Virgin has no legitimate interest in VIRGIN mark for beverages

Argentina
In Virgin Enterprises Ltd v Café La Virginia SA (Case 13921/02, February 7 2008, only recently released), the Federal Court of Appeals in Civil and Commercial Matters has held that Virgin Enterprises Limited had no legitimate interest in registering the mark VIRGIN for goods in Classes 32 and 33 of the Nice Classification.
 
In 1991 Virgin sought to register the trademark VIRGIN (and design) for goods in Classes 9, 16 and 25. In order to do so, Virgin entered into an agreement with Café La Virginia SA, the owner of the registered trademarks LA VIRGINIA, VIRGINIA GOLD and VIRGIN ISLANDS for goods in Classes 32 and 33 (beverages). Under the agreement, Virgin undertook not to apply its trademark to foodstuffs at any time.
 
However, in violation of the agreement, Virgin subsequently applied for the registration of the trademark VIRGIN for goods in Classes 32 and 33. La Virginia opposed the applications based on its registered trademarks and the applications were abandoned. Virgin later applied for the registration of the same trademark in the same classes. Once again, La Virginia opposed.
 
As a consequence, Virgin filed suit for undue opposition, alleging that the VIRGIN mark and La Virginia’s trademarks were not confusingly similar. In response, La Virginiaalleged that Virgin had no legitimate interest in registering the trademark pursuant to Article 4 of the Trademark Law.
 
The Federal Court of Appeals held that in light of the agreement between the parties, Virgin’s behaviour contravened the rule that all contracts must be interpreted in good faith, as provided for by the Civil Code. Therefore, Virgin had no legitimate interest in registering the trademark VIRGIN for goods in Classes 32 and 33. Furthermore, the court ruled that Virgin’s past conduct (ie, applying for the registration of the trademark and subsequently abandoning the application) aimed to test the extent to which La Virginia would seek to enforce its rights.  
 
Under the Trademark Law, an application is deemed to have been abandoned if an opposition is not challenged within the relevant time period. According to the court, applying for the registration of the same mark after abandoning an application represents an attempt to circumvent the requirements and safeguards set forth by the law.
 
The court then turned to Virgin's argument that the agreement applied only to foodstuffs in Classes 29, 30 and 31, and did not cover beverages in Classes 32 and 33. In analyzing whether beverages fell within the definition of ‘foodstuffs’, the court concluded that trademark law does not provide a definition of ‘foodstuffs’ and thus referred to the Food Code. The court held that the code does not limit the definition of ‘foodstuffs’ to goods in Classes 29, 30 and 31, but applies to all solid and fluid food products.
 
Finally, the court assessed whether the VIRGIN mark and La Virginia’s trademarks were confusingly similar. The court found that the marks were undeniably similar based on the following grounds:
  • The word ‘virgin’ is present in all the trademarks at issue; and
  • LA VIRGINIA is a well-known trademark.
The court further held that Virgin had acknowledged the similarity between the marks when it opposed La Virginia’s application for the registration of the trademark VIRGINIA for goods in Class 32.
 
Fernando Noetinger, Noetinger & Armando, Buenos Aires

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