Infringement Actions

November 3, 2020

The new Federal Law for the Protection of Industrial Property includes several changes regarding administrative infringements, with the following being the most relevant:

• In the infringement actions related to the commercialization of products or services, the “knowingly” requirement has been deleted. Traditionally, there has been a distinction between the infringements that could be brought against the manufacturers of products that violate an industrial property right and the merchants that sell them, with an additional requirement, consisting of having to demonstrate that the merchant’s infringing activity was being carried out knowingly. However, the new Law has eliminated this requirement, thus giving the same treatment to manufacturers and merchants, which may cause some concern for retailers.
• The new Law introduces a wider definition of what is understood as “use” of any of the figures protected by the Law. The chapter of administrative infringements establishes that the term “use” includes, among others: “manufacturing, producing, imitating, storing, distributing, importing, exporting, offering for sale, selling, transporting or putting into circulation”.
• In the infringement action related to industrial designs, the conduct of “reproducing or imitating” has been replaced by the term “use”, which includes the manufacturing, producing, imitating, storing, distributing, importing, exporting, offering for sale, selling, transporting or putting into circulation, as mentioned above.
• Two new infringement actions related to industrial and commercial secrets have been introduced. The first one is for the misappropriation of information that is considered to be an industrial secret, and the second one is for the production, offering for sale, selling, importing, exporting or storing products or services, which use a trade secret.

Currently, violations involving industrial secrets can only be pursued and sanctioned through criminal actions. However, the introduction of these new infringement causes opens the door for the legal holders of trade secrets to pursue the violations thereof, either through criminal, administrative or civil actions.

• In the infringement action related to the use of the combination of distinctive signs, operative and image elements, it will no longer be necessary to prove the use of the three elements jointly. Now, under the new Law, it will be enough to prove the use of any of the three above-mentioned elements for the infringement action to proceed, which provides better grounds for the defense of trade dress.

Furthermore, the part of the former law expressly indicating that the commission of this infringement action constituted unfair competition, has been suppressed.

• The procedural type infringement actions such as: attempting frivolous infringement proceedings; avoiding access to IMPI’s commissioned personnel to carry out inspections, and not providing information to IMPI, when required, have been deleted.

Nevertheless, these last two actions are still penalized through the imposition of a fine, as set forth in the chapter dealing with “inspections” in the new law.

• The amount of the fines that can be imposed by IMPI, derived from any administrative infringement set forth in the new Law, has been increased, and now said fines can be up to 250,000 UMAs (approximately one million USD).
• The changes introduced by the new Law will apply only to administrative proceedings started after November 5, 2020. Those litigious proceedings started before the above-mentioned date, will be resolved in accordance with the former Law of Industrial Property.

It is expected that these changes will have a positive impact in the enforcement of IP rights in the Mexican legal system, since now IP holders will count on more and better tools to prevent third parties from infringing their exclusive rights.