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In entrepreneurial practice, new projects are commonly launched by several like-minded people together, but often their paths diverge with time. Moreover, there is a high possibility of direct competition arising between former co-founders.

Very often, the stumbling block is the designation/trademark that was originally used jointly by all co-founders. Thus, when the spheres were separated, one of the co-founders registered a combined trademark in his name and provided the other two with letters of consent indicating that he consented to the use of the word element in the combined designation. The second co-founder, who at that time had filed his combined trademark for registration in a certain color combination with the same word element, also issued a similar letter of consent to the third co-founder. The third co-founder, based on two letters of consent, registered his combined trademark in a color combination different from the trademarks of his former colleagues. However, a few years later, the third founder submitted for registration a designation that copied not only the verbal element (which was initially agreed upon by the founders), but also the color scheme of the second founder. This trademark of the third founder was also registered by Rospatent on the basis of letters of consent issued by the co-founders at the time of business division (i.e. after a significant period of time).

The second founder, whose interests were represented by «A.Zalesov & Partners» Patent & Law Firm, filed a suit with the Chamber of Patent Disputes to challenge the validity of a trademark granted to the third co-founder, whose color scheme was similar to the color scheme used by the second co-founder for a long time.

By decision of Rospatent, the registration of the trademark was considered invalid. This decision was upheld by the Russian IP Court. In particular, the Court analyzed the disputed trademark in comparison with a series of trademarks of the second co-founder. It stated that «the compared designations have certain differences in terms of graphic criteria due to the presence of different visual elements in them (...), the implementation of strong verbal elements in different styles, including a stylized indication of the «and» letter in contrasting service marks, as well as the location of elements in a rectangle (controversial service mark), in a square (opposite marks according to the certificate of the Russian Federation No....) and a circle (opposite sign according to the certificate of the Russian Federation No….)». At the same time, the Court considered that «these differences cannot be considered significant, since the compared designations are made in a single color scheme of white-green-gold, while the verbal elements are made in white, the figurative elements are in golden style, and the named elements are located in geometric shapes (square, circle, rectangle) on a green background. The foregoing also indicates that the compared designations have a certain degree of similarity according to the graphic criterion.»

At the same time, the Court confirmed the inavailability of using the submitted letter of consent as confirmation of the consent of the second co-founder to register a trademark containing an identical verbal element and a similar coloristic solution. The Court based its decision on the following circumstances established during the dispute. More than a year and a half passed between the second co-founder issuing a letter of consent to the third, during which the second co-founder registered another designation as a trademark, including «identical verbal elements «…», which differs from the disputed service mark, primarily by the overall visual impression produced.» The Court explained that the indication in the letter of consent of the description (its completeness) of the filed designation with its reproduction is a necessary condition in order to be able to identify it and establish the actual will of the person who provided such consent. The panel of judges came to the conclusion that when using identical verbal elements, combined designations can produce a different visual impression due to the coloristic solution, however, in the case under consideration, it was the repetition of the color scheme, in addition to the identity of the verbal element, that became the reason for filing the application and making a decision on recognition trademark registration is invalid.

The client was represented in the Court by Senior Associate Anna Kakurnikova and Associate Zhora Akopyan.

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