By Gabriel Francisco Leonardos

Advertising and Marketing seeks to provide local answers to international questions concerning advertising and marketing law. Chapters provide expert advice on the legislation and regulation of advertising and marketing, including the legislative processes arising from advertising disputes and challenges, the regulation of misleading advertising and the control, prohibition and restrictions in place on certain type of goods and services and to certain audiences, regulations affecting direct and indirect marketing and promotion, and up-to-date analysis of social media and the latest advertising trends.

Three major developments in Brazil suggest the country is entering an exciting era for IP owners. Gabriel Francisco Leonardos and Pedro Vilhena of Kasznar Leonardos report.

April 12, 2017 was an unusual day for the Brazilian Intellectual Property System. The Brazilian Patent Office (BPO) announced 3 good news for IP owners.

 It will come into force next Thursday (November 24, 2016) a new resolution issued by CADE (Conselho Administrativo de Defesa Econômica), the Brazilian antitrust authority, that redefines the rules for the submission of “associative contracts” for prior approval.

The Superintendency of the Brazilian antitrust authority (Conselho Administrativo de Defesa Econômica – CADE) has recommended the sanctioning of three major automobile manufacturers for infringing the economic order on grounds of an alleged abuse of intellectual

property rights.

Getting the Deal Through: Advertising & Marketing / 2016

Reproduced with permission from Law Business Research Ltd. This article was first published in Getting the Deal Through: Advertising & Marketing 2016, (published in May 2016; contributing editor: Rick Kurnit, Frankfurt Kurnit Klein & Selz, PC) For further information please visit www.gettingthedealthrough.com.

Kasznar Leonardos Advogados' litigation team, specialized

in Intellectual Property matters, discussed the concrete

implementation of the new Code of Civil Procedure

(effective as of March 18, 2016) in a workshop held in the

São Paulo offices, on March 4 and 5, marking the closing

of a profound cycle of studies on the subject.

Brazilian law requires that international know-how agreements must be previously registered before the BPTO – Brazilian Patent and Trademark Office, in order for Brazilian companies to be allowed to remit payments abroad.  Moreover, the BPTO of registration also enables Brazilian companies to treat the payment as an “operational expense” for corporate income tax purposes, among other effects.

According to the law, there is no doubt that know-how agreements are submitted to this kind of proceedings. However, the law is not clear concerning agreements for rendering technical assitance services, since, in these cases, the technology transfer may, or may not be present.

In the trial of Special Appeal # 1.512.647 (decided on the 13th of May and published on the 5th of August), the Superior Court of Justice (in charge of standardizing the jurisprudence in Brazilian Courts) provided some guidance on liability of ISP in case of copyright infringement – an issue that was not codified by the Civil Basis for the Internet (“Marco Civil”). In the case at stake, a video producer filed a lawsuit against Google demanding the removal of several Orkut communities that were offering for sale a range of unauthorized copies of educational videos. The producer also requested the payment of damages. According to the producer, Google failed to remove the Orkut[1] communities after receiving a cease and desist letter, whereas Google alleged that such C&D letter did not inform the URLs of the infringing pages.

The Special Appeal was lodged by Google against a decision rendered by the State Court of Appeals of Minas Gerais[2]. This decision ordered the company (i) to pay damages to the producer in an amount to be fixed by an Expert or, in case that was not feasible, in accordance with article 103 of Brazilian Copyright Act[3]; and (ii) to remove the infringing pages. In brief, Google alleged that the company company could not comply with the Court order, as the producer did not inform the URLs of the infringing pages. Moreover, the company argued that it was a case of subjective liability and Goggle did not perform any activity that was deemed as copyright infringement.

Although this case happened before the Civil Basis for the Internet entered in force, the Reporting Justice Luís Felipe Salomão understood that it was desirable to render a decision that was in line with the principles enshrined by that Act. Therefore, he confirmed that it was a case of subjective liability, and underlined that, since the matter was not codified by the Civil Basis for the Internet, the Brazilian Copyright Act applies.

[1] A social network that was owned by Google.

[2] A State in Southeast Brazil.

[3] That establishes a presumption of selling of 3,000 (three thousand) infringing copies.

The Superintendency of the Brazilian antitrust authority (Conselho Administrativo de Defesa Econômica – CADE) has dismissed a case brought against the holder of essential patents related to an international standard in cell phone technology. According to the

bureau, there was no infringement of the economic order concerning the abuse of intellectual property rights.

CADE's Superintendency is the first federal instance to analyze acts of economic concentration, such as mergers and acquisitions, and the occurrence of infringements of the constitutional economic order. CADE, the national antitrust watchdog, is encharged with enforcing the constitutional economic principles, such as free enterprise, freedom of competition, social role of property, consumer protection and the restraining of abusive behavior.

In the present case, the patentee of the international standard cell phone technology was accused of sham litigation and patent misuse, since it had sued the denouncing company, which tried to obtain the due licenses, for patent infringement.

Practical Law – Life Sciences / 2015

Practical Law – Life Sciences / 2015

The administrative court of the Brazilian antitrust authority (Conselho Administrativo de Defesa Econômica – CADE) has very recently fined a major pharmaceutical industry in over 36 million Brazilian reais (approx. 11 million American dollars) for sham litigation involving the patent application in Brazil of a blockbuster drug used in the treatment of cancer. Although this is not the first millionaire fine imposed by CADE on a pharmaceutical company, cases like this are still rare and the case law of the bureau’s administrative court, which is a federal nonjudicial instance encharged with enforcing the constitutional economic principles, such as free enterprise and free competition, is still being built.

In the present case, the accused company has filed a patent application for a procedure to produce the abovementioned drug before the TRIPS Agreement had come into force in Brazil (later it has broadened the application’s claims to include the drug itself). As it is of common knowledge, Brazilian Law did not admit the patentability of chemical and pharmaceutical compounds until the issuance of the new Industrial Property Act in 1996, which was passed by Congress in order to comply with TRIPS. Notwithstanding the foregoing, by the time the applicant has requested the examination of the invention before the Brazilian Patent Office (BPO), the TRIPS agreement had indeed come into force.

As we informed in our previous newsletters # 2, of January, 2014, and # 6, of August, 2014, the Brazilian Patent Office (“INPI”) enacted Resolution No. 113 in October 2013 ordering that all patents with 2 (two) or more annuities in arrears should automatically be definitely shelved and extinct, without the possibility of restoration. Such resolution aimed primarily at reducing the backlog of pending patent applications and also served to the general goal of increasing the realm of the public domain in Brazil, but many understood that INPI's resolution was in direct violation of Section 87 of Brazil’s Patent Act, according to which the shelving or extinction of a patent can only be decreed by INPI after the patentee has failed to apply for the restoration of the patent (paying the annuities in arrears with a penalty) within the deadline of 3 months after being summoned to do so through a publication in the Official Gazette.

INPI’s Resolution 113 had the potential to swiftly shelve or make extinct over 10,000 patent applications and issued patents, and on July 2014 the Brazilian Association of Patent & Trademark Agents (ABAPI) filed a class action against INPI seeking its revocation. On January, 2015 the 25th Federal Trial Court of Rio de Janeiro ruled in favor of ABAPI and ordered INPI to immediately halt the mass shelving or extinction of patents and to overturn all shelving and extinction decisions that by then had already been published by INPI.