Not infrequently our clients contact us reporting that they have started a project to expand their mark to a certain country through a sales representative or distributor, in order not to have such a high cost from the beginning of the operation. The trademark application is made by the sales representative, who verbally agrees to transfer ownership of the registration in the future, but when the business relationship ends for any reason, the registration is not transferred and then the disputes begin.
Considering the high cost and the long time that these disputes can incur, often the client ends up opting for negotiating with the third party for the trademark assignment, to solve the issue more quickly, because it is known that in addition to these issues, it must be considered the subjectivity of the judge's decision. In these cases, the client ends up paying thousands of dollars to buy their own trademark.
It is important to note that, besides exceptions provided by international treaties to which countries are signatories, and their local laws, the priority and exclusivity of a given trademark registration falls to the one who requested it first (first to file). Of course, the exceptions established by local laws can completely contradict this logic, as for example in U.S. law, where the right is privileged to the owner who first uses the trademark (first to use).
In addition to the hypotheses of those countries that give priority to the first to use a certain mark, it is known that there are mechanisms available to the "true owner" of a trademark to plead in its defense and get back a registration that is in fact his. However, these mechanisms are mostly more costly and sometimes take years to be granted to the holder who has had his right violated.
As an example, in Brazil the Federal Law 9.279/96 that deals with the rights and obligations related to intellectual property provides in its article 129 that "the ownership of the trademark is acquired by the registration validly issued, according to the provisions of this Law, being assured to the owner its exclusive use throughout the national territory ...". Despite this, the first paragraph of that article itself already brings with it an exception, which refers to the possibility of "any person who, in good faith, on the date of priority or filing, used in the country, for at least 6 (six) months, an identical or similar trademark, to distinguish or certify an identical, similar or related product or service, shall have the right of precedence to registration".
That is, although we have the priority granted to the one who first requests the application for registration in the Brazilian legal system, it is also provided the possibility of the one who first uses to put himself in a contrary way and prevent the registration. The problem is that there are formal requirements for this mechanism to be triggered.
The right of precedence in the administrative sphere (within the BPTO's judgement) can only be granted when the application for similar or identical registration is identified at the time of the filing of an opposition (60 days from the publication of the third-party's mark), or of cancellation action (180 days from the publication of the concession of the third-party's mark), having also the task of proving the previous use in good faith for at least 6 months before the date of the application for registration of the third party mark.
In this scenario exposed, we still have to consider the subjectivity of the examiner's analysis, which can understand that the signs are not similar to the point of confusing the consumer or causing an undue association, choosing not to grant the request for opposition or cancellation action, even if the previous use is proven. This is because the right of precedence aims to confer special protection to the one who previously uses the mark, but without leaving aside the concern with the most fragile part of this relationship, which is the consumer and his perception before the marks in the market.
Although there are mechanisms available for the holder to plead and defend their interests, it is always very important to understand that, as a general rule, priority and exclusivity fall to the holder of the registration and the task of proving otherwise is the responsibility of those who do not agree with it.
Considering that the mark is the most important and valuable intangible asset of the company, the importance of a precise legal advice before the expansion of the business and exploitation of the mark in a different country is paramount, so that a solid commercial relationship is established, mitigating possible harms.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.