Understanding the Naked Licensing Doctrine and Its Impact on Advertising, Business, Licensing, Marketing and IP Protection Strategies!

The Naked License Doctrine is often overlooked by many business owners, corporations, franchisers, advertising, marketing and licensing professionals.  For example, there are often times when there is no oversight over how your brand, design, logo, business name or trademark is used by different departments, suppliers, vendors, and other third parties.

Many times, it is an employee using your brand, design, logo, business name or trademark to assist non for profits or promote events for others; however, there is no license of your mark or how the mark is used by the non for profit.  Other times, the advertising and marketing department rolls out a new version of your mark, but does not acquire approval to make the modifications or recognize how it might affect the commercial impression of your original mark.  Sometimes, there is a negative response from consumers and it may actually lead to a dilution or tarnishment of the original mark.

In other cases, the advertising and marketing professionals are too eager to acquire other distribution channels by encouraging use of the mark on a third party’s website, store fronts, advertising and/or marketing brochures without having the third party sign any agreement or license to use your mark.  The worst cases are when franchisers do not take the time to see how their franchisees are using the brand or mark.  This is a significant problem even if, the franchise agreement has some provisions relating to licensing and use of your brand or mark.

The key is are there any actual methods or means for a brand or trademarks owner to prevent a third party or licensee from changing the colors, design, layout, location, font or quality of the products or services sold under its brand or mark.  Is there some process to have a third party or licensee submit its modification to the original brand or mark owner?  Is this process actually utilized?  Is there any means of monitoring or overseeing the third party or licensee’s activities to determine if, your brand or mark is being misused?

If there is no practical means to ensure that your brand or mark is not used, in any way that dilutes, tarnishes or changes the commercial impression of your original brand or mark, then you may be subject to losing your trademark rights.  Even if, you have a license, this situation is ripe with others being able to assert that the license is in essence a naked licensee, thus, you should not be allowed to retain trademark protection of your brand or original mark.  It is always a good idea to consult a trademark attorney prior to licensing and instituting trademark policing policies.

Of course, if you have any concerns or questions, then please contact us at: http://www.vplawgroup.com

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