.

3. Assets to be assigned:

Trademarks, Service marks, certification marks and collective marks shall be assigned.

• Pending Trademark Application:

The agreement must specify, that whether pending trademark application be included as an asset. In USA, there is a portal[8] to know and check the status of such application.

• Issued Trademark Registration:

The agreement must also specify inclusion of Issued Trademark Registration as an asset. In India, a portal[9] has been designed to Register Trademark Application, Track certificate requests, etc.

• Goodwill:

Goodwill is an intangible asset which adds value to the worth of trademarks. The transfer of goodwill being legal, also depends upon jurisdiction. In India, the transfer of mark without goodwill is deemed valid, while as per US Law, both common and Lanham Act (US Trademark Act), transfer of mark without goodwill is deemed to be invalid.

• International Registration:

International Registration of marks is governed by Madrid Agreement[10] concluded in 1891, and protocol related to that agreement in 1989. It makes protection of marks possible in large number of countries, by obtaining International Registrations.

It should be clarified that whether the trademarks to be assigned include International Legislations, or any restrictions or conditions are imposed on assignment of basic application. 

• Common Law Trademarks:

It should be duly mentioned, whether to be assigned trademarks include trademarks in use, but not registered (Common Law Trademarks) or the ones duly registered.  If it contains common law trademarks, then what are the requirements for setting forth details of common law trademarks.

• Trade dress or Get Up:

Inclusion or exclusion of Trade dress or get up among to be assigned trademark asset shall be specified. If not excluded, the requirements for describing, depicting or setting forth details for trade dress or get up in either the body of assignment or being attached with schedule shall be specified.

• Name of Living or deceased Individual:

If any to be assigned trademark asset includes name of living person or a deceased person, then it shall be informed. If yes, a signed, written consent from such person is required to register corresponding trademark in applicable jurisdiction.

• Right to sue:

The agreement shall contain right to sue and collect damages for current and past infringement to the contracting party.

4. Execution Requirements:

• Signatories:

The assignment shall be duly signed by both assigner and assignee.

• Witnesses:

Trademark Assignment Agreement (TAA) can be executed by maximum of two people and minimum one.

• Notarization:

Jurisdiction to a party is solely limited to laws prevailing in the nation. While, In India, the notarization is mandatory.

• Legalisation:

Legalisation and grant of certificate is essential in India

• Date and Place of Execution:

Places such as place of execution must explicitly be mentioned in the agreement. The date shall be the same on which agreement is officially entered into. 

• Power of Attorney:

The requirements for an acceptable power of attorney shall be briefly defined and discussed.

5. Assignor:

Assignor’s real name shall be mentioned, and his name consistency shall be verified with other assets as well. If the assignor is a legal entity, he shall disclose about the entity and other details.  After this, the address proof stands most important and shall be mentioned below name.

6. Assignee:

Assignee also has to follow the same procedure and mention the above thing in the same process, mentioning name, legal entity (if any, followed by details) followed by address.

7. Consideration and Taxation:

• Consideration

The enforceable and valid TAA must expressly state the consideration given by the assignee to the assignment for all trademark assets.

• Taxes or Duties:

TAA would be subject to purchase deed stamp or other payment of transfer duty or duty in applicable jurisdiction, shall be specified. The payment and computation of tax should be specified, transfer duty is preferred.

8. Miscellaneous Provisions:

• Heirs:

The validity of the assignment agreement would be binding upon legal heirs or not, shall be duly specified.

• Further Assistance:

Co-operation and assistance of assignor to assignee in recording, enforcing, or taking other action in near future shall be specified to be agreed upon.  If yes, then accordingly the borne of expenses shall be clarified.

CONCLUSION:

Trademark Assignment Agreement (TAA)[11] is an agreement entered into to ease the transfer of technology, gain benefits and ensure material for future creations. This agreement builds a strong foundation for fulfilling future endeavours.  The trademark agreements acts as a subsidiary to technology transfer agreement, which basically covers all the agreements related to Intellectual Property Rights (IPR). The most important feature of the agreement is to safeguard the inventor’s right for the invention, as in many cases it is evident, that the other party tries to infringe the rights of inventor by claiming similar rights on related marks. Thus, for such instances, the importance of precise, specific and definite agreements increases., and to serve this very purpose, Trademark Assignment Agreement is very essential.

References:

[1] Brief of Articles of Trademark in TRIPS agreement 

   Available at: https://www.wto.org/english/docs_e/legal_e/27-trips_04_e.htm#2

[2]  E- Gazzette available at: http://www.ipindia.nic.in/writereaddata/Portal/IPORule/1_69_1_312_1_TRADE_MARKS_RULES_2017 English.pdf

[3] Cases discussed above are available in brief at:https://www.hg.org/legal-articles/top-5-interesting-trademark-cases-in-india-51057

[4]  Citation: 1999 IIAD Delhi 229, 78 (1999) DLT 285

[5] Basics of Trademark Assignment

   Avalable at:  https://www.inta.org/TrademarkBasics/FactSheets/Pages/Trademark%20Assignments.aspx

[6] Checklist to be ensured in drafting the Trademark Assignment Agreement available at:

https://www.inta.org/GlobalTrademark/Documents/Checklists/Checklist_Trademark%20Assignment%20Agreement-Final.pdf

[7] Deed of Trademark Assignment Agreement

  Available at: https://www.ainoglobal.com/Agreements/9_%20Trademark%20Assignment%20Deed.pdf

[8] Portal for checking status and viewing documents

  Available at:  https://www.uspto.gov/trademarks-getting-started/trademark-basics/searching-marks-uspto-database

[9] Portal for Registering Trademark application and knowing rules as such for Trademarks

  Available at: https://ipindiaonline.gov.in/eregister/eregister.aspx

[10] Summary of Madrid Agreement

   Available at: https://www.wipo.int/treaties/en/registration/madrid/

[11] An example of Trademark Assignment Agreement is attached

    Available at: https://www.sec.gov/Archives/edgar/data/1347022/000119312506259754/dex1035.htm