Bad faith filings in Vietnam – from law to practice

CategoriesTrends and IP Practice in Vietnam

 

An overview on Vietnam prevailing laws

 Although no specific definitions and regulations on bad faith/ dishonesty filings or bad faith/ dishonesty registrations are found under the laws of Vietnam, the concept of bad faith/ dishonesty is still directly or indirectly recognized and referred to in some legislation as follows:

 

Article 6 of Law on Intellectual Property of Vietnam (hereinafter referred to as “IP Law”), on basis of establishment of IPRs: “Rights of marks shall be established on the basis of the decision on the grant. In terms of for well-known marks, rights shall be established on the basis of use independently from registration procedures.”

Article 87 of IP Law: “An organization or individual shall have the right to registration of a mark to be used for goods or services he or she produced or supplied.

An organization or individual legally engaged in the trade in a product produced by a third party shall have the right to registration of a mark to be used for the product, provided for the producer neither uses such a mark for the product nor objects to such registration.

A person who has the right to registration may assign, in writing, the right to other organizations or individuals by way of a written contract for bequest or bylaw inheritance.

With regard to a mark being protected in a member country of an international treaty which prohibits the representative or agent of a mark owner to register such mark and of which Vietnam is also a member country, then such representative or agent shall not be permitted to register such mark unless it is so agreed by the mark owner, except where a legitimate reason is available.”

Article 96 of IP Law: “A trademark shall be entirely invalidated in case the applicant for registration neither has right to registration nor has been assigned such right.

Any parties shall have the right to request the NOIP to invalidate a trademark registration.

The time period for making request for invalidation shall be its whole term of protection.  With regard to marks, such time limit shall be 5 years as from the grant date, except for the case where the trademark has been granted due to the applicant’s dishonesty/bad faith.”

Article 112 of IP Law, on third party’s opinions: “As from the date an application is published till prior to the date of issuance of a decision on grant, any third party shall have the right to express opinions to the NOIP on the grant or refusal. Such opinions must be made in writing and be accompanied by documents or must quote the source of information.”

Article 17 of the Decree No. 103/2006 on Respect for previously established rights: “IPRs of an organization or individual may be invalidated or banned from exercise if they conflict with previously established IPRs of another organization or individual”.

Point 5.3 of Circular 01-2007-TT-BKHCN dated February 14, 2007, of  the Ministry  of  Science and Technology provides that: “Representatives of application owners are accountable to application owners for all consequences of the declaration or supply of untruthful information in transactions with the NOIP and  pay compensations for any damage caused”.

Point 22.3 of the Circular also provides that: “A complainant shall ensure the truthfulness of supplied proofs and are liable for consequences of the supply of untruthful proofs.”

All application forms along with Circular No. 01/2007/TT-BKHCN, including application for registration of trademark, contains the part: “The applicant’s commitment” that: “I undertake that all information which I have declared in this application is true and correct and I am legally responsible for my declaration”.

 

In view of the above, it can be seen that current regulations of Vietnam are quite compatible with international law, specifically: Article 6bis of the Paris Convention for the protection of Industrial property; Article 16 and Article 24.7 of the Trade-Related Aspects of Intellectual Property Rights (TRIPs agreement).

 

Generally, in Vietnam the “bad faith” concept is accepted as a basis for opposing an application or invalidating/cancellation against a trademark registration. However, to date, both Vietnamese legislation and International statute law are still silent regarding specific definitions on bad faith/ dishonesty filings or bad faith/ dishonesty registrations, which leads to different interpretations not only in Vietnam but also internationally.

 

The practical examination in relation to bad faith filings in Vietnam

 

According to the most common practice which expressed in Notification/Decisions issued by the National Office of Intellectual Property (the “NOIP”) and/or by the Courts, the notion of “dishonest” act can be either of acts as the followings:

 

  1. The “dishonest” act is to register an identical/similar mark for similar/related goods/services when he/she already knew of or must have known about the prior existence and use of the real owner’s trademark; or
  2. The “dishonest” act is generally dishonest behavior that is not faithful, false, and contrary to recognized commercial standards.

 

In practice, if a person denounces a third party as taking an action in bad faith, that person will bear the burden of proof by submission of clear and convincing evidence. The NOIP will inform the defendant of said denouncement and request the third party to submit counter-argument within a prescribed time to defend his or her situation. In some other cases, the NOIP may inform the plaintiff of his opinion in respect of the notification.

 

Evidences in demonstrating a bad faith act commonly accepted by the NOIP are of the  below:

  • Evidences proving that the applicant/registrant is aware of pre-existence of the genuine holder’s trademark before he/she files for registration of his/her trademark (wide fame and reputation or well- known status of the trademark thru widely used and registrations, advertising materials, turnover, annual sales, promotion and adverting expenses, prizes obtained…… );
  • Evidence proving the “relationship” between the applicant/registrant and genuine trademark holder in way of investment, license or contract relations (between the trademark owner and the employee, the manufacturer and its agent/distributor…without the consent of the real trademark owner);
  • Evidences of untrue/false document and information submitted to the NOIP for registration of trademark and/or otherwise actions…

 

Of note, in current trademark examining practice, it is rare for the NOIP, on its own, to initiate to identify if a case is bad faith filing. However in some cases, even though no opposition filed, the NOIP refuse the applied-for marks since they are identical with or confusingly similar to trademarks that are considered by the NOIP as well-known marks. In those cases, the NOIP considered that the trademark applications were applied in “bad faith” and/or by acts of unfair competition with aim at taking advantages from the real trademark owner.

 

As a legal consequence, once it is proved that the third parties filed/registered his trademark in bad faith, the pending application will be refused/ the granted registration will be cancelled/ invalidated. In other words, the submission made to the NOIP in bad faith is invalid.

 

Some typical bad faith cases successfully handled by INVESTIP

 

CASE 1:

Opposition against Application No. 4-2013-00415, mark , for “wine product” in class in 33 in the name of Intrixapple Co., Ltd. (VN)

The real trademark owner: SOCIÉTÉ CIVILE DU VIGNOBLE DE CHÂTEAU-LATOUR, addressed in PAUILLAC, Gironde, France
Genuine trademark and goods Opposed mark and goods
CHÂTEAU LATOUR Appellation Pauillac Contrôlée
Goods in class 33 (wine) Goods in class 33 (wine)
Ground of opposition: The opposed mark is similar to widely used and recognized trademark with prior date in accordance with Article 74.2 g) of IP law
Evidence/Argument submitted to the NOIP: (i) Evidences about wide fame and reputation status of the trademark thru widely used and registrations, advertising materials, turnover, annual sales, promotion and adverting expenses, prizes obtained… (ii) The legal representative of Intrixapple Co., Ltd is a very French citizen, who is fully aware of pre-existence of the genuine holder’s trademark when he files for registration of his mark (iii) Act of third party is bad faith aiming at taking advantages from the real trademark owner.
Result obtained: During substantive examination, having reviewed evidence and argument of the opposition, the NOIP refused the protection for trademark under application No. 4-2013-00415 (based upon Article 74.2 e) with a cited mark under IR.  770948 & Article 74.2 g) as the opposition).

The applicant appealed against the NOIP’s decision on refusal, but finally, the Decision on settlement of the appeal upheld the NOIP’s opinion.

 

 

CASE 2:

Cancellation against Registration No. 172149, mark  in class 01 in the name of Mr. Tran Vick Hung Vuong at the address: 2651 N. Harwood St., Suite 370, Dallas, Texas 75201, USA

The real trademark owner: BFR Health International, Inc., addressed: 2651 N. Harwood St., Suite 370, Dallas, Texas 75201, USA.
Genuine trademark and goods Cancelled mark and goods
Goods in class 01 Goods in class 01
Ground of cancellation: (i) The trademark “emz-usa, device” was, in fact, created by the real owner and (ii) The applicant was dishonest when he filed the trademark application
Evidence/Argument submitted to the NOIP: (i) an MOU jointly signed by the real owner, Mr. Tran Vick Hung Vuong and 02 other parties; (ii) emails as exchanges between real owner and Mr. Tran Vick Hung Vuong concerning trademark “emz-usa, device”; and (iii) third party filed for registration of his mark in bad faith
Result obtained: The cancellation request was filed in 2013. Third party defended his mark by arguing that he never knew about trademark “emz-usa, device”, that he created it on his own. The real owner showed the evidences proving that third party was a distributor of the real owner for exporting “emz-usa, device” to Vietnam.

The case was settled in 2017 by a Decision in favor of the real owner, cancelled the validity of mark under Registration No. 172149.

 

CASE 3:

Cancellation against Registration No. 123570, mark MAINETTI in class 20 & 35 owned by Cong ty TNHH Suntex (VN)

The real trademark owner: Mainetti (UK) Limited, addressed: Annfield Estate, Oxnam Road, Jedburgh, Roxburghshire, Scotland.
Genuine trademark and goods Cancelled mark and goods
MAINETTI MAINETTI
Goods and services in class 20 & 40 Goods and services in class 20 & 35
Ground of cancellation: The trademark “MAINETTI” of the real owner has been widely used before the filing date of the mark MAINETTI by third party (Article 74.2 g) of IP law); the real owner also argued that the word “MAINETTI” is distinctive as it is very their trade name. The fact that, third party stated that his mark was created by them, is dishonest.
Evidence/Argument submitted to the NOIP: (i) Since when the real trademark was first created and how it has been used since then; (ii) countries where the mark is being protected; (iii) countries where the mark is being used etc. All evidences are dated before the filing date of the mark MAINETTI by third party.
Result obtained: The cancellation was filed in 2011. The other party defended its mark by arguing that he never knew about the trademark MAINETTI of real owner. However, the real owner proved that the other party’s arguments are false.

The case was settled in 2015 by a Decision in favor of the real owner by a decision on cancellation of the validity of mark MAINETTI under Registration No. 123570.

 

Advice to avoid potential risks of bad faith filings in Vietnam

 

First of all, in order to avoid risks of bad faith filings in Vietnam, the genuine trademark owner should file applications for registration of trademarks that are being used and/or to be used in Vietnam as soon as possible since the cost for filing of trademarks in Vietnam is quite low in compared with that of other countries and is much lower than the cost for potential possible opposition and/or a cancellation, if any.

 

Furthermore, the trademark owner should always keep regular watches on  published  applications in Vietnam to timely detect and file opposition for the reasons that (i) in practice, cancellation action is often much more costly and time-consuming than an opposition case, and (ii) the NOIP is often inclined to conserve its opinions raised in examination process and reluctant to cancel a trademark registration, thus the chance of success in a cancellation case is not high as compared with the opposition action.

 

Proposal for improvement of the laws 

 

From our practical point of view, with the appropriate references from foreign practices and experiences, we deem that it is time to consider supplementing more details into the current IP law guiding the implementation of the law to identify “dishonest” behavior in the filing of trademark applications to facilitate the settlement of related cases. Some main contents which should be carefully consider in order to improve the prevailing laws are: (i) To build a specific definition on bad faith/ dishonesty filings or bad faith/ dishonesty registrations and/or (ii) To set forth as clear as possible some typical examples/criteria to ascertain bad faith/ dishonesty filings and/or (iii) To guide as detailed as possible on the evidences required in proving an alleged bad faith filing./.

 by INVESTIP – Hanoi, April 2017