Since 1997, the Mexican statute makes a distinction between personal rights and economic rights. Personal rights include the right to decide if a work should be disclosed or not, the right to modify the work, the right to oppose the mutilation of the work, and the right to be acknowledged as author, among other rights. As a rule, personal rights have no monetary value and may not be assigned by contract.

Economic rights include the right to copy the work, distribute copies, communicate the work, authorize the public use of derivative works (such as translations and adaptations), among others, and may be assigned and licensed.

As a consequence of the 2003 amendment to the Federal Copyright Law, many lawyers and associations of authors claim that the economic rights on works of authors that died 50, 75 or 90 years ago are still in force, hence the holders of such economic rights are entitled to claim royalties for the use, public communication or reproduction of the works.

However, a thorough review of the different provisions and past legislations regarding copyright may lead to a different conclusion.

The Federal Copyright Law of 1947[1] provided that the term of copyright was the life of the author plus 20 years. A new copyright statute enacted in 1956 extended the life of copyright to the life of the author plus 25 years.

The Federal Copyright Law of 1956[2] expressly stated that the copyright term of works of authors that died before the enactment of the new law would be automatically extended to the term provided in the 1956 statute. In other words, the Federal Copyright Law of 1956 provided the retroactive application of the new extended term of copyright.

The 1956 law was amended in 1963; the 1963 amendments were so deep and extensive that it is usual to speak about the Federal Copyright Law of 1963[3], as if it were a new statute. The Federal Copyright Law of 1963 extended the term of copyright to the life of the author plus 30 years after his death. However, unlike the 1956 statute, the transitory articles of the 1963 law did not provide that the new term could be retroactively applied.

An amendment in 1982[4] to the Federal Copyright Law of 1963 stipulated a new extension for the term of the copyright: the life of the author plus 50 years. Again, the transitory articles of the amendment did not provide that the extended term would be retroactive.

Constitutional article 14 prohibits the retroactive enforcement of a law or regulation, only if it harms an acquired right. However, in my opinion, as a rule, in order to retroactively enforce a new law or amendment, it is necessary for the new or amendment law to expressly provide such retroactive effect[5]. The only exception would be new laws or provisions that stipulate criminal or administrative penalties, if the new stipulation or law states a benefit or less severe penalty; in this case the new stipulation or law would be enforced automatically, without explicitly stating the retroactive enforcement of the new law of provision[6].

Without a provision allowing the retroactive enforcement of the extended terms of copyright stipulated in the Federal Copyright Law of 1963 and its amendment of 1982, it is quite arguable to state that the original copyright term stipulated in the Copyright Law of 1956, was extended by the Federal Copyright Law of 1963 or its amendment of 1982. If the terms stated in the Law of 1963 and its amendment of 1982 cannot be enforced in connection with authors that died when the Law of 1956 was still in force, the copyright on the works of an author that passed away, i.e. on October 31, 1963, were extinguished by October 31, 1988, (25 years after the date of death).

In the same way, the term of copyright of authors that died when the Copyright Law of 1963 was in force, but before the amendment of 1982, did not get the benefit of the new extended term. The exclusivity rights on the works of an author deceased in 1966 would be extinguished by 1996.

The Federal Copyright Law currently in force was enacted on December 24, 1996[7], and became enforceable on March 24, 1997. As I stated at the beginning of this post, the 1997 Federal Copyright Law was the first statute to provide an explicit distinction between personal and economic rights in the field of copyright[8]. Originally, the Federal Copyright Law of 1996 stated a term of 75 years, counted from the date of death of the author, for economic rights. As in 1963 and 1982, the Federal Copyright Law of 1996 did not stipulate that the new extended term of the economic rights on a work could be retroactively enforced; the 2003 amendment to the Federal Copyright Law (enacted on July 23, 2003, and enforceable on July 24, 2003)[9] that extended the term of economic rights to a 100 years, counted from the death of the author, did not state retroactivity either.

Therefore, in opinion, the extended terms for economic rights provided in 1996 and 2003 may not be extended to works by authors that died before the new terms became enforceable.

About a year ago, AIPPI submitted Question 235 or Q235 about the term of copyright protection in Mexico. Unfortunately, the answer to the question from the Mexican chapter did not analyze the issues regarding the retroactive enforcement of the extended terms of copyright protection in Mexico.

In conclusion, there are four possible scenarios regarding the term of copyright economic rights in Mexico, depending on the statute or amended statute that was enforceable by the time the author of the work died:

A. In the case of the works of authors that died by or before January 11, 1982, the term of the copyright economic rights expired on January 11, 2012. These works are in public domain now.

B. In the case of the works authors that died between January 12, 1982 and March 23, 1997, the term of the copyright economic rights will expire 50 years after the date of death.

C. In the case of the works of authors that died between March 24, 1997 and July 23, 2003, the term of the copyright economic rights will expire 75 years after the date of death.

D. In the case of the works of authors that passed away on or after July 24, 2003, the economic rights will expire 100 years after the date of death.

For more information about copyright in Mexico, you may read Some basics about copyright law in Mexico.

———————–

[1] The Federal Copyright Law of 1947 (in Spanish) is available here.

[2] The Federal Copyright Law of 1956 (in Spanish) is available here.

[3] The Federal Copyright Law of 1963 (in Spanish) is available here.

[4] The 1982 amendment to the Federal Copyright Law of 1963 (in Spanish) is available here.

[5] There is an old non-binding precedent (in Spanish) from the Supreme Court that supports this opinion: “Retroactividad de la ley (Teoría de los derechos adquiridos) (Legislaciones del Distrito Federal y de Yucatán)”, Semanario Judicial de la Federación, Quinta Época, Tomo LXXVIII, p. 2435.

[6] There is a recent binding precedent (in Spanish) from the Supreme Court: “Principio de retroactividad de la norma posterior más favorable. Procede aplicarlo en beneficio del gobernado cuando la nueva disposición deja de considerar antijurídica la conducta sancionada con multa fiscal”, Semanario Judicial de la Federación y su Gaceta, Décima Época, Libro XIX, Tomo 2, abril de 2013, p. 1321.

[7] The original text of the Federal Copyright Law of 1996 (in Spanish) is available here.

[8] Before 1996, the distinction between economic and personal rights was known in Mexico, but limited to the jurisprudence and judicial decisions, as evidenced in this non-binding precedent (in Spanish) from 1987: “Derechos de autor. Distinción entre el derecho de divulgación y el patrimonial de explotación de la obra”, Semanario Judicial de la Federación, Séptima Época, Volumen 217-228, Sexta Parte, p. 214.

[9] The text of the 2003 amendment to the Federal Copyright Law of 1996 (in Spanish) is available here.

La entrada The different lenghts of Copyright in Mexico se publicó primero en Reyes Fenig.

ACTA is an international treaty. Morocco, Singapore, South Korea, Australia, Japan and the United States of America already signed it, although is not still in force as far as I know. In very general terms, the purpose of ACTA is attacking the illegal trade of pirated/counterfeited products, including their massive distribution online.

There has been a lot of controversy around ACTA, not only in Mexico but in many countries where the adoption has been proposed. A well-known case is the rejection of ACTA by the European Parliament after its approval by the European Commission.

It is not the purpose of this post starting a discussion about the possible benefits and risks of ACTA. However, there were two situations that strongly called my attention about the decision of the Mexican government about signing ACTA. First, I think it was odd that the Mexican President decided to sign ACTA (the President is the ultimate responsible of signing an international treaty) in spite of the explicit opposition of the Senate and the Federal Telecommunications Commission. Second, there are still a lot of informed people that believe that the Internet is “law-free” (or lawless?) environment beyond any State jurisdiction.

1. ACTA was signed in spite of the opposition of the Senate and a relevant Mexican government agency.

The Mexican Senate organized a Plural Study Committee (Grupo Plural de Trabajo) to analyze ACTA. In its conclusions, the Committee expressly requested the Executive Branch not to sign ACTA.

The position of the Senate is extremely important because ACTA needs the Senate’s ratification to be in force in Mexico. On the other hand starting September 1, 2012, a newly-elected Senate will start working. Perhaps the President (who will step down from office next November 30, 2012) thought that the newly-elected Senate will be more favorable to ACTA than the current senators.

The Federal Telecommunications Commission (COFETEL) is the government agency in charge of regulating telecommunications. COFETEL also expressed an adverse opinion to ACTA. COFETEL’S press release 65/2010 states that ACTA “could negatively impact the rate of penetration and general development of the national Internet industry”. The opinion of COFETEL was not binding.

During an interview with the Mexican journalist Carmen Aristegui, the Commissioner of the MPTO stated that the opinion of COFETEL was disregarded on formal grounds, basically because there was no evidence that all the commissioners approved the opinion against ACTA and COFETEL did not confirm its position after a request from the MPTO. Therefore, it is clear that the President (not actually the MPTO) decided to ignore the opinion of the federal regulatory agency in the field of telecommunications, in the in spite of the explicit purpose of ACTA of impacting the digital environment.

Now that the term of President Calderón is about to end, in less than two months the Mexican government took material steps to make Mexico part of two somehow controversial international agreements related with Intellectual Property (the Madrid Protocol and ACTA), although it is unclear when Mexico will effectively join both agreements. We do not know when the Mexican government will deposit the accession document to the Madrid Protocol (it may take months, even years) and ACTA needs the ratification of the Senate.

The approval of the Madrid Protocol and the accession to ACTA were unexpected.

Although the MPTO has been providing information about the Madrid Protocol for at least one year, by September 5, 2011 the Ministry of Foreign Affairs had no knowledge of Mexico approving the Madrid Protocol, but in April 2012 the Ministry of the Interior submitted the Madrid Protocol to the Senate for approval, which was swiftly granted.

On the other hand, after the negative opinions of the Mexican Senate and COFETEL, ACTA seem dead and still the federal government signed it without giving any prior notice.

Recently, the Minister of Economy stated that Mexico decided to join the Madrid Protocol because the United Stated conditioned supporting Mexico to join the Trans-Pacific Partnership (TPP) to the approval of the Madrid Protocol. I would not be surprised that signing ACTA was also a condition set for supporting the accession of Mexico to the TPP.

2. Internet as a “free environment”

In the interview with the Commissioner of the MPTO, the journalist Carmen Aristegui suggested that internet is a “free environment” that should allow the free and unrestricted distribution of ideas content.

The journalist’s position reflect the extended idea about the Internet as a law-lawless environment, as if it were another planet away from the reach of the State.

It is clear that there is a lot of freedom in the Internet, especially freedom to express ideas and opinions; this blog is an example. However, the freedom and rights of any person have limits, and usually the limits are set by the freedom and rights of others.

The above is extremely important in the case of distribution of contents through the Internet, therefore distribution or works. Freedom as a rule in the Internet is not a license to infringe other people’s rights. Freedom of speech should be encouraged, but the freedom to express my own ideas and works is very different from communicating and distributing the ideas and contents of other people when the owner of the rights on such ideas and contents does not agree with their distribution.

The distribution of contents and works in the Internet should be punished when such distribution is against the will of their authors or right-holders, even in the absence of monetary gain. Copying and distributing contents and works of others without authorization or against the explicit prohibition of the right-holders to do so without profit might not be a crime, but it is still against the law. Unfortunately, a lot of people do not understand this and prefer to support a misconception of freedom in the Internet.

Mexico must improve the protection of IP rights, there is no question about it. However, treaties and laws by themselves are not enough to change the reality. Existing laws and regulations in Mexico are fairly good (they could be better), but Mexico has to dramatically improve the enforcement, and in order to do so, courts and administrative authorities need better technical and material capabilities, and also the will. Getting the will to strongly and consistently enforce the existing laws against counterfeiting is difficult when the society continues considering most cases of piracy and product counterfeiting as lesser offenses, if offense at all. Incentives to purchase counterfeited goods are strong, and as long as there is demand for counterfeited products there will be offer, no matter treaties and laws. People need to be educated not only about the importance of protecting and observing IP rights but about the benefits that society and as whole and its members individually obtain from IP. Otherwise, I do not see how to win this fight.

La entrada Mexico signs ACTA se publicó primero en Reyes Fenig.

Before the 2010 amendments, many activities associated to the infringement of IP rights in Mexico were already punished with extreme severity. For example, the willful production, distribution and importation of goods bearing counterfeited trademarks in commercial scale are delitos graves or felonies, thus the defendant is not allowed to be free on bail during the trial. In the same sense, the willful non-authorized reproduction of works protected by copyright in commercial scale is a felony too.

However, in all cases, in order to start an investigation, the holder of the copyright or registered trademark copyright had to file a querella or formal complaint. A characteristic of the crimes that require querella is that the right holder may stop the investigation or the trial by withdrawing the charges (perdón in Spanish).

The querella requirement could obstacle an investigation; for example, when officials of the Customs Agency or the General Attorney Office found and seized a shipment of counterfeited goods or illegal copies of works, without a querella, there was no justification to maintain the seizure of goods or authority to continue the investigation. Further, the formalities that have to fulfill a power of attorney required to file a querella can be very difficult to accomplish for foreign entities. As a result, a federal judge could dismiss a trial because the power of attorney of the representative of the right holder was missing some formal requirement.

As I said before, in the case of crimes that need a formal complaint, the copyright or trademark owner could terminate the investigation or even the trial with a perdón or withdrawal of charges. This possibility allowed the trademark or copyright holder to negotiate a settlement with the defendant, although this sort of negotiations often discouraged, even upset, the officials of the General Attorney Office.

Now, with the June 2010 amendment, many -not all- IP related crimes (most of them associated to copyright) will be investigated ex-officio.

In the copyright field, for example, willfully producing, reproducing, importing, transporting, distributing, selling (in a store) or leasing copies of copyright protected works, with commercial purposes and without authorization, is not only a felony but also will be investigated ex-officio. On the other hand, willfully selling unauthorized copies of copyright-protected works in the streets, with commercial purpose, is a crime that now will be investigated ex-officio, although it is not a felony.

In the trademark field, the June 2010 amendment did not change most of the crimes associated with trademark counterfeiting provided in the statute. Most cases of trademark counterfeiting remain being felonies, but they still need the formal complaint or querella filed by the trademark owner in order to be investigated.

Nevertheless, as a consequence of the June 2010 amendment, willfully offering in sale goods bearing counterfeited trademarks, in the streets with commercial purposes, is now a crime that may be investigated ex-officio although, paradoxically, it is not a felony.

The Federal Congress also amended some provisions regarding the preliminary measures that a trademark, patent or copyright holder may request from the Mexican Patent and Trademark Office (MPTO) to stop infringing activities, namely the requirements that the defendant must fulfill to lift such measures.

The most usual way to oppose infringement of IP rights –including most copyright infringement cases- is the administrative infringement action, filed with the MPTO. The MPTO has authority to issue preliminary measures. The preliminary measures may include the seizure of infringing products and an order to the infringer to stop the production of infringing products and recall the merchandise already in hands of distributors.

In order to obtain the preliminary measures, among other requirements, the defendant must file a bond. The purpose of the bond is to guarantee the payment of the actual damages that the preliminary damages may cause to the defendant in case the MPTO decides there was no infringement.

The defendant is allowed to lift the preliminary measures and continue it business as usual, by filing another bond. The purpose of the bond is to guarantee the payment of the damages that the defendant’s activities may cause to the plaintiff.

In practice, the MPTO has not enough data, if any at all, about the amount of the possible damages that the preliminary measures may cause to the alleged infringer, thus the MPTO sets the amount of the bond at it own discretion. Sometimes, the plaintiff files the bond with the MPTO before it accepts to issue them; if it is high, there is a good chance that the MPTO will accept it, although technically it is an arguable practice.

If after the enforcement of the preliminary measures, the MPTO believes that the amount of the bond is too low, it has authority to request the plaintiff to increase the bond, within a three or five days term. Failure of the plaintiff to increase the bond would result in the lift of the preliminary measures.

Once that the preliminary measures have been enforced, the alleged infringer has the right to lift them, y filing another bond. The purpose of this bond is guaranteeing the payment of the damages that the alleged infringing activities may cause to the plaintiff. The practice of the MPTO was to set the amount of the defendant’s bond in twice the amount of the bond filed by the plaintiff.

Now, the amended statute stipulates that the bond that the defendant may file shall be 40% higher than the bond filed by the plaintiff. Nevertheless, the MPTO keeps authority to request the increase of the amount of the bonds filed by the plaintiff or defendant, in case it considers that their amounts are not high enough to guarantee the payment of the damages.

Finally, it is now an administrative infringement that the patent holder, or the recorded licensee (if the recorded license does not provide against the filing of infringement actions against third parties), files an infringement action against a third party, if there was an earlier final decision ruling that there was no patent infringement involving the same cause of infringement.

From my perspective, this new cause of infringement is odd, and I can only understand it as a way of refraining innovative pharmaceutical companies from harassing generics manufacturers with constant infringement actions repeating the same causes of infringement, assuming of course that the efforts of the patent holders to enforce their patent rights can be generally qualified as ‘harassment’.

The amendments to the Federal Criminal Code suggest that there is an intention to increase the fight against piracy, although it also shows lack of a coherent strategy, given the different treatment to crimes associated to trademarks and those related to copyright, and the inconsistencies in each field.

Only time will tell if the will to combat piracy is real, or only a measure to cool down Mexico’s trade partners, mainly the United States, who kept Mexico is the Watch List of the 2010 Special 301 Report.

La entrada Amendments to the Mexican statutes toughens (and softens) fight against piracy and IP infringement se publicó primero en Reyes Fenig.

This case has been incorrectly identified as an intellectual property infringement case. Actually, this matter is not related to intellectual property or copyright, but to the special regulations that govern the use and property of the pieces and objects created by the native cultures settled in Mexico before the arrival of the Europeans, generically known as prehispanic pieces and cultures.

The use of the images and devices reproducing prehispanic monuments, objects and art are governed by a federal statute named Ley Federal sobre Monumentos y Zonas Arqueológicas, Artísticos e Históricos or Federal Law regarding Archaeological, Artistic and Historic Monuments and Zones (Monuments Statute). Section 27 of the statute states that all objects and buildings produced by civilizations in the Mexican territory before the arrival of the Spaniards (Olmec, Maya, Zapotec, Toltec, Aztec, among many others), as well as the human, botanical and animal remains, related to such civilizations, shall be considered as “archaeological monument”. 

The reproduction of any “archaeological monument” for commercial purposes requires an authorization from the INAH, and payment of a fee.

However, as stated above, the restrictions for the use of the copies of the “archaeological monuments” are not related copyright; the authors of such ancient works, most of them anonymous, died centuries ago, and the works are no longer subject of copyright protection; they are of public domain. In spite of the fact that the “archaeological monuments” are in public domain, the federal law does not allow its free use. It is a public order restriction, associated to the “research, protection, preservation, restoration and recovery of the historic, artistic and archaeological monuments” (as the statute expressly stipulates). I wonder if not allowing the free use and copying of the “archaeological monuments” actually helps to achieve any of the above-objectives.

It is important to highlight that the fee that should be paid for the authorization to use images and reproductions of “archaeological monuments” (regardless who is the owner of the actual copied piece) is in the benefit of the federal government; it is not a royalty in the benefit of the author, heirs or some sort of assignee (community or ethnic group).

The statute only imposes certain conditions to the commercial reproduction of “archaeological monuments”, so anyone may make a works based on an archaeological object or building (by means of a picture, drawing, sculpture or engraving), and such work would be copyright-protected in the extent of its originality. If the reproduction of the “archaeological monument” is for commercial purposes in Mexico, it would be necessary to obtain the authorization and pay the fee to the INAH, regardless any additional authorization from the copyright-holder of the reproduction.

The restrictions and fees stated in the Monuments Statute are valid only in Mexico, although it is known that some Mexican government agencies have tried to enforce them out of Mexico. If any person decides to reproduce and commercialize outside Mexico the image of an “archaeological monument”, there is nothing INAH may do to prevent or oppose such commercialization or demand the payment of a fee. Nevertheless, it would be important not to forget that the reproduction of the “archaeological monument” may have an author, and that such author may be the holder of a copyright enforceable in Mexico or abroad.

Finally, I do not have enough information about the actual liability of the Starbucks Mexican operator, as seller of the mugs, and of the supplier of said mugs, due infringement of the Monuments Statute. However, any person that, in one way or the other, profits from images and reproductions of archaeological pieces and buildings in Mexico, should be careful of having the proper authorization from INAH. Profiting from the images and reproductions of “archaeological monuments” is legal in Mexico, but it requires some paperwork.

La entrada The use of images and reproductions of ancient objects and buildings in Mexico se publicó primero en Reyes Fenig.

The Tribunal Federal de Justicia Fiscal y Administrativa or Federal Court of Tax and Administrative Affairs (FCTAA) is a relatively new court. It was enacted in 2001, and its immediate predecessor was the Federal Tax Court. Most of the judges of the FCTAA are tax specialists. However, amendments to several statutes, particularly the modifications of April and May 2000 to the Federal Law of Administrative Procedures, broadened the scope of the old Federal Tax Court to decide a large number of administrative matters, (i.e. trademark registration, public officials liability, environmental protection, mining permits… etc.) until it became the FCTAA in December 2000. 

From mid 2000 to late 2008, appeals regarding IP matters were decided by on the thirteen non-specialized chambers of the FCTAA in Mexico City. Since January 2009, IP appeals are being decided by a specialized chamber, also located in Mexico City. 

The Federal Law of Contentious Administrative Procedures (FLCAP) rules the appeal procedure with the FCTAA. The immediate predecessor of the FLCAP was the contentious chapter of the Federal Tax Code, that governed the appeals with the now extinct Federal Tax Court. 

As you may see, a tax court and a tax law were the predecessors of the current specialized IP Chamber of the FCTAA and of the statute that govern the procedure for appeals involving IP. 

In a typical procedure concerning taxes, there are two parties with opposing interests: the State and the tax payer. The statute that governs the appeals in IP matters took this model. The problem is that in many IP matters, there may be more than one opposing party (such as the proprietor of a registered trademark that was cited as anticipation in a case involving the rejection of a trademark application, or the adversary in a patent invalidation or infringement action). 

At Law School, my Tax Law teacher told us that the purpose of Tax Law was defending tax payers, and many of the provisions (not all) stated in the Federal Tax Code, and later in the FLCAP reflect this way of thinking. Tax law tends to be very formalistic about the decisions and procedures to determine the existence of taxes and liabilities related to unpaid taxes. The lack of fulfillment of a formal or procedural requirement may result in the invalidation of the decision and the procedure, and all the Chambers of the FCTAA must review ex officio that the challenged decision complies with all formal requirements, regardless the arguments of the appellant. 

While such rigor may be desirable in a tax case, it may not be justifiable in a case where the decision of the Mexican Patent and Trademark Office (MPTO) was the result of a “trial-shaped” procedure or did not impose a fine but rejected a trademark or patent application. 

The FLCAP makes no distinction between decisions arising from a purely administrative procedure (such as the abandonment of a patent or the rejection of a trademark application) and decisions rendered as the result of an administrative procedure where the MPTO acted as a court to decide a dispute between two parties, such as a trademark or patent infringement case. 

Therefore, all the rigor that the FCTAA must use to review the compliance of formalities of a tax related decision, regardless the merits of the appeal, are being also applied to review all the decisions from the MPTO. 

The precedents 

A very important issue in Mexican administrative law, and especially in tax law, refers to the authority of the government agencies and the officials to decide taxes, administrative sanctions and impose fines. 

Historically, the government has exercised it power abusively. As a consequence, the Constitution and legislation have provided a number of requirements and limits to protect individuals and private entities from such abuses (whether such protections actually work or if they work only in the benefit of a privileged few would be subject of another discussion). 

One of the above-stated requirements is that the authority of any government agency to impose some burden or extinguishing some right of a private person must be expressly provided in an act of a federal o state legislature (Ley) or in a body of rules issued by the President or Governor himself (Reglamento). 

Certain bodies of rules, such as the estatutos orgánicos or “organizing regulations and the acuerdos delegatorios or “decisions to delegate authority” may provide a government agency with authority for certain actions, but in no case such authority may be broader than the one provided in the legislation or rules, and may not stipulate authority to impose burdens or limit or extinguish rights, if the legislation or the rules did not explicitly stated such authority. 

The requirement for all government officials to have explicit authority provided in the statute or in the rules to decide a case where the official imposes a burden or extinguishes or limits a right does not stop there. There is a binding precedent from the Supreme Court that demands that the official that decides a case must state all the statutes and rules that provide the authority to render the decision, including the article, section, paragraph, subparagraph, etc.** The FCTAA must review this issue ex-officio***, and if it finds one mistake, it must invalidate the decision due lack of authority of the issuing official, even if such lack of authority was never argued by any of the parties, or if it is irrelevant to decide the merits of the case. 

As I explained above, such rigor may be desirable in a tax case, because it has the clear intention of protecting the tax-payer against the abusive behavior of the executive branch. However, in a trademark infringement or cancellation case, this sort of ruling does not result in the enhanced protection of intellectual property rights. On the contrary, it seriously harms intellectual property owners and their activities; the delay of a final decision causes doubts and uncertainty about the enforceability and validity of IP rights, because the effect of the invalidation due apparent or actual lack of authority of the MPTO’s officials is the issuance a new decision signed by an official with authority to do so, or simply correcting the typing flaw that refers to the applicable provision of the statute that originates the authority of such official. 

Of course, given the some voids in the regulations that govern the activities of the MPTO’s officials, the new decision is not always free of formal flaws that may also cause, again, their invalidation, without ever looking at the merits of the appeal. 

Unfortunately, an IP case does not always stop at the FCTAA. The final instance is the Federal Court of Appeals. There are eleven non-specialized courts of appeals with jurisdiction to review the decisions rendered by the IP Specialized Chamber of the FCTAA. The courts of appeals issue contradictory rulings from time to time. When contradictory rulings arise, the Supreme Court may review the cases and decide what ruling should prevail; the Supreme Court’s decisions are binding for all the courts of appeals and the FCTAA. 

Finally, if the patent, trademark or copyright owner wants some indemnification related to a patent, trademark or copyright, the MPTO’s infringement decision must become final (after all the appeals), and then the right-holder may file an action with a court of common jurisdiction, which means to start all over again, but now to try to claim damages and lost of profits. 

The future 

One thing is clear: The current system does not work. Even a relatively simple case may take many years to be decided just because all the time wasted in irrelevant appeals. 

Some practitioners have suggested that the law should be amended to exclude IP from the scope of the FCTAA. Actually there is a bill that the Chamber of Representatives approved in late 2006 to exclude IP from the scope of the Federal Law of Administrative Procedures, and as a consequence, from the FCTAA. The bill is pending at the Senate. 

Although the lack of efficiency of the FCTAA is obvious, I am not sure that this is a good solution. District Courts may decide faster than the FCTAA, but the MPTO’s decisions tend to have many procedural and forma errors that may result in decisions from the District Judges just to cure formal and procedural flaws, with no actual benefit as for the time it takes to reach a final decision would be concerned. 

Finally, most District Judges have not been in regular contact with IP law since 2002, after the FCTAA took over the appeals for IP matters, so their decisions show in general less analysis of the case that the decisions of the FCTAA. 

From my perspective, Mexican IP law needs a structural change. The MPTO should not have authority any long to decide infringement and invalidation cases; such authority should be on specialized federal district courts, which may decide in the same decision if the trademark registration or patent is valid, if it has been infringed and award damages and/or attorney’s fees to the prevailing party.

 Of course, it is a complex issue and any solution would have to be more complex than what I just stated above. In any case, what all practitioners agree is that we need a change, and we have to start working on it now.

 * Ninth Era, Weekly Judicial Journal of the Federation, Courts of Appeals, XXIX, April, 2009, page: 1925, Thesis: I.7o.A.617 A, Registry 167451

 ** Ninth Era, Weekly Journal of the Federation, Supreme Court, Second Chamber, XXV, June 2007, page 287, Thesis: 2a./J. 99/2007

 *** Ninth Era, Weekly Journal of the Federation, Supreme Court, Second Chamber, XXVI, December 2007, page 154, Thesis: 2a./J. 218/2007

La entrada The basic structure of IP litigation in Mexico (Second part) se publicó primero en Reyes Fenig.

A very common complaint from IP owners is the extremely long time it takes to obtain a final decision in an IP infringement action or a patent invalidation or trademark cancellation case.

The purpose of this post is explaining the structure of IP litigation in Mexico, and of the appeals system in this field of law; why appeals have been taking so long in being decided; why they may take longer; why the courts appear to be so unreasonably formalistic about the authority of the officials of the Mexican Patent and Trademark Office that decide cases; and what can we expect in the close future.

In Mexico, most IP litigation involves administrative instances, such as the Mexican Patent and Trademark Office.

It is possible to file criminal charges in connection to trademark forgery and illegal reproduction of works protected by copyright, and file actions for damages with a civil court, and the Mexican Patent and Trademark Office would have little involvement, if any, in these sorts of procedures.

However, administrative cases involving infringement and invalidation of IP rights largely outnumber the matters currently handled by the General Attorney’s Office and the criminal and civil courts, thus this post with make only reference to the administrative litigation.

Having said the above, the basic structure of an IP litigation process is the following:

A. The first instance is the Instituto Mexicano de la Propiedad Industrial or Mexican Patent and Trademark Office (MPTO).

The MPTO not only issues patents and registers trademarks; it also has authority to decide infringement actions involving patents, trademarks and some cases of copyright, and the invalidation or cancellation of patents and trademarks.

An infringement or cancellation or invalidation action involves a full administrative trial, with the filing of a complaint, and answer, filing and review of evidence, final arguments and a decision.

The MPTO typically takes from 10 to 18 months to decide a trademark cancellation/infringement action. A patent infringement/invalidation action may take from one to three years, sometimes more, if the substantive matter of the patents is complex, as in the case of biotechnology.

The MPTO may not award damages or attorneys’ fees. It may only impose a fine of the infringer; order the preliminary and/or definitive seizure of infringing product issue a preliminary/definitive order to stop the manufacture and/or commercialization of infringing goods; or remove a trademark from the registry or invalidate the patent.

B. Appeals against the MPTO

There are three possible ways to challenge a final decision from the MPTO, no matter if the decision is the result of litigation or of a purely administrative procedure (final rejection of a trademark or patent application).

B1. Administrative Review. It is possible to file a petition for administrative review with a higher-rank official of the MPTO itself.

The filing of the petition for Administrative Review is optional. The appellant may choose not to file it and appeal the decision with the Tribunal Federal de Justicia Fiscal y Administrativa or Federal Court of Tax and Administrative Affairs (FCTAA) –see B2- or file an Amparo claim (constitutional appeal) with a Federal District Court –see B3-.

The higher rank officials of the MPTO tend to confirm the decisions, unless there was a clear procedural or formal error.

Filing a petition for Administrative Review using substantive arguments against the decision is usually a waste of time, or an effective way to delay a final decision, given that the MPTO may take one year or more to simply confirm the earlier decision.

The decision issued in connection Administrative Review may be subject of an appeal with the FCTAA (see B2) or an amparo claim (see B3).

From a technical perspective, the appeal with the FCTAA and the amparo claim are completely different procedures in nature and structure, but in order to keep it simple, I will make emphasis only in practical issues.

B2. Appeal with the FCTAA. The appeal with the FCTAA is the most usual way to challenge the decisions of the MPTO. The appellant has 45 business days to file the appeal with the FCTAA.

The FCTAA is divided in salas or chambers of three judges each, and a Highest Chamber of eleven judges.

The FCTAA started reviewing appeals concerning IP in mid 2000, as a consequence of an amendment to the Federal Law of Administrative Procedures (FLAP). Since January 2009, appeals concerning IP matters are decided by a specialized chamber.

The FCTAA takes between one and two years to decide an appeal. The FCTAA has authority to order the MPTO to cure some formal or procedural flaw and render a new decision, or to decide on the merits of the case instead of the MPTO.

The general rule is that the parties are allowed to file new evidence and arguments, not previously submitted with the MPTO. However, there is a recent non-binding decision from the Seventh Court of Appeals in Mexico City, that intends to limit the filing of new evidence and arguments to prove the use of a trademark in appeals associated to cancellation actions due lack of use*.

B3. Amparo claim. The amparo claim involves a constitutional review of a final authority’s decision by a federal district judge to verify if there was a breach of a garantía individual or constitutional basic right.

One basic constitutional right in Mexico is that all decisions should be issued in accordance to the law. If the decision breaches the law, then it may also be unconstitutional.

As a general rule, the consequences of the amparo are limited to the invalidation of the authority’s decision, if found against the constitution, and the issuance of a new decision, which under certain circumstances, may be subject of a new amparo claim or an appeal with the FCTAA.

The amparo was the usual way to challenge decisions from the MPTO, until mid 2000, when the amendment to the FLAP gave the FCTAA authority to review appeals against the decisions o the MPTO, among other government agencies.

Notwithstanding the above, the amparo claim is still available to challenge most decisions of the MPTO, although practitioners do not use it, given the shorter time they would have to prepare the appeal. Further, the district judges tend to invalidate decisions only to order the MPTO to cure a formal or procedural flaw and render a new decision, instead of deciding the merits of the case. Finally, and from my very personal perspective, the FCTAA’s decisions usually show more careful analysis of the parties’ arguments than the decisions from the district judges.

Unlike the appeal with the FCTAA, the general rule is that the parties are not allowed to file new evidence or arguments.

The appellant has 15 business days to file the amparo claim, and the judge may take from 6 to 12 months to issue a decision.

C. Final appeals

As explained above, the decision issued by a higher rank official of the MPTO in connection to a petition for administrative review (see B1) may be challenged with the FCTAA or a federal district judge.

The decisions issued by the FCTAA and the district judge may be subject of a final appeal with a tribunal colegiado de circuito or federal court of appeals, or with the Mexican Supreme Court in some extraordinary cases, such as the direct interpretation of the Federal Constitution or the constitutionality of a statute or statutory provision.

The final appeal may be decided by any of the seventeen courts of appeals specialized in administrative matters located in Mexico City. A federal court of appeals takes about six to ten months to decide a final appeal. The Supreme Court may take a little longer.

In the second part of this post, I will explain some of the reasons why the appeals take so long to be decided, and why they may take longer.

* Ninth Era, Weekly Judicial Journal of the Federation, Courts of Appeals, XXIX, April, 2009, page: 1925, Thesis: I.7o.A.617 A, Registry 167451

La entrada The basic structure of IP litigation in Mexico (First part) se publicó primero en Reyes Fenig.

1. Works are protected from the moment of creation

Works are protected by copyright from the moment they are created, materialized in any media and capable of being copied, regardless their merit or destiny. The work is protected when it is original or has certain degree of originality.

2. Copyright does not need registration

The registration of the work is not essential for copyright protection. Copyright is acknowledged without registering the work or fulfilling any particular formality. The registration of a work with the Public Copyright Registry, by itself, does not transform the registrant in author or makes him holder of the copyright on the registered work.

The registration of a work originates a document that proves, beyond any doubt, the existence of the work at a given time, and the claim by the registrant of the copyright on the work. However, the registration is not the source of the copyright.

The aforementioned does not imply that registering a work is useless. On the contrary, it is an effective way to preparing evidence about the existence of the work, which may be extremely important in case of a dispute. Further, given that Mexican society is extremely formalistic and paper-oriented, the work has a higher status when registered. It is frequent that businessmen, authors and government officials (even from “specialized” agencies) acknowledge the existence of copyright only if the work is registered.

Registering a work with the Instituto Nacional del Derecho de Autor or Mexican Copyright Office (MCO) is relatively simple and, if done correctly, the MCO may issue the registration certificated in only four weeks.

3. Copyright provides two categories of rights: the personal rights and the economic rights

Copyright provides two different categories on rights: derechos morales or personal rights and derechos patrimoniales or economic rights. Only economic rights may be contractually assigned, provided that the parties comply with certain statutory formalities.

4. The purchase of the original work does not assign the copyright

Purchasing the original work does not imply in any way the acquisition of the copyright on the purchased work. The assignment of the copyright demands a specific written agreement with monetary consideration.

5. The existence of a work implies the existence of an author

Under Mexican law, the existence of an individual identified as author is essential for the copyright; corporations cannot be authors, although they may be the copyright holders. Any entity claiming to be the copyright holder would have to demonstrate the chain of title from the author. This requirement may be particularly complicated for certain works, such as software, where it may be difficult to identify all the authors that had intervention in the work.

6. Ideas by themselves are not protected by copyright

It is necessary to materialize the idea through the work, and even so the subject matter of the protection would be the work, not the idea. The same idea may give place to different original works, and each one of them may have an independent protection.

7. Trademarks, patents and copyright are not the same.

There are some similarities between patents, copyright and trademarks, but it is essential to clearly distinguish one from the others. Each kind of protection gives their holders different privileges and disadvantages in relation to the others.

Against the opinion of many reputed colleagues, I think that the choice of a legal way of protecting an intellectual creation may exclude the others; for example, if the shape of an industrial product is registered as an industrial design as provided by the Industrial Property Law, it automatically excludes the possibility of claiming copyright on the same design.

You may also find useful information in The different terms of Copyright in Mexico.

La entrada Some basics about copyright law in Mexico se publicó primero en Reyes Fenig.