I have to thank one of my clients for alerting me to an interesting (and kind of weird) trademark event happening this week in New York City. Apparently, on December 8th at the Waldorf Astoria Hotel, a company by the name of Racebrook Marketing Concepts is holding a “Brand Name Auction” during which “150 Timeless Trademarks” will be sold to the highest bidder. The website describes the event as follows:
Buy a priceless Trademark, including its Domain Name, and reinvent its commercial success. Never in the history of marketing and advertising has there been this unique investment opportunity.
The initial purchase is a royalty free, fully paid, exclusive license, including the right to sub license, that you can turn into full ownership when you file the Statement of Use and it is accepted by the Patent and Trademark Office.
Thinking that I may be able to pay off my student loans by getting involved in this “unique investment opportunity,” I conducted some further research and found that a number of different companies have filed intent-to-use applications seeking to register trademarks that were once being used in connection with various products and services but were abandoned due to non-use of the trademark over a long period of time. A sampling of these marks include:
OLD SODA SHOPPE (Serial No. 77119669) for different types of beverages
PERMASTRATE (Serial No. 77638682) for hair care products
SLENDERELLA (Serial No. 77529111) for weight reduction programs and consultation
KITTEN SOFT (Serial No. 77742795) for paper towels, tissues, and toilet paper
These applications have already been approved by the Trademark Office and were not opposed by a third party during the 30 day publication period. Therefore, all that remains to achieve registration is for the owners of these applications to file the Statement of Use once they (or their authorized licensees) make commercial use of the marks. As an aside, I note that almost all of these applications were filed by the same attorney. Must be good work if you can get it.
So what is really going on here? Well, the highest bidder is not actually buying the trademark or trademark application because the law prohibits the sale or transfer of intent-to-use trademark applications before the trademark is put in commercial use. Rather, the highest bidder is merely purchasing from the owner of the application an exclusive, royalty-free license to make use of the mark in association with the products or services listed in the application. Once the licensee begins to advertise and sell the products/services under the trademark, the owner of the application will be obligated to file the Statement of Use and the Trademark Office will issue the registration. The owner of the registration will then assign the registration and all rights to the trademark to the licensee, thereby making the licensee the sole owner of the trademark.
Pretty cool, right? Maybe, but only assuming two things are in place. First, the “timeless trademark” on which the individual is bidding must still have some positive name recognition and nostalgia among the public. Otherwise, it would be no different than creating and developing a completely new trademark from scratch. I personally scanned through the list of trademarks up for auction and found only two that I even vaguely recognized. I guess “timeless” is in the eye of the beholder.
Second, the license between the highest bidder and the owner of the trademark application cannot be “naked.” In other words, the owner of the application must set standards for the use of the trademark by the licensee and exercise quality control over the products/services offered under the mark. If no such license exists, then rights in the trademark may be deemed to have been abandoned and any registration that might issue could be subject to cancellation. And, let’s face it, will the highest bidder know that such a license is necessary? Probably not unless he stumbled upon my blog.
All things considered, I think I’ll forgo this historic chance to own a washed-up, has-been, obsolete trademark and find another way to pay off my student loan debt.