Unlock the Power of Online Signature Legality for Trademark Assignment Agreement in the US

How to eSign a document: online signature legality for Trademark Assignment Agreement in United States

- Hi everyone, I'm Attorney Aiden Durham with 180 Law Co. in Denver, Colorado, and you're watching All Up In Yo' Business. (light music) (keys clacking) (arrow whooshing) On this episode of All Up In Yo' Business, we're gonna talk about which comes first, an LLC or a trademark? Or in other words, should you focus on getting a trademark before you start forming your business? But before we get into it, don't forget to like, subscribe, and share and hit that little bell button so you get notifications anytime I post a new video. And don't forget to check the description for links to more information and resources. You can download my free guide, free tips for trademarking your brand, and you can also get more information about my trademark services if you're looking for more help with getting a registered trademark for your business. All right, so it's probably no big secret that there are a lot of things that go into starting a business. A lot of steps that need to be taken and a lot of to-do's that need to be checked off. And it can often be pretty confusing, figuring out the proper order for doing all of that. What do I do first? Do I worry about this? Or do I need to take care of this first? Lots of questions come up and a big one has to do with trademarks and whether you should focus on getting a registered trademark or applying for a trademark, or if you should first start with actually forming the business. Because I work mostly with LLCs and a lot of single-member LLCs, I'm gonna use LLCs for these examples and talk about LLCs. But what I'm talking about really applies to any other kind of business entity, not just specifically LLCs. So if we're talking about starting a business and we're gonna operate as an LLC, the big question is, "Do I form the LLC first or do I file for the trademark first?" As with most things, there's no one right answer. It always, always depends on your situation, your circumstances, all of that. But generally speaking, what I typically recommend is forming the business first. Getting the LLC formed first before you worry about filing the trademark application. The reason for this is because the trademark is going to be owned by someone. And normally we would want the LLC to be the owner of the trademark because the LLC is gonna be the one using the trademark. So let's say we file the application for the trademark first, since the LLC doesn't exist yet, it can't be the applicant. It can't be named as the owner of the trademark because it doesn't exist. So in that case, you as the individual or individual owners of the business would have to be the applicant and the owner. And that's fine, but if you are the owner of the trademark, but then your business is going to be using it, you would have to assign or transfer the trademark ownership to the business. You can't really do that while the trademark is in the application process. Once the trademark has been registered, then it's fairly easy to transfer it from the owner to the LLC. But you know, it always again, kind of depends on the situation. So because of that, that's really the main reason that we typically want to set the LLC up first. It's so the LLC exists so it can own the trademark. Now the little one exception that I make to this is usually with single-member LLCs. If you're gonna be the only owner, then in the end it's not really a big deal if you are named as the owner of the trademark initially. Because then, like I said, once the trademark is registered, you can assign or transfer that ownership to the LLC. And that can be part of your member contribution to the LLC, is this intellectual property, this trademark registration. But the reason I say that specifically for single-member LLCs is because when there's more members, more people involved, it can potentially cause a problem later on if we're trying to transfer ownership. Or let's say there are multiple members, and one of the members is named as the owner. If that member decides to pack up and leave or hit the road, then it may not be easily possible to get that ex member to transfer ownership of the trademark to the LLC now. Or it is possible to have multiple owners of a trademark so if multiple members are the owners, then it's just more that goes into having to make that assignment or that transfer because we're dealing with more people who have to agree to it now, essentially. So, in the end, overall, it is best to start with forming the LLC or getting the entity up and running and formed before you worry about filing a trademark application or pursuing trademark registration. But! But, but! The big thing with that is that just because we're not worrying about the trademark just yet, doesn't mean we don't need to worry about the trademark just yet. This is gonna be especially important if the name of your LLC is going to be the trademark. It's going to be the name or the brand that you're gonna do business under. Something that often kind of gets people confused is a business name or an LLC name isn't the same as a trademark at all. You can have your LLC be registered under some name and then your trademark can be something completely different. You don't necessarily have to do business under the name of your LLC. You can use a trade name or a DBA. You can have different brands under an LLC. So if the LLC name is what you're going to use as your trademark, if that's going to be the trademark, if that's going to be the brand, then you do want to at least do some preliminary trademark clearance before you commit to a specific LLC name. Because with LLC registrations, there's not gonna be checks and balances like there are with trademark registrations, where an examining attorney tells you, "This trademark is available and you can have the registration." That doesn't happen with LLC registration. So just because you register the name under an LLC, doesn't mean that it's going to be available for you to register as a trademark. So if you're in the process of setting up an LLC and that LLC name is what you are going to use as your trademark, then at least, do a good thorough Google search. Get on the USPTO's website, they have the TESS, T-E-S-S search database that you can do a pretty simple search of any registered or pending trademark applications. At least get a good idea of if the name that you wanna to use for your LLC and trademark is at least available. Best case scenario, of course, would be to have an attorney perform a full clearance search for you before you even worry about the trademark, so that way we get the trademark down, then we know we're in the clear for filing the trade. I'm sorry, we get the LLC done, and then we know we're in the clear for filing the trademark. Having said that, though, in the end, let's say you file and form your LLC, and then you get around to thinking about the trademark and you find that that trademark's actually not available, you won't be able to register that trademark. For most states, the process of amending your LLC's name, it's not very difficult. It's not a especially costly or time consuming process. So often, worst case scenario, if you do want the LLC's name and the trademark to be the same, you can always go back and amend or change the LLC's name if the initial name isn't available as trademark registration. I know that this comes up because a lot of people worry about, "I wanna get my trademark protected before I put it out there." So that's kind of the underlying thought is, "Well, I don't even wanna start this LLC because I don't want the name to be out there if I don't have a trademark registration." But the problem with that is that you have to put the trademark out there before it becomes a trademark. I'm sure you guys have heard me say this before. If you haven't, you'll hear me say it again, but a trademark isn't a trademark until it becomes a trademark. So just because you file the application for the trademark, doesn't mean it's a trademark if you're not actually using it as a trademark yet. So just because we filed the application, that's not giving you really a whole lot of benefit. It's giving you some benefit because it's getting you in the system, getting the trademark in the database and it's getting that ball rolling. But if you file the application and never start doing business, never start using the trademark, then you're not gonna have a trademark because you have to be using it in order for it to be a trademark. And finally, just to clear up a little bit of confusion that I often deal with, LLC registration, registering an LLC or a corporation or any other kind of business with your state or at the state level does essentially nothing for trademark protection. LLC registrations and trademark registrations are completely separate and different things. If you register an LLC, that doesn't mean you have a trademark in that name or any real kind of trademark protection. Again, you have to actually be using the trademark. It's only when you use the trademark that it becomes a trademark and some trademark rights are attached. So to summarize, if we're wondering what comes first, the LLC, or the trademark, typically, it's gonna be the LLC that we wanna take care of first. That's all for this episode, folks. Drop a comment below, let me know what you think. And again, don't forget to check the description for additional information and resources. You can also learn more about my all-inclusive trademark registration package called Brand Bombshell, where I take care of every step of the process from clearing the trademark to everything that comes along in the application process. You can learn more about that, or if you're a DIY-er a bit on a tighter budget, you can check out my online course called BRANDISH: DIY Your Trademark Application, where I teach you the step-by-step process for preparing and applying for a trademark without a lawyer. Thank you all so much for watching. I'm Aiden Durham, and I'll see you next time. (light music)