AUDITING TRADEMARK

Verification:

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Most businesses have trademark portfolio quality issues due to external inputs, including new client and attorney acquisitions, general inconsistencies in systems and data entry. If you try to pay for the renewal with an incorrect renewal date, you could lose the trademark. Its as simple as that. You may also need to prepare a list of possible trademarks for licensing, M&A, litigation or an audit. If your data is inaccurate, all of this activity can be delayed. To Verify a potential trademark is strong, available to use, and ready to register, we do much more than a direct hit federal search. To maximize the commercial strength and minimize the weaknesses of a trademark, Not Just Patents recommends our service and our Five-Step Verification process: y Verify Inherent Strength: Searching federal, state, and common law marks to see if the potential trademark or parts of the potential trademark are being used by third parties. One of the goals of a Strong Trademark Registration is to reserve the exclusive use of the potential trademark which means verifying that the potential trademark is not already used by prior users Verify Right to Use the potential trademark--verify the potential trademark has no prior users that may prevent you from registering your mark or who may sue you for using their mark (including users who have abandoned their registration but have not abandoned the mark and have not lost the right to defend their claim) by searching federal, state, and common law marks to see if the potential trademark or parts of the potential trademark are being used by third parties; Verify Right to Register the potential trademark--verify the potential trademark meets USPTO standards for registration . Verify the potential mark (as currently used) Functions As A Mark in applicable specimens of the mark--verify it meets USPTO standards for a trademark rather than just being a collection of mere words or symbols that do not justify legal protection as a trademark. Verify that the Goods and Services ID is both the correct and the maximum claim that are user can make and verify that the Goods and Services ID meets USPTO requirements before filing and verify that the specimen of use meets USE IN COMMERCE requirements before filing a basis (i.e. Was the use a bona fide sale or transportation in commerce which may lawfully be regulated by Congress?).

y y

A registration that protects legal rights and sets the ground work for Strong Trademark Registration strategies will protect investments in a product or service that can last through a long product life. A registration that only meets minimum requirements for filing (all the right blanks filled in) may not ever issue or may not protect legal rights. The abandonment rate of trademark applications at the USPTO (trademarks that did not issue) is very high, 141,908 were abandoned trademarks in FY 2011, about 37%. Many applications do not meet federal trademark law because they have a likelihood of confusion with other registered or

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pending marks, are merely descriptive or generic, have specimens that do not show the trademark functioning as a trademark, have inadequate specimens of use and many other reasons. Many abandonments are from intent-to-use applications where the Alleged Amendment of Use (AAU) or the Statement of Use (SOU) were never filed with the USPTO or were not accepted (problems with specimens). Getting a trademark does not have to be a gambling process.

Methods Of Valuing:
Valuing trademarks is similar to valuing brands. A trademark is a right to a word, sequence of words, symbol or design used to identify a product or service. The associated goodwill that is attached to a trademark is sometimes known as the brand. When valuing trademarks, an appreciation of these wider considerations is important as the two are often intrinsically linked. Intangible Business specializes in valuing trademarks as well as other associated assets such as brands. This is often useful for sale negotiations or a trademark dispute, such as quantifying damage to a trademark, when a representative of Intangible Business acts as expert witness. A thorough, commercial approach is essential to ensure a reliable trademark valuation that can withstand cross-examination and court scrutiny. There are three main approaches to valuing trademarks which Intangible Business adopts. Trademark valuation methodologies: 1. Income approach to valuing trademarks Anticipated future income that is attributable to the trademark is a key component of the income approach to valuing trademarks. This income is discounted to present the trademark value as a single amount. Royalty rates are frequently used to drive the income approach to valuing trademarks. This calculates the amount the trademark owner would need to pay in royalty income if someone else owned the trademark. 2. Market approach to valuing trademarks As part of the market approach to valuing trademarks, comparable royalty rates are sourced to fuel the income approach. Royalty rates are sourced from Intangible Business proprietary database as well as from external sources. Comparable trademark transactions are also analyzed and benchmarked to help support the trademark. 3. Cost approach to valuing trademarks the cost of creating the trademark and the cost and associated risks of re-creating a similar trademark are key considerations when valuing trademarks. These valuations are used primarily to support the other trademark valuation methodologies. Other approaches to valuing trademarks are considered where appropriate although the income approach generally drives trademark valuations with the market and cost approaches acting as sense checks and support. Intangible Business has valued trademarks across industries, countries and markets, including entertainment, leisure & tourism, professional services, fashion, fragrances, pharmaceuticals, technology and telecoms.