Kolin Electronics vs. Taiwan Kolin,
GR No 221347; December 01, 2021
[Second Division] [Hernando, J]
Facts:
On August 7, 1993, KECI filed an Application with the then Bureau of Patents, Trademarks and Technology Transfer (BPTTT) for the registration of the "KOLIN" mark covering electronic products under Class 9 of the Nice Classification, which Taiwan Kolin opposed. The Bureau of Legal Affairs (BLA) denied Taiwan Kolin's opposition, prompting the latter to appeal the BLA's decision to the Court of Appeals (CA). CA ruled that KECI's predecessor-in-interest and assignor has been actually using the "KOLIN" mark in business in the Philippines as early as February 17, 1989, prior to its filing for registration of the said mark in 1993. On this score, the prevailing trademark law at the time, RA 166, considers prior use in the Philippines as the basis for priority right or registration right of a trademark or service mark. Thus, the CA upheld KECI's registration of the "KOLIN" mark, vesting KECI with the exclusive right to use the same for automatic voltage regulators, converters, rechargers, stereo booster, AC-DC regulated power supply, step-down transformer, PA ampilifier AC-DC, and related goods thereto. The CA's July 31, 2006 Decision became final and executory on November 16, 2007.
In 2015, the Court's Third Division promulgated its Decision in Taiwan Kolin Corporation Ltd. v. Kolin Electronics Co., Inc. (2015 Kolin case). In the said case, the Court allowed the registration of the "KOLIN" mark for television sets and DVD players in favor of Taiwan Kolin, over KECI's objections that the mark which Taiwan Kolin seeks to register for the said goods is identical, if not confusingly similar, with KECI's "KOLIN" mark registered on November 23, 2003, covering the following products under Class 9 of the Nice Classification: automatic voltage regulator, converter, recharger, stereo booster, AC-DC regulated power supply, step-down transformer, and PA amplified AC-DC. In giving due course to Taiwan Kolin's application, the Court opined that the products covered by Taiwan Kolin's trademark application and KECI's registration under Class 9 are not related, and that there is no likelihood of confusion that would deceive the ordinary intelligent buyer between the two.
In 2021, the Court En Banc promulgated its Decision in Kolin Electronics Co., Inc. v. Kolin Philippines International, Inc. (2021 Kolin case) which denied the registration of KPII for television sets and DVD players under Class 9 of the Nice Classification. In so ruling, the Court en banc held that there is a resemblance between KECI's and KPII's marks, the goods covered by KECI's registration under Class 9 are related to the goods covered by KPII's, there is evidence of actual confusion between the two marks, and the goods covered by KPII's fall within the normal potential expansion of business of KECI. After the Court abandoned the use of product or service classification as a factor in determining relatedness or non-relatedness, it stressed that the 2015 Kolin case does not apply as a precedent in the controversy in the 2021 Kolin case since the former did not comprehensively consider all the jurisprudential factors in determining relatedness and it included an inapposite discussion on subcategories in the Nice Classification as an additional basis for its conclusion on non-relatedness. In the 2021 Kolin case, the Court also highlighted that KECI was already declared as the owner of the KOLIN mark under the Trademark Law, and noted that the 2015 Kolin case merely gave KPII, as an instrumentality of Taiwan Kolin, the right to use the exact mark allowed to be registered in the 2015 Kolin case, i.e., the KOLIN design mark, not a blanket authority to use or register any and all figurative or stylized versions of the word "KOLIN".
On May 29, 2007, KECI filed a trademark application for registration of the "KOLIN" mark under Class 35 of the Nice Classification for use in the business of manufacturing, assembling, importing, and selling electronic equipment or apparatus. Taiwan Kolin and KPII did not oppose the said registration, and the mark was registered on December 22, 2008.
On August 16, 2007, KECI filed Trademark Application No. 20-2007-000009 for the mark "www.kolin.ph" under Class 35 for use in the business of manufacturing, assembling, importing, and selling electronic equipment or apparatus. The application was published in the IPO e-Gazette on January 11, 2008, and Taiwan Kolin was given four months or until May 10, 2008 to file an opposition thereto.
On May 12, 2008, Taiwan Kolin filed an Opposition to the said application on the following grounds that: 1) the application violates Section 123.1(d) of the IP Code which proscribes the registration of a mark identical with a registered mark belonging to a different proprietor with an earlier filing or priority date; 2) the registration of "www.kolin.ph" will cause grave and irreparable injury to Taiwan Kolin's goodwill, reputation, and business using the KOLIN brand; 3) that the trademark application violates the rule in the Implementing Rules and Regulations (IRR) of the IP Code requiring a specific description of goods, business or services; and 4) that "www.kolin.ph" does not function as a mark. Notably, the documents attached to Taiwan Kolin's Opposition marked as "A" to "T" were all photocopies.
BLA dismissed Taiwan Kolin 's Opposition for failure to comply with the provisions of Sections 7.1 and 7.3. of Office Order No. 79, series of 2005, which amended the Regulations on Inter Partes Proceedings (Inter Partes Regulations) and required the attachment of originals or, in the case of public documents, certified true copies of the attached documents.
The IPO Director General denied Taiwan Kolin's appeal in a Decision. CA affirmed the findings of the IPO Director General. CA noted that KECI has the right to use the "KOLIN" mark under Class 35 by virtue of the Certificate of Registration issued to it on December 22, 2008, which constitutes prima facie evidence of the validity of the registration, the registrant's ownership of the mark, and the registrant's exclusive right to use the same. Moreover, the CA pointed out that contrary to Taiwan Kolin's assertions, its "KOLIN" mark is not an internationally well known mark that would prevent KECI's registration of the domain name, "www.kolin.ph".
CA reiterated that the Inter Partes Regulations require the submission of the originals or certified true copies of the supporting documents upon the filing of the Opposition. It observed that Taiwan Kolin's subsequent submission of most of the originals and/or certified true copies of its documentary exhibits in its motion for reconsideration with the BLA does not constitute substantial compliance with the Inter Partes Regulations. Moreover, the circumstances do not warrant the relaxation of the Inter Partes Regulations in favor of Taiwan Kolin.
Taiwan Kolin maintains that the Inter Partes Regulations do not require the submission of original or certified true copies of the documentary exhibits together with the opposition, or prohibit an oppositor from subsequently complying with the requirement on the submission of the original supporting documents to the opposition after the filing of the same. It asserts that Section 7.1 of the Inter Partes Regulations merely requires that the opposition be "in due form," which means being compliant with the following provisions of the Inter Partes Regulations, to the exclusion of the other provisions: (a) Rule 3, Section 3; (b) Rule 4, Section 2; (c) Rule 5, Section 3; (d) Rule 6, Section 9; (e) Rule 7, Sections 3 and 5; and (f) Rule 8, Sections 3 and 4. Taiwan Kolin insists that to construe otherwise would be tantamount to adding another ground for dismissal after the Inter Partes Regulations have expressly confined its terms to those expressly mentioned, and failed to consider that certified or original supporting documents may be submitted at a later time.
Taiwan Kolin further avers that KECI's application for registration of "www.kolin.ph" suffers from overbreadth and generality since it is broad enough to cover line of goods covered by Taiwan Kolin's trademark applications under Classes 9 and 11, in violation of Rule 417 of the IRR of the IP Code, which proscribes the use of broad terms in identifying the goods, business, and services. Moreover, Taiwan Kolin maintains that KECI is not the first and prior user and registered owner of the "KOLIN" mark. It argues that Taiwan Kolin's application for registration of the "KOLIN" mark under Class 9 and KPII's application for goods falling under Class 35 precede the application sought by KECI for "www.kolin.ph"; thus, KECI is not entitled to the registration of "www.kolin.ph" in its favor, whether or not the same be limited to the services covered by its Class 35 Trademark Application. In addition, it asserts that the registration of "www.kolin.ph" is barred under Section 123.1(E) of the IP Code.
Issue 1:
Whether Taiwan Kolin's failure to submit the original supporting documents in its Opposition against KECI's application for registration of "www.kolin.ph" warranted the outright dismissal of its Opposition.
Held:
Yes; Taiwan Kolin's opposition was properly dismissed by the BLA. While the Inter Partes Regulations may be relaxed for meritorious cases and for compelling reasons, the relaxation of the rules is not warranted in the case at bench.
Sections 7.1 and 7.3 of the Inter Partes Regulations are clear - the submission of documents and other requirements attached to the petition and opposition shall be filed with the Bureau in their original or, in the case of public documents, certified copies thereof. Otherwise, the petition or opposition shall be dismissed outright.
KECI has the right to register and use the mark "www.kolin.ph". At the outset, and as reiterated in the 2021 Kolin case, we stress that KECI was already declared the first and prior user of the "KOLIN" mark in the Philippines and thus the owner of the "KOLIN" mark under RA 166, in a final and executory decision rendered by the CA. In connection thereto, Section 236 of the IP Code states that nothing in the IP Code shall impair the rights of the enforcement of marks acquired in good faith prior to the effective date of said law.
Moreover, it is settled that a certificate of registration of a mark is prima facie evidence of the validity of the registration, the registrant's ownership of the mark, and of the registrant's exclusive right to use the same in connection with the goods or services and those that are related thereto specified in the certificate. The said presumption may be challenged and rebutted when an adverse party, in the appropriate action, can show that the certificate of registration is not reflective of ownership of the holder, such as when: (1) the first registrant has acquired ownership of the mark through registration but subsequently lost the same due to non-use or abandonment (e.g., failure to file the Declaration of Actual Use); (2) the registration was done in bad faith; (3) the mark itself becomes generic; (4) the mark was registered contrary to the IP Code (e.g., when a generic mark was successfully registered for some reason); or (5) the registered mark is being used by, or with the permission of, the registrant so as to misrepresent the source of the goods or services on or in connection with which the mark is used.
In connection thereto, it is beyond cavil that KECI, having been issued Certificate of Registration No. 4-2007-005421, is the registered owner of the "KOLIN" mark under Class 35, specifically for "the business of manufacturing, importing, assembling, or selling electronic equipment or apparatus". Significantly, the list of services in the said certificate is identical to the list of services of KECI's application for "www.kolin.ph". This certificate of registration vests KECI the exclusive right to use the "KOLIN" mark in relation to the services covered by the registration. Unless and until the said registration of KECI is nullified or cancelled through the proper proceeding, the rights emanating from the said registration should be respected.
In recognition thereof, courts in the United States have held that the use of a trademark of another company or person within the domain name of a web address can constitute a trademark violation. To protect the goodwill and reputation of their business and products in the online sphere, it is but logical for companies to register their trademarks in the form of domain names under the IP Code.
In fine, the owner of a registered trademark, absent any legal obstacle or compelling reason to the contrary, should be allowed to register, in its favor, a domain name containing its registered trademark as a dominant feature. KECI's application to register and use the mark "www.kolin.ph", presumably as its domain name and platform to sell its products in the internet, is merely in exercise of and consistent with its exclusive right to use "KOLIN" on the business of manufacturing, importing, assembling or selling electronic equipment or apparatus. KECI's exclusive right to use the "KOLIN" mark for the business of manufacturing, importing, assembling, or selling electronic equipment or apparatus is entitled to protection, whether such use is exercised online or through a physical market – and whether the mark is printed on product packaging or included in the domain name of its website. Indeed, to preclude KECI from safeguarding its right to protect the name of its domain name containing its registered mark would unduly limit the scope of selling and antiquate the concept in relation to the current times.
Issue 2:
Whether the IPO Director General erred in ruling that (a) Taiwan Kolin's applications and registrations for the "KOLIN mark" refer to goods and services that are not related to KECI's trademark application for "www.kolin.ph"; and that (b) the registration of "www.kolin.ph" in favor of KECI is limited to the services covered by KECI's trademark application.
Held:
In the meantime, just as KECI's registration for KOLIN under Class 35 was successfully registered and is presumed valid unless otherwise shown in an appropriate action, Taiwan Kolin's registrations in Classes 11 and 21 remain valid and subsisting for as long as they have not been cancelled by the IPO or the courts in the proper action. These registrations remain to be prima facie evidence of Taiwan Kolin's ownership of the design mark KOLIN, and of the registrant's exclusive right to use the specific stylization and design of the said mark in connection with the goods, business or services specified in the certificate. Said right remains enforceable during the certificates' effectivity and prior to their cancellation.
The purpose a trademark is to point out distinctly the origin or ownership of the goods or services to which it is affixed; to secure to him, who has been instrumental in bringing into the market a superior article of merchandise, the fruit of his industry and skill; to assure the public that they are procuring the genuine article; to prevent fraud and imposition; and to protect the manufacturer against substitution and sale of an inferior and different article as his product.
WHEREFORE, the Petitions in G.R. No. 221347 and G.R. Nos. 221360-61 are DENIED for lack of merit. The January 27, 2015 Decision and November 4, 2015 Resolution of the Court of Appeals in CA-G.R. SP No. 122566 and CA-G.R. SP No. 122574 are AFFIRMED.
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