When to Form an LLC or Corporation vs. Filing a Trademark Application: A Guide by Attorney Elizabeth Potts Weinstein

Hello, I'm Attorney Elizabeth Potts Weinstein. Today, we'll discuss whether you should form your LLC or Corporation first or file your trademark application. Ideally, you would form your LLC or Corporation before filing your trademark application. However, there are important considerations to keep in mind to avoid delays.

Forming Your LLC or Corporation First

When you plan to run your business through an LLC or Corporation, it's usually best for that entity to own the trademark. This approach simplifies future processes since you won't need to assign the trademark later. It also avoids complications when proving your statement of use, the specimen, and the date of first use for the trademark.

The Financial and Timing Challenges

However, some clients face financial constraints or delays in starting their business. They might not have the funds to form an LLC or Corporation and file a trademark application simultaneously. In such cases, delaying the trademark filing can be problematic.

Why You Shouldn't Delay Your Trademark Application

1. Priority Date: Filing a trademark application early secures your priority date. This prevents others from filing for the same or similar trademark.
2. Review Time: The review process for trademarks is lengthy. Currently, it takes about nine months for the USPTO to examine a trademark application. Delaying your filing could result in significant setbacks if your trademark is denied and you need to rebrand after launch.

Filing a Trademark First

If forming an LLC or Corporation is not immediately feasible, filing the trademark application first may be the best option. Here are some key points to consider:

1. Assignment Process: When you eventually form your LLC or Corporation, you'll need to formally assign the trademark to the entity. This involves paperwork and filing with the USPTO, which, while not difficult, must be done correctly.
2. Intent to Use Applications: If you file an intent-to-use application, the entity that will use the trademark must be the one listed on the application. Forming an LLC or Corporation after filing can create complications if the entity is not the same as the one listed in the application.

Conclusion

In summary, if possible, form your LLC or Corporation before filing your trademark application to avoid future complications. However, if forming the entity will take several months or more, it's better to file the trademark application first to secure your priority date and start the review process. Be prepared to handle the necessary assignments and paperwork later.