Something to declare: how an IMPI finding can help avoid stand-offs

Although the nomenclature and definition of famous and well-known marks varies from jurisdiction to jurisdiction, most countries offer additional protection for marks based on their established reputation among consumers. Mexico is no exception: Article 98ter of the Industrial Property Law defines ‘well-known marks’ as marks that are known by a specific sector of consumers or certain commercial circles in the country, as a consequence of the commercial activities developed either in Mexico or abroad, or by their promotion or advertising. A mark will be regarded as ‘famous’ when it is known by the majority of consumers.

While it may seem that the difference between well-known and famous marks refers only to the extent that the mark is known, under Mexican law the two categories have different legal effects.

Article 90(XVI) of the Industrial Property Law, as amended in 2018, contains an additional burden of proof in relation to well-known marks that is not applicable to famous marks. It provides that a trademark application will not be granted if the mark is identical or confusingly similar to a prior trademark that the Mexican Institute of Industrial Property (IMPI) evaluates or has declared as well known in Mexico, regardless of the products of services for which protection is sought. However, under Article 90(XVI), the prohibition for registration will come into effect only if the use of the proposed mark might:

• cause confusion or likelihood of association with the owner of the well-known mark;
• produce a benefit to the applicant that has not been authorised by the owner of the well-known mark;
• tarnish the well-known mark’s reputation; or
• dilute the distinctive character or the well-known mark.

Famous marks, in contrast, constitute full barriers against an application for identical or confusingly similar marks.

They may be enforced as a ground for cancellation of a registration granted to cover an identical or confusingly similar mark, or be the ground for requesting the declaration of an administrative infringement, whereas well-known trademarks require that likelihood of confusion, unauthorised benefit of third parties or dilution be proven before IMPI.

Obtaining recognition

IMPI can recognise a trademark as famous or well known either by declaration or by evaluation. Both declarations and evaluations can prevent third parties from registering identical or confusingly similar marks in any class.

The Industrial Property Law provides that the owner of a well-known or famous mark may obtain a certificate in which its status is recognised. To do this, specific evidence must be brought before IMPI, showing that the mark has been known in a specific commercial circle or a given sector of the public when requesting a declaration for a well-known mark, or by the majority of the population when applying for a declaration that a mark is famous.

However, Article 90(XVI and XVII) of the Intellectual Property Law authorises IMPI to evaluate whether a mark is famous or well known based on the examiner’s own subjective criteria and prior knowledge of the mark. The party that has a legal interest in the mark can ask IMPI to perform an evaluation in any proceeding.

Obtaining declarations

In light of the above, the information required to be submitted before IMPI when requesting a declaration that a mark is well known or famous is laid out in Article 98ter(2) as follows:

I the sector of the public comprising real or potential consumers who identify the mark with the products or services which it protects, based on a market survey or study or any other method permitted by law;

II other sectors of the public excluding real or potential consumers that identify the mark with the products or services which it protects, based on a market survey or study or any other method permitted by law;

III the commercial circles comprising tradesmen, industrialists or service providers connected with the type of products or services, who identify the mark with the products or services protected by the mark, based on a market survey or study or any other method permitted by law;

IV the date of first use of the mark in Mexico and, where applicable, abroad;

V the period of continued use of the mark in Mexico and, where applicable, abroad;

VI the marketing channels in Mexico and, where applicable, abroad;

VII the methods of disseminating the mark in Mexico and, where applicable, abroad;

VIII the period of actual advertising of the mark in Mexico and, where applicable, abroad;

IX the investment made during the previous three years in advertising and promoting the mark in Mexico and, where applicable, abroad;

X the actual geographical area of influence of the mark;

XI the sales volume of the products or the revenue received from the provision of the services protected by the mark, during the previous three years;

XII the economic value represented by the mark in the shareholders’ equity of the company owning the mark, or in accordance with a valuation of the company;

XIII the registrations of the trademark in Mexico and, where applicable, abroad;

XIV the franchises and licences that have been granted with respect to the mark; and

XV the percentage of the share of the mark in the relevant market sector or segment.

The Industrial Property Law imposes strict requirements in connection with the well-known and famous status of marks, and sets an evidential burden so high that it can cause problems for plaintiffs and owners, especially when evidence such as market research is expensive and must be conducted with specific characteristics. Such evidence would have to prove beyond doubt that the mark is widely sold and advertised, and that consumers in at least the sector connected with the products or services that the mark relates to know of the existence of the mark.

In light of these issues, in November 2019 MORENA party senator Ernesto Pérez Astorga made a legislative proposal for a new Industrial Property Law. Although a draft of the law is yet to be published, it would aim to eliminate some of the evidence required in relation to famous and well-known marks – specifically, the geographic area in which the mark is known, the sales figures for the products or the income earned for providing the services covered by the mark over the past three consecutive years (in Mexico and abroad), and the economic value of the mark.

Comment

Well-known and famous marks constitute a legal impediment for new applications that are confusingly similar or the right upon which cancellation and infringement actions may be instituted.

Another important benefit for the owners of well-known or famous trademarks in Mexico is that they can elect that the information provided to IMPI should be treated as confidential and be marked for the study of the examiner attorney only, to avoid the publication of the owner’s sensitive information (eg, the economic value of the trademark established in their accounting books).

Although declarations that a mark is well known or famous do not constitute a procedural requirement and evidence gathering can be difficult, they have significant benefits. Certification is effective for five years, is renewable subject to the same conditions, gives the owner additional legal effects that will be positive for the trademark (specifically, to act as an obstacle against third parties trying to register a confusingly similar or identical mark in Mexico), and serves as grounds for cancellation or for an administrative declaration of infringement.

In conclusion, it is always advisable to obtain a declaration of well-known or famous status from IMPI, to have additional elements to preserve the exclusive use of a trademark and the good reputation that owners of famous and well-known trademarks have developed with their consumers through years of market sales.