Trademark licensing allows a sports team, athlete, league, or other rights owner to authorize another company to use its protected name, logo, nickname, slogan, or other trademark without transferring ownership of the mark.
For example, a professional team might license its logo to an apparel manufacturer that produces officially licensed hats and shirts. An athlete might authorize a footwear company to use the athlete’s registered nickname in connection with a limited merchandise collection. The trademark owner generally remains the owner while the licensee receives defined permission to use the mark under the terms of the agreement.
An important trademark-law requirement is that the owner maintain appropriate control over the nature and quality of the licensed goods or services. Section 5 of the Lanham Act provides that legitimate trademark use by a related company can benefit the trademark owner, and USPTO practice identifies control over the nature and quality of the goods or services as the central issue in a licensing relationship.
For sports organizations and athletes, licensing can transform intellectual property into a significant revenue source while allowing outside businesses to manufacture merchandise, operate branded programs, or promote products under authorized trademarks.
What Is a Sports Trademark License?
A sports trademark license is an agreement in which the trademark owner, known as the licensor, gives another party, known as the licensee, permission to use one or more trademarks under specified conditions.
The underlying trademark may be a team name, team logo, league emblem, athlete name, nickname, catchphrase, tournament name, mascot, or another source-identifying brand asset.
A license does not ordinarily mean that the trademark has been sold.
The licensor retains ownership while granting a limited right to use the mark. The agreement can restrict that permission according to product type, geographic territory, sales channel, duration, design, or other commercial conditions.
This distinction separates licensing from a trademark assignment. An assignment transfers ownership of the trademark itself, while a license generally authorizes use without transferring ownership. The USPTO treats an assignment as a transfer of trademark ownership.
Can a Sports Team License Its Name and Logo to Merchandise Companies?
Yes.
Sports teams frequently license their names and logos to companies that manufacture apparel, hats, collectibles, sporting goods, toys, accessories, and other consumer products.
Instead of manufacturing every product internally, the team can authorize specialized businesses to produce approved merchandise under the team’s trademarks.
For consumers, the licensed trademark signals that the merchandise has an authorized relationship with the sports organization. For the team, licensing creates an opportunity to expand product distribution without directly operating every stage of manufacturing and retail.
The license should clearly identify which trademarks the manufacturer may use and which products are authorized.
Permission to put a team’s logo on hats, for example, should not automatically be interpreted as permission to use the logo on footwear, video games, dietary supplements, or unrelated products unless the agreement grants those rights.
Can Athletes License Their Names and Nicknames?
Yes.
Athletes can potentially license commercially valuable identifiers such as their names, nicknames, logos, catchphrases, signatures, and other brand assets.
The USPTO’s current Name, Image, and Likeness guidance expressly recognizes names, nicknames, catchphrases, and other personal identifiers as potentially valuable commercial assets. It also notes that NIL may be licensed to companies for endorsements and that federally registered trademarks can generate revenue through licensing deals.
For example, an athlete might license a registered nickname to an apparel company for a clothing collection or authorize a brand to use the athlete’s name as part of an endorsement campaign.
The contract should identify whether the company is receiving trademark rights, NIL rights, publicity rights, promotional rights, or some combination.
Those concepts overlap, but they are not legally identical.
Are Trademark Licensing and NIL Licensing the Same Thing?
No.
Trademark rights and NIL rights can work together, but they protect different interests.
NIL generally concerns commercial use of personal identifiers such as an athlete’s name, image, likeness, voice, nickname, catchphrase, or signature. Publicity and personality rights are primarily governed by state law and applicable contracts.
Federal trademark protection applies when an athlete’s identifier functions as a trademark for goods or services.
The USPTO specifically distinguishes the two. NIL can be licensed to sponsors to promote products or services, while federally registered trademarks identify the source of goods or services and may separately generate value through trademark licensing.
An athlete endorsement agreement can therefore involve both.
A sneaker company may receive permission to use an athlete’s photograph and likeness in advertisements while also receiving permission to place the athlete’s registered trademark on a limited-edition product.
The contract should make clear which rights are being granted.
Who Owns a Trademark After It Has Been Licensed?
The licensor generally remains the trademark owner.
A properly structured license grants permission to use the trademark without transferring ownership.
This matters because commercial use by an authorized licensee can benefit the trademark owner when the legal requirements for related-company use are satisfied.
TMEP § 1201.01 states that trademark ownership can be based on use by a related company whose use inures to the applicant’s benefit. The TMEP identifies the party controlling the nature and quality of the goods or services as the trademark owner.
Accordingly, a sports team does not ordinarily lose ownership merely because another company manufactures every jersey bearing the team’s logo.
The manufacturer can be the licensee while the team remains the owner.
Can a Licensee’s Trademark Use Count as Use by the Sports Team or Athlete?
Yes, when the licensing relationship satisfies the related-company requirements.
Section 5 of the Trademark Act provides that legitimate use of a mark by related companies can inure to the benefit of the registrant or applicant. Federal regulations similarly recognize use by related companies for trademark-registration purposes.
The USPTO’s current TMEP further states that ownership rights may be acquired and maintained through controlled licensee use, even when the licensee is the party physically using the trademark in commerce.
For example, a league could authorize a manufacturer to produce licensed sportswear bearing the league’s trademark. If the league appropriately controls the nature and quality of those products, the manufacturer’s authorized use can benefit the trademark owner.
This is one reason quality-control provisions are not merely business preferences. They are closely connected to trademark ownership and validity.
Why Does Quality Control Matter in a Sports Trademark License?
Quality control helps preserve the connection between the trademark and the source or reputation consumers associate with it.
When fans see an official team logo on a product, they reasonably expect some level of authorization and oversight from the trademark owner.
Trademark law reflects that expectation.
The USPTO defines a related company by reference to the trademark owner’s control over the nature and quality of the goods or services offered under the mark. TMEP § 1201.03 likewise identifies that control as the essence of related-company trademark use.
For sports merchandise, the license might therefore require approval of materials, colors, logo placement, packaging, manufacturing standards, labeling, and final product samples.
For a licensed training program, quality control might address coach qualifications, curriculum standards, facilities, safety practices, and customer experience.
The exact controls depend on what is being licensed.
What Is Naked Licensing?
“Naked licensing” generally refers to licensing a trademark without exercising sufficient control over the nature and quality of the licensed goods or services.
This can create serious trademark consequences.
The current TMEP warns that a trademark owner that fails to exercise sufficient control over licensees or franchisees may be found to have abandoned rights in the trademark.
Sports organizations should therefore avoid treating trademark licensing as simply collecting a royalty in exchange for unlimited logo use.
If numerous unrelated businesses are allowed to place a team trademark on products of uncontrolled quality, the connection between the mark and a consistent source can weaken.
A well-structured licensing program typically combines contractual quality-control rights with actual oversight.
Does a Trademark License Have to Be in Writing?
Trademark licensing can sometimes be recognized even without a formal written agreement.
The USPTO’s current TMEP states that controlled licensing arrangements can be recognized whether oral or written, and in appropriate circumstances a license can even be implied.
That does not mean sports organizations should rely on informal arrangements.
Sports licensing can involve significant revenue, brand reputation, manufacturing obligations, geographic restrictions, sponsorship conflicts, and termination rights. A written agreement creates a far clearer record of what the licensee may and may not do.
For teams and athletes, reducing the agreement to writing is particularly important when merchandise will remain in circulation long after it is manufactured.
What Should a Sports Trademark License Cover?
A sports trademark license should clearly define the commercial boundaries of the relationship.
At minimum, the parties should know which trademarks are licensed, which products or services may carry them, where the rights apply, how long the permission lasts, whether the license is exclusive, and what approval rights the trademark owner retains.
The agreement should also address quality control, use of artwork and brand guidelines, royalties or other compensation, sales reporting, sublicensing, unauthorized channels, inventory after termination, enforcement responsibilities, and the ownership of newly created materials where relevant.
The precise provisions depend on the transaction.
A global merchandise license for a major sports organization requires a different structure from an athlete authorizing one sponsor to produce a limited run of T-shirts.
The legal principle, however, remains the same: the scope of permission should be clear.
What Does an Exclusive Sports Trademark License Mean?
An exclusive license generally gives one licensee specified rights to use the trademark within an agreed field, subject to the language of the contract.
Exclusivity can be defined in different ways.
A company might receive exclusive rights to manufacture hats bearing a team’s trademarks in the United States. Another licensee might receive rights for jerseys. A third could receive rights for collectibles.
Alternatively, a company might receive broad exclusivity for an entire merchandise category.
The contract should specify whether the trademark owner itself retains the right to sell competing products and whether other licensees can operate in adjacent categories.
Terms such as “exclusive” should not be left undefined when significant sports merchandise revenue is involved.
Can a Sports Team License the Same Trademark to Multiple Companies?
Yes, when its contractual commitments permit it.
Sports organizations commonly maintain multiple licensees across different merchandise categories, territories, or channels.
For example, one company might manufacture apparel, another might make trading cards, and another might produce sporting equipment under the same team trademark.
The licensing program should ensure that those grants do not conflict.
If an apparel company has already received exclusive rights for a particular category, granting overlapping rights to another manufacturer could create a contract dispute even though the sports organization owns the underlying trademark.
Effective trademark licensing therefore requires both intellectual property management and accurate contract administration.
What Are Trademark Licensing Royalties?
Royalties are payments made by the licensee in exchange for the right to commercially use the trademark.
Sports trademark licenses can structure compensation in numerous ways, including a percentage of net or gross sales, guaranteed minimum payments, flat fees, advances against royalties, or combinations of these approaches.
The appropriate structure depends on the value of the brand, the product category, expected sales, exclusivity, geographic scope, and bargaining position of the parties.
A sports organization may also require periodic sales reports and audit rights so it can verify royalty calculations.
Trademark law does not require one particular royalty model. The financial structure is principally a contractual matter.
Can an Athlete License a Trademark to a Sponsor Without Giving Up Ownership?
Yes.
Licensing is specifically designed to permit authorized use while allowing the athlete to retain ownership.
For example, an athlete could grant a sports drink company permission to use the athlete’s registered nickname in a promotional campaign while retaining ownership of the nickname trademark.
The sponsor’s rights could be limited to a specific campaign, product, territory, and period.
When the agreement ends, the sponsor’s permission to use the mark should generally end as provided by the contract.
This makes licensing particularly useful for athlete brands because an athlete can commercialize the same core intellectual property through multiple nonconflicting relationships over a career.
Can a Sponsor Automatically Put a Team Logo on Merchandise?
No.
Sponsorship and trademark licensing should be distinguished.
A sponsor may receive certain rights to display a team logo in advertising or describe itself as an official partner. That permission does not necessarily include the right to manufacture and sell products bearing the team mark.
A merchandise license may require a separate grant.
Sports agreements should therefore define what “use” of the trademark actually means.
Permission to display a logo in an advertisement is commercially different from permission to place it permanently on thousands of products offered for sale.
Can a Licensee Change a Sports Team’s Logo?
Only to the extent authorized by the trademark owner.
Sports organizations commonly use detailed brand standards governing logo proportions, approved colors, spacing, typography, background use, and prohibited alterations.
Those standards can become part of the quality-control system.
A manufacturer should not assume that receiving permission to use a logo also grants permission to redesign it, combine it with unrelated marks, change colors, or create derivative versions.
Unauthorized modifications can create both trademark and contractual concerns.
The agreement can require approval of designs before manufacturing begins, helping prevent disputes after large quantities of merchandise have already been produced.
Can Sports Trademark Licenses Be Limited by Territory?
Yes.
A trademark license can authorize use in specific geographic areas.
For example, a sports organization might grant one company merchandise rights in North America and another company rights in parts of Europe or Asia.
Territorial restrictions are particularly important for global sports brands because trademark ownership and licensing rights can differ from country to country.
A U.S. trademark registration does not itself provide worldwide trademark protection. International licensing should therefore be coordinated with the sports organization’s foreign trademark portfolio.
Before granting foreign rights, the licensor should confirm that it has sufficient rights to authorize the trademark in the relevant jurisdiction.
Can a Sports Trademark License Be Limited to Specific Sales Channels?
Yes.
A license may distinguish between physical retail, team stores, e-commerce, marketplaces, stadium sales, wholesale distribution, direct-to-consumer channels, or other forms of distribution.
This has become increasingly important because a licensee authorized to sell products through one channel may later attempt to distribute those products through online marketplaces or discount retailers.
Channel restrictions can help sports organizations protect pricing, sponsorship relationships, other licensees, and the reputation associated with official merchandise.
The contract should state clearly whether marketplace sales, international shipping, promotional giveaways, or third-party resellers are permitted.
Can a Merchandise Company Sublicense a Team Trademark?
Only if the original license permits sublicensing.
A licensee does not automatically have unlimited authority to grant trademark rights to other businesses.
Sports merchandise frequently involves multiple commercial participants, including manufacturers, distributors, retailers, fulfillment companies, and subcontractors.
The agreement should distinguish between companies merely performing production services for the licensee and companies receiving independent rights to use or exploit the trademark.
If sublicensing is permitted, the trademark owner may require approval of each sublicensee and impose the same quality and brand standards that apply to the primary licensee.
This helps prevent trademark rights from spreading through an uncontrolled chain of third parties.
Who Owns New Artwork Created for Licensed Sports Merchandise?
The answer depends on the applicable intellectual property rights and the parties’ contract.
A merchandise company may create new illustrations, packaging, graphics, slogans, or designs incorporating the licensed team trademark.
The team may own the underlying name and logo but not automatically own every new creative element developed by the licensee.
Copyright and trademark ownership should therefore be addressed separately.
The license agreement can specify who owns newly created artwork, whether rights are assigned to the team, whether the licensee may reuse the artwork, and what happens to design files after the agreement terminates.
This can become important when a successful merchandise design outlives the original licensing relationship.
Can a Team or Athlete License a Trademark That Is Not Federally Registered?
Potentially, yes.
Federal registration is not an absolute prerequisite to every trademark license.
Trademark rights can arise through use, and parties may contract concerning unregistered trademarks.
Federal registration, however, can strengthen the licensing position by creating a public record of ownership and providing other statutory benefits.
The USPTO also notes that federal registration can increase the commercial value of an athlete’s brand and strengthen licensing arrangements.
Before licensing an unregistered mark, the owner should consider whether the underlying rights have been properly cleared and whether federal registration would improve the strength and certainty of the arrangement.
Should a Sports Organization Register Merchandise Trademarks Before Licensing Them?
When merchandise is commercially important, federal registration should receive serious consideration.
A team may already own its name for sporting entertainment services but then begin licensing that same name for clothing, sporting goods, collectibles, or other products.
The existing service registration does not automatically become a registration covering every new merchandise category.
A licensing strategy should therefore be coordinated with the trademark portfolio.
If a team expects substantial royalties from apparel, it should review whether its registrations adequately cover the marks and goods being licensed.
The same principle applies to an athlete launching merchandise under a personal nickname or logo.
What Happens When a Sports Trademark License Ends?
The licensee generally must stop using the trademark in accordance with the termination provisions of the agreement.
The difficult issue is often what happens to existing inventory.
A manufacturer may still possess thousands of products bearing the team or athlete trademark when the license expires. The contract can specify whether those products must be destroyed, returned, sold during a limited sell-off period, or handled another way.
Digital materials should also be addressed.
The licensee may need to remove trademarks from websites, marketplace listings, social media accounts, advertising, product photographs, packaging templates, and other materials.
Clear post-termination obligations can reduce the possibility that formerly authorized products or advertising continue appearing in the market in a way that suggests an ongoing relationship.
Does a Former Licensee Become a Trademark Infringer After the License Ends?
Potentially.
Once permission terminates, continued trademark use may become unauthorized and can create infringement concerns.
This can be particularly confusing to consumers because the former licensee previously had a legitimate association with the brand.
A company that was once an official merchandise partner may still have packaging, website content, inventory, and marketplace listings displaying the sports organization’s trademarks.
The license agreement should therefore state precisely when authorization ends and what limited post-termination activity, if any, remains permitted.
Enforcement decisions will depend on the contractual language and the nature of the continued use.
Is Trademark Licensing the Same as Selling a Sports Trademark?
No.
Licensing normally preserves ownership with the licensor. Selling the trademark involves an assignment.
The USPTO describes an assignment as a transfer of trademark ownership and provides a federal system for recording ownership changes.
This distinction can have major consequences for athletes.
An athlete who signs an agreement granting broad “perpetual” rights without carefully reviewing whether the deal is a license or an assignment could unintentionally surrender far more control than anticipated.
Sports organizations should similarly ensure that merchandise agreements grant only the rights necessary for the particular commercial relationship.
Who Should Enforce the Trademark Against Counterfeiters?
The licensing agreement should address enforcement responsibilities.
The trademark owner may retain primary responsibility for enforcement, or the agreement may give a licensee specific responsibilities for reporting suspected counterfeit goods and preserving evidence.
Whether a licensee can independently bring litigation involves additional questions concerning the rights actually granted and applicable standing rules.
As a practical matter, merchandise licensees should at least have a clear process for reporting counterfeits and unauthorized sellers to the trademark owner.
Sports organizations should avoid a situation in which each licensee assumes someone else is monitoring infringement.
Can Poor Licensing Practices Damage a Sports Trademark?
Yes.
Trademark licensing is valuable because it allows a brand to expand commercially without giving up ownership. But uncontrolled licensing can create legal and reputational risks.
TMEP § 1201.03 emphasizes that the key issue in license and franchise situations is the nature and extent of the trademark owner’s control over the goods or services. The USPTO also recognizes that a trademark owner’s failure to exercise sufficient control may jeopardize trademark rights.
For sports brands, the commercial risk may be equally significant.
Low-quality merchandise, inconsistent logos, unauthorized product categories, inappropriate retailers, or conflicting sponsor relationships can damage the goodwill attached to a team or athlete’s identity.
Licensing should therefore be managed as brand stewardship rather than simply as permission to print a logo.
What Should Sports Teams and Athletes Do Before Signing a Trademark License?
The rights owner should first confirm what intellectual property it actually owns.
That may include federally registered team names, logos, athlete names, nicknames, catchphrases, or other marks. The owner should then identify the specific rights the commercial partner needs rather than granting unnecessarily broad permission.
The proposed product or service categories, territory, channels, exclusivity, term, quality-control process, royalties, sublicense rights, approval procedures, enforcement obligations, and termination provisions should all be considered together.
Athlete agreements should additionally distinguish trademark rights from NIL, publicity, endorsement, and personal-service obligations.
This is particularly important when an athlete’s commercial brand may continue for decades after the athlete’s playing career ends.
How Can Sports Organizations Build a Strong Trademark Licensing Program?
A strong licensing program begins with a well-organized trademark portfolio.
The organization should identify who owns each name, logo, slogan, mascot, and other brand element, obtain federal registrations for commercially important rights, and establish consistent brand standards.
Licensing agreements can then be aligned with clearly defined merchandise categories and commercial territories.
The organization should also maintain an accurate record of current licensees, approved products, territories, expiration dates, royalty obligations, and authorization levels.
Quality control should occur in practice rather than existing only as unused language in the contract.
As the brand grows, the trademark portfolio and licensing program should be reviewed together. New merchandise categories, digital products, international markets, athlete collaborations, sponsorship programs, and training services can all create new licensing opportunities and new trademark risks.
For sports teams and athletes, the goal is not simply to permit others to use a famous name or logo. The goal is to monetize the brand while preserving ownership, quality, consumer trust, and long-term control.
Cohn Legal, PLLC advises athletes, sports teams, leagues, sports organizations, and other brand owners on trademark registration, licensing, merchandise protection, NIL-related trademark matters, portfolio strategy, and enforcement.
Primary Sources and Authorities
The principal federal authority governing controlled trademark licensing is Section 5 of the Lanham Act, 15 U.S.C. § 1055, which provides that legitimate use by a related company may inure to the benefit of the trademark registrant or applicant. 37 C.F.R. § 2.38 likewise recognizes trademark use by related companies for federal registration purposes.
TMEP § 1201.03 explains that the essence of related-company use is control over the nature and quality of the goods or services offered under the trademark. The TMEP specifically addresses license and franchise situations and recognizes that ownership may be acquired or maintained through controlled licensee use.
The TTAB’s decision in Sock It To Me, Inc. v. Aiping Fan, 2020 USPQ2d 10611, further reflects the principle that control over the nature and quality of the goods or services is central to determining ownership in a related-company relationship.
For athletes, the USPTO’s current Name, Image, and Likeness guidance distinguishes NIL rights from trademark protection and expressly recognizes that federally registered athlete trademarks can create value through licensing relationships.
Trademark assignments should be distinguished from licenses. The USPTO defines an assignment as a transfer of trademark ownership, while a trademark license ordinarily allows use without transferring ownership.
Author: Abraham Cohn, U.S. trademark attorney and founder of Cohn Legal, PLLC. Cohn Legal advises athletes, sports teams, leagues, sports organizations, and growing brands on trademark clearance, federal registration, trademark licensing, NIL-related brand protection, merchandise programs, portfolio development, TTAB proceedings, and enforcement.