Improper Use of Trademarks under Company Names

December 16, 2011
Improper Use of Trademarks under Company Names

As discussed in previous publications, Mexican Intellectual Property law has established a series of actions as administrative violations for the improper use of protected rights related to distinctive marks or inventions, including, among others: the use of trademarks, commercial names or commercial notices that are the same or similar to those registered without the consent of the owner; manufacturing or creating products protected by a patent or an industrial model or design registration; offering products for sale which contain a trademark or which are patented knowing full well that such products are not authorized by the owner of the trademark or patent; etc. In this article, however, we discuss a specific violation where companies, acting in bad faith, intend to take advantage of the notoriety of trademarks that have a good reputation in the market. Section V of article 213 of the law on this subject establishes that the following provides cause for a proceeding and, as such, an administrative violation, “Using, without consent from the owner, a registered trademark or anything similar to a degree of confusion, with a commercial name or denomination or corporate name or vice versa, as long as such names, denominations or corporate names are related to establishments that operate with the products or services protected by the trademark”. This section is relevant in those cases when a person appears before the corresponding authority, improperly and knowing well that a trademark may not be registered because it belongs to a third party, to request authorization to form an entity whose corporate name primarily contains the trademark that it intends to use. In other words, authorization to create a company whose name is that of a trademark of certain prestige is requested and, at times, obtained in order to carry out the production or provision of services related to the trademark. Without a doubt, this behavior confuses the general public, which typically recognizes products more by their trademark than by the name of the entity that produces them. Consequently, these offenders market and distribute their products by showcasing the name of the company on the packaging, the same which contains the trademark as a fundamental element. Mexican authorities tend to verify that trademarks have not been violated in this manner upon formation of an entity; however, there have been occasions when an improper corporate name authorization has been granted. However, this does not preclude the offender from being punished for using the registered trademark, and the authorities will order the removal of the trademark from its denomination or corporate name.

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