As a rule, a trademark registration is not enforceable against a third party that started using, in Mexico and in bona fide, a trademark identical or confusingly similar to the registered one, to identify the same or similar products or services, if such use started before the filing date in Mexico. Claiming a date of first use in the application creates an exception to the rule.

Further, as a rule, Mexican registered trademarks may be invalidated on grounds of earlier and continuous use, in Mexico or abroad, of an identical or confusingly similar trademark to identify the same or similar goods or services, provided that such use started before the filing date in Mexico and has been continuous[1]. Claiming a date of first use in the application creates an exception to the rule.

The claim of the date of first use in the trademark application does not have consequences before the issuance of the trademark registration. Mexico does not demand use of the trademark to issue the registration and claiming a date of first use would not expedite the examination of the application.

After the issuance of the Mexican trademark registration, if the registrant claimed a date of first use in the application, the resulting registration would be enforceable against a third party using an identical or confusingly similar trademark in Mexico identifying the same or similar goods or services, even if such use started before the filing date in Mexico. Only if the use began before the date of first use stated in the application, then the trademark registration would not be enforceable against said third party.

As I said before, the rule is that a Mexican trademark registration may be invalidated due earlier and continuous use in Mexico or abroad if the use started before the filing date in Mexico. However, as an exception, if the registrant claimed a date of first use in Mexico in the application, then the plaintiff in the invalidation action would have to prove that it started the continuous use in Mexico or abroad before the date of first use stated in the application, instead of the filing date in our country.

Stating a date of first use has an important downside. The Mexican Industrial Property Statute stipulates that a trademark registration may be invalidated if it was issued using false information stated in the application. Although I am not aware of any statistics available, most of the invalidation actions I have filed on grounds of false information in the application, were related to the date of first use stated in the trademark application. The Mexican Patent and Trademark Office and the courts had consistently decided that the plaintiff did not have the burden of proof to demonstrate that the date of first use stated in the application was false; it was the trademark owner who had to demonstrate the truthfulness or accuracy of the date of first use. Considering that affidavits of use have almost no value as evidence in Mexico, proving that the applicant did not lie when stating a date of first use could be very difficult, especially in cases when the date of first use was several years old.

According to the statute of limitations, the vulnerability of a registered trademark against an invalidation action due false information stated in the application has to be filed within a five-year term after the publication of the trademark registration in the Official Gazette.

As you may imagine, stating a date of first use in a trademark application could become a dangerous trap and a potential risk of invalidation.

Some judges did some isolated efforts to moderate the rigor of the cause of invalidation provided in the statute. For example, there was an old isolated precedent from 1990 that provided that the invalidation on grounds of false information stated in the application, namely the date of first use, should only be declared if the plaintiff proves that the trademark owner obtained an unfair advantage from such a date of first use claim or that the first use claim could cause an unfair competition situation. However, other judges not only did not follow the precedent, but most of them affirmed the opposite position.

Things changed recently. On July 2016, a panel of judges issued a binding precedent about the invalidation action on grounds of false information stated in the application[2]. The precedent basically states that, in a cancellation action claiming that the date of first use stated in the trademark application was false, the burden of proof to demonstrate that the date of first use on a trademark application was false is on the plaintiff.

The precedent will dramatically reduce the chances of getting a trademark registration invalidated due a false or inaccurate date of first use; it seems extremely difficult to prove that someone was not using a trademark in the date it stated I the application. Therefore, the plaintiff has to prove that it was materially or legally impossible for the trademark owner to start using the trademark in the date stated in the application. Other than the above, the plaintiff may file evidence suggesting that a date of first sue is false, but not an actual direct proof.

The precedent was not free of controversy, because of the technicalities it implied. A significant number of judges in the panel disagreed, and one of them even prepared a very interesting minority report.

In any case, claiming a date of first use now seems much safer for trademark applicants and owners than it was just a few months ago. The precedent could be fair for trademark owners, but it may also lead to illegitimate claims with dangerous consequences (read my post The relevance of the date of first use in Mexican trademark applications)

One question that remains to be solved is if this precedent may be applied to invalidation cases that started before the publication of the precedent. The Amparo Statute provides that binding precedents from the federal courts of appeals or the Supreme Court may not be retroactive. I think the provision prevents the federal courts of appeals and the Federal Court of Administrative Affairs from using the precedent to decide appeals filed after July 1, 2016. However, I believe the Mexican Patent and Trademark Office may start ruling cases using this new binding precedent, no matter when they were filed.

[1] It is not required to prove that the plaintiff’s trademark is well-known in Mexico; earlier and continuous use of the mark in any country is enough. The statue of limitations provides that such an invalidation action has to be filed within the third anniversary of publication of the issuance of the Mexican  trademark registration in the Official Gazette.

[2] “NULIDAD DE REGISTRO MARCARIO. CUANDO SE ALEGA LA FALSEDAD DE LA FECHA DEL PRIMER USO DE LA MARCA, CORRESPONDE AL ACTOR LA CARGA DE ACREDITAR LOS HECHOS CONSTITUTIVOS DE SU ACCIÓN”, at Semanario Judicial de la Federación, Volume II, No. 32, July 2016, page 1445. benefit-from-new-binding-ruling-precedent.

La entrada New binding ruling benefits owners of trademarks registered in Mexico that claimed date of first use. se publicó primero en Reyes Fenig.

Nevertheless, Mexico acknowledges certain rights and defenses for the users of non-registered trademarks; Mexico also allows applicants to claim a date of commencement of use in Mexico, in order to obtain some benefits after the issuance of the trademark registration. In any case, these rights and defenses should not be construed as common-law rights (there is no common-law in Mexico) or exceptions to the first-to-file principle: the first applicant has priority to get the trademark registration, no matter who claimed the earliest date of first use or if the earliest applicant expressly stated that it has not started using the trademark at all.

In the same sense, only the registered owner of the Mexican trademark registration would have exclusivity rights on the trademark, regardless if a third party started using the same trademark before, even if the Instituto Mexicano de la Propiedad Industrial or Mexican Patent and Trademark Office (MPTO) has acknowledged such earlier use.

Notwithstanding the above, the claim of the date of first use of the trademark in the application, may actually extend the scope of rights resulting from the registration, but may also create a significant vulnerability of the trademark registration against an invalidation action.

I. ACTIONS AND DEFENSES FOR THE EARLIER USERS OF NON-REGISTERED TRADEMARKS IN MEXICO

The first user of a non-registered trademark in Mexico is not acknowledged as the proprietor of the mark, thus it may not file trademark infringement actions against other users of the same mark for the same goods or services.

Nevertheless, in theory, the first user of the trademark could file unfair competitions actions against other users of the mark, but it has to prove an intention to deceive the consumers, or that the trademark is well-known; in practice, it is difficult to prevail if there is not a registered or well-known trademark involved in the unfair competition claim.

Notwithstanding the above, Mexican law provides a defense and an action to the first users of non-registered trademarks to oppose the holder of a trademark registration.

A. Defense against a trademark registration

The Mexican statute provides that a trademark registration is not enforceable against a third party that have used in good faith and in Mexico, an identical or confusingly similar trademark to the registered one for the same or similar goods/services, if such use in Mexico has been continuous and started before the filing date of the trademark application or before the date of first used stated in said application.

B. Action against a trademark registration

The user of a trademark may file an invalidation action against an identical or confusingly similar registered trademark, covering the same or similar goods or services, provided that said use is continuous, started before the filing date of the application or the date of first use stated in the application, if any.

The Mexican statute of limitations stipulates that the invalidation action has to be filed within a three years term after the publication of the registration in the Industrial Property Gazette.

This action is unique because it is not necessary to prove earlier use in Mexico. Earlier and continuous use in any country in the world would be enough to invalidate the Mexican trademark registration. It is not necessary to prove that the used trademark is well-known or famous in Mexico (there is another action for those cases), and there is no reciprocity requirement in case the use took place abroad.

II. BENEFITS FROM CLAIMING FIRST USE IN A MEXICAN TRADEMARK APPLICATION

Claiming a date of first use in a trademark application may provide important advantages compared with a trademark registration with no prior use claim, although the applicant may benefit from those advantages only after the issuance of the registration.

The first use claim does not expedite or delay the prosecution of the trademark application. It is not required to file a specimen of the product/or service and the MPTO would not demand evidence confirming the date of commencement of use.

The claim –or lack of claim- about the date of first use and the statement stating that the trademark has not been used in Mexico may not be amended.

1. Defense of the trademark registration against earlier users

If a third party wants to challenge the validity of a trademark registration due earlier and continuous use in Mexico or any other country (as explained in I.B above) of an identical or confusingly similar mark covering the same or similar products or services, and the challenged registration has a claim of first use, then the plaintiff has to prove that it started using the trademark before said date of commencement of use (and not before the filing date in Mexico as it happens with a “regular” trademark registration).

2. Enforceability against earlier incorporated legal entities that use the trademark without authorization in their corporate name

The general rule is that the owner of a trademark registration may file an infringement action against a company that uses, as part of the corporate name, the registered trademark without authorization of the trademark owner, provided that:

(i) The infringing company’s activities are related to the goods or services covered by the infringed trademark, and

(ii) The filing date of the infringed trademark registration is earlier than the date of incorporation of the infringing company.

The above is the general rule. However, if there was a claim of first use in the trademark application, the trademark owner may file the infringement action against companies that started using the mark in their corporate names before the filing date of the application in Mexico, but after the date of commencement of use stated in the application.

One matter that has not been clarified in connection with this cause of infringement (actually, with all causes of patent, trademark and copyright infringement) is associated to the statute of limitations. The special statutes are silent about this issue, but the more general Federal Law of Administrative Procedures (complementary to the special Industrial Property and Copyright statutes) states a 5 years term.

The existence of a statute of limitations in connection to the infringement of IP rights has so many important implications (such as when the term stated in the statute of limitations starts; in our case,  when the infringing corporation ws incorporated, when the infringing corporation ceases activities or when the infringing corporation is is dissolved) that discussing them requires another post.

3. Enforceability against earlier non-authorized users of the registered trademark

The general rule provides that a Mexican trademark registration is not enforceable against a third party that started using in Mexico, in good faith, and before the filing date of the Mexican trademark application, a mark identical or confusingly similar to the registered one to identify the same or similar goods or services.

However, a Mexican trademark registration would be enforceable against a third party that started using before the filing date of the Mexican registered trademark, the same or a confusingly similar mark in Mexico (even in good faith) applied to the same or similar goods and services, if there is a date of first use stated in the trademark application, and such date of first use predates the date the third party began using the mark.

III. RISKS ASSOCIATED TO THE FIRST USE CLAIM IN THE TRADEMARK APPLICATION

This is not a perfect world, and the benefits that may provide the claim about the date of first use of a trademark in the trademark application are not exempt of certain risk, namely the vulnerability of the trademark registration with the first-use claim against an invalidation action due false information stated in the application.

The statute provides as cause of invalidation of a trademark registration, stating false information in the trademark application. Such false information may refer to any of the data fields of the application, such as the applicant’s name, address, nationality, and of course, the date of first use.

The statute of limitations provides that an invalidation action against a trademark registration due false information in the trademark application may be filed within a five years term, counted from the date of publication of the registration in the Industrial Property Gazette.

When a third party files an invalidation action against a trademark registration, claiming that the date of first use stated in the trademark application was false, the burden of proof is on the trademark owner, who has to prove that the date of commencement of use in Mexico was correct.

Mexican law and courts are very formalistic, thus proving the accuracy of a date of first use can become an extremely difficult task.

A non-binding precedent from the Tribunal Federal de Justicia Fiscal y Administrativa or Federal Court of Tax and Administrative Affairs (FCTAA), states that if the date of first use was inaccurate by just a few days, and the evidence shows that the trademark owner it started using the trademark long before the plaintiff, the trademark registration should not be invalidated*. I think that the FCTAA’s position is absolutely fair, but it is not fully consistent with the statutem and the precedent has yet to be confirmed to be binding.

(Update September 30, 2016. A binding ruling from a panel of appeal judges in the Mexico City Circuit ruled that the plaintiff has to prove that the date of first use was false or innacurate. This ruling significantly reduces the risk of having a registered tradematk invalidated because there was a date of first use. Read my post “New binding ruling benefits owners of trademarks registered in Mexico that claimed date of first use”.)

In order to prevent the vulnerability to an invalidation action due false information stated in the application, the general advice is that the date of commencement of use should have some documentary backup, namely invoices issued to customers located in the Mexican territory.

If the applicant is not certain that the trademark has been used in Mexico, or does not have any document to prove it, the usual recommendation is not stating a date of first use in Mexico, either by explicitly stating that the mark has not been used in our country, or by leaving the data field in the application blank.

Use by persons different from the trademark applicant, such as sister and parent companies and shareholders, as a general rule, may not be claimed in the benefit of the trademark applicant.

Some tips about the claim of first use:

(1) If the applicant has used the trademark on goods or services different from the ones stated in the trademark application, the applicant should not claim a date of commencement of use.

(2) In my opinion, if the applicant has used the trademark on one or a few of the goods or services listed in the trademark application, but not all of them, the applicant may claim a date of first use and such date would benefit all the products or activities listed in the trademark application.

It is important to say that this is my opinion; the statute is silent regarding this issue, and there are no published precedents supporting or rejecting my position.

(3) In my opinion, stating that the trademark has not been used, or leaving the field blank (there would be a statutory presumption that the trademark has not been used), in spite of the fact that the trademark has actually been used in Mexico, would not be a false statement that would make the registration vulnerable to an invalidation action due false information.

From my perspective, stating that the trademark has not been used or failing to make a statement at all, in spite that the applicant has used the mark, would be a valid and legitimate waiver of the right to claim the date of first use, given that no third party would be harmed in any way by such non-use statement.

Of course, my colleagues may disagree with my opinions, especially in the absence of explicit provisions in the statutes or judicial precedents. Hopefully, the courts will decide who is right in a not so distant future.

* See Journal of the Federal Court of Tax and Administrative Affairs, Era VI, Year I, No. 11, November 2008, page 587. This decision somehow confirms an old isolated non-binding ruling from a Federal Court of Appeals of 1990 (Weekly Judicial Journal of the Federation, Eight Era, Volume VI, Second Part-1, July-December 1990, page 198).

La entrada The relevance of the date of first use in Mexican trademark applications se publicó primero en Reyes Fenig.