Electronic Signature Legitimacy for Trademark Assignment Agreement in Canada

How to eSign a document: electronic signature legitimacy for Trademark Assignment Agreement in Canada

welcome to the contract Tear Down Show from law Insider where legal experts tear down contracts from some of the most well-known companies and high-profile Executives around the world in this episode attorney Britney St FL brings us a trademark assignment agreement with an international twist so let's tear it down hey everybody welcome back to the contract Tear Down Show from law Insider I'm Mike whan joined today by my friend Britney St Flur Britney how are you today hi am great Mike thank you for having me I'm ready to be confused Britney I gotta be honest because I recently had a conversation with a buddy Steve sedbury who uh talked to us about trademark license agreements we're talking about something related and you're going to tell me the difference this is a trademark assignment agreement I'm pulling this from law Insider it is as between Shanghai magma digital which I assume is also a cool club or something and huray times communication which I assume is a less cool Club because it has kids there uh Britney what are you seeing in this document when are we going to run into this kind of thing what is a trademark assignment agreement okay so let's start there so with the trademark assignment agreement is essentially a complete transfer of ownership rights from one party to the next party and that's the difference between the assignment agreement versus the licensing agreement because with the licensing agreement it's going to be for a period of time in which the owner permits the other individual to use their trademark but not on it cool okay well that makes sense so we're going to go through again you have uh a lot of you're dealing with a lot of international clients these are two uh companies that are outside the United States but they're in the same country and so some of these things may not transfer exactly and I hope you'll call out where things might be different uh based on where the countries are represented uh by these companies but let's start uh with number two registration fees it says the registration for the change of the registered owner of the trademarks shall be undertaken by the assignor and the assignor shall bear the registration fees in incurred hereby what do you think normal uh who's normally paying these fees well typically it depends on what the parties agree on I would say that um I like the fact that this is a part of the agreement just because you know you want to have all of these things kind of lined out before you make the decision to move forward right you want to make sure know who's responsible for what and what you can expect from each party and so the fact that they have the registration fees apart of the agreement is ideal and the registration fees aren't too costly and so it's not like it's a big hoopla for either party to take on either way but you know it's just nice to have this type of thing lined out in advance in the agreement in our conversation with Steve he talked about he analogized these kinds of situations to buying a house and representing title and having Title Insurance all these things I'm going to jump down to section three to representations and warranties because you see in here these two companies making these kinds of title promises so if I jump to uh 3.1.5 the assignor will not engage in any action that will be detrimental to the validity of the trademarks after the completion of the assignment of course the stuff before it says you know I own this nobody else is after it but then they're making continual promise to not break it 32 you know they've got for the asse they've got similar responsibilities if I look at 322 it says the assign subject to its business scope and corporate power has taken necessary steps and obtained full Authority and all consent to uh go and execute and perform on this this agreement so you're seeing between these two not just sort of backwards looking I own this similar to a title to a house but also some forward-looking representations what are you seeing in this section well it's interesting you um compared it to a title of a home because ultimately you want to ensure that when you're doing these assignments that the Trad Mark itself has perfect title right because what you don't want is for someone who doesn't actually have ownership rights to essentially be assigning it to someone else because then it's invalid a automatically right and so you don't want those issues because at that point fees would have already been paid expectations would not have been met and then everyone is kind of confused and now they're having to take it to trial for infringement and you don't want any of those issues so the fact that this agreement requires perfect title before the transfer and then also it also requires good faith effort from both parties to ensure that the assignment is seamless essentially I'm looking just as a curiosity you mentioned with assignment you're passing it on entirely it's interesting to me that they're representing future responsibilities as they talk about this when there is a full transfer but also just as an aside I'm looking at four and effective date and term it says this agreement has been duly executed by the authorized representatives as of the date shall be effective simultaneously doesn't have anything about term about how this thing might end I'm assuming when you're looking at these kinds of documents might not say hey this is valid for 10 years like a license does because as you pointed out you're legit handing the whole thing over but is there normally like ways to get out of the deal similar to those kinds of license agreement do you have termination options in these contracts well typically you know if you wanted to ensure those type of warranties you would include them in the agreement themselves and if you were to go down to five Clause five it shows you that this is how they would settle the dispute if there one if there's one that arises right and so because of that you know that it's not just simply going to be someone feels like they got the short end of the stick but they have uh just a course of action that they can take to ensure that they're not you know being taken advantage of essentially in this agreement and so it lines out exactly what steps that they should take in order to ensure that again they don't get the short end of the sck yeah the settlement of disputes is interesting we've talked about this with arbitration agreements that um sometimes companies will include this bit it it points out that they will strive to settle any dispute uh from the interpretation or performance through friendly consultation within 30 days after one party asks for consultation and then if that all falls apart we'll go to a binding arbitration uh is this normal that you're seeing this kind of with an assign because this is not a long-term relationship in the same way the licenses where you know you guys are sort of renegotiating every decade this deal this is a full handoff is it normal to still try to preserve that relationship by saying hey we'll be buddies with each other I'm not just taking you to court right away well ultimately um we can't truly say what's normal and what's not normal because yet again it depends on what the parties agree on but the fact that this is in here I feel that it's very beneficial for the parties and it probably gives them a bit of relief right and moving forward with this agreement just knowing that they have um just they have options if in the event that things do go aride and this is always best and I would recommend these type of options for dispute settlements in these type of agreements just because of that because what you never want is again if something happens with the trademark because trademarks they are valid the registrations themselves are valid well speaking for the USPTO side of things they are valid for a number of years at a time and then you have to renew them every so often and because of that you want to ensure that when transfers are being had that depending on the time frame in which these transfers are being had that things with the registration itself are intact and the only way to ensure that if in the event things are not intact with the registration that the individual on the other end of this agreement that they have guarantees for themselves and for their business and for their brand because these are investments people are making on themselves on their families and on their brands so it has to make sense for everyone involved yeah and you mentioned to me in preparation for this conversation that you have background dealing with deals that go across borders right in in this case they don't go across borders they're both within uh China and they say under applicable law in six the interpret implementation of this agreement shall be governed by the laws of the People's Republic of China this makes sense because they're both there tell me about when you're dealing with those crossborder agreements how are the parties making decisions on applicable law are there defaults to certain countries do do you see each side saying no my you know the normal conflict of laws stuff that I'm I'm going to pick mine versus yours what are you normally seeing in these kinds of agreements well typically it depends on who has the advant AG right because you would think that the individual that owns the trademark the assignor has the advantage but if for financial reasons they need to sell this this registration and they need to you know transfer it over then AE would have the upper hand in that situation right and so again it just depends on the parties and what makes sense for the individuals that are a part of the agreement the assignor and the assign and their brands right and for the reason in which they're um doing this transfer or assignment right yeah I want to ask sort of a kind of a broad question um that that helps me to think about these types of agreements you know usually with something like a license or you've got these sort of long-term deals and and you have a responsibility if you're a li to go and exercise you know get value out of the license or you might lose it right you've got to go get value out of the marks when you're dealing with an assignment like this and there's a full transfer is there a long-term relationship should there be what is you know again we talked about the termination there doesn't seem to be much in the way of if you do x with this Mark I get to go take it back and kill this deal what is the longterm relationship if any that you would see in these kinds of assignments would you like to have one would you like to have more enforcement on the back end if that makes sense I think that the extent of the relationship that should take place is just with regard to renewals and as this agreement lines out the assign nor cannot do anything detrimental to the registration or the the brand itself um prior to the transfer right and so those are the things that ensure that if there is ever something that comes up with the registration itself with the renewals or if there is anything to basically disparaged the mark itself prior to transfer or even after transfer then you know that these are things that can be uh spoken about and settled between the parties right uh otherwise if you just have it where it's we signed the agreement and we move on and you don't continue that relationship or that Rapport to some degree um then you kind of leave yourself in a space where anything can happen and I don't think that that's the best place to leave yourself in right yeah it's a little hard to do what was the word that they use friendly consultation little hard to do friendly consultation if you go take their trademark and then uh you know beat it up in public all right well cool I appreciate you sharing this uh Britney this is uh interesting stuff again put in the context of the other ways we've talked about using marks it's interesting to hear about this full transfer and especially the the international context for people who want to learn more about that context about you know dealing internationally in these kinds of issues what's the best way to reach out to you breny perfect well we'll include that information as well is a link to this document over at ler.com resources and if you want to be a guest on the contract Tear Down Show just email me I'm at Community lawi insider.com we would love to have you Britney thank you again and we'll see you all next time it's been a pleasure thank you thanks so much for tuning in to this episode of the contract Tear Down Show from law Insider if you're enjoying the show please feel free to rate subscribe and leave a review wherever you listen to your podcasts that's that helps others find the show we really appreciate it thanks again for listening and we'll catch you in the next episode