Trademark Caselaw | Argentina | The Burton Corporation Succeeds in Battle Over Trademark BURTON Despite Initial Missteps
Late last year, the Civil and Commerce Federal Chamber, in Argentina, ruled in favor of The Burton Corporation in its appeal against a lower court’s dismissal of a lawsuit seeking the annulment of a trademark registration for BURTON, in class 25, held by Argentinian company AHJ SRL, in a case that comprised a trademark opposition as well as a trademark auction, resulting from a bankruptcy proceeding, while highlighting the importance of due diligence in trademark opposition settlements, among other aspects of trademark enforcement.
The BURTON logo. Source: https://brand.burton.com/logo/
The Burton Corporation is an outdoor sports equipment and apparel company, which the Chamber acknowledged has owned trademark BURTON, internationally, since 1977 and in Argentina since 1997, a circumstance that ended up playing a significant role in the outcome of the case.
The Burton Corporation had acquired eleven registrations for trademarks BURTON and BURTON BOARDS in classes 09, 14, 18 and 25, during a 1997 trademark opposition settlement with Sud Snow S.A., yet for a reason not specified in the ruling of November 27, registration No. 1.809.085, for BURTON, in class 25, was not included in he settlement and thus was not acquired by the company.
Later, during 2006 and within the bankruptcy process of Sud Snow S.A., the bankruptcy court ordered the subject registration to be auctioned, and upon the request of the bankruptcy trustee, The Burton Corporation was subpoenaed so that it made an offer to acquire the subject registration within a period of thirty days, which it failed to do despite being duly notified. As a result, AHJ S.R.L being the sole bidder, acquired the registration for ARS 300.00 (at the time, the equivalent of approximately US$ 100.00).
Upon issuing its ruling, the Chamber found that trademark BURTON’s well-known status -which it still ended up acknowledging at least within the sport of snowboarding and specially in the United States- was not the most relevant to the case, as the core of the conflict revolved around whether AHJ S.R.L. had acquired registration No. 1.809.085 in bad faith or not. The Chamber also found that, despite the clear negligence of The Burton Corporation in failing to acquire the subject registration upon being subpoenaed for that specific purpose, that circumstance did not excuse what it deemed to be an attempt by AHJ S.R.L. to take an unfair advantage of the reputation of the former’s brand, via its acquisition of the registration.
The Chamber based its decision on different elements that showed AHJ S.R.L. knew about the reputation of trademark BURTON and intended to benefit from it, including the fact that it had sold goods identified with said mark, and had even contacted The Burton Corporation during 2011, offering to license the subject registration in Argentina and stating that it had been continuously using the subject mark with the hope of reaching the proposed commercial agreement.
In issuing its ruling, revoking the lower court’s decision and declaring the annulment of registration No. 1.809.085, the Chamber further stated that while the circumstances of the case were enough to rule in favor of The Burton Corporation, in pursuit of preserving good commercial practices, the law also has the purpose of protecting consumers’ interests that could otherwise be affected.
Finally, and although ruling in favor of the plaintiff, the Chamber emphasized that had it not been for its negligence, judicial expenses associated with the controversy could have been avoided and, as a result, also ruled that it should court costs with the defendant and bear 40% thereof.
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