TRADEMARKS REGISTERED IN BAD FAITH

by | Nov 3, 2020 | Trademarks

Introduction

Trademark legislation makes registration in bad faith invalid. The purpose of this measure is to bring the situation back to an earlier state in order to eliminate the effects produced and invalidate the trademark thus registered.

The application of the law on bad faith has led the courts to develop a consistent case law from which the criteria for detecting the existence of bad faith when registering a trademark are derived.

In a very brief way, we can list the indications that reveal the bad faith registration, derived from the case law of the Court of Justice of the European Union (CJEU):

(i) The fact that the applicant knows, or must know, that a third party uses, in at least one Member State, an identical or similar sign for an identical or similar product which may give rise to confusion with the sign for which registration is sought.

(ii) The intention of the applicant to prevent that third party from continuing to use such a sign.

(iii) The degree of legal protection enjoyed by the sign of the third party and the sign for which registration is sought (CJEU judgment of 11 June 0209, Case C-529/07).

Following the guidelines laid down by the CJEU our courts have settled disputes at national level, applying and developing the basic criteria for the registration made in bad faith, thus creating a consolidated case law (We cite as an example Supreme Court Judgments No 414/2011 of 22 June 2011 and No 2361/2019 of 17 December 2019).

In this article we want to share our experience in the defence of a sign that was registered in bad faith by a third party and what we have learned from the sentence of the Provincial Court of Barcelona that resolved the litigation (Judgment No 617/2020 of 30 April 2020).

The Case

The sentence in question settled a case in which the owner of the trademarks sued a company for infringement of its exclusive right on the grounds that the registered term was being used in its advertising.

In its defence, the defendant company claimed earlier intellectual property rights for having created the registered term for an advertising campaign. In addition, it brought a counterclaim against the plaintiff, in which it sought an action for the invalidation of the marks for having been registered in bad faith. It also demanded the complete invalidation of the registered sign on the grounds that it had earlier intellectual property rights and that the sign did not have a distinctive character, since it described the products it tried to distinguish.

The creation of the name

The origin of the name Bocapincho / Bocapintxo was the result of an advertising creation, for a campaign whose purpose was to commemorate 25th anniversary of the Pans & Company franchise.

The advertising campaign consisted of creating a new product (a sandwich + meat on a skewer) which they called Bocapincho / Bocapintxo and which was presented by the famous chef Karlos Arguiñano, who created the recipes.

In addition, other advertising elements had been created for the campaign, such as, images, videos, songs, jokes, games. All of this commercial advertising was going to be broadcasted by various media, analogue and digital, such as: billboards located in the main cities in Spain, exhibition on the premises of the franchise, communication on social networks and on the franchise website, on which all the videos created for the advertising campaign could be viewed.

The advertising and sale of the new product were to be carried out over a certain period of time that lasted only two months. The videos, however, would be visible on the company’s website for a longer time, until the imaging agreement with the chef was concluded.

Registration of the marks Bocapincho / Bocapintxo

Just a few days before the scheduled date for the launching of the advertising campaign of Pans & Company, the company Comess Group de Restauración S.L. requested the registration of two trademarks before the Spanish Patent and Trademark Office (OEPM), of the word type with the term: Bocapincho and Bocapintxo.

This strange coincidence did not go unnoticed by the Patent and Trademark Agent of Pans & Company. They objected to the trademark applications to the OEPM and sent a letter by burofax to the applicant for the trademarks to inform him of his earlier intellectual property rights arising from the creation of advertising, which included the term applied for as a trademark.

The applicant for the trademarks replied in writing denying any knowledge of the earlier rights to the sign, which was the subject of the registration of its trademarks. In addition, it claimed a priority right granted by the registration and warned them that its exclusive right prevented the use of the sign by third parties.

The application process for the trademarks continued and the trademarks were granted, despite the opposition filed. Meanwhile, the registrant again sent a request to the advertising company to prevent the advertising use of the term Bocapincho / Bocapintxo, and a few months later filed a lawsuit for infringement of its trademark rights.

Litigation

In this case the defendant company faced a double challenge: (i) to prove that it had created advertising prior to the application for registration of the marks; and (ii) that the applicant for registration knew the name created for advertising. The main problem, however, was that the advertising campaign had not been disclosed on the date of the registration of the marks.

Without doubt, the criteria set out in the case-law were of great help in the defence of this case, because the evidence of bad faith was presented. First, the letters requesting the cessation of use sent by the applicant to the advertising company showed that the application for registration of the mark was intended to prevent the use of the term Bocapincho / Bocapintxo by Pans & Company, ignoring the fact that the company had created it for its advertising campaign. Second, the term as an advertising creation enjoyed the protection of intellectual property. The third element, proving that the applicant knew about the sign and that it had been used prior to registration, was still missing, though.

Proof was going to be the key, so the task was to investigate the entire process of advertising creation from conception to publication thoroughly. This task was carried out in collaboration with the advertising company and the media and advertising agencies that had participated.

The outcome of the investigation provided evidence that allowed a hypothesis to be developed as to the possible access to the advertising creation by the applicant for the registration of the marks. In fact, two possible ways of accessing knowledge of the term Bocapincho / Bocapintxo were found. On the one hand, there was a match with a former employee of the advertising company, who started working with the company that applied for registration of the marks just one day before the application. On the other hand, the advertising company knew that a franchisee of Pans & Company, also had a franchise of the company that made the registration.

It is important to say that the above facts were proven with different evidence provided in the procedure. It was demonstrated, therefore, that the publicity was made in advance of the time of registration; that the advertising elements were disclosed to a circle of persons close to the advertising company, including franchisees, prior to the application of the brands; and a connection was established between the persons who accessed the advertising elements with the registrant.

In this way, it was possible to establish a presumption that allowed the judge to determine that there was a previous use and that the registrant could have had knowledge of the advertising campaign to promote the Bocapinchos before its dissemination.

Finally, we must say that in this case other factors intervened that were decisive to determine the existence of bad faith: (i) The manifest will of the applicant of the marks to prevent the advertising company from using the word created for its advertising; and (ii) the lack of use of the registered trademarks, given that despite having obtained the registration the trademarks they were never used.

Conclusion

We believe that the Judgment of the Barcelona High Court has provided the case law of our High Court with some important elements for interpreting and applying the law.

i) Previous use of the sign. The Hearing understood that it took place with the dissemination of the advertising elements among a circle of persons who had contact with the registrant. In this case, its existence was estimated on the basis of the proven facts and without the need for the use to have been known to the general public.

ii) The overall analysis. The consideration of all elements of the case was crucial to prove the intent of the applicant, because he never actually used the trademarks.

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