Division I of the Civil and Commercial Federal Court of Appeals of the city of Buenos Aires confirmed the lower court’s decision in Espert S.A. v. Philip Morris Products S.A. on July 16, 2015. That decision admitted an opposition filed by the defendant, owner of the marks MARLBORO and MARLBORO & design in International Class 34, against trademark applications for MELBOUR & design and MELBOUR FILTER CIGARETTES FULL FLAVOR 19 & design in the same class.
Espert (the plaintiff) filed a complaint pointing out that the intense use of its mark MELBOUR & design demonstrated it had acquired de facto rights in the local market. Espert argued that its company, which started doing business in 2002, had 120 employees and had acquired 12 percent of the domestic cigarette market since its foundation. The plaintiff also stated that the lack of confusion between the marks was supported by the fact that the defendant (Philip Morris) had withdrawn an opposition filed against its prior trademark application for MELBOURNE & design in the same class. Moreover, Espert cited a court decision of Division II of the same Court of Appeals (Philip Morris Products S.A. v. Medidas Cautelares (Preliminary Injunction) (Nov. 16, 2006)) that ruled that MARLBORO’s notoriety did away with any confusion. This decision further highlighted that the challenged words MELBOUR and MELBOURNE brought to mind an important city and port of Australia, therefore denying the injunction.
Philip Morris argued that it was the largest private cigarette company in the world founded in 1847, doing business in more than 160 countries. The company said that in 1924, it introduced into the market its most famous mark, MARLBORO, which it claimed was confusingly similar to MELBOUR. Philip Morris also claimed that it had opposed the plaintiff’s mark from the beginning, as it was a slavish imitation.
The Court of First Instance rejected the complaint on the grounds that the confronted marks were confusingly similar fantasy words. On appeal, the Federal Court of Appeals held that notoriety required two elements: (i) broad knowledge of the sign (to be known by all the public and not only by the purchaser of the relevant market), and (ii) the spontaneous association made by people between the sign and the product.
The appeals court said that MARLBORO was a prestigious and globally renowned mark that was synonymous cigarettes and involved a classic case of obvious notoriety that extended beyond cigarette consumers. It further stated that MELBOUR brought to mind the opponent mark MARLBORO and could cause confusion, since they both protected identical products that were sold in the same stores. Finally, the appeals court said that although MARLBORO’s notoriety could in principle do away with the confusion with MELBOUR, it was not reasonable to choose a mark with no meaning, compounded with a design and colors almost identical to the opponent mark to distinguish locally manufactured cigarettes.
The case highlights the conditions that a mark requires to be considered notorious as well as the protection granted to such marks by Argentine courts.
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