Title
Supreme Court
Shangri-la International Hotel Management, Ltd. vs. Developers Group of Companies, Inc.
Case
G.R. No. 159938
Decision Date
Jan 22, 2007
Dispute over "Shangri-La" trademark and "Sa logo" between Kuok Group and DGCI; SC ruled DGCI's registration void due to bad faith, lack of prior use, upheld Kuok Group's ownership.

Case Digest (G.R. No. 198587)
Expanded Legal Reasoning Model

Facts:

  • Parties Involved
    • Petitioners: Shangri-La International Hotel Management, Ltd., Shangri-La Properties, Inc., Makati Shangri-La Hotel & Resort, Inc., and Kuok Philippines Properties, Inc.
    • Respondent: Developers Group of Companies, Inc. (DGCI)
  • Procedural History
    • The case originated from Civil Case No. Q-91-8476, involving a complaint for trademark infringement filed by petitioners against DGCI.
    • The Regional Trial Court (RTC) of Quezon City ruled on March 8, 1996, in favor of petitioners.
    • The Court of Appeals (CA) issued decisions on May 15, 2003, and a resolution on September 15, 2003, both favoring petitioners.
    • DGCI elevated the case to the Supreme Court via a petition for review, which granted the petition and dismissed the infringement complaint on March 31, 2006.
    • DGCI thereafter filed a Motion for Reconsideration to reverse the Court’s decision.
  • Claims and Contentions Raised by DGCI in Its Motion for Reconsideration
    • Petitioners’ certification of non-forum shopping was insufficient.
    • The use of "Shangri-La" and its logo by the Kuok Group in their corporate and hotel names justified DGCI’s use.
    • Petitioners’ claim of legal and beneficial ownership of the trademark and logo was baseless.
    • Petitioners impermissibly changed their theory from ownership to seeking relief as a person who may be damaged.
    • The finding concerning registration of the mark in various patent offices worldwide was inaccurate.
    • DGCI’s registration of the “Shangri-La” mark and logo was valid due to at least two months’ prior use before application.
    • Under Section 2-A of Republic Act No. 166 (R.A. No. 166), actual commercial use in the Philippines is required pursuant to the territoriality principle in trademark law, making petitioners’ use outside the Philippines insufficient to confer ownership.
    • The RTC and CA’s failure to find bad faith on DGCI’s part should be binding on the Supreme Court.
    • DGCI’s use of the trademark and logo in the Philippines deserves protection under the territoriality principle.
  • Supreme Court’s Consideration
    • DGCI largely repeated arguments previously resolved by the Court.
    • DGCI failed to present any new, substantial, or compelling reason to justify reconsideration.
    • DGCI’s own witness’s testimony demonstrated bad faith and lack of the two-month prior use requirement, rendering their registration void.
    • The Court reaffirmed the territoriality principle but held that DGCI was not entitled to protection due to defects in its registration.
    • Petitioners maintained their stance as rightful, legal, and beneficial owners of the mark and logo throughout the proceedings without improper change of theory.
    • The Court emphasized that even if petitioners were not owners, R.A. No. 166 allows any person who believes they may be damaged by registration to seek relief.

Issues:

  • Whether DGCI’s Motion for Reconsideration raised new or substantial grounds warranting reversal of the Court’s Decision that dismissed the infringement complaint.
  • Whether petitioners’ certification of non-forum shopping was sufficient.
  • Whether petitioners legally and beneficially owned the “Shangri-La” mark and logo.
  • Whether DGCI’s registration of the “Shangri-La” mark and logo was valid based on alleged prior use.
  • Whether the territoriality principle under Philippine trademark law was properly applied in this case.
  • Whether there was bad faith in DGCI’s registration and use of the contested mark and logo.
  • Whether petitioners impermissibly changed their theory from ownership to possible damage as basis for relief.

Ruling:

  • (Subscriber-Only)

Ratio:

  • (Subscriber-Only)

Doctrine:

  • (Subscriber-Only)

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