Trademark used in good faith prevailed over earlier application

The Silvano brothers ran the “Silvano” restaurant in Tomás Jofre, a small town in Mercedes, Province of Buenos Aires. It had originally opened as a general store by their grandfather and in 1954 it was transformed into a restaurant. The reputation of the place grew until it was turned into a tourist resort. In 2003 the Silvano brothers applied for the registration of trademark “SILVANO DE TOMÁS JOFRÉ” in class 43, and this application was opposed by Mr. Marianello on the basis of his identical earlier mark. The Silvano brothers filed suit seeking to cancel Marianello’s registration, and sought to recover damages. They based their request on their prior use of their unregistered mark and on the fact that “SILVANO” was their surname. They also pointed out that Marianello, together with his parents, ran a restaurant in the same town, and therefore could not ignore the plaintiff’s commercial activities.

Mr. Marianello answered the bill of complaint and counter-claimed for cancellation of the plaintiffs’ application. He pointed out that when applying for the mark “SILVANO DE TOMÁS JOFRÉ” he already owned trademark “D´LOS VIEJOS DE TOMÁS JOFRÉ” and that the plaintiffs had not opposed his applications. He also pointed out that in 2001 he had sold his business and goodwill, including the mark “D’ LOS VIEJOS DE TOMÁS JOFRÉ”, and that he had tried to reach an agreement with the plaintiffs, offering, without success, to grant an authorization to use the mark “SILVANO DE TOMÁS JOFRÉ” or “SILVANO” in the same town. He further informed that he had relinquished his rights on the mark “SILVANO DE TOMÁS JOFRÉ” and that he had never used it, so that there was no purpose in prosecuting the cancellation action. Finally, he argued that since the Silvano brothers had not opposed his marks “TOMÁS JOFRÉ” and “D’ LOS VIEJOS DE TOMÁS JOFRÉ”, they were not able to claim rights in the mark “SILVANO DE TOMÁS JOFRÉ” now.

The Court decided for the plaintiffs, highlighting the value of the plaintiffs’ unregistered trademark “SILVANO” and pointing out that the defendant could not possibly ignore it. On the other hand, it dismissed the cancellation action filed against the plaintiffs’ pending application, arguing that applications are one-sided acts deprived from the effects of registration, and that they can be subject to oppositions rather than to cancellation actions. In this connection, the Court did not follow earlier case-law which admitted the cancellation of a pending trademark application, where it was held that trademark applications per se could produce legal effects.