On December 13, 2016, Division 3 of the Federal Court of Appeals in Civil and Commercial Matters, in re “Alberto Merlo and Hijo S.A. v. Merlo, Raúl Héctor” (case No. 6074/2014) reversed the preliminary injunction which, based on the registration of trademark "MERLO", had ordered the defendant to stop using the word “Merlo” “in any capacity whatsoever”, as the Court considered that the defendant, in his professional role as a real estate broker, had used his personal name and surname together, jointly with the real estate company "Remax", whose trademark he was using, without any confusion, diversion of customers, dilution or discredit to the plaintiff.
The plaintiff, Alberto Merlo and Hijo S.A. (Alberto Merlo), is a company engaged in the real estate business. Here it sued to enjoin use of the trademark “MERLO” as well as the name “Merlo” for real estate broker services by defendant Raúl Héctor Merlo (Raúl Merlo). This court action was based on plaintiff’s ownership of the trademark “MERLO” (and device) in classes 35, 36 and 42.
The plaintiff also requested a preliminary injunction as set forth in Article 50 of the TRIPS Agreement, directed against the use and promotion of the names “Raúl Merlo”, “R. Merlo” and “Merlo”, as well as their use in the websites remax.com and remaxayres.com.ar. Plaintiff based this request on the emblematic ruling “Toselli”, under which a family member was ordered to stop using a mark identical to his surname “Toselli” in connection with real estate services.
The judge of first instance admitted the claim, considering that the plaintiff had proved fumus bonis iuris and imminent danger, and granted the preliminary injunction and ordered defendant to immediately stop using and promoting the name “MERLO” in any capacity whatsoever.
The defendant appealed this decision, which was subsequently reversed by the Court of Appeals.
In his appeal, the defendant also claimed the lapsing of proceedings, and requested, subsidiarily, the clarification of the decision regarding the use of the word “Merlo” and the phrase “in any capacity whatsoever”. He pointed out that his name was Raúl Héctor Merlo, and that he used it on business cards and on the awning of the premises, on posters and the website, but always associated with the real estate firm Remax and not as a trademark but to identify himself as an auctioneer and franchisee of that company.
He also stated that the doctrine of the “Toselli” (case No. 10508.01 of February 25, 2010) and "Llauró" rulings (case No. 20659.11 of December 21, 2000) was not applicable here and indicated that the plaintiff had failed to prove imminent danger, as it had taken them a year to request the injunction and another year to execute it. Finally, he held that the well-known character of the trademark “REMAX” attracted consumers.
The Court of Appeals dismissed the request of lapsing of the proceedings and rejected the request for clarification, but granted the appeal and reversed the decision of first instance.
To this end. the judges of Division 3 stated that the purpose of Article 50 of the TRIPS Agreement was exceptional as it modified a factual or legal situation and that said rule sought to provide protection to intellectual property rights holders with a provisional, rapid and effective measure to prevent an infringement as well as the entry of infringing goods into the channels of commerce.
Thus, the Court noted that the defendant used his first and last name Raúl Merlo jointly but as a real estate broker associated with “Remax”, and that it was "Remax" the word used as trademark. No defamation, or diversion of customers, dilution or discredit had been established, contrary to the plaintiff’s allegations. The Court also remarked that the circumstances of this case were in principle different from those in “Toselli” and “Llauró”.
The Court of Appeals thus reaffirmed the difference between the use of a person’s name associated with a trademark and the use of a person’s name as a trademark in itself.