Clients often ask me whether they need an LLC to trademark. The short answer is “no.” However, the better answer is it depends on some consideration about ownership and cost.
LLCs are Not Necessary to Trademark
A limited liability company (“LLC”) is a state-level entity. A trademark filing before the United States Patent and Trademark Office (“USPTO”) is a federal-level filing that serve as a source indicator for Goods and/or Services.
If you file for a trademark with the USPTO, you would need to provide an “applicant.” The USPTO will allow both LLCs or individuals (meaning “humans”), to register a trademark under their name. For example, my neighbor, John Doe, could file an application for his bakery “Blue Dog” under either the company name “Blue Dog Bakery LLC” or as “John Doe.”
Why Don’t I Need A Business to File a Trademark?
If you file and obtain an LLC or corporation in any state (or, for that matter, in any country), you are placing the corporate entity as a shield between yourself and creditors. This is a convenient way to separate your personal and business assets and liabilities. In essence, this is why LLCs and corporations were formed—to serve as a barrier between the business and the individual. When your Secretary of State conducts a search for an LLC or corporation, he or she does not care if a name is too similar to another. They only care if there is a direct match.
On the other hand, trademarks are source-indicators that tell the world from where certain Goods and/or Services emanate. Trademarks also help distinguish your Goods and/or Services from your competitors in the same or related industry or service. Here, when a USPTO Examining Attorney conducts a search, he or she does care whether two names are so similar that it may cause consumer confusion.
As you can see the two are not at all related and serve different functions.
Benefits To Owning an LLC Before Filing for a Trademark
The two benefits of LLC ownership are: (1) “domicile” privacy; and (2) no need to reassign the trademark recordation.
A “domicile” for an LLC is either the “principal place of business” or the business’ headquarters. In contrast, the “domicile” for a person is the place he or she intends to return to or reside.
In addition, if your LLC has a business office separate from your home address, then you can protect the privacy of your home address as well. Keep in mind however, that the USPTO does not accept UPS addresses or P.O. boxes because these are not domiciles in the legal sense.
Providing a business name can protect your privacy from having to publicly disclose your name on the public USPTO database. However, if you sign a trademark application by yourself, then that privacy is lost. This is a good reason to hire a trademark attorney who can sign on your business’ behalf.
No Need to Reassign the Trademark
The second reason you should consider whether you need an LLC before filing a trademark is because of the money saved in avoiding a reassignment. Each trademark has at least one current owner. If after filing under your individual name, you wish to assign the trademark to your company, you will incur additional fees. While an LLC is not necessary to file a trademark, you could save money by filing for the LLC first.
You do not need to own an LLC to file a trademark. However, file for an LLC first can give you two distinct advantages. The first advantage is some degree of privacy. The second benefit is foregoing the need to assign a trademark to your company.
Syed Law can help you file an LLC and file a trademark.