The tech giant filed an injunction, seeking to stop iFone from using its strikingly similar name, since it could confuse consumers. However, a Mexico City court struck down Apple's request, effectively denying it the right to use its brand name in a specific class of telecommunication services.
Despite the legal blow, Apple's plans for the release of the iPhone 5 were unhindered; Apple still holds two trademarks for the iPhone in Mexico in other classes -- categories that govern how a trademark is used -- including "computers, software, cameras, and mobile phones" and "electronic game devices."
Apple launched its legal battle against iFone in 2009, filing suit against the company in an attempt to invalidate iFone's trademark in class 38, which covers telecommunication services, so Apple's pending trademark could be approved. iFone returned fire, filing a countersuit against Apple.
Ultimately, the court found iFone registered its trademark in Mexico in 2003 -- four years before Apple attempted to do so -- and denied the injunction on the grounds that the iPhone brand is too phonetically similar to the iFone, not vice versa.
"It's the third time Apple has lost," attorney Eduardo Gallastegui said, according to Fox News Latino. "iFone is fully entitled to the use of its brand name."
While the court's denial has not stopped Apple from selling the iPhone 5 in Mexico, it could affect iFone's current suit against Apple, in which the company reportedly demands 40 percent of Apple's iPhone profits in Mexico as damages, according to PhoneArena. If decided in iFone's favor, Apple would be liable for partial remuneration of its iPhone profits in Mexico.
Apple faced a similar situation in China earlier this year over its iPad trademark after Proview Shenzhen claimed it was the rightful owner. However, Apple decided to settle the case, paying $60 million to Proview to end the dispute so it could continue selling the iPad in China.
Several of Mexico's top carriers are reportedly offering the iPhone 5, but Apple's latest model was in such high demand last week that many stores sold out completely with further shipments not expected for three to four weeks.