Tips for Avoiding Trademark Scams and Solicitations

66,349 Trademark Stock Photos and Images - 123RF

The USPTO’s database of trademarks is often used as the source of mailing information for unsolicited communications sent to trademark applicants and registrants. Many of these notices are scams, while others are for services which are not needed or required. Some are overpriced versions of real services. Some appear to be services which would be legitimate if provided by a licensed attorney, but many of these services are not performed by licensed attorneys.

Some companies include terms like “United States,” ”Trademark,” “Office,” or “Agency” as part of their names to appear legitimate. For example, in 2021, the operator of two entities who disseminated misleading notifications under the names “Patent and Trademark Office” and “Patent and Trademark Bureau” pled guilty to four counts of federal mail fraud. Some notices also include information from the USPTO database to appear legitimate. However, some notices provide false deadlines to try and get away with their scams before real notices would be sent.

Official notifications come from the “United States Patent and Trademark Office” in Alexandria, Virginia, and all official emails come from the domain name “@uspto.gov.” Recent changes in trademark practice require trademark lawyers to provide email addresses for clients to the USPTO, but these email addresses are hidden from public view. These email addresses are used by the USPTO to send reminders for trademark maintenance and to provide official notification of important post-registration events. For example, the USPTO could send notice of the filing of a cancellation action by email.

As a result of these scams and solicitations which continue to proliferate, we recommend that clients do not pay anything for their trademarks which we do not ask them to pay. We advise clients to check with us if they are ever unsure, as some solicitations are quite misleading and can appear legitimate at first glance. We do not charge for our time in helping clients avoid such scams or solicitations. To learn more, please contact Kevin Thompson at kthompson@lgattorneys.com, or visit https://calendly.com/kthompson-lg to schedule an appointment.

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Selling Your Business?

John Smith owned a small manufacturing business.  One day he received a call from one of his competitors who said he was interested in buying John’s business.  John was now 75 and this seemed like the perfect opportunity for him to retire and have that “nest egg” for him live comfortably in retirement.

John met with the buyer and they discussed, in general, John’s business.  After the meeting, the buyer presented a letter of intent to John, which proposed a purchase price of $10,000,000, subject to the buyer’s due diligence investigation of John’s business.  John felt pleased with the letter of intent and signed and returned it to the buyer.

During a long and protracted (and quite thorough) due diligence, the buyer and his accountants and lawyers examined the business and its books and records.  Based upon their examination, they advised the buyer of various legal and financial risks that John’s business was exposed to and which could become issues that the buyer would have to face.

John could not produce all of his current contracts with his customers.  The contracts which he had contained provisions which could cause the contracts to be terminated upon a sale of the business or a transfer of the ownership of the business.  Their key employees had no employment agreements and could compete with the business once they terminated employment.  The leases for the business’s facilities could not be assigned.

Despite the issues with the business, the buyer was still interested in purchasing the business.  The bad news was that the revised purchase price was to be $8,500,000 with a significant portion to be held in escrow pending resolution of various legal issues.

The above scenario is very common with small business owners.  Bigger companies who regularly acquire smaller companies are “professionals” in the acquisition business.  They know exactly what to look for and they know how to “string the seller along” until they present a reduced offer which most sellers feel they have to accept.

If you are thinking of selling your business, make sure that your business is ready to be sold and that you have copies of all contracts and leases and that you understand what they provide and how they will be affected upon a sale.  Have written employment agreements with all your “key employees.”  Pay attention to your inventory, your accounts receivable and other assets which “drive the sales price.”  Protect your intellectual property by obtaining patents, to the extent applicable, and trademarks.

If you are considering selling your business and would like a “legal check-up,” please do not hesitate to contact:

Morris Saunders at:
msaunders@lgattorneys.com or 312-368-0100.

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