Right of Defense and false information

Intellectual Property regulations establish a pecuniary punishment (fine) for those litigants who consciously provide false information or hide information required by the administrative authority; said fine shall amount up to 50 tax units (each tax unit amounts approximately to US$ 1246).

The article at issue is Article 116 of Legislative Decree N° 1075 and, as stated by the Administrative Court, said article does not establish the granting of a power to the administrative authority but obliges to impose a fine when any of the mentioned reasons exist, such as providing false information.

Notwithstanding the above-mentioned, the criterion for establishing when a declaration contains false information has not been established by legislation, so it was necessary that said criterion be determined by case law.

In this regard, Resolution No. 4726 -2016/TPI-INDECOPI established the parameter for considering that a declaration does not constitute an act of providing false information: the exercise of the right of defense. In the case evaluated by the mentioned resolution, the Trademark Office punished a company with a fine amounting to 5 tax units since, according to the Trademark Office, it had provided false information.

In the referred case, the Trademark Office required the defendant to indicate the date on which it ceased using the plaintiff’s marks.  The defendant stated that it ceased using said marks from the date on which the license granted in its favor concluded.  Subsequently, based on the means of proof filed in the proceeding, the Trademark Office verified that after the conclusion date of the license the defendant still had elements that included the trademark on which the complaint was based.

Nevertheless, the Administrative Court revoked the fine punishment imposed by the Trademark Office, considering that defendant’s declaration was the valid exercise of its right of defense. Moreover, it took into consideration that the defendant had indicated that after the conclusion of the license, it went through a transitional period in which it progressively removed from its premises the trademark on which the complaint was based.

In this sense, it is noted that the Administrative Court believes that not every declaration that may result imprecise in connection with what is demonstrated in the evaluation of the means of proof must be considered an act through which false information is provided, given that this would limit the party to exercise its right of defense.

In this matter, it is interesting to add that through the right of defense the parties contradict the factual and legal arguments raised against them, so if –in an infringement proceeding- a person considers that the act which took place constitutes a valid act, the trademark authority must not consider said declaration as false information, even if it is verified that the denounced fact occurred (verified infringement), since it is part of the legitimate exercise of the defendant’s right of defense.