Kabushi Kaisha Isetan vs.

lAC
GR 75420, 15 November 1991; Second Division, Gutierrez Jr., (J)

Facts: Kabushi Kaisha Isetan is a Japanese corporation, and owner of the trademark Isetan and
the Youngleave design. Isetann Department Store, on the other hand, is a domestic
corporation, and owner fo the trademark Isetann and flover design. In 1980, Kabushi
Kaisha Isetan field petitions for the cancellationof the supplemental registration of Isetann with
the Philippine Patent Office. It also filed for the cancellation of the mark Isetan from the
corporate name of Isetann Department Store with the SEC. Both the SEC and theDirector of
Patents, eventually, ruled against Kabushi Kaisha Isetan. It appealed to the
intermediateAppellate Court, which denied the petition for being filed out of time.

Issue: Whether Kabushi Kaisha Isetan has the right to seek for the cancellation of the word
Isetan from thecorporate name of Isetann Department Store.

Held: No. A Fundamental principle in Trademark Law is that the actual use in commerce in the
Philippinesis a pre-requisite to the acquisition of ownership over a trademark or a tradename.
Kabushi Kaisha Isetan hasnever conducted any business in the Philippines. It has never
promoted its trademark or tradename in the Philippines. It has absolutely no business
goodwill in the Philippines. It is unknown to Filipinos except thevery few who may have
noticed it while traveling abroad. It has never paid a single centavo of tax to
thePhilippine Government. Under the law, it has no right to the remedy it seeks. Isetann
Department Store isentitled to use its trademark in the Philippines.

BATA INDUSTRIES vs CA
Facts:

The respondent New Olympian Rubber Products sought to register the mark "BATA" for casual
rubber shoe products, alleging it had used the said mark since the 1970s. The petitioner, a
Canadian corporation opposed with its allegations that it owns and has not abandoned said
trademark. The petitioner has no license to do business in the Philippines and the trademark has
never been registered in the Philippines by any foreign entity. Bata Industries does not sell
footwear under the said trademark in the Philippines nor does it have any licensing agreement
with any local entity to sell its product.

Evidence show that earlier, even before the World War II, Bata shoes made by Gerbec and Hrdina
(Czech company) were already sold in the country. Some shoes made by the petitioner may have
been sold in the Philippines ntil 1948. On the other hand, respondent spent money and effort to
popularize the trademark "BATA" since the 70's. Moreover, it also secures 3 copyright
registrations for the word "BATA". The Philippine Patent Office (PPO) dismissed the opposition
by the petitioner while the Court of Appeals (CA) reversed said decision. However, a 2nd
resolution by the CA affirmed the PPO decision.

Issue: Does the petitioner have the right to protect its goodwill alleged to be threatened with
the registration of the mark?

NO. Bata Industries has no Philippine goodwill that would be damaged by the registration of the
mark.
Any slight goodwill obtained by the product before World War II was completely abandoned and
lost in the more than 35 years that passed since Manila's liberation from Japan. The petitioner
never used the trademark either before or after the war. It is also not the successor-in-interest of
Gerbec & Hrdina and there there was no privity of interest between them, Furthermore, the Czech
trademark has long been abandoned in Czechoslovakia

PHILIP MORRIS, INC. VS. FORTUNE TOBACCO CORPORATION

Facts:
Petitioner Philip Morris, Inc., a corporation organized in the State of Virginia, U.S.A, is
the registered owner of the trademark MARK VII for cigarettes. Similarly, petitioner
Benson & Hedges (Canada), Inc., a subsidiary of Philip Morris, Inc., is the registered
owner of the trademark MARK TEN for cigarettes. Fabriques de Tabac Reunies, S.A.
a Swiss company, another subsidiary of Philip Morris, Inc., is the assignee of the

trademark LARK, . Respondent Fortune Tobacco Corporation, a company organized in

the Philippines, manufactures and sells cigarettes using the trademark MARK.
Petitioners, on the claim that an infringement of their respective trademarks had been
committed, filed, on August 18, 1982, a Complaint for Infringement of Trademark and
Damages against respondent Fortune Tobacco Corporation before the Regional Trial
Court of Pasig. After the termination of the trial on the merits trial court rendered its
Decision dated November 3, 1999 dismissing the complaint and counterclaim after
making a finding that the respondent did not commit trademark infringement against the
petitioners.

Issue: Whether or not there was infringement of the petitioners trademarks by the
respondent.
Ruling:
There was no infringement. The trial court expounded that in order for a name, symbol
or device to constitute a trademark, it must, either by itself or by association, point
distinctly to the origin or ownership of the article to which it is applied and be of such
nature as to permit an exclusive appropriation by one person.

Philip Morris Inc. vs. CA

Facts:
Maintaining to have the standing to sue in the local forum and that respondent has
committed trademark infringement, petitioners went on appeal to the CA. CA decision on
January 21, 2003 (while ruling for petitioners on the matter of their legal capacity to sue

in this country for trademark infringement) affirmed the trial courts decision on the
underlying issue of respondents liability for infringement. The motion for
reconsideration denied by the CA. Petitioners seek petition for review of the Court of
Appeals.
ISSUES:
(1) Whether or not petitioners, as Philippine registrants of trademarks, are entitled to
enforce trademark rights in this country;
(2) Whether or not respondent has committed trademark infringement against petitioners by its
use of the mark MARK for its cigarettes, hence liable for damages.

HELD:
It must be emphasized that their standing to sue in Philippine courts had been recognized, and
rightly so, by the CA. Such right to sue does not necessarily mean protection of their registered
marks in the absence of actual use in the Philippines. Members of the Paris Union does not
automatically entitle petitioners to the protection of their trademarks in this country ABSENT
ACTUAL USE OF THE MARKS IN LOCAL COMMERCE AND TRADE. The Philippines
adherence to the Paris Convention effectively obligates the country to honor and enforce its
provisions as regards the protection of industrial property of foreign nationals in this country.
However, any protection accorded has to be made subject to the limitations of Philippine laws.
Foreign nationals must still observe and comply with the conditions imposed by

Philippine law on its nationals.

R.A. No. 166 (as amended, specifically Sections 228 and 2-A29), mandates actual use of the
marks and/or emblems in local commerce and trade before they may be registered and ownership
thereof acquired. The petitioners cannot, therefore, dispense with the element of actual use.
Their being nationals of member-countries of the Paris Union does not alter the legal situation.