Case Analysis #1: Federal Court decides for cancellation of a trademark without prior opposition at the BRPTO
November 10, 2017

by Roberto Carapeto* On April 6 2015, the 25th Federal District Court of Rio de Janeiro published a decision where it applied the general principles of civil law in order to accept a request for cancellation of a trademark. The court accepted the request despite the plaintiff not having previously used any administrative remedies in attempting to cancel the trademark. Japanese company BANDAI NAMCO, the plaintiff, filed a lawsuit in 2013 against GHASSAN ALI NAHLE (defendant) and the Brazilian Patent and Trademark Office (BRPTO) seeking the transfer or the nullity of three trademark registrations for the composite trademark “TEKKEN TEC”, which had been filed in 2006 before the BRPTO by the defendant. The plaintiff, filed trademark applications for the trademark “TEKKEN” in 2009 on some classes. However, the BRPTO denied registration on class 9 based on the defendant’s further registrations in 2011. BANDAI NAMCO sought to nullify the defendant’s registration and claimed that it had been using the trademark “TEKKEN” for over 20 years, long before the defendant filed for his applications in 2006. The plaintiff based its requests on Art. 124, XVII1 and XXIII2, Art. 1263 of Law 9.279/96 (Industrial Property Law – LPI), and Art. 6bis of the Paris Convention. In its answer to the lawsuit, the BRPTO agreed with the plaintiff’s requests. However, it pointed out that the plaintiff had not used the available administrative remedies to oppose and to nullify the trademark. Hon. Judge Felipe Bittencourt Potrich considered substantial evidence showing the strength of the mark “TEKKEN” and its development by BANDAI NAMCO since 1994. The Japanese company is known worldwide for developing famous video games and other electronic games. According to the Judge, it was clear that the plaintiff had created and developed the electronic games alone with the understanding that the fame of the mark “TEKKEN” was built solely by the BANDAI NAMCO. Moreover, the element “TEC” from the defendant’s mark “TEKKEN TEC” was not distinctive enough to avoid confusion with the plaintiff’s mark “TEKKEN”. The Judge further considered the relationship between the plaintiff’s product as software and the trademark system. The judge considered that the LPI prevents the registration of trademarks related to titles protected by copyright and those likely to cause confusion or association. Therefore, in his view, the fact that the defendant’s trademark implies an irremovable association with plaintiff’s product (software) should have prevented its registration at the BRPTO. Despite the interesting factual circumstances and discussions related to the merits of the lawsuit set out above, the most significant aspect of this recent decision for trademark applicants and owners is the declaration of trademark invalidity by the court. The case is distinctive in that the court decided that the lack of opposition or post-grant review before the BRPTO was not an obstacle to the courts findings. The court confirmed that previous case law has established that the failure to use available administrative remedies would prevent a plaintiff’s request for trademark invalidity before the Judiciary. However, considering the facts and circumstances of the case, and specifically the worldwide use of the mark by the plaintiff and possible bad faith of the defendant, Judge Potrich disregarded the previous case law and accepted BANDAI NAMCO’s invalidity request. The Court found that:

“Upon a teleological interpretation of the norms in question, it is possible to conclude that they were made for a situation where the players that dispute said trademark operate, coexist and maintain their focus on a national level, in a way that they can monitor regularly the allowance of new trademarks by the BRPTO and acts against them, when that’s the case. The plaintiff, however, is a Japanese company that commercializes their products in numerous countries in the world, and considering the level of diversity that the international market has achieved, it is reasonable to accept their invalidity request even without a timely opposition.”

Although being a decision from court of first instance, the above case creates an interesting precedent to allow big international companies to challenge third parties’ trademark registrations directly in the courts even if they have lost the deadline for administrative remedies. * Roberto Carapeto is an attorney at Licks Attorneys’ Tokyo officeIf you have any questions or need additional information, please contact us at prevail@localhost/licks/site.

1 Art. 124 The following are not registrable as marks: (...) XVII - literary, artistic or scientific works, as well as titles protected by copyright and likely to cause confusion or association, except with the consent of the author or owner; 2 Art. 124 (…) XXIII - signs that imitate or reproduce, wholly or in part, a mark of which the applicant could obviously not fail to have knowledge in view of his activity, and of which the proprietor is established or domiciled in the national territory or in a country with which Brazil maintains an agreement or guarantees reciprocity of treatment, if the mark is intended to distinguish a product or service that is identical, similar or akin, and is likely to cause confusion or association with such third party mark. 3 Art. 126 Marks that are well-known in their field of activity in the terms of article 6 bis (1) of the Paris Convention for the Protection of Industrial Property will enjoy special protection, independently of whether they have been previously filed or registered in Brazil.

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