If you’re forming a partnership with another individual, you should be aware of the implications for your company’s ownership. If you have an equal partnership, each partner owns 50% of the firm. However, many partnerships are not that clear-cut, and other circumstances may influence who owns what share of the company. For example, if one person co-founded the company years before their partner joined, they may have more say over how certain decisions are made or which aspects of running their business are handled by one individua trademark l versus another all of this will depend on how your partnership agreement is structured.
When more than one person co-owns a firm, they must decide how to share the company’s ownership.
Simply said, a trademark is a term or phrase that identifies the source of your goods or services. To apply for trademark, you must have proof of commercial usage and must follow the necessary US Patent and Trademark Office requirements (USPTO). In this post, we will define trademark registration and explain how it may help your business flourish.
When discussing trademarks, the first issue that arises is: What does the term “trademark” mean? Any unique name, symbol, or device used in commerce by an individual or organisation to identify its products or services as emanating from it alone is referred to as a trademark (unless otherwise authorised by law). The United States Patent and Trademark Office (USPO) manages trademarks in two categories: common law marks and federal registration marks. An unregistered mark is protected against infringement by common law, whereas federal registration grants you exclusive use on all goods/services within specific industries defined by classifications, such as clothing lines under Section 44111201 through 44113309 or arts & entertainment services such as literary works under Section 101 through Chapter 9999; however, there are some exceptions for certain industries, such as Agriculture Industry Codes 0100 through 2399.
Whether you’re launching a business with your partner or merely have a co-owned business name, you must decide whether to register for a trademark in your individual names or as the corporate entity. When making this selection, there are various aspects to consider.
Is money an issue? Applying for a trademark as a person may be less expensive than as a business or LLC, but there are downsides.
Is every partner named on every document? If just one person’s name appears on the application and papers, that person’s name will appear on all official USPTO records and correspondence (United States Patent & Trademark Office). If another partner was subsequently joined, he or she would be unable to access any existing files since their names were never added to those records.
Two partners can file for a trademark in one of two methods.
One partner might be the trademark’s owner, while the other is designated as a co-owner on the trademark application. Alternatively, both spouses might be identified as co-owners of the same name on their own individual applications. The benefit of this strategy is that it allows each partner to retain control over their individual share of the brand after they’ve established and built it together.
It may be less expensive to register the trademark in one person’s name, but this approach has limitations.
You’re probably thinking that registering a business name in both names is the greatest option, as long as you and your partner get along. A trademark is an asset, and assets are inevitably the source of dispute.
So, what’s the catch? Even if your partnership lasts decades and your company grows from strength to strength, one of you will want out. If one partner departs or dies, their half of the trademark does not follow them; it remains with their previous partner. This implies that if you’re thinking about splitting up but want some financial recompense for not being able to partake in future earnings (and maybe having no input in how these profits were produced), it can be cheaper and less risky to register the trademark under one person’s name alone.
If both parties wish to be mentioned on the trademark, they must file separate trademark application . They won’t have to pay a filing fee twice, and when their application is granted, they’ll each receive their own certificate of registration. Even if their business name is a joint venture or partnership name and not an individual intellectual property right, each person must file a separate application.
Each individual must provide the following: a copy of the other party’s statement (signed by both parties) confirming that he or she agrees to share ownership in the trademark and has made a substantial contribution to its establishment or development
A specimen of usage demonstrating how the mark has been utilised commercially by all three parties
If one of the partners wishes to quit the firm, the partners may have differing opinions about who should hold the trademark.
You can only sell your trademark interest to another party. If you are the only owner of a trademark, you may sell it to someone else. If you are not the only owner of a trademark and your partner has an equal or higher stake in that property than you do, he or she must agree to any transaction. This might cause issues if one partner want to exit their business connection and sell their interest in the business name but is unable to do so for whatever reason (such as a lack of funds) or does not choose to do so for any other reason (like wanting more control over company decisions).
A business name can be trademarked by two persons, although this arrangement needs considerable effort and forethought.
You must be able to claim co-ownership of a business name in order to trademark it. In other words, the two persons who intend to use the mark together (and have an equal stake in doing so) must also agree on how ownership of their firm will be divided.
If one partner wishes to sell his or her portion of the company and leave, there must be a defined procedure for dealing with jointly owned trademarks. A third party cannot acquire only one owner’s