A trademark symbolizes the name, image and goodwill of any business. Trademarks can be sold, transferred or assigned over time as a result of business growth, restructuring, merger or acquisition of the brands. Such assignment of trademark ownership in India should be effected by means of a formally valid document called the Trademark Assignment Agreement. The agreement is under the provisions of the Trade Marks Act, 1999, and it makes the transfer legally valid and enforceable.
This blog describes the definition, significance, and forms, key provisions, and presents a convenient assignment agreement template on trademarks to use as a reference.
Introduction
Trademarks have ceased to be mere logos or brand names, but useful commercial properties. Enterprises spend a huge time and money on establishing brand recognition and trust. In the event that such an asset is transferred, care and legal transfer are done in order to prevent any disputes in the future.
A Trademark Assignment Agreement serves an important purpose of providing effective documentation of the transfer of ownership between two parties. Regardless of whether the trademark is registered or unregistered, a written agreement is necessary to create legal rights and enforce the legal Indian trademark laws.
What is a Trademark Assignment?
The assignment of a trademark is the transfer of the ownership of a trademark by the owner (assignor) to somebody or something (assignee). When that is done, the new legal owner of the trademark is the assignee who assumes the right to use, license or enforce it.
In Indian law, trademarks are either assigned with goodwill or without goodwill. An assignment with goodwill implies that the trademark is sold together with the business reputation attached to the trademark without any limitations, but an assignment without goodwill imposes restrictions on the use of the trademark by the assignee in connection with the same goods or services.
Law Relating to Trademark Assignment
In India, the trademark assignment is regulated by the Trade Marks Act, 1999 and Trade Marks Rules, 2017. Section 37 of the Act acknowledges the right of the registered owner to assign the trademark, whereas Section 38 entitles assignment with or without goodwill.
To make the assignment legally enforceable against third parties, the assignment should be registered in the Trademark Registry within the stipulated time.
When is a Trademark Assignment Agreement Needed?
An assignment agreement is needed in a number of business scenarios. They are the sale of a business or brand, acquisition of intellectual property, restructuring of a company, assignment to a group company, or successors or legal heirs.
Trademark assignment agreements are usually employed even when it comes to startup investments or brand monetisation in order to clarify ownership.
Significance of Trademark Assignment Agreement
A well-written assignment agreement guarantees that ownership is assured and the interests of the two parties are not compromised. It assists the assignee to impose trademark protection against infringement and permits easy registration of the assignment in the Trademark Registry.
In the absence of a written contract, a dispute can be created as to ownership, the extent of rights transferred, and consideration paid, which results in costly litigation.
Key Provisions of a Trademark Assignment Agreement
An assignment agreement of trademarks must be simple, detailed and exhaustive. It needs to state the trademark, the parties and the nature of the assignment attractively. Unclear agreements usually result in challenges to the Registry or enforcement problems.
Relevant details such as assignor and assignee, a description of the trademark, consideration, a date of effect, rights transferred, representations and governing law are key elements in the contract.
Sample of Trademark Assignment Agreement Format
The following is one of the reference formats of a trademark assignment agreement. This format would have to be personalised to the transaction and legal needs.
TRADEMARK Assignment Agreement
This Trademark Assignment Agreement is done on this day of 20.
BETWEEN
Name of Assignor ………It is the Assignor, with its registered address at _____________-, hereinafter referred to as the “assignor” in this expression, which shall also apply to its successors and authorised assigns;
AND
The name of the Assignee………… with its registered address at _____________, hereinafter referred to as the “Assignee” that phrase shall mean the same as its future successors and its assigns as permitted by law.
WHEREAS
The Assignor is the rightful and sole proprietor of the trademark, there being Application/Registration No. in Class of the Trade Marks Act, 1999.
The Assignor has accepted to assign the given trademark to the Assignee and the latter to take the same under the terms and conditions contained in this Agreement.
- ASSIGNMENT OF TRADEMARK
The Assignor hereby assigns, irrevocably and transfers to the Assignee all its right, title and interest in the said trademark in favour of the Assignee, together with/without the goodwill of the business, with effect from the date of.
- CONSIDERATION
Considering the assignment, the Assignee will give to the Assignor an amount of money (Rupees only), the delivery of which the Assignor hereby concedes.
- RIGHTS VESTING IN ASSIGNEE
By the time this Agreement is enforced, the Assignee will be entitled to use, register, renew or license the trademark or assign or enforce the trademark as per the law.
- REPRESENTATIONS AND WARRANTIES
The Assignor guarantees and certifies that such trademark is the real and actual proprietor of the trademark, that there is no inhibition or third-party interest on the trademark and that it is at liberty to make the assignment.
- INDEMNITY
The Assignor is also obliged to indemnify the Assignee against the loss or claim due to breach of representations under this Agreement.
- GOVERNING LAW AND JURISDICTION
This Agreement shall be governed and interpreted in accordance with the laws of India. Courts shall enjoy exclusive jurisdiction.
- EXECUTION
IN WITNESS WHEREOF, the parties are signing this Agreement on the date first mentioned above.
Assignor
Signature:
Assignee
Signature: ____
Registration of Assignment of Trademark
Upon the execution of the agreement, the assignee shall submit the prescribed form to the Trademark Registry so as to document the assignment. Registration gives publicity to ownership change and makes it stricter on enforceability.
Common Mistakes to Avoid
One common mistake is failing to clearly specify whether goodwill is included. Another frequent issue is using vague trademark descriptions or incorrect application numbers. Many businesses also overlook the timely registration of assignments, which can weaken legal protection.
Conclusion
A Trademark Assignment Agreement is a crucial legal document that formalises the transfer of trademark ownership. A well-drafted agreement ensures clarity, protects commercial interests, and facilitates smooth registration with the Trademark Registry. Given the value associated with trademarks, businesses should approach trademark assignment with proper legal planning and documentation to safeguard their brand assets effectively.
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