Court hits reverse gear in FORD infringement case

Brazil

The Court of Appeals for the Federal District has reversed its earlier decision that the Brazilian Association of Former Ford Distributors' use of FORD in its name did not infringe Ford Motor Company of Brazil's trademark rights. In its revised decision, the court held that FORD should be considered to be a highly reputed trademark and therefore could not be used by the association (Case 2001.01.1.014235-0).

The association was created to defend former Ford car dealers from alleged acts and omissions by Ford. Ford initiated a court action claiming that the use of FORD in the association's name infringed its trademark rights. It pointed out that the FORD mark is protected by the Paris Convention for the Protection of Industrial Property, and the Brazilian Constitution and Industrial Property Law.

The Civil Court of the Federal District ordered the association to stop using the mark but denied Ford's request for damages. Both parties appealed.

The Court of Appeals for the Federal District held in a majority opinion that (i) the ex-dealers had the right to identify themselves as 'former Ford distributors' as a matter of fact, and (ii) this use was not commercial and, therefore, out of the reach of the protection afforded by domestic law and the Paris Convention (see Former Ford dealers may use FORD mark).

Ford filed an appeal to reverse the majority decision supporting the dissenting opinion of Judge Carmelita Brasil. Brasil had held that (i) the law grants special protection to famous trademarks such as FORD, even in the absence of competition, and (ii) the association's use of the name had already tarnished the mark. Brasil had also found that the name Ford - the famous founder of the company - is protected based on personal rights, which are absolute.

On re-examination, the Court of Appeals for the Federal District upheld Brasil's dissenting opinion. The court concluded that FORD should indeed be protected as a highly reputed trademark and that the scope of protection should therefore be extended to all fields of activity. The fact that the association was not engaged in commercial activity did not preclude the special protection afforded to highly reputed trademarks.

In addition, the fact that FORD is a patronymic lead the court to decide that the association should have requested authorization before adopting FORD as part of its name.

It stated that moral damages were not duly proved and rejected Ford's appeal in this regard.

The association has a right to appeal.

Rodrigo Borges Carneiro, Dannemann Siemsen Bigler & Ipanema Moreira, Rio de Janeiro

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