TRADEMARK ASSIGNMENT| PROCEDURE OF ASSIGNMENT OF TRADEMARK IN INDIA

WHAT IS TRADEMARK ASSIGNMENT?

Trademarks are intellectual property, and the owner of a trademark, like any other asset, has the right to sell, license, or transfer the intellectual property. Trademark Assignment Agreements or Licensing can be used to make such a transfer. When a trademark is assigned, the registered brand’s ownership is transferred. When a trademark is licensed, however, the rights to the trademark remain with the original owner, with only a few limited rights granted to the third party. This assignment can be completed with or without the transfer of goodwill.

As a result, trademark assignment entails the transfer of the owner’s title, rights, interests, and benefits to another party. The transferring party is referred to as the “Assignor” while the receiving party is referred to as the “Assignee”.

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DEFINITION IN THE LAW

As per the definition enshrined under the Trade Marks Act, 1999[i], the term “assignment” refers to a written assignment made by the parties involved.

“Transmission” is defined in Section 2 (1) (zc)[ii] as “the transmission by operation of law, as well as any other mode of transfer other than assignment.”

Sections 37 to 45 of Chapter V of the Act, as well as Rules 68 to 79 of the Trade Marks Rules of 2017, prescribe the form and procedure for trademark assignment and transmission in India.

FOUR DIFFERENT WAYS TO ASSIGN A TRADEMARK IN INDIA

In India, various forms of trademark assignments are approved. The parties will fall into a particular form based on their needs and requirements, and the Assignment Agreement will be drafted accordingly.

  • COMPLETE ASSIGNMENT TO ANOTHER ENTITY: In this case, the registered trademark’s entire set of rights is assigned to a third party. After that, the assignee has all of the rights that the original trademark owner did. The assignee would then become the sole owner of the trademark, with rights to assign, trade, and market it, as well as the ability to prevent others from using it without permission. For example, A, the owner of a brand, sells his mark to B in its entirety. A no longer owns any brand rights.
  • PARTIAL ASSIGNMENT: The transfer of ownership in this type of assignment is limited to specific products/services as determined by the parties and stated in the Trademark Assignment Agreement. For example, if the owner of the trademark “Apple” stipulates in the assignment agreement that the assignee can only use the assigned trademark for iPhones. Then he is prohibited from using the mark on any other goods or services other than iPhones.

NOTE: Both complete and partial assignments can now be made with or without the assignment of goodwill.

  • ASSIGNMENT WITH GOODWILL: When a goodwill assignment is made, the assignor receives the rights and value associated with the trademark in exchange for using the mark on products and services that the assignor already sells. For example, if X, the owner of the trademark “Red Tape,” owns a trademark for the manufacture and sale of shoes, he or she can assign the trademark and grant the assignee the right to use it for the same product and activity for the manufacture and sale of shoes.
  • ASSIGNMENT WITHOUT GOODWILL: The assignor can limit the assignee’s rights to the product he has already used, which means that both the assignor and the assignee can use the same trademark for different products or services. For example, if the owner of the trademark “Red Tape” uses it for the manufacture and sale of shoes and decides to assign it without goodwill, the assignee can use the trademark “Red Tape” for any other product covered by the trademark but not shoes.

For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.

THE TRADEMARK ACT OF 1999 RESTRICTS CERTAIN ASSIGNMENTS

  • RESTRICTION ON PARALLEL USE: When an assignment results in the creation of exclusive rights in different people for the same or similar goods or services, and the use of the trademark is likely to deceive or confuse them. Multiple exclusive rights in relation to the same or similar goods or services held by different people are thus prohibited. This prevents multiple people from using the same or similar goods or services under the same or similar trademarks.[iii]
  • RESTRICTION ON MULTIPLE TERRITORIAL USE: Multiple territorial applications Restriction: When an assignment creates an exclusive right in different people in different parts of India for the same or similar goods or services. As a result, assigning scattered rights across India is prohibited.[iv]

REGISTERING A TRADEMARK ASSIGNMENT WITH THE REGISTRY

The procedure for registering a trademark assignment with the Registry is outlined below.

  • ASSIGNMENT OF THE REGISTERED TRADEMARK: Section 38[v] allows for the assignment of an unregistered trademark. As per the provision, any unregistered trademark, with or without goodwill, maybe further allocated or transmitted. Form type TM-16[vi] can be used to file an appeal for the same.
  • ASSIGNMENT OF THE UNREGISTERED TRADEMARK: Section 39[vii] allows for the assignment of an unregistered trademark. The provision specifies that a trademark may be assigned in part or in whole, with or without goodwill. Both trademark assignments can be made on Trademark Form 23[viii] or 24[ix].

PROCEDURE FOR TRADEMARK ASSIGNMENT AGREEMENT

  1. A person (subsequent proprietor) who acquires rights through assignment must file an assignment registration application with the Registrar of Trademarks.[x]
  2. The Registrar of Trademarks shall enter the details of the assignee (subsequent proprietor) as the proprietor of the trademark assigned to him in respect of the goods or services for which the assignment has been made after the Registrar has been satisfied.[xi]
  3. When the parties disagree about the validity of an assignment, the Registrar may refuse to register it until the parties’ rights are determined by a competent court.[xii]
  4. The application for registration of a trademark assignment must be decided by the Registrar of Trademarks within 3 (three) months of receipt of the application.[xiii]
  5. When there is a reason of doubt about the veracity of any statement or document provided, the Registrar may require any person who has applied to be registered as the proprietor of a registered trademark to provide such proof or additional proof of title as the Registrar deems necessary.[xiv]
  6. The Registrar may impound and deal with any document produced in proof of a person’s title that is not properly or sufficiently stamped, according to Chapter IV of the Indian Stamp Act, 1899.[xv]
  7. The Registrar will specify how the trademark assignment will be advertised. Following that, the applicant must create an advertisement in accordance with the guidelines. A copy of the advertisement, as well as a copy of the Registrar’s directive, must be submitted.
  8. When the Registrar permits the registration of an assignment, the following information must be entered in the register:[xvi]

a. the assignee’s name and address;

b. the assignment’s due date;

c. a description of the right assigned if the assignment is for any right in the trademark;

d. the criteria under which the assignment is made;

e. The date on which the entry is made in the TM register.

When the Registrar is satisfied with all of the paperwork, the trademark will be officially transferred from the original owner to the new owner.

IMPORTANT FACTORS FOR DRAFTING AN EFFECTIVE ASSIGNMENT AGREEMENT

  • The Assignment and the obligations outlined therein must not infringe on the owner’s rights.
  • It must be stated whether the assignment is with or without goodwill.
  • The said agreement’s drafting must show a clear purpose for the transaction, and the agreement’s clauses must flow from that purpose.
  • The geographical scope of the assignee’s rights and value in the trademark must be stated explicitly.
  • It must be stated whether the trade dress (if any) is being transferred along with the trademark.
  • If the trademark being assigned includes the name of a living or deceased person, the person’s (or their representative’s) written consent must be obtained.
  • It is necessary to mention the transfer of the right to sue and collect damages for past and future infringements.
  • It must be stated whether the said agreement is binding on the legal heirs.
  • Any provision for the assignor’s cooperation and assistance to the assignee in enforcing, recording, or taking legal action against the assignee in the near future must be specifically mentioned to be agreed upon. Furthermore, the party who will bear the costs must be specified.

For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.

MANDATORY REQUIREMENTS 

  • The contract must be written. In India, oral transmission is not recognized.
  • The parties involved, namely the owner (assignor) and the buyer, must be clearly identified in the agreement (assignee).
  • The nature and value of the consideration for which the ownership is being transferred must be clearly stated.
  • The importance of clearly stating the date and day of the assignment is critical in order to avoid any complications in the event that future disputes arise.
  • Rather than simply stating agreement for the transfer of trademarks in the assignor’s ownership, relevant applications or registrations must be clearly mentioned.
  • The agreement must be executed properly, which means it must be notarized, stamped according to the applicable Stamp Act, and subject to stamp duty.
  • Signatures and witnesses, as well as the date and location of the execution, must all be clearly stated.

IN INDIA, YOU’LL NEED THE FOLLOWING DOCUMENTS TO REGISTER A TRADEMARK:

  • TM CERTIFICATE: Trademark Registration Certificate. (if any)
  • DETAILS OF THE PARTIES: Name of the assignor and assignee, as well as a description of the assignor and assignee.
  • NO OBJECTION CERTIFICATE (NOC): No Objection Certificate issued by the original owner of the registered trademark.

ADVANTAGES OF A TRADEMARK ASSIGNMENT IN INDIA

  • CALCULATE THE WORTH OF YOUR BRAND: It takes a lot of money, time, and effort to build a brand. With a trademark assignment in India, the trademark owner(s) will cash in on the value of a name that had previously only existed on paper. The assignor may still impose necessary constraints as a result of the combined efforts.
  • ASSIGNMENT AGREEMENT ACTS AS A VALID PROOF: In the event of a trademark-related dispute, the assignee’s legal rights would be easily established thanks to the trademark assignment agreement. By examining the validity of all clauses mentioned in the agreement and publishing the assignment in the Trade Marks Journal, the Registry ensures that all checks are in place.
  • A WELL-KNOWN BRAND NAME: The assignee has the benefit of dealing with a well-known and established brand. The assignee saves time, effort, and money when it comes to building brand value.
  • BUSINESS EXPANSION: When it comes to licensing, the assignor’s business grows as more vendors join in on the brand-building effort. The assignor and assignee’s combined efforts will propel the brand value forward.

POINTS TO BE KEPT IN MIND

  • The assignment must be written.
  • It is possible to assign both registered and unregistered marks.
  • The assignment can be done with or without the company’s goodwill.
  • The event of assignment establishes the rights and title of an assignee rather than the registration of those rights and titles.
  • The registration of an assignment is only preliminary proof of trademark ownership.
  • Even before registration, an assignee has rights.

CONCLUSION

With the right strategies, brand assignments can open doors to new opportunities. The concept of assignment entails some foresight into the future of the parties involved as well as the brand in question. The owner of a trademark can cash in on their intellect, efforts, time, and money by assigning it. It’s also crucial to register a trademark assignment because it updates the assignee’s information in the trademark register, which serves as a notice to the general public. The development of a brand, its propagation, and its use are all in the hands of the owner, making the assignment an efficient way to handle the situation.

For more information, please contact us on info@trijuris.com or call us Mb. No. 85100 58386 or 9310 717274.

[i] Section 2 (1) (b), the Trade Marks Act, 1999.

[ii] Section 2 (1) (zc), the Trade Marks Act, 1999.

[iii] Section 40, the Trade Marks Act, 1999.

[iv] Section 41, the Trade Marks Act, 1999.

[v] Section 38, the Trade Marks Act, 1999.

[vi] https://ipindia.gov.in/writereaddata/images/pdf/form-TM-16.pdf

[vii] Section 39, the Trade Marks Act, 1999.

[viii] http://www.ipindia.nic.in/TM-23.pdf

[ix] http://www.ipindia.nic.in/tm-24.pdf

[x] Section 45, the Trade Marks Act, 1999.

[xi] Ibid.

[xii] Supra at 9.

[xiii] Rule 76, the Trade Marks Rules, 2017.

[xiv] Rule 77, the Trade Marks Rules, 2017.

[xv] Rule 78, the Trade Marks Rules, 2017.

[xvi] Rule 84, the Trade Marks Rules, 2017.