Cancellation of Trademark Registration due to Logo Imitation: Lessons for Business Owners

In today’s competitive landscape, companies across sectors invest significantly in visual identity, brand and reputation as strategic assets. For the business owner aiming to distinguish a product or service in the market, trademark registration with the National Institute of Industrial Property (INPI) in Brazil is a crucial step. However, failure in this step or improper use of an already established brand may lead to serious legal and financial risks. The recent ruling by the Federal Regional Court of the 2nd Region (1st Specialized Panel) which upheld the cancellation of Brazilian figurative mark registration no. 919795650, by a company in the footwear-apparel sector, for imitating the logo of New Balance, provides a valuable warning to business owners and brand managers dealing with brand identity, graphic design and INPI registration.

Development: legal aspects and practical implications

Legal framework – Article 124 XIX of Law 9.279/96

he TRF-2 decision relied directly on item XIX of article 124 of the Law 9.279/96 (Brazilian Industrial Property Law – LPI), which provides as a ground for unregistrability or cancellation of a mark when it “reproduces or imitates a pre-existing mark, of which the applicant is not authorized, in a manner capable of generating confusion or association with a mark previously registered and used in the country.”

Jurisprudence has established that whenever there is relevant resemblance between graphical signs and operation in the same market segment, there is a risk of confusion. In the case at hand, the Court found that the challenged logo, though bearing changes such as different angulation or dashed lines, did not differ sufficiently from the New Balance symbol, which constituted “almost identical” signs and ability to mislead consumers. It is also relevant that the protection of a prior mark becomes stronger when the mark is well-known or has acquired distinctiveness (in this case New Balance, active in Brazil and abroad for decades).

Market proximity, risk of confusion and the “distance theory”

From a practical viewpoint, the Court highlighted two main factors: (i) closeness of the market segments – footwear and apparel – which increased risk of confusion; and (ii) visual similarity of the signs was sufficient to cause undue association by consumers. The applicant argued the so-called “theory of distance” (i.e., many similar marks coexist in the market), yet the Court rejected it in face of a well-known mark, where the tolerance margin is narrower.

Accordingly, business owners must understand that registering or using a brand identity that is close to a prior mark — especially in the same or related segment — carries a high risk of cancellation, prohibition of use and liability.

Practical impacts for the company and guidance for the brand manager

For business owners and brand managers the ruling has several practical consequences: first, investment in brand identity and marketing may be lost if registration is cancelled or the mark’s use is prohibited; second, products may require recall, brand change, inventory losses or even obligation to compensate the holder of the prior mark for unauthorized use. In the case at hand, beyond cancellation, the TRF-2 confirmed prohibition of use and increased attorneys’ fees.

From a preventive perspective, companies should adopt best practices: before launching a new brand or logo, conduct searches of prior marks at the INPI and, where applicable, internationally; verify whether similar marks exist in the segment or adjacent segments, evaluate registrability of the logo and whether it may approximate established symbols. At the registration stage, document the creation process, design sources, national and international references, as well as legal analysis of collision risk. If there is an existing contested mark or evident risk, negotiate license or assignment of mark may be alternative. In companies operating internationally or planning expansion, consider registration in other countries to avoid surprises such as recognition of prior mark through use abroad.

Another practical guidance for brand managers is the continuous monitoring of the company’s mark-portfolio and competitive market. The mere peaceful coexistence of similar marks does not mean that the situation will be accepted by INPI or courts, especially if the prior mark is well known. The company should assess whether its mark may potentially generate undue association, confusion risk or exploitation of third-party reputation, and adopt internal approval procedures, licensing agreements, digital platform surveillance and brand-approval protocols to strengthen legal security.

In summary, the TRF-2 decision reaffirms that trademark protection in Brazil, especially when the mark is widely known, is strong and demands that companies — including micro, small and medium enterprises — pay rigorous attention to the conception, registration and use of their visual identity. A brand manager or business owner who ignores this context risks not only the registration, but also the continuity of the use of a mark, generating unexpected costs and reputational harm.

Given this reality, it is advisable that companies retain specialized legal counsel in intellectual property from the stage of brand conception, through registration and post-registration monitoring. Preventive action proves far more efficient — and less costly — than rectifying vulnerabilities after a dispute. Whenever in doubt about registration, prior-mark search, collision risk or licensing and international protection strategy, seeking assistance from specialized attorneys is prudent. This applies to companies of all sizes: to recognise that the brand is not merely a drawing, but a right that directly impacts the company’s assets and competitiveness in the market.