Levi Strauss (Phils.) v. Vogue Traders Clothing Company (G.R. No. 132993)

Facts:

Petitioner Levi Strauss Phils. is a grantee of license by its US-based principal to use LEVI’S trademark in the manufacturing and sale of its clothing and other goods. Later, petitioner discovered the existence of respondent’s trademark LIVE’S which in its view was confusingly similar to its trademark. Thus, petitioner instituted an administrative case for its cancellation. Respondent on the other hand, filed a civil action for damages against petitioner. Petitioner counterclaimed that its trademark is infringed and moved to enjoin respondent from using said confusingly similar mark. Trial court ruled for petitioner. CA ordered the trial court to desist from proceeding with the civil case until the pending administrative action has been resolved.

Issue:

Whether or not the administrative action to cancel the trademark registration can proceed independently from an action of infringement or unfair competition.

Ruling: YES.

The passage of Republic Act No. 8293, otherwise known as the “Intellectual Property Code of the Philippines,” expanded the rights accorded to an owner of a registered trademark. Sections 151 (2) thereof state:

Section 151.2. Notwithstanding the foregoing provisions, the court or the administrative agency vested with jurisdiction to hear and adjudicate any action to enforce the rights to a registered mark shall likewise exercise jurisdiction to determine whether the registration of said mark may be cancelled in accordance with this Act. The filing of a suit to enforce the registered mark with the proper court or agency shall exclude any other court or agency from assuming jurisdiction over a subsequently filed petition to cancel the same mark. On the other hand, the earlier filing of petition to cancel the mark with the Bureau of Legal Affairs {formerly BPTTT] shall not constitute a prejudicial question that must be resolved before an action to enforce the rights to same registered mark may be decided.

It bears stressing that an action for infringement or unfair competition, including the available remedies of injunction and damages, in the regular courts can proceed independently or simultaneously with an action for the administrative cancellation of a registered trademark in the BPTTT. As applied to the present case, petitioner’s prior filing of two inter partes cases against the respondent before the BPTTT for the cancellation of the latter’s trademark registrations, namely, “LIVE’S” and “LIVE’S Label Mark,” does not preclude petitioner’s right (as a defendant) to include in its answer (to respondent’s complaint for damages in Civil Case No. No. 96-76944) a counterclaim for infringement with a prayer for the issuance of a writ of preliminary injunction.

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