Overview of Trademark Assignment

The most popular way to protect brand identity in this fiercely competitive industry is through trademarks. Nevertheless, it also helps to expand the customers and brand of your business. Passing over the ownership of the trademark is one such business expansion strategy in certain situations. We shall thus go into great detail about the complete process of assigning a trademark in an effort to explain this aspect of trademarks. In addition, IP rights maintenance costs are diminished by the transferring of trademark process and provide immediate financial gains. A trademark assignment is a legal written document executed between the assignor and the assignee. Trademark Assignment in India acts as the portion of the transfer of ownership of rights, title, and interest from one party to another, it can be recognized by word, phrase, and symbol or design or trademark related to the business.

The Trademark Act of 1999 defines trademark assignment in Section 37. When a trademark and brand mark are assigned, the owner's rights, interests, and titles are transferred.  A person can transfer ownership, benefits, rights, and interests to another person through the process of assignment. A trademark can be assigned to someone to give them ownership of it. Transfers are made by assignors, and the people who receive them are known as assignees.  Trade Marks Act 1999, Section 2(1)(b) defines an assignment as a written transfer of a trademark between the parties. Trademarks can be assigned with or without the business's consent, both registered and unregistered.

Advantages of Assigning Trademarks

Listed below are a few advantages of trademark assignment:

1. Brand building requires a large financial outlay, a lot of work, and time. 
2. We call this trademark valuation. As a result, by assigning their Trademark to a third party, the owners or authors of the Trademark may receive its equivalent in monetary terms.
3. An actual demonstration is a Trademark Assignment Agreement. The Trademark Assignment Agreement is a legitimate document to have in the event that the trademark assignment is challenged or problematic. These assignment agreements provide strong protection for authorial rights and trademark owners. 
4. The owner of a well-known brand's trademark benefits from working with an established brand. 

Categories of Trademark Assignment and Transfer

1. Complete Assignment 

The term "complete assignment" describes the transfer of all trademark rights from one person to another. This covers the rights to earn royalties, transfer the Trademark further, and maintain complete control over how it is used. 

For example, if owner "X" sells owner "Y" all rights to a trademark, then owner "Y" becomes the sole owner and is able to use the Trademark anyway they want, assign it to others, establish usage guidelines, and get royalties. This situation does not require "X's" consent. 

2. Partial Assignment 

A partial assignment is the transfer of ownership that is limited to particular goods or services. 

For instance, if owner "X" wishes to assign its Trademark (♫) exclusively to clothing but owns other products related to men's lifestyle, "X" may transfer the Trademark to "Z" under the agreement that "Z" may only use it for clothing. The Trademark may still be used by "X" for any extra products. We refer to this kind of transfer as a partial assignment. 

3. Assignment in Support of Goodwill 

A trademark can be transferred from one party to another along with all of its rights and values through the process of assignment with goodwill. 

For example, In the case of watches, A, the owner of the 'TH' trademark, may assign it and give the assignee permission to use it in connection with the same product. 

4. Assignment without Goodwill 

When a trademark is transferred without goodwill, it is presented in a way that makes use of it for purposes other than its original designated purposes. 

For instance, suppose a company named "A", specializing in the sale of cosmetic products for women, transfers its Trademark (♫) to "B," specifying that "A" can only use it for products unrelated to goods for men. 

Priorities in Trademark Assignment

1. Only written transfers of trademarks are allowed. 
2. The assignment must have the following two identifying parties-
3. An assignor (owner of the Trademark) and
4. An assignee (buyer of the Trademark).
5. The assignor's agreement and intention are required for the assignment of trademarks.
6. A trademark may only be assigned in return for fair and sufficient payment (amount).

Who Has the Power to Assign a Trademark?

A trademark that is registered with the authorities may be assigned by its owner in accordance with Section 37 of the 1999 Trade Marks Act. However, the provisions of that law shall apply to it.

As a result, trademark assignments are allowed in India.

When Can the Trademark Be Assigned?

It can be assigned in the following situations:

1. Death of the Trademark Owner

When the owner, i.e., the assignor, dies, its ownership passes to the successor of the previous owners in a will or estate. The situation is that the Trademark must be valid and should not have been abandoned by the prior owner. 

2. Sale of business

Like other properties, intellectual properties are also the assets for the company. Even the Trademark is also saleable along with the company. Provided, it has to be registered under the company's name. If a company acquires a business along with the trademark rights with regard to the sale of assets of the company, the intellectual properties are also said to be transferred.

3. Change of the ownership of the business

When two companies decide on having a merger or an amalgamation of the company, a notification is sent to the registry. All the intellectual property of the acquired company is transferred to the new owner through the trademark assignment agreement between the parties.

4. Change in the form of business

Whenever there is a change in a business plan or its form or organisation an assignment is a boon for those businesses.

Agreement for Trademark Assignment

The components of a trademark assignment agreement are as follows;

1. A trademark is usually assigned by mutual consent between the concerned parties.
2. According to the Trade Marks Act, 1999 Section 2(1)(b), an "Assignment" is a formal agreement made by the parties involved. For this reason, a written agreement is required. 
3. The assignor and the assignee are the minimum number of parties required by the agreement.
4. It will make reference to the transferred "mark."
5. The execution date and location must be specified.
6. The consideration that the assignee provided to the assignor in return for the trademark assignment must be mentioned.
7. The agreement must mention the date that the assignment will become effective.
8. Whether the assignment is made with or without the business's goodwill must be stated.
9. It shall be stated in the non-operative portion of the agreement that the assignor is the Trademark's original owner and that he is authorized to assign it.
10. The objective of the trademark assignment or transfer must be stated in it.
11. The owner of the Trademark will not have any adverse effects from the agreement.
12. Limitations must also be specified if the agreement is to operate within a specific geographic location.
13. If there is a partial assignment, the product or service name or names must be stated.
14. If the agreement is to operate in a particular geographical boundary, then such limits shall also be mentioned.
15. In the case of partial assignment, the name(s) of the product or service shall be mentioned.
16. It will provide that, in addition to the ability to sue for infringement, an assignee shall be entitled to use and transfer a trademark. 
17. Indicate that the terms of the agreement will apply to the legal heirs of the parties.
18. The agreement on dispute settlement may contain an arbitration clause. 
19. Both parties' signatures are required, along with the proper witnessing, stamping, and notarization.