CHILE: Consumers’ Right to Truthful Information

In a recent decision now heading to the Supreme Court of Chile, the Court of Appeals broke new ground in supporting the consumer’s right to truthful information. It also further defined the separation between the country’s industrial property law and its unfair competition law, and it backed an assertion of confusion of the consumer without requiring proof of the confusion. 

On January 30, 2020, the Court of Appeals of Santiago (the court) revoked the resolution of the Sixth Civil Court, accepting a complaint filed for acts of unfair competition and infringement of industrial property rights. Rol Civil-15.114-2018.

In 2018, Hunter Douglas Industries Switzerland GmbH (Hunter), owner of Chilean registration No. 877046, in Classes 6, 20, and 24 for the mark LUXAFLEX covering curtains and other products in Class 24, sued Juan Antonio Amigo for infringement of Law 19,039, namely for improper use of the LUXA trademark (which is not registered) to distinguish the same products, which was misleading or deceptive to consumers. Hunter also alleged that the defendant was engaging in acts of unfair competition under Law 20,169, on the basis of conduct attempting to take unfair advantage of the trademark owner’s reputation in a manner that was misleading as to the origin of the products.

The judgment of first instance dismissed the case on the grounds that there was not enough evidence to prove the above-mentioned violations. However, on appeal, the court revoked the decision, upholding both claims. With respect to the trademark infringement claim, the court noted that the marks are similar and cover the same products. Likewise, the unfair competition claim was demonstrated by the appropriation of images of products belonging to the trademark owner, in addition to the creation of a trademark similar to the LUXAFLEX trademark—that is, LUXA.

The court’s ruling is noteworthy. It constitutes a precedent in unfair competition where historically the tendency has been to reject claims for this type of infraction, evidencing in this ruling a more modern approach. In particular, the court highlighted the right of consumers to truthful information.

Also relevant is the differentiation and separate analysis of the types of conduct that constitute violation of the Industrial Property Law and those that violate the Unfair Competition Law. Although the laws protect different legal rights, they also have a direct and complementary connection, as supported by the ruling.

The final notable aspect was with respect to the infringement of the trademark, namely the requirement that consumers be misled or confused, without it being necessary to prove the confusion in question. The decision emphasized that “when advertising the sale of ‘LUXA curtains’, it is possible to believe that the origin, quality or type of those curtains, if not the same, are at least closely related to the same LUXAFLEX product.”

An appeal against the decision of the court is pending before the Supreme Court. It can typically take between eight and 12 months to hear a case.

Although every effort has been made to verify the accuracy of items in the INTA Bulletin, readers are urged to check independently on matters of specific concern or interest. Law & Practice updates are published without comment from INTA except where it has taken an official position.

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