Background
In a service-based economy, many industrial and consumer products are manufactured and sold through trademark licensing arrangements. Under these types of contractual agreements, the owner of the trademark licenses its brand name or mark to another company in exchange for a licensing fee. The authorized user of the trademark then has a contractual right to manufacture and sell the goods bearing the trademark. However, in some circumstances, the mere act of licensing the trademark to a manufacturer of a product for a fee can expose the licensor to a product liability claim under the Apparent Manufacturers Doctrine (AMD).

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Hands signing contract_SS_10590013In defending product liability cases, product manufacturers, sellers and distributors often tender a request for defense and indemnity from claims to one of their business partners. Typically, the tender arises from two common scenarios: (1) a product distributor or seller tenders its defense to the product’s manufacturer or (2) a product manufacturer or assembler tenders defense to the manufacturer of a component part used in the final product. Given the fact most of the products sold in the U.S. marketplace are manufactured overseas, the tender of defense is typically made to a foreign entity. This adds an additional layer of complexity to the situation.
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