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TITLE: MEDINA/RACKEY CRYSTAL TOP CORP. v. GLOBAL QUEST VENTURES

FACTS:

The case involves a dispute over the trademark "Mr. Gulaman." Respondent Global Quest Ventures, Inc. (Global) filed an application for trademark registration of "Mr. Gulaman" but discovered that petitioner Ma. Sharmaine R. Medina had a pending application for the same mark. Global opposed Medina's application, claiming they are the rightful owner of the mark. Global alleged that they commissioned Benjamin Irao, Jr. to create and register the mark as a copyright in 1996, with the rights assigned to them in 2005. Despite the opposition, Medina's trademark registration was issued. Global filed a petition for cancellation, alleging fraudulent acquisition. The Intellectual Property Office granted Global's petition, which was affirmed on appeal.

In another dispute involving the same mark, appellant Carmencita Medina held a certificate of registration for the mark "Mr. Gulaman (Stylized)." Global Brands Group of Companies (Global) claimed to be the prior user and originator of the stylized "MR. GULAMAN" mark. The Office of the Director General and the Court of Appeals ruled in favor of Global, prompting Medina to file a Petition for Review with the Supreme Court.

In a separate case, petitioner RJ Francisco Marketing Inc. claimed to be the first to use the mark "Mr. Gulaman" in commerce in 1994 through Romualdo C. Rivera. The petitioner attached delivery receipts from 2004 to 2006 to support its claim of prior use. Liwayway Marketing Corporation (respondent) argued that the issue of the petitioner's denial of due process has been resolved, and that its ownership of the mark has been proven through various pieces of evidence.

ISSUES:

  1. Whether or not the Court of Appeals erred in affirming the cancellation of petitioner's Certificate of Registration.

  2. Whether or not the Intellectual Property Office erred in refusing to admit petitioner's answer.

  3. Whether or not petitioner's right to due process was violated.

  4. Whether ownership of a trademark is acquired through registration or prior use.

  5. Whether the removal of the phrase "previously used in the Philippines by another and not abandoned" in the Intellectual Property Code (IPC) indicates the abandonment of the ownership regime under the Trademark Law.

  6. Whether the registered mark has become the generic name for the goods or services for which it is registered.

  7. Whether the registered mark is being used by the registrant to misrepresent the source of the goods or services.

  8. Whether the registered mark was obtained fraudulently or contrary to the provisions of the Intellectual Property Code.

RULING:

  1. The Court of Appeals did not err in affirming the cancellation of petitioner's Certificate of Registration. The prima facie presumption of ownership attached to the certificate can be overcome by evidence of prior use by another. In this case, the evidence presented by respondent showed that they had prior use of the mark "Mr. Gulaman" before petitioner's registration.

  2. The Intellectual Property Office did not err in refusing to admit petitioner's answer. The Court of Appeals already resolved this issue in a previous case, finding that petitioner waived her right to file an answer by failing to do so within the reglementary period and disregarding the verification requirement.

  3. The claim of denial of due process is baseless. The Court of Appeals already ruled on the issue of the Intellectual Property Office's declaration of petitioner's default, and this decision became final and executory.

  4. Ownership of a trademark is acquired through registration. The current rule under the IPC is that ownership of a trademark is acquired through registration made validly in accordance with the provisions of the IPC. The registration of a trademark vests ownership over it. The rule that ownership is acquired by prior use was abandoned through the enactment of the IPC.

  5. The removal of the phrase "previously used in the Philippines by another and not abandoned" in the IPC does not indicate the abandonment of the ownership regime under the Trademark Law. The intent of the lawmakers was to abandon the regime of ownership under the Trademark Law, as amended. The fact that the IPC requires actual use of the mark and that a certificate of registration is prima facie evidence of ownership does not imply that actual use is still a recognized mode of acquiring ownership under the IPC. Actual use is required for the registered owner of a mark to maintain his ownership. Bad faith may still be a ground for the cancellation of trademark registrations.

  6. The registered mark was found to be the generic name for the goods for which it is registered.

  7. The registered mark was being used by the registrant to misrepresent the source of the goods.

  8. The registered mark was obtained fraudulently or contrary to the provisions of the Intellectual Property Code.

PRINCIPLES:

  • A trademark is a creation of use and belongs to the person who first used it in trade or commerce.

  • The prima facie presumption of ownership attached to a certificate of registration can be overcome by evidence of prior use by another.

  • The registration of a trademark creates a prima facie presumption of ownership but does not automatically vest ownership. Ownership of a trademark confers the right to register it.

  • Ownership of a trademark is acquired through registration.

  • Actual use is required for the registered owner of a mark to maintain his ownership.

  • Bad faith may be a ground for the cancellation of trademark registrations.

  • The generic name of a mark is determined by the primary significance of the mark to the relevant public.

  • Fraud in trademark registration involves intentionally making false claims to take advantage of another's goodwill and cause damage or prejudice to another.

  • The concepts of bad faith and fraud in trademark registrations go hand-in-hand.

  • The Intellectual Property Office is in a better position to determine matters of bad faith in trademark registrations.

  • Factual findings of the Intellectual Property Office are generally accorded great respect and finality by the courts, as long as they are supported by substantial evidence.