Trademark Assignment Online in India

Overview

A trademark is simply the name of your business. Trademark is involved in the name of the business itself, a logo or a "combined mark" that covers both your business name and the logo related to that. Like any other property or asset, the owner of the trademark (the assignor) has the right to sell, license or transfer the same. The transfer of trademark is possible through the Trademark Assignment Agreement or Trademark Licensing. The current article basically explains the term trademark assignment along with its advantage, types of trademark assignment, pre-requisites and procedure of trademark assignment.

Trademark Assignment

Trademark is an intellectual property and like any other asset, the proprietor of a trademark has the authority or power to sell, license or transfer the owned intellectual property. Such transfer can be made through Trademark Assignment or through licensing.

Whenever a trademark is assigned, there is some sort of variation in the ownership of the registered brand. But when it is licensed, the benefits related to the trademark continue to vest with the buyer but only a few qualified rights are given to the third party. This assignment can be done with or without assigning the goodwill of business. In case of a registered trademark, such assignment is required to be recorded in the Register of a trademark.

Some of the advantages of the trademark assignment (concerning both the owner and the buyer) are listed hereunder:

• The trademark assignment enables the owner of the trademark to en cash the value of his brand.
• With the help of a trademark assignment, the assignee can obtain the rights of an already established brand.
• The assignment of the trademark supports both the assignor and the assignee to expand their respective business.
• In case of any dispute, the trademark assignment agreement would enable the assignor or the assignee to establish the legal right.

Trademark Licensing

The licensing of a mark is to allow others to use the mark without assigning the ownership and the same may be done for all or some of the goods and services covered. The Trademarks Act does not mention the term 'License'; the concept under the Act is mentioned as that of a 'Registered User'.

Trademark licensing is advantageous to both the parties. While the licensor enjoys its rights to the mark by getting the royalties for its use, the licensee is able to expand its market operations by using the brand and developing its reputation.

In case of Licensing, the licensor is open to license the rights over the trademark in any manner it may like. The Licensor can restrict the rights of the licensee with respect to the products or services, time for which it can use such mark, and area within which it can use such mark.

Statutory Definition of Trademark Assignment

Section 2(1)(b) of the Trade Marks Act, 1999: "Assignment" means an assignment in writing by the act of the parties concerned.

Who Can Assign a Trademark?

As per section 37 of the Trade Marks Act, 1999, the person entered in the register of trademarks as the proprietor of a trademark shall have power to assign a trade mark and to give effectual receipt for any consideration for such assignment.

Assignability of Registered or Unregistered Trademark

As per section 38 of the Act, a registered trademark can be transferred with or without the Goodwill of the business concerned either in respect of all the goods or services in respect of which the said trademark is registered or of some of the goods or services.

Moreover, as per section 39 of the Act, an unregistered trademark may be assigned with or without the Goodwill of the business concerned.

Types of Trademark Assignment

There are four types of trademark assignments:

1. Partial assignment
2. Complete assignment
3. An assignment with Goodwill
4. An assignment without Goodwill / Gross assignment

1. Partial Assignment

Under the partial assignment, the assignor transfers only limited ownership with regard to specific products/services.

2. Complete Assignment

Under the complete assignment, entire rights with respect to the registered trademark are transferred by the assignor to the assignee.

3. An Assignment with Goodwill

Where an assignor assigns to the assignee the value, rights and entitlements also, as associated with a trademark with respect to the goods or services already in use by the assignor. After taking over the goodwill associated with the trademark, the assignee is free to use the trademark assigned to him for all goods or services including those already in use by the Assignor.

For Example: Mr. A is the owner of trademark "TM" used in relation to clothing and footwear. Mr. A assigns to Mr. B the said trademark "TM" along with the Goodwill associated with it. Therefore, Mr. B is eligible to use the said trademark "TM" for clothing and footwear including other goods or services dealt by Mr. B.

4. Gross Assignment or Assignment without Goodwill

Where an assignor assigns to the assignee the right and entitlements in a trademark with respect to goods or services which are not in use by the assignor. In other words, the assignee is not entitled to use the trademark in relation to goods or services already in use by the assignor. The goodwill attached to the brand is not transferred to the assignee.

For Example: Mr. A is the owner of trademark "TM" used in relation to clothing and footwear. Mr. A assigns to Mr. B the said trademark "TM" in relation to goods or services other than clothing and footwear, without assigning the Goodwill. Therefore, Mr. B is not eligible to use the said trademark "TM" for clothing and footwear.

Requirements / Checklist for Assigning Trademark

Assets to be Assigned

• Pending trademark applications.
• Issued trademark registrations.
• Goodwill.
• Associated marks, applications or registrations.
• International registrations.
• Common law trademarks.
• Names of living or deceased individuals.
• Domain names, email accounts, social media or website accounts, etc.

Execution Requirements

• Signatories.
• Witness.
• Notarization.
• Legalization.
• Execution date and place.
• Power of attorney.

Process for a Trademark Assignment

The process of assignment of trademark happens when assignment or transfer of intellectual property rights to another person is done with or without goodwill. The various steps to be followed for the completion of the process of Trademark assignment are as follows:

• An application of a trademark assignment shall be made in Form TM-P by the assignor or assignee, or both can make a joint request to register the assignee as a subsequent proprietor.
• Apply with the registrar of a trademark within six months from the date of procurement of the proprietorship. The application can be filed later, but the requisite fee may vary accordingly.
• In case of assignment without goodwill or assignment of a certified trademark, the regulation from the registrar of trademarks is needed before the expiry of six months from the date on which assignment is delivered or within the extended period provided by the registrar.
• Advertise the assignment in such a manner and within such a period as the registrar may direct.
• A copy of the direction of the registrar and advertisement of the assignment must be submitted to the office to make sure that the directions have been followed accordingly.
• On receipt of the trademark assignment application and required documents, the registrar after being satisfied shall register the assignee as the proprietor of the trademark and the specifications of the assignment shall be recorded in the register.

Restriction on Assignment of Trademark

1. Parallel Use Restriction: Where assignment results in creation of exclusive right in different persons in relation to same or similar goods or services and the use of the trademark will be likely to deceive or cause confusion. Multiple exclusive rights in relation to same or similar goods or services in different persons is not allowed. This prevents the parallel use of a trademark by more than one person in relation to same or similar goods or services. (Section 40)

2. Multiple Territorial Use Restriction: Where the assignment results in creation of exclusive right in different persons in different parts of India, in relation to same or similar goods or services. Assigning of scattered rights in different parts of India is not allowed. (Section 41)

Who Can Register Trademark Assignment?

1. Under section 45, a person (subsequent proprietor) who became entitled by way of assignment shall apply for registration of assignment before the Registrar of trademarks.
2. The Registrar shall enter the details of the assignee (subsequent proprietor) as the proprietor of the trademark assigned in respect of goods or services for which the assignment has been made, after due satisfaction of the Registrar of trademarks (under section 45).
3. Under section 45, whenever the validity of assignments is in dispute between the parties, the Registrar may refuse to register the assignment until the rights of the parties are determined by the competent court.
4. Under rule 76 of Trade Marks Rules, 2017, Registrar of trademark shall dispose of the application for registration of assignment of trademark within a period of three months from the date of receipt of application.
5. Under rule 77 of Trademark Rules, 2017, Registrar may, where there is reasonable doubt about the veracity of any statement or document furnished, call upon any person who has applied to be registered as proprietor of a registered trademark to furnish such proof or additional proof of title as the Registrar may think fit.
6. As per Chapter IV of the Indian Stamp Act, 1899 (rule 78 of Trade Marks Rules, 2017), whenever in the opinion of the Registrar any document produced in proof of title of a person is not properly or sufficiently stamped, the Registrar shall impound and deal with it.
7. Where the Registrar has allowed the registration of assignment, the following particulars shall be entered in the register (rule 84 of Trade Marks Rules, 2017):
   • Name and address of the assignee.
   • Date of assignment.
   • Where the assignment is in respect of any right in the trademark, a description of the right assigned.
   • Basis under which the assignment is made.
   • Date on which the entry is made in the register.

Right of the Assignor on Assignment of Trademark

The assignor terminates to have his rights, title or any interest in the trademark the moment the assignment deed is executed in favour of the assignee, irrespective of the fact that the name of the assignee has not been updated in the record of the Registrar of trademarks.

Rights of the Assignee: When Assignment Is Complete but Registration Is Pending

Though as per section 45 of the Act, it is mandated that the assignee shall apply before the Registrar of the trademarks to register his title. But this does not mean that recording of assignment of registered trademark asserts all rights or titles or interest in the assignee. The right in assignee does exist even before the registration of assignment. The assignee of a trademark is also entitled to file a civil suit, even though the recording of assignment of registered trademark is pending before the registrar of trademarks.

Forms and Fees

In order to record an assignment, an application of a registered trademark can be made through the following forms:

• Trademarks which are pending: Form TM-M is required to be filed by the applicant. Fee Required — INR 900 for each mark.
• Trademarks which are registered: Form TM-P is required to be filed by the applicant. Fee required — INR 9000 for each mark to be assigned.

Benefits of Trademark Assignment

1. Unlock Value: Through an assignment agreement, the brand owner can unlock the value of the brand, which, until this point, only has value on paper. The assignee could be significantly better off beginning a market with a previously well-known brand, rather than developing a new one entirely.
2. Valid Proof: In case of a dispute associated with the trademark, legal rights would quickly be established through the action. The Registrar assures that all the checks are in place by testing the validity of all the clauses in the agreement and declaring the assignment in the Trade Marks Journal.

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Conclusion

Assignment and Licensing of brands are considerable issues and proper strategizing may open vistas of opportunities for all — a licensor, a licensee, an assignor and an assignee. Both concepts involve a degree of planning for the future of the parties involved and the brand in question. Assignment of trademarks allows the Proprietor thereof to en-cash their intellect, efforts, time and money. It is equally important to register the assignment of trademark, since on registration the details of the assignee are updated in the register of trademark, serving as a notice to the public at large.

Disclaimer: The entire content of this document has been prepared as per the relevant provisions of the Act and rules made thereunder, applicable at the time of preparation. The users and readers agree that the information provided in this document is not professional advice. Therefore, we assume no responsibility therefrom.

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