13 Mar 2023
4 Aug 2022
A trademark may be one of the most important assets for your business.
Find out how to protect your business and enhance the value of your company with a Trademark Assignment Agreement.
If your business uses unique phrases or logos in your production of goods and services, you may wish to differentiate your business from your competitors. Often, customers rely on a trademark to distinguish one product from another.
Therefore, the reputation of your business may depend on the value and authenticity of your trademark. Hence, it is important to fully understand what a Trademark Assignment Agreement is and how to use it to your advantage.
A trademark is a type of intellectual property which identifies your goods or services. It can be any word, phrase, symbol, design that is able to distinguish your goods and services from others.
Having a trademark protects you and your business from your competitors. With a trademark, your goods and services cannot be easily replicated or copied. Depending on what jurisdiction you are in, there are different ways of protecting this right.
You may register your trademark so that you secure the exclusive right to use your trademark and eliminate any possibility that your competitor can copy your business. For instance, in Hong Kong, you can register your trademark with the Trade Marks Registry of the Intellectual Property Department. The legal effect of registration is that you will personally own the trademark, possess exclusive right and can take legal action against a third party who uses your trademark.
During assignment, one person, or the assignor, transfers rights or benefits to another person who is known as the assignee. In the context of trademarks, an assignor is the trademark owner and they can transfer the rights, interests, titles and benefits to the assignee, who is the new owner.
Beyond the assignment of trademark, patents and other intellectual property can also be the subject of assignment. Check out DocPro’s Patent Assignment Agreement and Intellectual Property Assignment Agreement.
As part of the trademark assignment process, it is useful for the assignor and assignee to utilise a Trademark Assignment Agreement.
A Trademark Assignment Agreement outlines the specific details of the transfer of the assignee’s rights, titles, interests and benefits attached to the trademark. As with all written contracts, it provides much more legal certainty and clarity as compared to any oral agreements.
It is important to note that Trademark Assignment Agreements are different from licenses to use trademarks. Licenses to use trademarks merely provide a user with permission to use a trademark and is not a transfer of ownership rights.
Typically, the registered proprietor of the trademark may assign a trademark for consideration. When a registered proprietor of the trademark wishes to transfer a registered trademark to another person for consideration, they may utilise a Trademark Assignment Agreement to facilitate this transaction.
In addition, a Trademark Assignment Agreement may also be executed even without a trademark registration. In some circumstances, owners of trademarks such as inventors or creators may assign the ownership of their trademark to a third party, like a company, in return for consideration.
Most people may have a rough conception of what a trademark is, but may not have much clarity as to the transfer of ownership. Therefore, it is important to draft up a Trademark Assignment Agreement. It is especially crucial if your business depends heavily on the value of the trademark, which depend on the certainty of the valid legal ownership of this trademark.
A Trademark Assignment Agreements provides valid proof of the legal right to the trademark. In the event of a dispute, the Trademark Assignment Agreement confirms who the most updated owner of the trademark is.
A Trademark Assignment Agreement provides an outline of the transfer of an assignor’s rights, title and interest.
Read on to learn more about the essential provisions in a Trademark Assignment Agreement.
The assignment provision assigns the rights, title and interests of the trademark to the Assignee and lists the date which the assignment of the agreement takes effect.
This provision is important since it irrevocably and absolutely assigns the aforementioned rights, title and interests and provides confirmation of the assignment.
As part of the trademark assignment, the assignee may pay the assignor a stipulated sum for the assignment of the trademark and the associated intellectual property. Depending on their preference, the consideration may take the form of money or the assignee’s ordinary shares.
The warranty section is essential in ensuring that the assignor has the power to enter into the agreement and has the power to legally perform their obligations. It is especially important in the context of a Trademark Assignment Agreement since the assignee would want assurance from the assignor that the trademark that is being assigned is free from mortgages, charges and other security interests, and that the assignor has not assigned, licensed or disposed any interest regarding the trademark to any other party other than the assignee.
Beyond consideration for the trademark assignment, parties may be additionally responsible for different associated costs.
For instance, there may be additional incurred costs for negotiation, preparation and execution of the assignment, or stamp duty associated with the transfer in ownership of the trademark. This section outlines who would be responsible for each item of payment to provide clarity in the event of a dispute.
At the end of the Trademark Assignment Agreement, the assignor and assignee may provide details of the trademark that is to be assigned.
If relevant, the specific technology associated with the trademark and any other proprietary information can be detailed in this section. A description of the trademark, including any creative particulars can be outlined. This is important in situations where the trademark in question is a word or phrase or a complicated design.
Both parties to the assignment can have a clear idea as to what the trademark comprises and the scope of the assignment.
Usually, assignment agreements are not required to be in writing and merely must show an intention to transfer rights.
However, local legislation governing the assignment of trademarks may stipulate that the assignment must be in writing. For instance, in Hong Kong, the assignment of a registered trademark must be in writing and signed by the assignor (s27(4) Trade Marks Ordinance Cap 559).
Therefore, you should always refer to your local legislation on the guidelines governing the transfer of a Trademark Assignment Agreement.
It will always be in your business’ best interests to protect the value of your trademarks. To properly distinguish your products and services from your competitors, prevent misuse of your trademark and to ensure your business can reach its full potential, make sure you use a Trademark Assignment Agreement.
Please note that this is a general summary of the position under common law and does not constitute legal advice. As the laws of each jurisdiction may be different, you may wish to consult your lawyer.
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