As per applicable laws in India,trademarksare considered as intangible assets and hence, the proprietors/owners of trademarks can assign and transfer rights in the same similarly to how they would transfer rights in physical properties (existing in tangible form). The legal process for assigning rights in any trademark (whether registered or unregistered) involves execution of an assignment deed between the parties.
The act of assignment denotes a transfer of legitimate rights, interests, titles and benefits from one person to another. The assignment of a trademark means to transfer the owner’s exclusive right in a trademark to another person/entity. In the case of such an assignment, the transferring party is referred to as assignor, and the receiving party is referred to as the assignee.
Assignor: Trademark assignment enables the trademark owner/assignor to monetize their brand's worth (such as by selling their trademark in exchange for consideration)
Assignee: Trademark assignment enables the assignee to gain access and/or ownership to an already established and well-known brand/trademark by virtue of such assignment.
Both parties: Trademark assignment can help both the assignor and the assignee expand their businesses, depending on whether the trademark assignment is made with or without goodwill
Legal implications: A trademark assignment agreement clearly outlines and sets out the statutory rights and obligations of both the assignor and the assignee.
The different kinds of trademark assignments are as follows:
Complete Assignment: The trademark owner transfers all ownership rights concerning the mark to another party, including the right to modify, rent, lease, loan, sell, assign, distribute, license, sublicense from and in connection with the Trademarks.
Partial Assignment: The trademark proprietor assigns the trademark to another person with respect to a specific geographical area and/or for only specific services or goods. The transfer of ownership in such trademark assignment is restricted to specific services or products.
Assignment with Goodwill of Business: The owner of the trademark transfers the trademark to another person, along with the goodwill associated with the trademark and business. This essentially indicates that the assignee will be the exclusive proprietor of the mark and can use the trademark for any goods or services, including the goods or services that the assignor has been using the trademark for in the course of trade.
Assignment without the Goodwill of Business The owner of the trademark transfers the trademark to another person/entity but does not transfer the goodwill associated with the trademark. This essentially indicates that the assignee cannot use the trademark for any goods or services that are similar to the goods or services that the assignor has originally been using the trademark for in the course of business
Written Form: The trademark assignment is required to be undertaken in written form i.e. it should be documented in the form of an assignment agreement/deed.
Identifying Parties: The trademark assignment agreement should clearly identify both parties involved, the assignor (the trademark's current owner) and the assignee (the intended purchaser of the trademark).
Assignor's Consent: The assignor must have the intention of transferring their trademark rights and must willingly agree to the same in writing.
Lawful Consideration: The trademark assignment agreement should contain a clause stipulating the consideration that will be paid by the assignee to the assignor in lieu of the assignment of a trademark.
Goodwill Specification: The trademark assignment agreement must explicitly state whether the marks are being assigned with or without the associated goodwill.
Geographical Scope: The geographical area or regions where the assignee holds the rights and values associated with the trademark must be clearly defined in the trademark agreement.
Legal Compliance: The agreement should be duly executed and must be stamped and notarized as per the applicable stamp duty regulations in India.
Signatures and Witnesses: The signatures of the parties involved, along with the signatures of witnesses, must be affixed to the agreement.
Date and Place: The date and location where the agreement was executed must be clearly stated therein.
Assignment Deed: A duly stamped and notarized assignment deed is mandatory for trademark assignment. For applicants residing outside India, the assignment deed must be notarized in the country of execution and subsequently stamped in India. This assignment deed will be submitted before the Registry along with the requisite application.
Affidavit of No Pending Litigation: The Indian Trade Marks Registry now mandates an affidavit confirming that there are no pending litigations or ownership disputes related to the trademarks being assigned. Along with the assignment deed, the assignee must submit a duly stamped and notarized affidavit detailing the assignment particulars, the assigned trademarks, and affirming the ownership status.
Power of Attorney (PoA): In case the assignment recordal request is being filed by a trademark attorney/agent on behalf of the assignee, a duly executed PoA from the assignee in favor of the attorney would also be required to be filed before the Trade Marks Registry.
The process of assignment of the trademark in India are as follows:
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Yes, an unregistered trademark can be assigned to any third-party entity/individual with or without the goodwill of the business associated with the trademark, provided the assigner can prove its ownership over the unregistered mark being assigned. To record such an assignment, an application can be made (in prescribed form upon payment of prescribed fee) before the Trade Marks Registry (in case where a trademark application has been filed before the Registry but is pending registration).
The primary distinction between trademark licensing and trademark assignment lies in the transfer of ownership rights. In trademark licensing, the owner of the trademark generally grants a limited license to another party (licensee), to use the mark, and no ownership rights are transferred. Conversely, trademark assignment involves a complete transfer of trademark ownership from the assignor to the assignee (inclusive of all exclusive user rights and entitlements in respect of the mark).
A trademark assignment agreement is crucial for guaranteeing the validity and enforceability of the trademark transfer. The agreement must be in writing and bear the signatures of both the trademark owner (assignor) and the assignee. It must also explicitly outline the terms of the assignment, including the consideration paid for the transfer and the rights being transferred
In case of a complete assignment, the trademark owner/assignor assigns and transfers to the assignee complete ownership rights over a trademark (including all rights associated with the trademark such as user rights, right to earn royalties, and other entitlements).