Trademark Portfolio Management – Things to Learn from Danone’s Recent Acquisition

Trademark portfolio management plays a crucially important role for companies, especially when it comes to mergers and acquisitions. A recent interesting case in this regard was the acquisition of the famous US plant-based food company Earth Island, by the French giant Danone. Following this interesting deal, in this article a trademark attorney from our firm will discuss the different aspects of trademark portfolio management that every company should be aware of.

Decker, Pex, Levi is an Israeli boutique IP law firm. The firm specializes in trademark law and intellectual property (IP). The firm represents Israeli and international clients in various IP legal matters. The services offered by the firm include assistance with handling trademark registration in Israel and worldwide, portfolio management, legal representation in trademark cases, etc.

Danone’s Plant-Based Deal – What Does It Show?

trademark portfolio managementTrends can certainly affect trademarks’ value and ownership. An interesting recent deal which demonstrates it is the acquisition of Earth Island, the US plant-based company. Earth Island was recently purchased by Danone, the French leading food company. The deal reflects 2 current trends: changes in the structure of the worldwide milk industry and a permanent increase in the demand for vegan/plant-based products.

According to a report by Reuters, Danone, which owns well-known brands such as Activia, Actimel and Evian, aims to increase its sales of plant-based products in the upcoming years. The company’s target is set at 5 billion euros from sales of plant-based products by 2025. Acquiring Earth Island could help the company in reaching this ambitious goal, as it is a veteran in the plant-based field (the company was founded in 1988). The company owns popular brands like “Veganaise” and “Follow Your Heart”.

This deal is not rare. We have seen similar deals of mergers and acquisition in Israel in the past few years as well. Such deals are interesting not only from the business point of view. They involve different legal aspects that are worth noticing. Among those aspects are the need to properly estimate the company’s trademarks value; the ways of transferring ownership in the company’s brands; etc. Below we will elaborate on them.

How to Estimate the Value of Trademarks and Brands?

Trademarks are IP assets. As such, their market value is influenced by different factors that are often distinguished from the ones of tangible assets. For instance, the reputation of specific brands or companies is more related to trademarks and other IP assets than tangible ones. 

That is the reason why it is crucial to conduct a comprehensive due diligence of a company’s products before discussing the deal in more detail. That is, to estimate the values of each brand in the market. For such an examination, it is important to be assisted by a trademark attorney with the relevant legal experience. 

Transferring of Ownership

Similarly to the way tangible assets (such as real estate) are in need of changing the registered ownership in order to be fully transferred, trademark deals involve the bureaucratic process of changing the brands’ ownership. 

Since trademark registration is territorial, the changing of ownership should be recorded in every territory in which the trademarks are registered. A way to accelerate the process is to register the trademarks globally, under the Madrid International System. The system includes membership of most western countries and territories, and allows for a unified registration of trademarks. Ownership transfer can be made via the Madrid System as well, without the need of changing the ownership in each country

However, not all countries are members of the Madrid International System. For instance, Hong Kong and the United Arab Emirates are not members. Thus, in such countries, as well as in cases where the trademark is not registered under the Madrid System, a territorial transfer of ownership might be necessary. 

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In summary, there are different legal aspects involved in deals of acquisition. The value of a company’s trademarks and brands must be estimated accurately. The transfer of ownership in the trademarks should also be conducted properly. If you have more questions about the legal aspects of trademark portfolio management, a trademark expert from our firm will be happy to assist you. The law firm of Decker, Pex, Levi is well experienced with representing clients in various trademark matters, in Israel and abroad.

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