Buying an Amazon Brand? Get the Trademark Assignment Right

Online brands change hands constantly, from full business acquisitions to one seller buying another's store. In most of those deals the registered trademark is what makes the brand registry, the listings and the reviews worth paying for. It is also the piece most often handled carelessly.

The mark travels with its goodwill

A trademark cannot be sold on its own, detached from the business it identifies. The statute requires that an assignment include the goodwill associated with the mark (15 U.S.C. § 1060(a)(1)). An "assignment in gross" that hands over the name and nothing else is vulnerable to challenge. A well-drafted assignment says expressly that goodwill transfers, and the deal should actually move the product line, not just the registration certificate.

Watch for intent-to-use applications

If any of the seller's marks are still pending on an intent-to-use basis, they generally cannot be assigned before the seller files an allegation of use, unless the buyer is taking over the business, or the part of it, to which the mark relates (also § 1060(a)(1)). We check the filing basis of every pending application in a deal for exactly this reason.

Record it, promptly

Recording the assignment with the USPTO's Assignment Recordation Branch does two things. It lets the new owner file maintenance documents and office action responses in its own name. And it protects the buyer against a later purchaser: an assignment is void against a subsequent buyer who pays value without notice unless it is recorded within three months or before that later purchase (§ 1060(a)(4)). Recording takes minutes once the document is right.

What we check before closing

We confirm the seller is the record owner of each mark, look at status and upcoming maintenance deadlines, and search for licenses, security interests or disputes that would follow the mark to the buyer. We also make sure the deal covers the things that are not trademarks but function like them: the marketplace brand registry account, domain names and social media handles. Finally, the agreement should require the seller to sign whatever is needed after closing, because there is always something.

After the deal, update the owner and correspondence details at the USPTO and on each marketplace's brand registry, and calendar the next maintenance window. Most post-acquisition trademark problems we see trace back to skipping that step.