Quality control provisions are the basis of any trademark licensing agreement. Quality controls protect the reputation of the brand holder by setting certain minimum quality standards by the licensee; Standards on which consumers rely in their purchasing decisions. Where a licensee does not exercise sufficient control over the quality of the products and/or services offered by the taker, the mark may be considered abandoned in some countries (for example. B in the United States) or likely to be attacked by the licensee or a third party (for example. B in the UK). Conversely, maintaining too much control over the quality of the products granted may expose the licensee to unnecessary liability for claims of liability and negligence as a result of product liability and negligence, and cause too much harm to the activities of the licensee. Particular attention should therefore be paid to the application of quality control rules that maintain the value of the brand, while giving the taker the opportunity to carry out his activities as he sees fit. The most direct method of demonstrating appropriate quality control is an explicit written licensing agreement requiring the licensee to actively monitor the nature and quality of the products bearing the licensed mark. Doeblers` Penn. Hybrids, 442 F.3d to 823; FreeCycle Sunnyvale v. Freecycle Network, 626 F.3d 509, 516 (9th Cir. 2010).
However, a license should not be explicit. Doeblers` Penn. Hybrids, 442 F.3d to 824; See also Ritchie v. Williams, 395 F.3d 283, 290 (6 cir. 2005) (referring to the thesis that “the existence of a licensee`s right to monitor the quality of his licensee`s activities is neither necessary nor sufficient, since the quality control of the goods or services of his licensee is in fact a legal mechanism… ». A licensee relationship may be implicit. Doeblers` Penn. Hybrids, 442 F.3d to 824. Whether an implied trademark licence is considered to exist is determined on the basis of the objective conduct of the parties.
In the absence of an explicit right to quality control of products bearing the license mark, a trademark holder may nevertheless avoid the finding of an uncontrolled license and abandonment of the trademark if it is able to identify effective control through control or monitoring. Ritchie, 395 F.3d to 290. Whether a certain level of quality control and control is sufficient is determined on a case-by-case basis; However, it must be sufficient in all cases to meet the “reasonable expectations of customers.” FreeCycle Sunnyvale, 626 F.3d to 519. It is always advisable that the licensee provide an electronic version of the brand and all stylized artworks, designs, logos or typography used by the licensee so that the licensee does not create its own version of the brand. This is especially important if the marking contains a design element, logo or stylized font and ensures that the right size, distance, colour and typography are used. The license agreement must make it clear that copies of the mark can only be made by the artwork provided by the licensee. Any changes made by the licensee to the brand before any use by the licensee must be approved by the licensee. In the event that no graphic design can be made available to the purchaser in electronic form, the licensee should provide the licensee with explicit and detailed instructions to establish the mark using the correct size, distance, colour and typography, and specify that any use of the trademark created by the licensee must be approved in writing before the newly created brand is affixed to a licensed product.