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VIA S/A, responsible for the Casas Bahia and Ponto Frio chains, filed a lawsuit against MAGAZINE LUIZA S/A, seeking to refrain from using its registered trademarks “CASAS BAHIA” and “PONTO FRIO” in sponsored links on the GOOGLE ADS tool and compensation for material and moral damages. According to the case files, the company's motivation was the receipt of an extrajudicial notification in 2021, sent by MAGAZINE LUIZA S/A on the eve of Black Friday, demanding the immediate and definitive cessation of any and all use of the trademark “MAGAZINE LUIZA” in sponsored links of VIA S/A advertisements. In response to the notification, VIA S/A claimed that this was a common, recurring, and tolerated practice in the market in which both parties operate, a practice that was also adopted by MAGAZINE LUIZA itself. Furthermore, it argued that MAGAZINE LUIZA acted in bad faith when sending the notification on the eve of Black Friday, an event of enormous economic interest for the retail sector, causing a brutal market imbalance by abandoning the stance of reciprocal tolerance for the aforementioned practice.

At the time, preliminary injunction was granted determining the cessation of the use of the trademarks “CASAS BAHIA” and “PONTO FRIO” as titles and keywords in the provision of sponsored advertisements in search tools such as Google, Bing, and the like, as well as to the prohibition of including such reproductions and imitations in the title of their sponsored advertisements, within a 5 day period. However, after the objection, a judgment was rendered denying VIA S/A claims, based on the position of the Court of Justice of the European Union, which defends the non-existence of violation of the trademark when there is no attack on its functions, as well as the absence of unfair competition if the consumer can distinguish that the advertisement is not related to the trademark owner. In its appeal, VIA S/A aclaimed that there was a clear imbalance in the market's self-regulation in the use of the trademark as a keyword, which would constitute unfair competition by MAGAZINE LUIZA, in addition to there being evidence of the undue association of VIA S/A's trademarks as keywords used by MAGAZINE LUIZA.

In a decision signed by Judge-Rapporteur Sérgio Shimura, the Appeal was acknowledged and granted in the sense that the allegations of VIA S/A regarding the improper use of the registered trademarks “Casas Bahia" and "Ponto Frio" in links sponsored by MAGAZINE LUIZA give rise to unfair competition, with emphasis on the following excerpt:

^{“It is worth remembering that unfair competition is characterized by the diversion of customers, through the improper use of mechanisms that induce consumers to a confusion between commercial, industrial or service provider establishments, or between the products and services offered for sale. Such practice may affect or reduce the value of a trademark or company name in the respective class of activity, as it may be associated with companies that provide services or sell products of dubious or inferior quality to those that already have good indicators. As a result, there is a possibility that consumers may become confused or link one trademark to another, as if they were from the same business or economic group, causing harm to the registration or patent owner. Furthermore, the trademark's distinctiveness must be combined with anteriority and specificity. Anteriority corresponds to its use with precedence, in which the exteriorization is carried out in a pioneering manner; and specificity is the identification of a common trademark with a specific type of product or service. Once the combination of these factors has been demonstrated, the trademark or patent owner may seek legal protection to suspend or interrupt its improper use, in addition to compensation for financial losses and moral damages, due to the practice of parasitic competition, characterized by the diversion of customers, dilution, and reputation of the trademark and/or company name, under the terms of Articles 130, 207, and 209, Law #9,279/1996. [...] Thus, from the evidence, it was demonstrated that the defendant used a nominative elements of another's registered trademark, with sufficient distinctiveness and in the same field of activity, as a search term for the dissemination of advertisements contracted with internet search providers, characterizing unfair competition, according to Statement XVII of the Group of Chambers dedicated to Business Law (“The use of a nominative element of another's registered trademark, company name or establishment title, with sufficient distinctiveness and in the same field of activity, as a search term for the dissemination of advertisements contracted with internet search providers constitutes an act of unfair competition”). In reinforcement, by Statement XXIII of the Group of Chambers dedicated to Business Law, “The use of a nominative element of a trademark, business name or title of a competing establishment, as a keyword on the Google advertising platform (Google Ads), characterizes parasitic use, as it encourages the practice of unfair competition (Article 195, III, Law #9,279/1996), implying joint liability of the provider, due to the risk of the activity (Article 927, sole paragraph, of the Brazilian Civil Code)”.}

Furthermore, the decision determined the cessation of the use of the trademarks “Casas Bahia” and “Ponto Frio” in sponsored links or in other tools by MAGAZINE LUIZA, under penalty of a daily fine of BRL 5,000.00 (limited to BRL 100,000.00), and set compensation for moral damages in the amount of BRL 10,000.00.

Although the use of competing trademarks by retailers in internet search tools was reciprocal for some period, this fact does not eliminate the illegality of the action since the use of a third-party trademark in redirecting online searches may undoubtedly lead to customer diversion and damage to the trademark owner.

The Brazilian Patent Statute determines that ownership of a trademark is acquired through validly issued registration, ensuring the owner its exclusive use throughout the national territory, as well as the right to protect its material integrity or reputation. The same statute provides that anyone who uses fraudulent means to divert, for their own benefit or that of others, another person's customers commit the crime of unfair competition. Furthermore, as highlighted in the decision rendered in this case, Statements XVII and XXIII of the Group of Chambers dedicated to Business Law, which summarize the understanding of the area and aim to standardize judgments, provide that:

^{Statement XVII – The use of a nominative element of another's registered trademark, company name or establishment title, with sufficient distinctiveness and in the same field of activity, as a search term for the dissemination of advertisements contracted with internet search providers constitutes an act of unfair competition. (approved in a session held on September 27, 2022)}

^{Statement XXIII – The use of a nominative element of a trademark, business name or title of a competing establishment, as a keyword on the Google advertising platform (Google Ads), characterizes parasitic use, as it encourages the practice of unfair competition (Article 195, III, Law #9,279/1996), implying joint liability of the provider, due to the risk of the activity (Article 927, sole paragraph, of the Brazilian Civil Code). Inapplicability of Article 19 of the Brazilian Internet Bill of Rights, once the choice of keyword for targeted advertising service is not to be confused with the production of content by third parties. (approved in a session held on December 12, 2023)}

Although the aforementioned statements were inserted after the original judgment, dated September 06, 2022, which dismissed the claims of VIA S/A, a case law search at the São Paulo Court of Appeals reveals that there were already precedents regarding the configuration of unfair competition and parasitism resulting from the improper use of trademarks registered by third parties in online search tools, evidencing the mistake in the basis of the decision based on judgments of foreign courts, especially in positions contrary to those previously rendered in national courts.

Furthermore, it is worth remembering that unfair competition affects not only the parties involved, but also consumer relations. Thus, the infringement of trademark rights and the practice of unfair competition and parasitism enable the diversion of customers, illicit enrichment, and the dilution and weakening of the infringed trademark. Even if the practice is “well tolerated by the parties”, attention must be paid to the damages caused to the consumer, who may be misled, confused, or undue association and end up purchasing products and/or services from a source other than the one originally intended.

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