Birkenstock vs. Phil Shoe Expo Marketing - CD JCS

Statutory Construction Mercantile Law Cases CY 2014

2015-2016 Sunday Class Atty. Molina

Birkenstock Orthopaedie GMBH and Co. KG (formerly Birkenstock Orthopaedie GMBH) vs. Philippine Stock Expo Marketing Corporation 15 SCRA 469 FACTS: Petitioner, a corporation duly organized and existing under the laws of Germany applied for various trademark registrations before the Intellectual Property Office (IPO). However, the applications were suspended in view of the existing registration of the mark “BIRKENSTOCK AND DEVICE” under Registration No. 56334 dated October 21, 1993 in the name of Shoe Town International and Industrial Corporation, the predecessor-in-interest of respondent Philippine Shoe Expo Marketing Corporation. On May 27, 1997, petitioner filed a petition (Cancellation Case) for cancellation of Registration No. 564334 on the ground that it is the lawful and rightful owner of the Birkenstock marks. During its pendency, however, respondent and/or it predecessor-in-interest failed to file the required 10th Year Declaration of Actual Use (10th Year DAU) for Registration No. 56334 on or before October 21, 2004, thereby resulting the cancellation of such mark. Accordingly, the cancellation case was dismissed for being moot and academic thereby paving the way for the publication of the subject applications. In response, respondent filed with the Bureau of Legal Affairs (BLA) of the IPO three separate verified notices of opposition to the subject applications docketed as Inter Partes Cases claiming, among others, it, together with its predecessor-in-interest, has been using the Birkenstock marks in the Philippines for more than 16 years through the mark “BIRKENSTOCK AND DEVICE”. In its Decision, the BLA of the IPO sustained respondent’s opposition, thus ordering the rejection of the subject applications. Aggrieved, petitioner appealed to the IPO Director General whereby in its decision, the latter reversed and set aside the ruling of the BLA thus allowing the registration of the subject applications. Finding the IPO Director General’s reversal of the BLA unacceptable, respondent filed a petition for review with the Court of Appeals. In its decision dated June 25, 2010, the CA reversed and set aside the ruling of the IPO Director General and reinstated that of the BLA. The petitioner filed a Motion for Reconsideration but was denied by the CA. Hence , this petition to the Supreme Court. ISSUE: 1. Whether or not the petitioner’s documentary evidence, although photocopies, are admissible in court? 2. Whether or not the subject marks should be allowed registration in the name of the petitioner? HELD: Jan Carlo M. Sanchez - Knew the LAW since August 2015

Statutory Construction Mercantile Law Cases CY 2014

2015-2016 Sunday Class Atty. Molina

1. The court ruled yes. It is a well-settled principle that the rules of procedure are mere tools aimed at facilitating the attainment of justice, rather than its frustration. A strict and rigid application of the rules must always be eschewed when it would subvert the primary objective of the rules, that is, to enhance fair trials and expedite justice. In the light of this, Section 5 of the Rules on Inter Partes Proceedings provides that, “The Bureau shall not be bound by strict technical rules of procedure and evidence but may adopt, in the absence of any applicable rule herein, such mode of proceedings which is consistent with the requirements of fair play and conducive to the just, speedy and inexpensive disposition of cases, and which will the Bureau the greatest possibility to focus on the contentious issues before it. In the case at bar, it should be noted that the IPO had already obtained the originals of such documentary evidence in the related Cancellation Case earlier before it. Under the circumstance and the merits of the instant case as will be subsequently discussed, the Court holds that the IPO Director General’s relaxation of procedure was a valid exercise of his discretion in the interest of substantial justice. 2. The court ruled in favour of the petitioner. Under Section 12 of Republic Act 166, it provides that, “Each certificate of registration shall remain in force for twenty years: Provided, that the registration under the provisions of this Act shall be cancelled by the Director, unless within one year following the fifth, tenth and fifteenth anniversaries of the date of issue of the certificate of registration, the registrant shall file in the Patent Office an affidavit showing that the mark or trade-name is still in use or showing that its non-use is due to special circumstance which excuse such non-use and is not due to any intention to abandon the same, and pay the required fee.” In the case at bar, respondent admitted that it failed to file the 10 th Year DAU for Registration No. 56334 within the requisite period, or on or before October 21, 2004. As a consequence, it was deemed to have abandoned or withdrawn any right or interest over the mark “BIRKENSTOCK”. It must be emphasized that registration of a trademark, by itself, is not a mode of acquiring ownership. If the applicant is not the owner of the trademark, he has no right to apply for its registration. Registration merely creates a prima facie presumption of the validity of the registration. Such presumption, just like the presumptive regularity in the performance of official functions, is rebuttable and must give way to evidence to the contrary. Besides, petitioner has duly established its true and lawful ownership of the mark “BIRKENSTOCK”. It submitted evidence relating to the origin and history of “BIRKENSTOCK” and it use in commerce long before respondent was able to register the same here in the Philippines. Petitioner also submitted various certificates of registration of the mark “BIRKENSTOCK” in various countries and that it has used such mark in different countries worldwide, including the Philippines.

Jan Carlo M. Sanchez - Knew the LAW since August 2015