Parties to a trademark dispute commonly resolve their issues through a co-existence agreement. A co-existence agreement sets up the fence posts around what the parties can do with their respective marks. A trap for the unwary when drafting a co-existence agreement is being lulled into a sense partnership because a co-existence agreement has the feeling that the parties will respect each others trademark rights.
But co-existence agreements are born out of an adversarial process and like other settlement agreements, are breached by a party to the agreement. If certain terms have been left out of the agreement, the non-breaching party may have a difficult time finding a venue to award it the relief it desires.
For example, if the co-existence agreement does not expressly provide for the prohibition against the registration of a mark that is subject to the co-existence agreement, then the non-breaching party may not be able to prevent the registration of the mark by filing an opposition or cancellation proceeding before the Trademark Trial and Appeal Board. Although some precedent exists that these magical words do not necessarily need to appear in the co-existence agreement so long as the breach of contract directly affects the ability for the breaching party to register its mark, the Board is unlikely to address the breach of contract claim if the express prohibition against registration is not in the co-existence agreement.
When negotiating co-existence agreements, make sure you include all the terms you will need to address a breach and the relief you would be seeking from the breach, so that you are not searching for a venue when a breach actually happens.