One of the most important terms is the quality control provision to protect goodwill from trademark rights; The purpose of a trademark coexistence agreement is that trademarks are often used by several companies in “good faith.” The absence of a formal agreement does not affect any company that uses the brand, as it is located in different parts of the world. However, as businesses grow, overlaps may develop and both parties may have substantial rights to use the trademark. In some cases, companies that extend and use the same or similar trademark usually enter into a coexistence agreement to avoid using the trademark in an undesirable or counterfeit manner. Coexistence agreements can provide practical solutions for companies that fear being sued for trademark infringement, as proactive agreements can avoid the high cost of litigation.  A trademark license (which is different from a trademark assignment) is essentially an agreement in which a trademark owner (the “Licensor”) allows someone else (“Licensee”) to use The Licensor`s trademark in connection with certain goods or services. Although a trademark license agreement does not generally need to be required in writing to be legally enforceable, it is strongly recommended that all trademark license agreements be written and signed by both licensor and licensee. At IPHub Asia, we specialize in trademark and design protection in Asia, with a focus on Southeast Asia. If you have any questions about trademarks, please contact us. You can also visit our website to learn more about our services. In some cases, companies that are in the same market or have the potential to be in the same market may also want to use a similar brand image. A trademark agreement allows two or more parties to use the same or a similar trademark under certain conditions.
These types of agreements may concern, among others: On the other hand, when granting a non-exclusive license, the trademark owner may appoint multiple licensees in a single jurisdiction or use the trademark in that country with the licensee. Trademark owners have the option to grant an exclusive or non-exclusive license to their trademarks. For an exclusive license, the trademark owner appoints a licensee in each country, and only the named licensee has the right to use the trademark in that country. Before entering into a brand agreement, companies should carefully consider their options. Make sure that any intellectual property agreement you sign provides adequate legal protection. If you have any questions or concerns about trademark agreements, an experienced trademark attorney in Maryland can help. If “both companies accept the rights to use the same trademarks, these agreements should be territorial so as not to create confusion among consumers as to origin in a common market, which could destroy trademark rights because the trademark does not indicate a single source of products,” explains James B. Astrachan, intellectual property attorney in Baltimore. Goods or Services, Duration and Territory – Identify the type of goods or services that the licensee offers under the Trademark, the duration of the Contract, and the geographic area in which the Trademarks are licensed. In addition to identifying products or services, licensed uses are often indicated. For example, the agreement may state that the following uses are permitted: manufacturing, sales, sales promotion, distribution and/or advertising.
In addition, Licensor may restrict or permit the following distribution channels: physical retail, Internet, wholesale or retail, or limited sales to certain stores or categories of consumers. A trademark license agreement is a contract between a licensor (the owner of the trademark) and a licensee whereby the licensor grants the licensee the right to use the trademark. The right to use these terms and conditions may be the right to manufacture/manufacture the products under the registered trademark and/or the right to distribute/sell the products or services under the licensed trademark. These are some of the most common provisions included in a trademark license agreement, if you need advice on more detailed matters, please contact our office for a courtesy consultation with one of our trademark advisors. The length and complexity of trademark licensing agreements vary widely. Although many licenses contain a similar structure, each license contains different details and clauses depending on the products or services being licensed. While it is more common to license trademarks rather than service marks, license agreements may include products or services. In addition, licensing agreements often include state-registered trademarks, but unregistered trademarks can also be licensed. With regard to registration, some countries maintain a legal obligation that licensing agreements must be registered.
The United States does not require a trademark license to be registered with the United States Patent & Trademark Office. Definitions – There is often a definition section (key terms are defined in the agreement). Overall, licensing agreements are very common, but trademark owners should engage an experienced consultant when designing clearly defined licensing agreements that protect both the goodwill of the brand to be used and the rights of the licensor. Termination and Right of Recourse – This provision is included in a license to encourage the parties to work together to resolve minor disputes arising out of the Agreement. In the event of a breach, the defaulting party has the opportunity to remedy the defect within a certain period of time. If the defaulting party continues to violate the Agreement, the non-infringing party has the right to terminate the Agreement. Licensee may engage a sublicensee to use the Trademark in the geographic area covered by the License Agreement. A trademark license agreement has several elements. The most important part of the agreement is to properly demonstrate that the licensor retains control over the quality of the goods or services sold in connection with the use of the trademark. Therefore, the provision of quality control is one of the most important elements that are part of trademark licensing agreements. The quality control provision of a trademark license agreement must ensure that the licensor of the trademark has set standards to maintain the goodwill associated with the trademark on which consumers of the goods or services have relied. General requirements under the quality control provision of a Trademark License Agreement may include, but are not limited to, the ability to review Licensee`s accounting records or accounting, inspection of Licensee`s facilities, internal audits of Licensee`s logs, and verification of printed materials in connection with the use of the Trademark.
Finally, trademark licensing agreements have the same general provisions contained in commercial contracts, including, but not limited to: the description of the parties; the intention of the parties who have brought them together in a legally binding contract; whether the agreement creates other business relationships; applicable law; and, where appropriate, compensation; limitation of liability; Warranties, etc. If the licensed trademark is registered with the United States Patent and Trademark Office (USPTO), the trademark license may be registered with the Assignment Services Division in order to constructively inform the world of the licensee`s rights to use the trademark. However, many licenses contain confidential or commercially sensitive information that the parties may not wish to disclose to the public. In these cases, it may be possible to register a redacted version of the license agreement or submit a separate document signed by the parties indicating the existence of a license. In summary, trademark licensing can be an effective and relatively inexpensive way for a trademark owner to expand the use and public recognition of their trademark. But there are also many pitfalls that licensors need to be aware of so as not to diminish the value of their trademarks or, even worse, lose their trademark rights altogether. A trademark assignment is a document used to transfer rights to a trademark (i.e., logo, name or symbol) to a new owner, creditor, or even in connection with the conduct of another contract negotiation. An assignment may either bear all the rights attached to a mark or be restricted in one form or another.
A trademark license agreement can be created as a separate agreement or as part of a general commercial agreement between the parties. This document provides general information and guidance for potential licensors and trademark licensees, as well as examples of formulations that should be included in any comprehensive trademark license agreement. .