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Licensing my Service mark in FL

Miami, FL |

Hello i have negotiated business terms with someone that wants to license my service mark to open up their own real estate company. I need someone to look at my agreement as soon as possible.

Attorney Answers 4

Posted

That needs to be reviewed by an IP attorney with trademark/servicemark licensing experience. Chances are any agreement you prepared pro se will be insufficient and need significant revision. I have probably reviewed 1500 of these and of those done pro se I can only remember about ten that were sufficient and only two that were well done, and that was because the person had years of experience in licensing. This will be even more the case if your use is in some other field than real estate, as you will need careful "insure to benefit" language and need careful "quality control" language so you keep control but minimize your liability. Real estate licensors need strong indemnities from their licensees and need solvent licensees and, even then, likely need to purchase insurance or have the licensees purchase insurance for you. Also, the royalty provisions for this will need to be tailored to provide assurance you don't get shorted by your licensee. And that's just the short of this. There are many other issues. For example, a key one will be registrations to protect both you and the licensee and another will be termination. Also, you will need to be careful or you will actually be issuing a franchise and that will trigger a whole host of other legal requirements you likely do not understand.

I am not your lawyer and you are not my client. Free advice here is without recourse and any reliance thereupon is at your sole risk. This is done without compensation as a free public service. I am licensed in IL, MO, TX and I am a Reg. Pat. Atty. so advice in any other jurisdiction is strictly general advice and should be confirmed with an attorney licensed in that jurisdiction.

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Posted

As a franchise attorney , who has actually walked the walk, owning and operating a very successful franchise, and a court-accepted, testifying franchise expert, I agree with my colleague, Bruce Burdick, especially about falling into the franchise trap.

In almost all situations where someone is given the right to license a mark, money changes hands and there is assistance (like training, providing advice, etc.) OR controls, the franchise trap is sprung. Essentially, this is a ticking time bomb with a very significant financial downside.

As an example, I had a client who was given a "license" to open two frozen dessert locations. He paid the licensor $20k each, for a total of $40k. The relationship went south and he found me. Although the licensor ignored our initial demand letter, filing a Complaint in Superior Court for selling an illegal, disguised a a license, franchise got their attention. The matter was settled fairly quickly for almost $600k. Licensor gets $40k, has to pay $600k - you do the math.

Good luck,


Kevin B. Murphy, B.S., M.B.A., J.D.
Franchise Attorney & Franchise Expert
Director of Operations - Mr. Franchise
FRANCHISE FOUNDATIONS APC

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Posted

You are walking a tightrope with what you plan to do. As an experienced franchise attorney, I can tell you that it is very difficult to draft a license agreement that does not violate the federal franchise laws. You should speak with an attorney immediately and have him or her advise you, knowing all of the specifics of your situation, with the proper way to accomplish your goals.

Please let me know if you have further questions.

This response does not create an attorney-client relationship and is not intended to provide legal advice for your specific situation.

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Posted

You should consult with a trademark attorney. There are a lot of traps for the unwary licensor and in absence of certain provisions within the policy you may find yourself at a disadvantage. The attorney you consult with is likely to ask additional questions from you and may need to obtain other information to ensure the validity and scope of the agreement.

This attorney communication is an analysis of first impression and in no way must be relied upon, or construed as giving rise to attorney responsibility, attorney client relationship or legal advice or opinion; it is not.

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