EMERALD GARMENT vs. THE H.D. LEE COMPANY

EMERALD GARMENT vs. THE H.D. LEE COMPANY

G.R. No. 210693

June 7, 2017

Facts:

This is a Petition for Review on Certiorari 1 filed by Emerald Garment Manufacturing Corporation (Emerald) against The H.D. Lee Company, Inc. (H.D. Lee) to assail the Decision 2 and Resolution 3 of the Court of Appeals (CA), dated April 8, 2013 and January 6, 2014, respectively. The CA reversed the Decision of the Intellectual Property Office's (IPO) then Director General Ricardo R. Blancaflor (DG Blancaflor) in Inter Partes Case, approving H.D. Lee's application for registration of the trademark "LEE & OGIVE CURVE DESIGN."

H.D. Lee filed before the IPO an application for the registration of the trademark, "LEE & OGIVE CURVE DESIGN" and claimed that the said mark was first used in the Philippines. Relative thereto, on outer clothing categorized under Class 25, which includes jeans, casual pants, trousers, slacks, shorts, jackets, vests, shirts, blouses, sweaters, tops, skirts, jumpers, caps, hats, socks, shoes, suspenders, belts and bandannas, was filed. Within three years from the filing of the application, H.D. Lee submitted to the IPO a Declaration of Actual Use of the mark. 5 H.D. Lee's application was published in the Intellectual Property Philippines' Electronic Gazette for Trademarks, which was belatedly released on January 5, 2007. 6 Emerald opposed argued that the approval of the application will violate the exclusive use of its marks, "DOUBLE REVERSIBLE WA VE LINE," and "DOUBLE CURVE LINES," which it has been using on a line of clothing apparel since October 1, 1973 7 and 1980, respectively.

DG Blancaflor rendered a Decision reversing the findings of Atty. Abelardo based on the grounds cited as follows:

• That H.D. Lee has established by substantial evidence that it is the owner of LEE & OGIVECURVE DESIGN. 
• That Emerald has trademark applications and/or registrations in the Philippines on marks similar to [H.D. Lee] and which were filed and/or registered earlier than H.D. Lee's trademark application is not sufficient to overcome the pieces of evidence proving H.D. Lee's ownership of LEE & OGIVE CURVE DESIGN. c. H.D. Lee has shown that LEE & OGIVE CURVE DESIGN is a well-known mark.

Furthermore, there is nothing in the records which explained how [Emerald] came to use a highly distinctive sign such as a "Back Pocket Design" or the "Double Curve Lines" which are identical or confusingly similar to the well-known mark LEE & OGIVE CURVE DESIGN. The absence of any explanation on how Emerald conceived these marks gives credence to the position that H.D. Lee is the owner and creator of LEE & OGIVE CURVE DESIGN and is, therefore, entitled to the registration of this mark.

Emerald filed a petition for review under Rule 43 of the Rules of Court, which the CA denied in the herein assailed decision which ruled that H.D. Lee substantially complied with the procedural requirements in filing before the IPO a petition for registration of the mark "LEE & OGIVE CURVE DESIGN." Hence, the petition.

Issue:

Whether or not the EMERALD GARMENT MANUFACTURING CORPORATION has the rights over the registration of the marks "DOUBLE CURVE LINES' and "DOUBLE REVERSIBLE WAVE LINE' as against H.D. Lee's "OGIVE CURVE DESIGN."

Ruling:

The instant petition is impressed with merit. The reason for this is that litigation must end and terminate sometime and somewhere, and it is essential to an effective and efficient administration of justice that, once a judgment has become final, the winning party be not deprived of the fruits of the verdict. Courts must guard against any scheme calculated to bring about that result and must frown upon any attempt to prolong the controversies. The Court also emphatically instructs anent the concept and application of res judicata, viz.:"a final judgment or decree on the merits by a court of competent jurisdiction is conclusive of the rights of the parties or their privies in all later suits on all points and matters determined in the former suit." The elements for res judicata to apply are as follows: (a) the former judgment was final; (b) the court that rendered it had jurisdiction over the subject matter and the parties; (c) the judgment was based on the merits; and (d) between the first and the second actions, there was an identity of parties, subject matters, and causes of action.

H.D. Lee argues that the principle of conclusiveness of judgment does not apply since no identity of issue exists between the instant petition, on one hand, and G.R. No. 195415, on the other. The Court finds the foregoing untenable as the issues all point to the registrability of the confusingly similar marks "DOUBLE CURVE LINES," "DOUBLE REVERSIBLE WAVE LINE," and "OGIVE CURVE DESIGN." Further, H.D. Lee's claim that the instant petition involves the mark "LEE & OGIVE CURVE DESIGN' and not "OGIVE CURVE DESIGN' is specious and a clear attempt to engage into hair-splitting distinctions. A thorough examination of the pleadings submitted by H.D. Lee itself shows that indeed, the focus is the "OGIVE CURVE DESIGN," which remains to be the dominant feature of the mark sought to be registered.

The Court needs to stress that in G.R. No. 195415 and Inter Partes Case No. 3498 before the IPO, Emerald had already established with finality its rights over the registration of the marks "DOUBLE CURVE LINES' and "DOUBLE REVERSIBLE WAVE LINE' as against H.D. Lee's "OGIVE CURVE DESIGN."