Trademark registration and pocket money saving

1. Introduction

Trademark registration in Brazil is an affordable activity. Besides Intellectual Property (IP) attorney's fees, the public price for filing a trademark is around US$88,00¹. Therefore, such initial phase of trademark prosecution could probably cost less than a couple of burgers and milkshakes at a fast-food joint in New York City.

Nonetheless, even big multinational companies are known to try to cheapen the accessible trademark prosecution system in Brazil, sometimes endorsing risky strategies. This short essay concern one of such cases, an entrepreneur choice that resulted on a expensive and unsuccessful litigation.

2. The Facts of Both Related Prosecution Cases

In the year of 1995, a company called IM&T filed for a nominative trademark ("Profile") to specify tires. After a quite long prosecution, the Brazilian Industrial Property Institute (INPI) - BRPTO -, granted such application (registered under the docket 818680121) in 1998. As any kind of property in Brazil, the Constitution demands that the holder fulfils its social function (article 5th, XXIX).

Therefore, although Brazilian Law does not impose a duty of use², there is an onus to properly exercise such IPR. The other option is to deal with the extinction of such right. The legal requirement of a de facto use avoids "trademark cemeteries" of unused registrations, well as avoids trademark filing speculators³. For each trademark registration, there shall be a "living soul" and not only a "ghost" holder.

A second company called Michelin, in 2006 initiated a post-grand procedure of prosecution towards the BRPTO, alleging that the "Profile" trademark owner did not destine sufficient use of such distinctive sign. The legal interest – standing – for Michelin to start such procedure against IM&T, was the refusal (in 2006) of the BRPTO to register the nominative trademark "Profiler" (filed in the year 2000, under the docket 823021343), also to specify tires.

Just like any lack of use allegation, the burden of proof sets against the trademark owner. In the Prosecution Trial Level, in 2007 the BPRTO agreed with Michelin and declared the extinction of IM&T's "Profile" trademark.

In turning point, nonetheless, IM&T filed an administrative appeal and successfully convinced the BRPTO of its point of view. Therefore, in 2009, the trial administrative level decision was reverted and the "Profile" trademark registration was comprehended as being in force.

A few months later, in June of 2009, the BRPTO published a new decision of the "Profile" trademark registration extinction. This time, nevertheless, the argument for such property termination was the lack of renovation requirement by the property owner. It is quite probable that the trademark owner was not UpToDate with BRPTO's decisions, duly and regularly published at the official gazette.

The direct consequence of IM&T prosecution defeat was that, after filing an administrative appeal concerning the "Profiler" trademark, Michelin was victorious and obtained such registration in 2010. Without IM&T's defeat, no coexistence between the "Profile" and "Profiler" trademark registrations for tires would be possible, since consumer rights⁴ are a binding force in Brazilian Law.

3. The Facts of Litigation Case

In Brazil, there are specialized Federal Courts that can rule a case when one challenges the BRPTO's decision. Since BRPTO has its headquarters in Rio de Janeiro, there are five federal Trial Level Courts, and two Appeal Level Courts in the 2^nd Federal Circuit. The high-quality decisions of such Federal Circuit results that: good faith litigators will avoid forum shopping to litigate in other Federal Circuits.

Unsatisfied with the prosecution results, IM&T filed an invalidation lawsuit towards the 13rd Federal Court of Rio de Janeiro. The merits opinion of Judge de Barros⁵, however, was to confirm the legality of BRPTO's decision. The plaintiff's argumentation (that the common publication at the BRPTO's gazette was not the proper manner to summon its attention) did not persuade the Court. Actually, the Trial Court level pointed out that, while the prosecution case about the lack of use of "Profile" trademark did not end, the registration was in force, and its owner should be alert for legal deadlines such as the renewal one.

Once filed the judicial appeal, IM&T obtained a majority opinion victory – against Michelin and the BRPTO/INPI thesis – in the appeal federal court level. Such decision was upheld in an en banc ruling, and the BRPTO did not appeal.

Based on the minority report, Michelin, nonetheless, filed a special appeal so that the Superior Court of Justice would hear this case. In Brazil, there are more than 75,000,000 lawsuits pending, which constitutes a quite litigating society. To deal with such backlog of judicial cases, Courts have been raising the procedural bars - year after year. In fact, the vast majority of special appeals are not able to abide procedural requirements, and for such reason, rarely have its merits analyzed by the High Court.

Michelin's special appeal, however, convinced Justice Araújo Filho⁶. In fact, such Hight Court Judge emitted his opinion that the BRPTO's decision (to extinguish AI&ET "Profile" registration for the lack of renewal) was the correct one. Unsatisfied, AI&ET filed an "internal" appeal so that the full body of the 4^th Chamber would rule the case. In a unanimous ruling, the 4^th Chamber confirmed the legality of the BRPTO's decision, in the same manner as the 13^th Federal Trial Court Level and Justice Araujo Filho interpreted the case.

4. Conclusion

Three important lessons can be extracted from such prosecution and litigation trademark cases. The first one can be summarized like the pop song from the 1980's band Starships: "It’s Not Over (’Til It’s Over)". After an unfavorable first result concerning the allegation of lack of actual use prosecution, perhaps the owner of "Profile" trademark left the usual deadlines (in particular, the renewal one) as a non-priority plan. However, such "game" had not terminated, and a prudent player shall act in the most orthodox and conservative manner not to be surprised later on.

The second issue to be learned concern the price dealt with prosecution attorneys. In other cases, different from the "Profile" one, there are clients that would rather save of "peanut's" money than to pay for an IP attorney to take a steady care of the case. Pocket money saving might result on the lack of reading the official gazette and the need of helpless argumentation such as paternalistic thesis of individual summoning. Such arguments did (and should not) not prevail in Brazilian Federal Courts. Actually, one must remember that prosecution is less expensive than litigation⁷, in particular when dealing with deep pocket ex parte.

The third and last point one could learn from such case is the "actual"⁸ and "consistent" use of a registered trademark, since there is a distinctive⁹ requirement to observe. Although one could brag about having hundreds of trademark registrations, without a continuous and substantial use of each and every of them, such property registration might encounter the will of a wise competitor. The Brazilian Constitution only guarantees protection for the virtuoso owner, not for the non-diligent one.

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1 https://www.gov.br/inpi/pt-br/inpi-data/precificacao-dos-servicos/tabela-de-retribuicoes-inpi_portaria-mdic-no110_2025-e-portaria-inpi-no-10_2025.pdf, prices available at the Brazilian Industrial Property website.

2 The same occurs in countries like Germany and Spain: García, Concepción Saiz. El Uso Obligatorio de la Marca. Valencia: Tirant lo Blanch 1997, p. 38

3 On the genuine use requirement as a mechanism designed to ensure that trademark rights fulfill their social and economic function in the marketplace, preventing registrations from being maintained solely as a means of restricting the legitimate activities of third parties, see: Schmidt, Lélio Denicoli. Marcas. Aquisição, Exercício e Extinção de Direitos. 3ª Edição Revista e Aumentada. Rio de Janeiro: Lumen Juris, 2023, pp. 345-346.

4 Approaching consumer law rights in trademarks, Bollier, David. Brand Name Bullies. USA: 2008, p. 83.

5 Honorable Federal Judge Márcia Maria Nunes de Barros, docket number 803712-10.2011.4.02.5101.

6 Honorable Justice Raúl Araújo Filho, Special Appeal docket number 1.878.735.

7 "The most common role that money plays is the obvious one: the larger, better financed company can object to a little business's name and threaten it with expensive litigation that it can ill afford. To avoid such litigation, the smaller company often surrenders the right to use its name. The opposite is also true. A smaller company that believes its name is being infringed by a giant corporation must decide whether or not it has the finances to carry out trademark litigation" SHUY, Roger Wellington. Linguistic Battles in Trademark Disputes. New York: Palgrave Macmillan, 2002, p. 13.

8 BARBOSA, Dênis Borges. Proteção das Marcas. Uma perspectiva Semiológica. Rio de Janeiro: Lumen Juris, 2008, p. 240.

9 About properly addressing the distintive requirement by use in Portugal, see: Gonçalves, Luís Manuel Couto. Função Distintiva da Marca. Coimbra: Almedina, 1999, p. 112.