Netflix and Escobar Family in Bitter Trademark Dispute Over 'Narcos'

Narcos Still and Roberto Escobar - Split - Publicity - H 2017
Left, courtesy of Netflix, right, courtesy of Escobar Inc.

Amid the unwelcome glare of the Sept. 11 shooting death of Carlos Munoz Portal — a Narcos location scout killed on the job in the rural region north of Mexico City — Netflix must also contend with an ongoing trademark dispute with the family of Pablo Escobar, the Colombian drug kingpin dramatized in the hit series.

Speaking Monday to The Hollywood Reporter, Escobar's 71-year-old surviving brother, Roberto De Jesus Escobar Gaviria, suggested the show's producers are not cut out for filming in such cartel-infested locales as Mexico and Colombia, adding that they would benefit from the hiring of "hitmen ... as security."

Gaviria also threatened to "close their little show" if the streaming giant failed to provide a $1 billion payment to his company, Escobar Inc., for intellectual property violations.

"Netflix are scared," he said. "They sent us a long letter to threaten us."

That letter, prepared and sent July 27 by the powerhouse Los Angeles firm Sheppard, Mullin, Richter & Hampton LLP, has been obtained exclusively by The Hollywood Reporter.

In it, lawyers for Narcos Productions, LLC (NPL) — the company behind the series and its popular video game spinoff Narcos: Cartel Wars — contend that without NPL's "knowledge or consent, on Aug. 20, 2016, Escobar filed use-based applications to register the marks NARCOS and CARTEL WARS with the [U.S. Patent and Trademark Office] covering a range of goods and services."

Those services include everything from "downloadable ring tones" and "sunglasses, decorative magnets" to "temporary tattoos, bookmarks and sheet music," according to the trademark application documents included with the letter.

The letter calls the claims "fraudulent." 

"For example," writes NPL attorney Jill M. Pietrini, "Escobar claims that it has used NARCOS in connection with things like 'operating a website' and 'game services provided online from a computer network' since Jan. 31, 1986. However, the internet had not been developed for widespread consumer use in 1986, nor was the capability to provide audiovisual works nor game services available at that time."

Pietrini goes on to say that the specimen used by Escobar for the trademark application "appears to be either from NPL's advertising or, at the very least, an infringing artwork that infringes NPL's copyrights in the Narcos Game."

Lawyers for Netflix then threaten to retaliate by suing the Escobar family.

"The remedies available to NPL for Escobar’s use of the Narcos Marks include, but are not limited to, NPL’s actual damages, statutory damages, Escobar’s profits attributable to the unauthorized use of the NARCOS and CARTEL WARS marks, attorneys’ fees, a bar to registration of the NARCOS and CARTEL WARS trademarks, and a nationwide injunction against Escobar’s further use of the NARCOS and CARTEL WARS marks or any other mark confusingly similar to the Narcos Marks," the letter says.

In a subsequent email correspondence obtained by THR and dated Sept. 1, an attorney for Escobar Inc. at Century City-based Browne George Ross LLP informs his client that he and Pietrini had a productive conversation about the claim.

"I floated the idea of paying you for an assignment or license or release related to your pre-exisiting rights in the trademarks in certain categories," Wesley writes. "She seemed to see the logic of exploring those discussions. She is going to speak with her client and get back to me."

This Netflix IP dispute comes amid another with the organizers of a Stranger Things-themed pop-up bar at Logan Square station in Chicago, which elicited a light-hearted but entirely serious cease-and-desist letter from the company.

According to Olof Gustafsson, the CEO of Escobar Inc., the network is beginning to take their threats seriously.

"At first, they refused to acknowledge us. After we registered all the trademarks and we’ve been granted some of them, they sent us a cease-and-desist letter. After that our attorneys and their attorneys have come to an agreement that basically they need to pay us something. Now it’s a matter of determining how much that something is," Gustafsson says.

He adds: "At the end of the day, if we don't take a deal, then we own the trademarks. They would have to rebrand their entire show. They know this. This is why they’re talking to us. Otherwise they would never entertain any discussions with a drug cartel family. "

According to Rebecca Tushnet, a Harvard Law School professor who focuses on copyright and trademark law, it's unlikely that Escobar Inc. could have a trademark claim to "Narcos" — a word which has come to mean anyone involved in the drug-cartel trade.

"It's possible to have trademarks that are the same for different goods and services. For example; Delta Airlines, Delta Dental, Delta Faucet," Tushnet says. "But at least some of the goods and services in the applications are overlapping.

"Also," she continues, "if the statement in the initial letter is correct that Escobar's specimen of use was copied from Netflix, that is eyebrow-raising and would create a serious problem for the Escobar application." When it comes to registering the titles of works, rules vary, Tushnet says, "so they might not be registered immediately [by Netflix] and the registration isn't required to have rights."

As for Escobar's lawyer saying Netflix lawyer had seen "the logic" in settlement discussions, Tushnet points out that "there are a lot of motives for a settlement, and that's completely standard, especially in Hollywood productions, which are notorious for paying out small amounts to make minor nuisances to go away. I wouldn't make any judgment about the validity of the claims from the fact that they're in discussions. Especially if no amounts are on the table."

Pablo Escobar's surviving brother has led a quiet and colorful existence since being released from prison in 2003, where he was rendered partially blinded and deaf from a mail bomb.

At the peak of his brother's operations, where Gaviria worked as lead accountant and "head of the hitmen," he was tracking billions of dollars in drug profits annually. The cartel had a $2,500-per-month rubber band bill just to bind the currency, according to one legend, and allegedly lost 10 percent in profits annually to rats eating the money.

But in a 2014 Vice interview conducted at his home in Medellin, Colombia, the surviving sibling insisted his cartel days are behind him. "I do good now," he said, before launching "into a lengthy speech about how he has gained valuable medical knowledge while caring for expensive horses, and used that knowledge to find a cure for HIV."

According to a March 2017 report from German broadcaster Deutche Welle, Gaviria opens his home to groups of international visitors as the final destination on Medellin "narco tours," where other stops include Escobar's gravesite and "the Cathedral," the drug kingpin's privately held and run prison.

As for whether or not anyone at Escobar Inc., including Gaviria, currently has any knowledge regarding what happened to slain location scout Portal, Gustafsson would only offer, "No comment on that. But Escobar Inc. cooperates with all law enforcement."

Representatives for Netflix did not immediately respond to a request for comment.