A Barcelona Court of Appeal has recently upheld a December 2011 trial court decision in a case involving the importation of thousands of garments bearing imitations of GIORGIO ARMANI SPA trade marks.  The notable feature of this case is that the importer provided a ‘cover registration’ -- a registered mark that is not identical to an earlier well-known mark (so as not to raise the alarm during the registration process), but which does bear some resemblance to it  -- in an attempt to justify the legality of its actions. This practice is said to have become increasingly widespread among infringers, who are becoming more professional and sophisticated.

An infringer who obtains a cover registration will then make, import or sell products which do not bear that mark, but which do bear a sign which imitates the earlier well-known mark. If the customs authorities or police try to stop the goods, the mark owner can show its cover registration to prevent the seizure of the goods; unfortunately, this tactic has proved to be successful in some cases, as it gives the appearance of legitimacy.

When goods that are branded in this way are seized and a criminal procedure is initiated, the infringer provides the Criminal Court with evidence of registration of the cover mark. Since the holder of a Spanish registered trade mark has a legal right to use its mark in trade, infringers take refuge in this ius utendi to justify their behaviour. Infringers also argue that the owner of the earlier well-known mark did not object to the registration of the later mark during the administrative procedure, and did not request the cancellation of the registration once it had been granted. The Barcelona Court of Appeal has now clarified that a defendant may not rely on the appearance of being protected by one’s own registered trade mark or argue that registration of its mark had not been contested by the holder of the earlier well-known mark. The subjective requirement of the crime at issue was met

“from the very moment the decision was made to register a distinctive sign that was similar [to a well-known trade mark] - as a preparatory act – in order to later import on a large scale products that were protected under the umbrella of the registered trade mark.”

Source: "Defendant cannot rely on 'cover registration' to justify infringement" by Jordi Camó, Grau & Angulo, Barcelona, World Trademark Review