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Trademark disclaimers: why the INPI’s new rules are worrying

26-05-2016

Marcelo de Oliveira Müller

Trademark disclaimers: why the INPI’s new rules are worrying

Pathdoc / Shutterstock.com

Brazil’s intellectual property office is introducing new rules on disclaimers for trademarks, but they are counterproductive, argues Marcelo de Oliveira Müller of Luiz Leonardos & Advogados.

In February, the Brazilian Patent and Trademark Office (INPI) enacted Resolution 161/16, which establishes new guidelines for the issuance of disclaimers. These guidelines briefly state that instead of continuing to provide individual disclaimers tailored to each specific case, all certificates of registration will simply bear a general remark, stating that portions of a trademark that cannot achieve exclusivity are, for a number of reasons, to be considered disclaimed and not subject to exclusivity. The text for the “standard disclaimer” contained in the resolution can be translated as follows:

“The protection afforded by the present trademark registration, considering what is provided for in section 124, II, VII, VIII, XVIII and XXI of Law 9.279 of May 14, 1996, will not impede that third parties use in its literal meaning, or use as a part of other trademarks which distinguish themselves from the
present one, when regarded as a whole, the following elements possibly contained in the trademark:

a. letter, number and date;

b. signs of generic, necessary, common, ordinary or simply descriptive nature when related to the product or service specified in the registration;

c. signs commonly used to designate a characteristic of a product of service specified in the registration regarding its nature, nationality, weight, value, quality and time of production or providing of a service;

d. colours and their names;

e. technical terms used in the industry, science and art, related to the product or service to be distinguished; and

f. the necessary, common or usual shape of a product or packaging, or also shapes that cannot be dissociated from a technical effect.”

The INPI makes it clear in the text of the resolution that this change aims at facilitating the rendering of decisions and understanding of each particular case.

With these new rules it appears that the results to be achieved will be precisely the opposite, and that practitioners and trademark owners alike will soon be facing a myriad of situations where the limits of rights will be completely unclear. In fact, instead of creating a clearer view of the INPI’s decisions, these new rules will actually place each and every trademark issued in a grey zone.

Even though an improvement in the INPI’s pace of trademark examination is not only desirable but in fact extremely necessary, the measures adopted for this purpose have to be carefully considered, as otherwise the poor quality of decisions will lead to great uncertainty and an enormous amount of questioning within the administrative and judicial spheres.

IP community takes action

This has led the Brazilian intellectual property community to contact the INPI in an effort to postpone the application of these rules, a move that led the INPI to publish a second resolution on the same subject, Resolution 162/16. This resolution suspends the effects of Resolution 161/16 until May 2, 2016.

On many previous occasions the INPI has changed its internal rules that guide trademark examiners on the issuance of disclaimers. This historical inconsistency can be clearly felt during the interaction with the INPI’s database, whether during trademark clearance or analysis of decisions for the development of strategies.

In fact, disclaimers have been rendered in a very inconsistent way in many situations, and it is easy to understand the INPI’s focus and efforts to reach more clear and definitive (at least for now) procedures and regulations for dealing with disclaimers.

Nevertheless, while doing so, the INPI cannot fail to consider that disclaimers serve many different purposes. For example, they make clear and impose a variety of limits and warrant rights that otherwise would be hard to secure.

Therefore, for the time being we do not foresee how the INPI can simply opt for no longer providing guidance to those who depend on it. A government body cannot simply choose no longer to provide decisions that determine the scope of one’s trademark rights, and create uncertainty and obscurity.

On many previous occasions the INPI has changed its internal rules that guide trademark examiners on the issuance of disclaimers.

The INPI must never forget that ultimately it plays the part of ruling on matters that have severe economic and social effects.

Concerns over investment

The doorway to investments in any country is through obtaining protection for one’s rights, whether IP, labour rights, etc. By creating uncertainty for trademark owners, the INPI automatically takes several backward steps when it comes to helping Brazil’s growth and economy. More than once we as practitioners in the field of IP in Brazil have seen similar behaviour and attitudes from the INPI.

Economic insecurity is not new to those who venture into the Brazilian market, but entering into this already confusing economic scenario without an assurance of what kind of rights you actually have when it is time to face competitors, counterfeiters and other peculiarities of our territory is something that will really worry investors.

With these new guidelines, the INPI erases any possibility of a clear understanding of the scope of protection granted by a trademark registration, leaving open for interpretation what disclaimers could possibly fit into each particular case.

Sometimes, the element disclaimed can be easily determined, although almost never with 100% certainty. At other times, such as for words commonly used in a certain market, it becomes completely unclear and doubtful.

It is important for the INPI to find new rules to guide the examiners on the issue of disclaimers, but it is really difficult to imagine that it could create a written formula that could possibly be applied equally to all trademarks and situations. The analysis must continue to be made on a case-by-case basis, as it has always been, or simply be ceased. The limitations imposed on each case must be clearly communicated to society in general, as happens with the other elements that define each trademark registration, such as the owner’s name or the specification of products or services.

The disclaimer imposed on a trademark is to be considered information that is as necessary to society in general as any other information relative to the registered trademark, and even more to the trademark owner itself.

Appeals against disclaimers

Nowadays, whenever a trademark is granted with a disclaimer, the trademark owner is entitled to present an appeal against this decision, which is regarded as a “partial rejection”. This appeal provides the applicant with the possibility of contesting the disclaimer imposed on the trademark rights it sought.

This is especially relevant to this analysis to the extent that the number of appeals against disclaimers that remain pending before the INPI is considerable, and these new rules will directly affect the examination of these appeals too. The appeals will be examined in light of the new understanding that a general disclaimer is to be imposed.

With these new rules on disclaimers, the INPI simply denies applicants the possibility of filing an appeal, as it will remain unclear exactly what was the decision rendered and what are the exact limitations that are foreseen in each case. As a matter of fact, by putting these new rules into effect, the INPI denies transparency and full comprehension of its acts, going against Resolution 161/16 itself.

Many of the words used by the INPI in its text represent characteristics that are missing in the new format of disclaiming trademarks that is to be implemented, since efficiency will not be achieved when you have to discuss matters later due to obscurity of a decision. At the same time transparency and clarity are far from being possible, while security is an asset that will disappear almost instantaneously when these rules come into force.

Finally, it should also be noted that since the INPI foresees in its resolution that these new rules will also apply to trademarks that are being renewed, it is possible that this will harm already acquired rights, especially since some disclaimers have been imposed on certain registrations after judicial battles.

These new rules create a confusing situation for applicants, namely that a lack of clearly defined limits will possibly oblige trademark owners to no longer rely on renewal publications and certificates, and constantly have to fight to prove the extension of their rights.

Despite some faults along the way, the INPI always accomplished the laborious work of addressing every single issue that needs to be addressed while examining a trademark application, showing a dedication to giving certainty of rights to trademark owners. Sadly, it appears now that the INPI has opted for deviating from this level of work.

We can only hope that these new guidelines will be reviewed and reconsidered by the INPI with the aim of continuing to provide those who seek trademark protection in Brazil a clear light on the limits, warranties and rights that derive from each trademark issued in our territory.

Marcelo de Oliveira Müller is head of the trademark department at Luiz Leonardos & Advogados, providing guidance on trademark protection and strategic solutions for trademarks and related issues. He has more than 20 years of practice devoted to intellectual property in Brazil. He can be contacted at: mmuller@llip.com

Marcelo de Oliveira Müller, Luiz Leonardos & Advogados, INPI, trademark, trademark rights, Brazilian Patent and Trademark Office,

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