Disturbing the Universe

David L Clements, science and science fiction

RI: What if they go broke?

1 Comment

Thinking about this last night, I came up with another question needing legal expertise to answer.

Well all know that the RI is in trouble. It may be that their heart is in the right place and they do all the good things that Mike and others, myself in an ideal world, would have them do, and say they will not seek to enforce their trademark on anybody in the scicom community.

But what then happens if the RI go broke and have to service their creditors by selling off all their property, intellectual and otherwise?

Will whoever buys the Christmas Lecture trademark bound by any agreement that the RI might have with the scicom community? Wouldn’t any purchaser of the trademark want to make money out of it no matter what agreements had been made by the previous owner?

To use Simon’s analogy of the gate in the field, we might have a nice friendly owner who decides to leave the gate open, but keep the field gated and fenced. But when the field gets sold, what is to stop the new owner from locking the gate and charging admission?

If this is the case – Simon, would it be? – then the only defence against this eventuality would be to have the trademark annulled. The RI’s continued existence is, at best, at risk given that they still owe a *lot* of money. The alternative would be banking on the good graces of not only the RI – and I would credit them with having their hearts, if not their heads, in the right place – but also any and every potential future owner of the trademark.

I’m not sure that’s a risk I want to take.

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Author: davecl

Astronomy, science, science fiction

One thought on “RI: What if they go broke?

  1. Again, these are my informal (but hopefully informed) views.

    Yes, a trade mark can be sold. Trade marks are property (s.22 Trade Marks Act 1994) and can be dealt with like other personal property (s.24(1)). It’s got to be in writing but in the scenario you describe that’s bound to happen.

    What might well happen though is that the trade mark would become liable to be revoked on the basis of loss of goodwill. ‘Goodwill’ is a rather nebulous concept in trade mark and passing off law but in essence it’s the reputation associated with the owner of the trade mark for the goods or services in question. It seems that the RI has tried to get around the problem of ‘Christmas Lectures’ being descriptive by relying on its long history of organising events under this title. But if the trade mark ends up with someone with no such history there would be no such goodwill.

    In some sorts of business, goodwill can be sold. If you have a well-earned reputation for selling quality widgets and you sell me your widget factory complete with award-winning widget designer and imaginative widget sales staff, I probably get your goodwill (indeed, the price I pay no doubt reflects this.) But a fire sale of RI assets is unlikely to transmit the RI’s reputation.

    So, I think that in the scenario you outline the ‘Christmas Lectures’ trade mark would become even more susceptible to being cancelled. (For pedants, it would in this case be revoked, whereas an application against it because it is too descriptive would lead to it being invalidated.) Again though, someone would need to take positive action to do this and until this happened anyone who bought the trade mark might indeed seek to apply it.

    As to whether the buyer would be bound by previous permissions, I’m not sure. Under s.28(3) TMA 1994, licences of trade marks are, provided that they are recorded in writing, binding on successor owners of the trade mark. But, under s.25, this only applies if they are registered with the IPO (is the RI really going to do this every time it gives permission?) or if the successor has notice. Being a bit cynical I wonder if our hypothetical trade mark buyer would deny all knowledge of any permissions granted by the RI…

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