[E-trademarks] Assignment of ITU application -- exception

[Dale Quisenberry]

Listmates,

Client filed ITU application in name of XYZ, Inc. (a foreign corporation)

Mark has not been used yet.

Client has now formed XYZ, LLC (a US based LLC).

Client wants to know if it can assign the ITU application from the Inc. to the LLC.

The starting point is no, but I’m exploring the exception in 15 USC 1060(a)(1):

(a)
(1)
A registered mark or a mark for which an application to register has been filed shall be assignable with the good will of the business in which the mark is used, or with that part of the good will of the business connected with the use of and symbolized by the mark. Notwithstanding the preceding sentence, no application to register a mark under section 1051(b) of this title<https://www.law.cornell.edu/uscode/text/15/1051#b> shall be assignable prior to the filing of an amendment under section 1051(c) of this title<https://www.law.cornell.edu/uscode/text/15/1051#c> to bring the application into conformity with section 1051(a) of this title<https://www.law.cornell.edu/uscode/text/15/1051#a> or the filing of the verified statement of use under section 1051(d) of this title<https://www.law.cornell.edu/uscode/text/15/1051#d>, except for an assignment to a successor to the business of the applicant, or portion thereof, to which the mark pertains, if that business is ongoing and existing.


So, at the moment, the LLC does not appear to be a “successor to the business of the [Inc.], or a portion thereof, to which the mark, if that business is ongoing and existing.”  Inc. has not started a business that uses the mark yet.

So I’m wondering which entity should use the mark first.

I believe the LLC is the entity that will be operating the business that uses the mark.

So one option is to put a license agreement in place between the Inc. and the LLC so that the use by the LLC is for the benefit of the Inc.

Does that open up any resulting registration to attack that the Inc. did not have bona fide intent to use?

If so is the only way to navigate this to have the Inc. use the mark, then file the statement of use, then assign the mark and goodwill to the LLC?

Has anyone been down this road before?

Dale

C. Dale Quisenberry
Quisenberry Law PLLC
13910 Champion Forest Drive, Suite 203
Houston, Texas 77069
(832) 680.5000 (office)
(832) 680.1000 (mobile)
(832) 680.5555 (facsimile)
www.quisenberrylaw.com<http://www.quisenberrylaw.com>

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