The Art of the Trademark Consent Agreement: How to Share a Brand Name Without a Legal Battle

A trademark consent agreement can give two businesses a practical way to use similar brand names without entering a costly legal battle. In California’s crowded marketplace, a Berkeley technology company, a San Francisco service provider, and a national consumer brand may encounter similar wording in different industries, channels, or geographic markets. Similarity alone does not automatically determine who must rebrand or who must abandon an application. The real question is whether consumers are likely to believe that the businesses come from the same source and whether carefully drawn written boundaries can meaningfully reduce that risk.

For businesses facing a Section 2(d) likelihood of confusion refusal or an opposition proceeding based on a similar mark, a consent agreement can be an alternative to either party giving up its brand entirely. Sharon Adams of Adams Law Office helps businesses evaluate trademark conflicts, filing strategies, settlement options, and long-term brand protection plans. This blog explains what a trademark consent agreement is, when it makes sense, what provisions it must include, and how the USPTO evaluates these agreements. You can also visit the trademark services page to learn more about the firm’s approach to conflict resolution.

What Is a Trademark Consent Agreement?

A trademark consent agreement is a contract in which two or more parties establish rules for using marks that are identical, similar, or potentially confusing. The agreement may permit continued use by both parties while defining boundaries designed to reduce consumer confusion. Those boundaries can address goods and services, geographic markets, trade channels, advertising methods, logos, domain names, social media accounts, and other measures designed to reduce the likelihood of confusion. 

A consent agreement for similar trademarks may be entered into before an application is filed, during USPTO examination, after a likelihood of confusion refusal, during an opposition proceeding, or after the parties discover marketplace overlap. It can also be useful when one party holds an existing registration, and the other party has developed meaningful commercial goodwill in a related mark in a different market segment. The Adams Law Office guide on whether two businesses can use the same trademark provides background on the factors that determine when marks can legitimately coexist.

Sharon’s Voice: Often, when the USPTO issues a Section 2(d) refusal based on likelihood of confusion with an existing registration, the applicant thinks about asking the registrant for a consent agreement, particularly if the blocking registration is in a different geographic area. In theory, this may seem like a good idea. In practice, an applicant asking for a consent agreement often makes the registration owner suddenly believe their trademark registration is much more valuable than it actually is. 

If the trademark applicant is willing to pay up, then perhaps a coexistence agreement may be reached. 

That appears to be what happened with Obama’s trademark application for HIGHER POWER. Obama’s production company filed an application for HIGHER POWER for video and film production in Class 041. The USPTO refused registration, citing a likelihood of confusion with an existing registration for HIGHER POWER for photography and publishing of audiobooks and music in Class 041. 

First, it’s obvious that a trademark clearance search would have shown that the HIGHER POWER registration would likely be cited against Obama’s application. We can assume Obama’s team did a clearance search and decided to proceed anyway. Then, when the USPTO issued the inevitable refusal based on likelihood of confusion, Obama’s team sought a consent agreement with the registrant. The settlement terms are unclear, but a consent agreement was reached, presumably upon payment by Obama’s team to the registrant. The consent agreement is shown below. 

A consent agreement does not automatically bind the USPTO or guarantee that a pending application will proceed to registration. The USPTO will review a consent agreement. If the USPTO finds that the consent agreement is a “naked consent agreement,” the USPTO will continue to find a likelihood of confusion. In evaluating a consent agreement, the USPTO considers these factors: 

(1) Whether the consent shows an agreement between both parties;

(2) Whether the agreement includes a clear indication that the goods and/or services travel in separate trade channels;

(3) Whether the parties agree to restrict their fields of use;

(4) Whether the parties will make efforts to prevent confusion and cooperate and take steps to avoid any confusion that may arise in the future; and

(5) Whether the marks have been used for a period of time without evidence of actual confusion.

The HIGHER POWER consent agreement seems to be a “naked consent agreement.” It contains boilerplate terms regarding the potential for likelihood of confusion and regarding the parties’ efforts to avoid confusion. Nevertheless, the USPTO did approve the HIGHER POWER consent agreement.  

A well-drafted consent agreement can support the case that confusion is unlikely, but it should not be treated as a substitute for a complete legal analysis of the conflict.

Why Similar Marks Do Not Always Require One Business to Rebrand

Trademark rights are tied to the source of particular goods and services. Two businesses may use similar words if their commercial contexts are sufficiently distinct. A mark used for restaurant services in Berkeley may legitimately coexist with a similar mark used for industrial engineering software in Seattle. The analysis does not depend only on whether the words look alike. It depends on the entire marketplace relationship between the businesses.

The factors relevant to this analysis include the similarity of the marks, the relatedness of the goods and services, the typical purchasing conditions, the sophistication of the likely consumers, the trade channels through which both businesses operate, any evidence of actual confusion, the strength of the earlier mark, and the expansion plans of both parties. The Section 2(d) refusal guide covering relatedness of goods and services explains how examining attorneys analyze this combination of factors.

A consent agreement is most appropriate when both parties can establish meaningful, enforceable, and realistic boundaries. It is less suitable when both businesses sell identical products to identical consumers under nearly identical marks, when there is an established history of actual confusion, or when one party’s realistic expansion plans would bring it directly into the other’s market within the near term.

When Should Businesses Consider a Consent Agreement? 

The right time to explore a negotiated solution depends on the circumstances of the dispute. An applicant may consider a consent agreement after receiving a USPTO Section 2(d) refusal based on a prior-filed application or registration. A trademark owner may consider it after receiving an inquiry from a new applicant whose mark creates potential overlap. Either party may encounter a demand letter, a notice of opposition, a petition for cancellation, or a marketplace complaint from a platform.

Businesses should not contact the other party without first understanding their own legal position. An informal email can be treated as an admission, a promise, or an opening for broader demands. Before initiating discussions, a business should review the relevant marks, conduct a clearance assessment, and identify its best and worst-case legal outcomes. The trademark clearance search guide explains why a fresh search at the time of the dispute may be more informative than the original search conducted at launch.

Step One: Conduct an Independent Risk Assessment

Before negotiating any consent agreement, each party should analyze the conflict independently. The assessment should identify who used the mark first in commerce, whether either party holds a registration, what those registrations cover, how the parties actually operate in the marketplace, whether there is documented evidence of consumer confusion, and whether either business has realistic plans to expand into the other’s territory or product category.

The analysis should cover corporate names, domain names, social accounts, product pages, packaging, advertisements, app store listings, and marketplace profiles. It should not be limited to the exact name in question. Related brand elements, including logos, color schemes, and slogans, may create confusion even when the parties use slightly different wording. A thorough review should also examine the broader landscape to identify any third parties whose existing rights might affect the proposed agreement. A consent agreement between two businesses does not extinguish the rights of an unrelated third party with a prior claim. 

The guide on searching before filing and the trademark opposition guide provide useful background for businesses trying to understand their legal standing before entering negotiations.

Key Provision One: Identify the Marks With Precision

The agreement should identify every mark covered by the arrangement with complete precision. That may include word marks, logos, stylized versions, slogans, trade dress, product names, service names, domain names, and abbreviations. The parties should attach clear specimens or visual exhibits for any design elements.

A vague description creates future arguments. If one party owns a word mark and the other uses a logo containing the same word, the agreement must clarify whether both are covered. If the arrangement permits use of a logo but prohibits standalone word use, that limitation must be explicit. The parties should also identify current registrations and pending applications by serial number or registration number, and the agreement should address whether the parties will file new applications, amend existing descriptions, consent to registration, or withdraw pending applications.

Key Provision Two: Define Permitted Goods and Services

The goods and services clause is a very important provision in a trademark consent agreement. The parties should describe with specificity what each business may offer now and what it may not offer under the shared or similar marks. The language should create a workable commercial boundary without accidentally restricting legitimate business development that presents no real risk of confusion.

For example, a software company may be permitted to use a mark for project management software but prohibited from offering financial advisory services under the same name. A consulting company may provide professional services but be restricted from launching a consumer mobile application. A restaurant may use a name for dining services, while the other party uses a similar name for packaged food sold through grocery retail channels. The Adams Law Office trademark classes guide explains why the commercial description in the agreement should align with, but not be limited to, USPTO classification categories.

Key Provision Three: Establish Geographic Boundaries

A geographic restriction may be appropriate when two businesses operate primarily in separate regions. However, online commerce makes geography inherently difficult to define in a consent agreement. A Berkeley business may have customers across the United States even if its office is local. A geographic restriction must therefore address websites, national shipping, online advertising, virtual events, and remote service delivery, not just physical store locations.

The agreement should define whether a party may open physical locations in the other’s designated territory, advertise to customers located there, exhibit at national trade shows, or accept orders through a nationally accessible website. It should also address what happens if one business expands organically into the other’s area through customer demand. A geographic provision that is too broad may prevent legitimate growth. One that is too narrow may fail to reduce the confusion it was designed to address. The California versus federal trademark guide explains why the geographic scope of protection is particularly important for businesses operating in a high-growth state.

Key Provision Four: Address Trade Channels and Marketing Practices

Reducing risk through separation of channels of trade is an important structural strategy in a consent agreement. One company may sell exclusively through enterprise contracts while the other sells through consumer retail or direct-to-consumer social media. One may operate in a professional B2B market while the other uses influencer marketing and retail stores. The agreement should describe those differences accurately and create clear rules for each channel.

Marketing restrictions may include prohibitions on bidding on each other’s brand names as paid search keywords, using language that suggests affiliation, mimicking the other party’s visual presentation, or advertising in the other party’s designated channels. The agreement should also provide a mechanism for addressing new channels that emerge after signing, such as new social platforms, content formats, or distribution models that did not exist at the time the agreement was negotiated.

Key Provision Five: Efforts to Avoid Confusion

A consent agreement should address the parties’ efforts to avoid confusion and the steps they will take to address any confusion that may arise in the future. For example, the agreement may require either party to inform the other of instances of actual confusion. 

Key Provision Six: Whether the Marks Have Been Used Without Confusion 

In some cases, the two marks have coexisted for a significant period of time. If this is the case, then it’s appropriate to include a statement regarding this in the consent agreement. 

What the USPTO Considers When Reviewing a Consent Agreement

When a consent agreement is submitted to the USPTO as part of a response to a Section 2(d) refusal, the examining attorney evaluates the agreement in the context of all other relevant facts. A consent agreement is one piece of evidence, not a dispositive solution. The USPTO has stated that a properly drafted consent agreement can carry substantial weight, particularly when it demonstrates that the parties have thoughtfully considered their respective commercial interests, includes meaningful limitations on goods, services, territory, and channels of trade, and establishes.

Conversely, the USPTO may give less weight to a bare consent letter that simply states one party does not object to the other’s registration without providing meaningful restrictions. The USPTO trademark examination process guide explains how examining attorneys review office action responses, and the Section 2(d) similarity guide provides the analytical framework the USPTO applies when evaluating likelihood of confusion.

Enforcing a Consent Agreement Over Time

A signed consent agreement is not self-enforcing. Both parties must monitor compliance and respond promptly when either party begins operating outside the agreed boundaries. Passive tolerance of a boundary violation can make enforcement more difficult later and may affect the overall strength of the arrangement.

The agreement may include a dispute resolution procedure, a timeline for raising concerns after discovery of a potential violation, and remedies available for breach. The parties may agree to mediation or arbitration before litigation, which can reduce costs and preserve the commercial relationship. The agreement should also address what happens when a party is acquired, merges with a third party, or significantly changes its business model, since these events can alter the competitive relationship in ways the original parties did not anticipate.

The trademark monitoring guide explains how systematic monitoring of the USPTO database and the marketplace can help a business identify when the other party begins moving outside the agreed boundaries. The guide on what to do when someone is using your brand name provides practical steps for responding to unauthorized use.

Alternatives to a Consent Agreement

A consent agreement is not the only option when two businesses discover similar marks. Depending on the circumstances, the parties may consider:

• A license agreement permitting one party to use the other’s mark under controlled conditions
• An acquisition of one party’s trademark rights by the other
• A rebranding by one or both parties to create sufficient distance between the marks
• A negotiated amendment to the goods and services description in a pending application
• Abandonment of a pending application in exchange for a license or other commercial consideration

The correct approach depends on the strength of each party’s legal position, the commercial importance of the mark to each business, the cost and risk of continued dispute, and each party’s realistic options for achieving its business objectives. A trademark attorney can help evaluate these alternatives before a business commits to any one path.

How Adams Law Office Approaches Trademark Conflict Resolution

Sharon Adams works with businesses at every stage of a trademark conflict, from the initial risk assessment through negotiation, drafting, USPTO submission, and enforcement. Every case is different. 

If your business has received a Section 2(d) refusal, a cease-and-desist letter, or a notice of opposition involving a similar mark, the first step is a realistic legal assessment of your position. You can contact Adams Law Office to schedule a free consultation, review the FAQ page for general information, or explore the firm’s trademark services to understand the full range of conflict resolution options available.

Frequently Asked Questions 

What is a trademark consent agreement?

It is a contract between two parties who use similar or identical marks, establishing rules for how each party may use its mark while reducing the risk of consumer confusion. The agreement typically addresses goods and services, geography, trade channels, actions that will be taken if there is a likelihood of confusion, and other relevant factors. 

Is a consent agreement legally binding?

Yes, a properly drafted consent agreement is a binding contract. Both parties must comply with its terms, and breach can result in legal remedies. The agreement should be drafted with care and reviewed by trademark counsel before signing.

Does a consent agreement guarantee that a trademark application will be approved?

No. The USPTO evaluates consent agreements as one piece of evidence among others. A well-drafted agreement with meaningful provisions carries significant weight, but the USPTO retains the authority to refuse an application if it concludes that confusion remains likely despite the agreement.

When is a consent agreement different from a coexistence agreement?

A consent agreement typically involves one party stating it does not object to the other’s trademark registration or use, sometimes with minimal restrictions. A coexistence agreement is generally more comprehensive, establishing detailed rules for use, territory, channels, and enforcement over time. Both can be useful depending on the facts.

What happens if one party violates a consent agreement?

A violation gives the other party legal grounds to enforce the agreement, seek damages or injunctive relief, or terminate the arrangement. The agreement may specify how disputes are raised, what timeline applies, and what remedies are available, although this is not required by the USPTO.

Can a consent agreement cover trademark applications in multiple countries?

A US consent agreement addresses rights under US trademark law. International trademark rights are governed by each country’s laws and may require separate agreements or filings. Businesses with international trademark concerns should obtain advice that covers the relevant jurisdictions.

How does the USPTO evaluate a consent agreement submitted with a Section 2(d) response?

The USPTO considers whether the agreement includes specific, meaningful provisions regarding the goods, services, territory, and channels of trade and whether the restrictions realistically reduce the likelihood of consumer confusion. A bare statement of consent without substantive terms carries much less weight.

Should a small business consider a consent agreement instead of rebranding?

It depends on the strength of the business’s legal position, the commercial value of the mark, and the cost and risk of the alternatives. For example, the owner of an existing trademark registration may decide that protecting the scope of the existing registration is more important than entering into a consent agreement. Another small business owner might agree to a consent agreement to avoid a challenge to their registration. A consent agreement may be able to preserve a valuable brand while avoiding the cost of litigation or the risk of having a trademark registration invalidated. A trademark attorney can help evaluate whether the specific conflict is suitable for a negotiated solution.

What is the difference between a trademark license and a consent agreement?

A license grants permission from a trademark owner to another party to use the trademark under conditions enumerated in the license agreement. A consent agreement acknowledges that both parties have independent rights to use similar marks and establishes how those rights will be exercised without creating consumer confusion. The legal relationship is fundamentally different.

How long does a consent agreement last?

The duration depends on what the parties negotiate. Some agreements run indefinitely until terminated by breach or agreement of the parties or by expiration of one or more of the trademark registrations. Others are limited in terms. 

Connect With Adams Law Office

For practical trademark education from Sharon Adams, connect on LinkedIn and subscribe to the Adams Law Office YouTube channel for video guidance on trademark conflict resolution, consent agreements, and brand protection planning.

This article is provided for general educational information only and does not create an attorney-client relationship or constitute legal advice. Trademark outcomes depend on the specific facts, the parties’ legal positions, applicable law, and the terms of any agreement.