By Anna Popova and Tiffany Valeriano, IP Recprdals Department, Brandstock

Regardless if you are recording an assignment, merger, or simple name or address change for your worldwide intellectual property portfolio, you are likely dealing with the question, “Should I file the recordals as a project in one shot, or should I take it in pieces over time?”

If you are like most of the IP departments we work with, there are stakeholders who are at opposite ends of these two methods of getting the job done. As a project, you are required to obtain a larger budget upfront, which could be difficult to get approved. What you probably know, and may want help communicating to other stakeholders, is that executing the change recordals in pieces will undoubtedly lead to considerably greater costs. These costs are due to an overall lack of volume (no economies of scale savings when instructing one-off changes), avoidable office actions, changes in pricing (official fees and local agent fees) over time, and liabilities, not to mention the costs to your valuable time!

We are often asked by our clients’ team members to help communicate the reasons a company should decide to execute their IP transfers and name and address changes as a project instead of piecemeal over time. Here are some important arguments you and other stakeholders should at least consider before making a decision:

Arguments to Execute Recordals as a Project and not as Piecemeal.

REASON 1: Piecemeal is (at least!) twice as expensive

In our experience, it usually will cost twice as much to file the changes piecemeal over time. Many companies will logically decide to file their changes along with renewals or even ad-hoc as needed. At first glance, this makes sense, but you will forfeit the sizable savings you are entitled to through volume discounts, in particular for large scale portfolios.

For example, a change of name or address in some territories can be filed on one application for multiple IP rights. WIPO charges 150 CHF for recording a change for any number of international registrations in the name of the same holder—you have no limit! If you file the changes in pieces, you will pay 150 CHF each time.

These savings don’t just apply to the official fees but also to those fees charged by your local agents and even your service provider if you have one. Furthermore, official fees and agent fees inevitably increase over time—usually unpredictable, creating budgeting headaches.

TIP: If you are working with a service provider or outside counsel for such a project, chances are you can negotiate spreading costs over multiple years, if needed.

REASON 2: Piecemeal will cause problems with new filing projects

A lot of stakeholders do not realize how their ownership changes will affect future filing projects. If recordals are done piecemeal, you are more likely to incur additional and unnecessary costs, office actions and tight deadlines. For instance, in many territories, it is not possible to register a new trademark if there is an ownership or even a slight address discrepancy on file for existing, similar registrations.

While this is not the case in every jurisdiction, this is true in many of the major markets, and in particular those with regulations governing associated IP rights.

In some cases a PTO will present deadlines without the possibility of extension. Should you not be able to deliver adequate evidence in time, you will lose your new application, thus forfeiting all fees already paid (official and agent fees), in addition to fees paid to reply to the office action itself.

REASON 3: Waiting to record with your renewals might not be possible

In many territories, it will not be possible for you to renew your trademark or design in the name of one entity when IP rights are currently registered in the name of a different entity or even have a different address on file. This is particularly true for territories where you must supply a power of attorney to your renewal agent. More specifically, your agent may not be allowed to renew your IP right should it be registered in the name of a different entity due to document formality requirements.

In most territories, you will have to file your assignment, merger, change of name and/or address before you file the renewal. If this is not planned for properly, you could end up being forced to renew within a grace period, which would lead to additional costs or even missing your renewal all together.

In some jurisdictions you may be able to file the change along with the renewal; however, you will still have to pay the official fees owed to the PTO for your change or transfer and the professional fees charged by your agent. Contrary to common belief, most countries will not allow you to file title updates and renewals together for the same fee as the renewal alone.

This is true for complete ownership transfers, name changes, address changes and even slight name discrepancies.

A common misconception is that you can just file simple name or address changes along with the renewals free of charge – but this not true in 99% of territories. You will nearly always have to pay the official fees and your agent will charge you professional fees for attending to this change along with your renewal.

REASON 4: Piecemeal is not even possible in some key territories

In some countries, it may not be possible to record the transfer or change for only one IP right at a time, thus you will be required to record the change for all of your IP rights in those countries. This is the result of the “all-or-nothing” requirement impacting trademarks and patents or due to associated trademark regulations.

REASON 5: Piecemeal makes it hard to enforce your ownership rights

In most territories, you will need to have the ownership information on record up-to-date at the PTO to properly and effectively enforce your rights. If your local agent is appearing in court on your behalf for an IP right in the name of one entity, and the correct effective owner is, in fact, different, this will jeopardize your case.

Not having your ownership information up-to-date can also impact your license agreements and royalty payments, lead to customs issues, etc. We have worked with companies who have faced seizures of goods at Customs due to ownership discrepancies, thus requiring we file changes immediately so that the goods would be released. Likewise, some license holders may use their knowledge of such discrepancies as reasons to withhold royalty payments. Both of these problems cost you time and money to remedy.

REASON 6: Projects produce cleaner portfolios

If the recordals are filed piecemeal, then the passage of time encourages errors in your IP management database, as team members come and go, entity names and addresses change, IP rights are transferred and new IP rights are filed, etc..

Furthermore, executing the recordals as a project will not only limit the inevitable changes that come with the passage of time but will allow focused resources to wholly clean the current portfolio. It is a considerable burden to maintain the history of what happened when and which IP rights should belong to which owners creating a considerable burden. This burden compounds over time but can be reduced by updating your chain of title during your recordal project.

This is a vital piece of portfolio “data hygiene”.

REASON 7: Recordals are actually legally required by most PTO’s

At the end of the day, a surprisingly high number of PTOs legally require that you register ownership changes, mergers, name changes and even address changes; therefore, most local agents will likely tell you it is either required or highly recommended. The truth is registering changes is only optional in a handful of territories.

Should you not register your changes in territories where it is either legally required or highly recommended to do so, you are leaving your organization open to unnecessary risks that may jeopardize your IP ownership.

Simply having the recordal documents in-house is not enough to affect the transfer or title change of IP rights. PTOs only respect what has been presented to them. It is important to remember that filing IP recordals is a deeply formality-driven process. Until you present your evidence and applications to the PTOs, legal transfers or changes that appear on paper carry little weight in most territories.

A Note Regarding Address Changes:
Contrary to common belief, address changes can often create problems in an otherwise clean portfolio. In our experience, many companies underestimate the impact of a simple address change. Yes, even a slight address discrepancy can result in an office action, possible refusal of your new trademark and/or renewal application, and jeopardize your ownership rights!

As you can see, there are some very important reasons to file your recordals as a project. That said, we appreciate it can be difficult to obtain an adequate budget to record your changes as a project. The consequence will be that you need to pursue your recordals on a piecemeal basis. While this is less than ideal, if your organization is willing and able to accept the risks associated with the arguments above, there are ways to organize your recordals that will reduce these risks and even present a compromise.

If you find yourself in this situation and would like some advice, please write to recordals@www.brandstock.com.