Bad faith registration leads to family dispute

The Court of Appeal of Granada has issued a decision on a family dispute over rights in the surname Bañuls between a company trading under the name Bañuls Atracciones SL and an individual named Vicente Bañuls Sañudo (Case 191/06, November 6 2006). The court concluded that Bañuls Sañudo had registered the mark ATRACCIONES BAÑULS in bad faith.

Both parties operate in the same industry, namely fairground attractions. Although it had not registered the name Bañuls as a trademark, the company Bañuls Atracciones was using the name to distinguish its trading activity. The conflict arose when the defendant, Bañuls Sañudo, registered ATRACCIONES BAÑULS as a trademark for "leisure services provided through fairground attractions" without first obtaining authorization from Bañuls Atracciones.

Bañuls Atracciones filed a writ of summons before the court against Bañuls Sañudo, claiming ownership of the trademark ATRACCIONES BAÑULS. According to Article 2.2 of the Spanish Trademarks Act (which regulates the claim of ownership of a trademark), it was necessary to prove that said trademark had been applied for in breach of third-party rights or in bad faith.

There is well-known case law from the Spanish Supreme Court which establishes that, initially, good faith is to be presumed for all registrations. This means that, in a case such as this one, the plaintiff has the burden to prove the existence of bad faith in the registration of the trademark.

The court first considered that the fact that both parties were members of the same family and were both involved in the same business activity could indicate that Bañuls Sañudo was aware of the existence of the company name Bañuls Atracciones and therefore registered the trademark ATRACCIONES BAÑULS in bad faith. However, in a departure from previous rulings, it also expressly took into account the fact that the corporate name Bañuls Atracciones was already registered in a public register (ie, the Register of Companies). The court explained that as the Register of Companies is publicly available, Bañuls Sañudo could be said to have constructive knowledge of the existence of the Bañuls Atracciones company name. It concluded that such evidence was sufficient to prove that the mark had been registered in bad faith.

Antonio Velázquez, Grau Baylos & Angulo, Madrid