II 

116TH CONGRESS 

1ST SESSION S. 2439 

To amend the Trademark Act of 1946 to provide that the licensing of 

a mark for use by a related company may not be construed as establishing an employment relationship between the owner of the mark, 

or an authorizing person, and either that related company or the employees of that related company, and for other purposes. 

IN THE SENATE OF THE UNITED STATES 

AUGUST 1, 2019 

Mr. KING (for himself, Mr. LANKFORD, Mr. CORNYN, Ms. SINEMA, Mr. 

BRAUN, Mr. MANCHIN, and Mr. CRAMER) introduced the following bill; 

which was read twice and referred to the Committee on the Judiciary 

A BILL 

To amend the Trademark Act of 1946 to provide that the 

licensing of a mark for use by a related company may 

not be construed as establishing an employment relationship between the owner of the mark, or an authorizing 

person, and either that related company or the employees 

of that related company, and for other purposes. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Trademark Licensing 

5 Protection Act of 2019’’. 


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1 SEC. 2. SAFE HARBOR. 

2 Section 5 of the Act entitled ‘‘An Act to provide for 

3 the registration and protection of trademarks used in com4 merce, to carry out the provisions of certain international 

5 conventions, and for other purposes’’, approved July 5, 

6 1946 (commonly known as the ‘‘Trademark Act of 1946’’) 

7 (15 U.S.C. 1055), is amended— 

8 (1) in the first sentence, by striking ‘‘Where a’’ 

9 and inserting the following: 

10 ‘‘(a) IN GENERAL.—Where a’’; and 

11 (2) by adding at the end the following: 

12 ‘‘(b) CONSISTENCY IN USE.— 

13 ‘‘(1) DEFINITIONS.—In this subsection— 

14 ‘‘(A) the term ‘authorizing person’ means 

15 a person that is authorized by the owner of a 

16 mark to license that mark for use by a related 

17 company; 

18 ‘‘(B) the term ‘communicate’, with respect 

19 to subparagraph (D)(i)(II), does not include 

20 any communication related to a personnel or 

21 employment policy or procedure; 

22 ‘‘(C) the term ‘employment relationship’ 

23 means any type of joint employer relationship, 

24 single employer relationship, or other employ25 ment-related status or relationship; 


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1 ‘‘(D) the term ‘exercise control over the 

2 mark’— 

3 ‘‘(i) includes, but is not limited to, re4 quiring a related company to— 

5 ‘‘(I) complete training conducted 

6 for the purpose of preserving or en7 hancing goodwill, a reputation, uni8 formity, or the expectation of the pub9 lic with respect to the nature and 

10 quality of goods or services associated 

11 with a mark; or 

12 ‘‘(II) communicate with the 

13 owner of a mark, or an authorizing 

14 person, with respect to preserving or 

15 enhancing goodwill, a reputation, uni16 formity, or the expectation of the pub17 lic with respect to the nature and 

18 quality of goods or services associated 

19 with a mark; and 

20 ‘‘(ii) does not include any personnel or 

21 employment policy or procedure that is 

22 communicated— 

23 ‘‘(I) by— 

24 ‘‘(aa) the owner of a mark; 

25 or 


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1 ‘‘(bb) an authorizing person; 

2 and 

3 ‘‘(II) to— 

4 ‘‘(aa) a related company 

5 with respect to the mark; or 

6 ‘‘(bb) any employee of a re7 lated company described in item 

8 (aa); 

9 ‘‘(E) the term ‘franchise’ means a fran10 chise, as defined— 

11 ‘‘(i) in section 436.1(h) of title 16, 

12 Code of Federal Regulations, as in effect 

13 on the date of enactment of this sub14 section; or 

15 ‘‘(ii) under an applicable State fran16 chise law; 

17 ‘‘(F) the term ‘franchisee’ means a 

18 franchisee, as defined— 

19 ‘‘(i) in section 436.1(i) of title 16, 

20 Code of Federal Regulations, as in effect 

21 on the date of enactment of this sub22 section; or 

23 ‘‘(ii) under an applicable State fran24 chise law; 


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1 ‘‘(G) the term ‘franchisor’ means a 

2 franchisor, as defined— 

3 ‘‘(i) in section 436.1(k) of title 16, 

4 Code of Federal Regulations, as in effect 

5 on the date of enactment of this sub6 section; or 

7 ‘‘(ii) under an applicable State fran8 chise law; and 

9 ‘‘(H) the term ‘personnel or employment 

10 policy or procedure’ means— 

11 ‘‘(i) any contractually retained right 

12 of the owner of a mark, or an authorizing 

13 person, to directly control a related com14 pany’s hiring, promotion, firing, or dis15 cipline of the employees of such related 

16 company; 

17 ‘‘(ii) any contractually retained right 

18 of the owner of a mark, or an authorizing 

19 person, to directly control a related com20 pany’s rates of pay, including wages and 

21 fringe benefits; 

22 ‘‘(iii) any contractually retained right 

23 of the owner of a mark, or an authorizing 

24 person, to directly control a related comVerDate Sep 11 2014 04:39 Aug 15, 2019 Jkt 089200 PO 00000 Frm 00005 Fmt 6652 Sfmt 6201 E:\BILLS\S2439.IS S2439

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1 pany’s assignment of employee work sched2 ules; 

3 ‘‘(iv) any contractually retained right 

4 of the owner of a mark, or an authorizing 

5 person, to directly control collective bar6 gaining procedures or labor relations; and 

7 ‘‘(v) any contractually retained right 

8 of the owner of a mark, or an authorizing 

9 person, to directly supervise the employees 

10 of a related company. 

11 ‘‘(2) APPLICABILITY.—For the purposes of the 

12 National Labor Relations Act (29 U.S.C. 151 et 

13 seq.) and the Fair Labor Standards Act of 1938 (29 

14 U.S.C. 201 et seq.), none of the following may be 

15 construed, alone or in combination with any other 

16 factor, as establishing an employment relationship 

17 between the owner of a mark that is a franchisor, 

18 or an authorizing person that is a franchisor, and a 

19 related company with respect to that franchisor, or 

20 the employees of that related company: 

21 ‘‘(A) The licensing of the mark for use by 

22 that related company or the employees of that 

23 related company. 


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1 ‘‘(B) Any exercise of control over the mark 

2 by that owner or authorizing person, as applica3 ble— 

4 ‘‘(i) with respect to the use of the 

5 mark by that related company or the em6 ployees of that related company; and 

7 ‘‘(ii) for the purpose of preserving or 

8 enhancing goodwill, a reputation, uni9 formity, or the expectation of the public 

10 with respect to the nature and quality of 

11 goods or services associated with the 

12 mark.’’. 

13 SEC. 3. APPLICABILITY. 

14 This Act, and the amendments made by this Act, 

15 shall not apply to any proceeding before the National 

16 Labor Relations Board that is commenced before the date 

17 of enactment of this Act. 

Æ 


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