Trademarks registered in bad faith: meaning and context

Trademarks registered in bad faith: meaning and context

Trademarks registered in bad faith refer to those trademarks that are applied for and registered with the intention of obtaining undue benefits or harming third parties, which is perhaps the biggest problem for their owners as their registrations are annulled or their legitimate rights over their trademarks are infringed.

Law 17/2001, of December 7, 2001, on Trademarks establishes the principle of good faith in registration and provides, as an autonomous cause, the absolute nullity of the registration of a trademark when the application has been filed in bad faith.

The concept of bad faith not defined in the law has been configured through case law, and from it we can infer that bad faith in trademark applications implies the adoption of behaviors contrary to accepted ethical principles or honest commercial and business practices.

Any allegation of bad faith must be analyzed through an overall assessment of all the relevant factual circumstances in the case, but, according to the EUIPO guidelines, the case law shows three particularly relevant factors that may indicate the existence of bad faith:

• Confusing identity/similarity of the signs when the registered trademark is identical or similar to the point of creating confusion with another already registered trademark.
• Knowledge of the use of an identical or confusingly similar sign, i.e., when the trademark owner knew or should have known of the use of an identical or confusingly similar sign.
• Dishonest intent on the part of the trademark owner.

Causes that may invalidate registered trademarks in bad faith

The EUIPO defines the following scenarios in which trademarks may be invalidated:

• First, when applications are filed for speculative purposes, that is, the registration of a trademark with the intention of obtaining an economic benefit.
• Secondly, the so-called parasitic behavior, which can be defined as an unfair practice consisting in the registration of a trademark with the intention of taking advantage of the reputation of the invalidity applicant or its registered trademarks and taking advantage of that reputation.
• Thirdly, those known as defensive trademarks, i.e., those that are registered for the sole purpose of preventing the entry of a third party in the market and/or obtaining economic advantages.
• And finally, the strategy of repeated registration of trademarks or Refiling which occurs when the owner of a registered trademark applies for the registration of a new trademark, which is identical or very similar to the original trademark, for the same goods or services for which the original trademark is registered. Thus, the debate arises when the new registration is related to the lack of use of the original trademark, that is, when the owner does not use the registered trademark and before the expiration of the period in which the lack of use could cause the revocation as established by law, chooses to register a new trademark identical to the previous one.

Other factors, according to the EUIPO, potentially relevant to assess the existence of bad faith include:

• The circumstances under which the challenged sign was created, the use made of the sign since its creation, the business logic underlying the filing of the application and the chronology of events leading up to the filing.
• The nature of the mark applied for.
• The degree of inherent or acquired distinctiveness enjoyed by the sign of the applicant and the sign of the trademark owner, as well as its degree of notoriety.

How to avoid the cancellation of registered trademarks in bad faith

Having exposed the problems that trademark registration can offer and whose ignorance can lead you to an undesired situation that can cancel your trademark, it is convenient to have the advice of an expert intellectual property lawyer.

At LetsLaw we have a great team of professionals, digital lawyers experts in the field, who can help you in every step of the process so that you can register your trademark with confidence and security.