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STF determines that dispute for the IPHONE trademark be resolved via conciliation

In March 2000, Gradiente, a Brazilian company currently called IGB Eletrônica, filed an application for registration for “G GRADIENTE IPHONE” trademark, in class 09, for “Cellular telephone devices, cellular telephone devices that provide access to the internet, fixed or mobile telephony, digital antennas, protective covers, batteries, chargers, speakerphone, handsfree, parts and accessories included in this class.”, which was granted by the Brazilian Institute of Industrial Property – INPI, in January 2008.

In January 2013, Apple filed a petition with INPI, requiring the caducity of the Brazilian registration, and filed before the Federal Court of the State of Rio de Janeiro (VFRJ) a lawsuit against the INPI and IGB, aiming the partial nullity of INPI administrative act which granted the registration. Thus, the dispute of the IPHONE mark started.

At the administrative dispute, IGB was victorious in July 2016 and its registration was maintained by the INPI. However, the lawsuit had a different course.

In September 2013, the 25th VFRJ upheld Apple’s request and declared the partial nullity of registration number 822.112.175, in class 09, for the compound mark “G GRADIENTE IPHONE”, and ordered INPI to annul the granted decision of said registration and to republish it in the Official Gazette, stating the exception regarding the exclusivity on the term “IPHONE” alone, thus granting the registration of the Apple trademark, with the disclaim “without exclusivity on the word IPHONE alone“.

The dispute continued through judicial appeals and, at the Federal Regional Court of the 2nd Region (TRF2), the decision was upheld by the Court with the argument that the right to exclusive use of the mark is not absolute – according to Reporter Judge Paulo Espírito Santo, it is necessary to take into account the indisputable fact that when consumers and the market think about iphone they tend to believe they “are dealing with the Apple device”. Thus, the isolated use of the trademark by any other company could have “harmful consequences” for Apple. The position adopted by the Court is against the Industrial Property Law, as recalled by one of the Judges, Dr. Abel Gomes, that stated in his vote that “protection to a trademark will only be guaranteed with the competent registration with INPI, under the terms of article 129 of the LPI.”

IGB appealed the decision and argued that it is an undisputed fact that the deposit of its trademark was made in 2000 and that the registration was only granted by the INPI in January 2008. It also argued that the TRF’s understanding “completely subverts the Brazilian intellectual property system, replacing the principle of filing priority with success in exploration, given that it is based on the fact that “the Apple iPhone, launched in 2007, was already a global fever, largely due to huge investments in advertising”, and that the definition of the owner of a trademark should take into account consumers’ opinion.

In June 2020 Minister José Antônio Dias Toffoli denied the appeal, claiming that the analysis of the case would require interpretation of the infra-constitutional legislation and reexamination of the facts and evidence, which is not applicable in extraordinary appeal.

Still not satisfied, IGB filed an interlocutory appeal aiming at reforming the monocratic decision of Minister Dias Toffoli. However, in a movement considered surprising, on the 4th of this month of December 2020, the Minister determined the suspension of the process, and the remittance of its file to the Conciliation and Mediation Center, seeking an out-of-court settlement of the dispute, stating that the issue discussed in the appeal deals with available equity rights and, for that reason, it was up to the remittance to attempt an agreement.

Therefore, the next step will be a possible friendly settlement between the parties, or the Minister will be forced to decide for them.

Patrícia Corrêa