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

[Crane, Susan]

Dale,

I see no significant risk in the foreign corporation licensing its US LLC from a registration perspective.  A business is entitled to decide it wants to own a mark  in the US, and subsequently form a US entity to market the product or service.  The fact that it solely holds the license does not prove lack of bona fide intent and more than a US holding company filing for marks and then licensing a US sub would.

That being said, if the US LLC will be paying royalties to the foreign Inc., there are various tax considerations that will come into play.

If the end goal is to have the US LLC own the mark, than your second scenario is also plausible – use under license, SOU filed, then mark assigned.  And much less risky than an assignment now that potentially could be challenged as an invalid transfer of an ITU.

Susan L. Crane
Group Vice President, Legal
Intellectual Property, Brands & Marketing

Wyndham Hotels & Resorts, Inc.
22 Sylvan Way
Parsippany, NJ 07054
O (973) 753-6455
M (973) 879-3420
Susan.Crane at wyndham.com<mailto:Susan.Crane at wyndham.com>



From: E-trademarks <e-trademarks-bounces at oppedahl-lists.com> On Behalf Of Dale Quisenberry via E-trademarks
Sent: Friday, June 20, 2025 10:25 AM
To: For trademark practitioners. This is not for laypersons to seek legal advice. <e-trademarks at oppedahl-lists.com>
Cc: Dale Quisenberry <dale at quisenberrylaw.com>
Subject: [E-trademarks] Assignment of ITU application -- exception

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
ZjQcmQRYFpfptBannerStart
This Message Is From an External Sender
Do not click links or open attachments unless you recognize the sender and know the content is safe.
    Report Suspicious  <https://us-phishalarm-ewt.proofpoint.com/EWT/v1/Nf401RNTQFE14GfWW3o!kEaJC7ENw0EbQMs3mjMnkXqPIfQ0tms0AHstRpGdzlU0qw9fAoo5FLgIFuwguZo85gocIy50mStAYbHtgvyX2owKyzJS7SStry26W03QOPqbvRm2memD5oGlpx-cXtzZ0ozgklZvNT6JEw$>   ‌
ZjQcmQRYFpfptBannerEnd
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://urldefense.com/v3/__https:/www.law.cornell.edu/uscode/text/15/1051*b__;Iw!!Nf401RNTQFE14GfWW3o!kXhFJ1aThj6rz61B_-h67sYyOy3if9fvkOF27u6oNVBs414gV-huwbIvlvuzuTp2csQZVOWJc6nUCyrw9XFXnEAvSuMYJ1M$> shall be assignable prior to the filing of an amendment under section 1051(c) of this title<https://urldefense.com/v3/__https:/www.law.cornell.edu/uscode/text/15/1051*c__;Iw!!Nf401RNTQFE14GfWW3o!kXhFJ1aThj6rz61B_-h67sYyOy3if9fvkOF27u6oNVBs414gV-huwbIvlvuzuTp2csQZVOWJc6nUCyrw9XFXnEAvUavgsHQ$> to bring the application into conformity with section 1051(a) of this title<https://urldefense.com/v3/__https:/www.law.cornell.edu/uscode/text/15/1051*a__;Iw!!Nf401RNTQFE14GfWW3o!kXhFJ1aThj6rz61B_-h67sYyOy3if9fvkOF27u6oNVBs414gV-huwbIvlvuzuTp2csQZVOWJc6nUCyrw9XFXnEAvXfh-Yx4$> or the filing of the verified statement of use under section 1051(d) of this title<https://urldefense.com/v3/__https:/www.law.cornell.edu/uscode/text/15/1051*d__;Iw!!Nf401RNTQFE14GfWW3o!kXhFJ1aThj6rz61B_-h67sYyOy3if9fvkOF27u6oNVBs414gV-huwbIvlvuzuTp2csQZVOWJc6nUCyrw9XFXnEAvh83zxao$>, 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<https://urldefense.com/v3/__http:/www.quisenberrylaw.com__;!!Nf401RNTQFE14GfWW3o!kXhFJ1aThj6rz61B_-h67sYyOy3if9fvkOF27u6oNVBs414gV-huwbIvlvuzuTp2csQZVOWJc6nUCyrw9XFXnEAvX0XiPLQ$>

This email may contain information that is confidential and subject to the attorney-client privilege, work product doctrine and other applicable privileges.  This email is intended to be received only by those to whom it is specifically addressed.  Any receipt of this email by others is not intended to and shall not waive any applicable privilege.  If you have received this email in error, please delete it and immediately notify the sender by separate email.  Thank you.


This email message (including all attachments) is for the sole use of the intended recipient(s) and may contain confidential information. If you are not the intended recipient, please contact the sender by reply email and destroy all copies of the original message. Unless otherwise indicated in the body of this email, nothing in this communication is intended to operate as an electronic signature and this transmission cannot be used to form, document, or authenticate a contract. Wyndham Hotels and Resorts and/or its affiliates may monitor all incoming and outgoing email communications in the United States, including the content of emails and attachments, for security, legal compliance, training, quality assurance and other purposes.
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://oppedahl-lists.com/pipermail/e-trademarks_oppedahl-lists.com/attachments/20250620/03fb20fc/attachment.html>