The Licensing Journal
Danny Simon, Editor
FROM THE ENTERTAINMENT DESK
“I am sorry, but I simply cannot afford to undertake that kind of program at this time.”
Does that sentence sound all too familiar these days? You propose a trademark program that will insure the safety of your client’s intellectual property only to see it shot down in flames due to the lack of money your client is willing to spend on what he or she may perceive as an expense that is not absolutely essential, perhaps one that can be put on hold for while, or in some cases is viewed as not critical to corporate survival?
You do have the best of intensions here it is not just about what your profit would from the fees your IP program would generate. You are of course entitled to profit from your services; after all you have a business to run. But in your line of work there is also another factor involved it is about fulfilling your obligation to your client; to ensure that you are protecting the company’s IP assets and sometimes taking no is just not an acceptable response.
Perhaps you need to rethink the manner in which your approach the development of an IP program, especially in this economy, when every dollar spent is being scrutinized, analyzed, and must be justified. At least for now, simply assume that approval of your plan will be subject to verbal battle. If your defense is weak do not be surprised if your plan is defeated.
So how do you go about preparing a trademark program that will serve your client’s needs; provide the necessary protection but without running up a significant legal bill day one of the program? Frankly, it is not that difficult. What it demands is that you take the time to really understand the property in question, the short term needs of client and what the long term needs are.
To analyze these questions you may want to begin by obtaining answers to these questions:
- What is the current status of the property? Do not be satisfied with just knowing the current status, but also attempting to understand where the property is heading, or how likely the demand for trademark will be with in a time period of six month, one year and two years.
- What are the key categories that need trademark protection today, not a six months or a year from now, but now. The key to getting the money you need to start building a trademark program is getting your foot in the door, meaning to get the client committed to a program – even if it is not a perfect one. Remember baby steps are better then no steps at all.
- What markets are relevant to the program? Sure, a worldwide program would ensure that your client’s mark is safe and sound, but let’s be realistic here; does the client really that kind of coverage now? Better to focus on the market or markets that are essential for today, with a plan to expand the program as the property expands. What about those territories known for piracy? Perhaps you select a market such as China, as it is still the manufacturing capital of the world, and add others later on.
- What is the long term plan for the growth of the property? Understanding what the long term plans are for the development and growth of the property will afford you the ability to provide you client with an understanding of how you plan to complement the expansion of the property with the protection it will need. It will also allow your clients the ability to be able to forecast what the costs will be for additional trademark costs later on, and provide for such in future budget projections.
Having done your homework, you should be able to compile a trademark program that will provide your clients with just the amount of protection they need now, thus handing them a budget that just might get approved. But more than that, not only will your program show what is necessary now, but it will also provide them with a guide for how they can grow the trademark program to complement the growth of the property, by category and by territory.
A few suggestions that you also may want to include in your trademark program pitch:
- It is essential that you are kept informed of every license/use that is contemplated being granted involving the trademark. Insist on this. Why? You need to be kept informed as to any additional categories your client is considering, reminding them they are operating under a “budget” plan. Therefore your clients cannot be moving ahead of the trademark’s protection – meaning before they grant any use of the mark, they damn well better check with you. If the category is not on list, then it is time to file.
- Suggest that a small percentage of royalty income be put into to a trademark fund. Think of it like a Christmas Club account, each time royalties come in, try to encourage the client to set aside 1-3% into a trademark legal account. Paying for such costs from royalties just may seem less painful then having to write a check out of the company’s corporate bank account.
- Under this type of program you are the monitor, the baby sitter of the trademark program. Do not expect that anyone on the client side will pay a great deal of attention (if any) to whether or not categories are covered for licenses that are being granted or contemplated being granted; the same holds true regarding territories. Also, it is going to up to you to remind your clients about increasing coverage in those markets that are known for pirating goods. You are the one who will have to bring up the subject of increasing this type of protection – meaning adding these types of markets to the list of territories – it will not be a conversation your client is ever likely to raise.
I hope you have found this article to helpful. Having built quite a few trademark programs over the years, it is the methodology I have always employed. Time and again I have found that management is much more agreeable to approve a budget with a smaller number on the last page then a larger one. Once approved, and into profits from royalty earnings, no one has ever denied my expansion of the trademark budget. Remember baby steps will get you there if it is your only mode of transportation.
Wishing you Happy Trademarking,