G.R. No. 183404 - Berris Agricultural Co., Inc. vs. Abyadang

Case Summary (G.R. No. 183404)

Factual Background

Respondent filed Trademark Application Serial No. 4-2004-00450 for the mark “NS D-10 PLUS” on January 16, 2004 for fungicide (Class 5) with 80% Mancozeb and the application was published July 28, 2005. Petitioner opposed on August 17, 2005 asserting confusing similarity with its registered trademark “D-10 80 WP,” also used for fungicide with 80% Mancozeb. Petitioner claimed prior use of “D-10 80 WP” and submitted an application and registration evidence. Respondent asserted independent creation and market presence of “NS D-10 PLUS” supported by Fertilizer and Pesticide Authority certifications and sales receipts.

Administrative Proceedings

The IPO-Bureau of Legal Affairs (BLA) issued Decision No. 2006-24 on April 28, 2006 sustaining the opposition and rejecting respondent’s application. The BLA denied respondent’s motion for reconsideration by Resolution No. 2006-09(D) dated August 2, 2006. Respondent appealed to the Office of the Director General, Intellectual Property Philippines, which denied the appeal and affirmed the BLA decision on July 20, 2007. Respondent secured review by the Court of Appeals, which reversed the IPPDG decision on April 14, 2008 and ordered registration of respondent’s mark and cancellation of petitioner’s registration; the CA denied petitioner’s motion for reconsideration on June 18, 2008. Petitioner then filed the present Rule 45 petition.

Evidence Presented

Petitioner submitted its trademark application dated November 29, 2002; an IPO certificate of registration dated October 25, 2004; packaging showing the mark “D-10 80 WP”; sales invoices and official receipts; and a notarized Declaration of Actual Use (DAU) dated April 23, 2003 stating first use on June 20, 2002 with attached sales documents. Respondent offered a copy of his product packaging; an affidavit dated February 14, 2006 describing the derivation of “NS D-10 PLUS” and denying knowledge of petitioner’s product; FPA certifications establishing respondent’s FPA registration since May 26, 2003 and market presence since July 30, 2003 and noting regional monitoring results; an FPA certification that petitioner’s pesticide was registered on November 12, 2004; and receipts for sales of respondent’s goods.

Issue Presented

The principal legal question was whether respondent’s mark “NS D-10 PLUS” was confusingly similar to petitioner’s registered mark “D-10 80 WP” such that IPO properly rejected respondent’s application, and whether the Court of Appeals erred in reversing the IPO decisions and ordering cancellation of petitioner’s registration without a petition for cancellation.

Parties' Contentions

Petitioner argued that the CA misconstrued facts and substituted its judgment for the IPO without a finding of grave abuse, and that the CA lacked authority to cancel petitioner’s duly registered mark absent a formal cancellation proceeding. Respondent contended that his mark was not confusingly similar, that petitioner failed to establish ownership of the registered mark, and that cancellation was appropriate to avoid multiplicity of suits.

Court of Appeals Decision

The Court of Appeals granted respondent’s petition and set aside the IPPDG decision. The CA concluded that the marks were not confusingly similar, that petitioner failed to prove ownership of “D-10 80 WP,” and that petitioner’s registration could be cancelled to avoid multiplicity of suits. The CA ordered that respondent’s application be given due course and that petitioner’s registration be cancelled. The CA denied petitioner’s motion for reconsideration.

Supreme Court Ruling (Disposition)

The Supreme Court granted the Rule 45 petition. The Court reversed and set aside the Court of Appeals Decision dated April 14, 2008 and Resolution dated June 18, 2008. The IPO decisions — Decision No. 2006-24 dated April 28, 2006, Resolution No. 2006-09(D) dated August 2, 2006, and the IPPDG decision dated July 20, 2007 — were reinstated. Costs were awarded against respondent.

Supreme Court Reasoning (Legal Basis)

The Court applied R.A. No. 8293 and its provisions on acquisition of rights by registration (Sec. 122), the prima facie effect of registration (Sec. 138), the DAU requirement and removal for non-use (Sec. 124.2 and Sec. 152), and the rights conferred by registration (Sec. 147). The Court recognized that registration constitutes prima facie evidence of ownership and exclusive right, but that the presumption may be overcome by proof of prior use by another. The Court found that petitioner established prior use through a sworn DAU dated April 23, 2003 showing first use on June 20, 2002, supported by sales invoices and official receipts. The Court emphasized the presumption of regularity and authenticity attaching to a notarized DAU received in due course by the IPO and required clear, strong, and convincing evidence to rebut it, which respondent did not produce.

Supreme Court Reasoning (Similarity and Confusion)

The Court examined confusing similarity under Section 123.1(d) of R.A. No. 8293 and applied the jurisprudential tests of dominancy and the holistic or totality approach. Under the Dominancy Test the Court found that the component “D-10” was the dominant and most memorable element of petitioner’s “D-10 80 WP” mark and that respondent’s “NS D-10 PLUS” shared the same dominant component. The Court observed that both marks covered identi

Case Syllabus (G.R. No. 183404)

Parties and Procedural Posture

Berris Agricultural Co., Inc. filed a Verified Notice of Opposition with the IPO on August 17, 2005 against the trademark application of Norvy A. Abyadang.
Norvy A. Abyadang filed Trademark Application Serial No. 4-2004-00450 on January 16, 2004 for the mark "NS D-10 PLUS" for fungicide in Class 5.
The IPO Bureau of Legal Affairs issued Decision No. 2006-24 dated April 28, 2006 sustaining the opposition and rejecting Abyadang’s application.
The IPO Bureau of Legal Affairs issued Resolution No. 2006-09(D) dated August 2, 2006 denying Abyadang’s motion for reconsideration.
Director General of the IPP, Adrian S. Cristobal, Jr., issued a decision dated July 20, 2007 affirming the Bureau’s decision and denying Abyadang’s appeal.
Abyadang filed a petition for review with the Court of Appeals which rendered a Decision dated April 14, 2008 granting the petition, giving due course to the "NS D-10 PLUS" application, and cancelling Berris’ registration "D-10 80 WP."
The Court of Appeals denied Berris’ motion for reconsideration in a Resolution dated June 18, 2008.
Berris Agricultural Co., Inc. filed the present petition for review on certiorari under Rule 45, Rules of Court seeking reversal of the Court of Appeals' April 14, 2008 Decision and June 18, 2008 Resolution.

Key Factual Allegations

Both marks at issue concerned fungicide products with active ingredient 80% Mancozeb and were classified under Class 5.
Berris relied on a notarized Declaration of Actual Use (DAU) dated April 23, 2003 stating first use of the mark "D-10 80 WP" on June 20, 2002, with attached sales invoices and official receipts.
Berris produced an IPO certificate of registration for "D-10 80 WP" with Registration No. 4-2002-010272 and stated a registration date of July 8, 2004 and a certificate date of October 25, 2004.
Abyadang submitted an affidavit claiming independent creation of "NS D-10 PLUS" and asserted earlier packaging registration with the Fertilizer and Pesticide Authority (FPA).
Abyadang submitted FPA certifications indicating registration and market presence of "NS D-10 PLUS" since May 26, 2003 and market presence since July 30, 2003, and FPA receipts of sales referring to "D-10" and "D-10+."
The parties submitted packaging samples, sales documents, FPA certifications, and affidavits as competing proofs of prior use.

Issues Presented

Whether Abyadang’s mark "NS D-10 PLUS" is confusingly similar to Berris’ registered mark "D-10 80 WP."
Whether Berris established ownership and prior use of the mark "D-10 80 WP."
Whether the Court of Appeals properly cancelled Berris’ registered mark in the absence of a petition for cancellation before the IPO.
Whether the Court of Appeals properly reversed and set aside the factual findings of the IPO absent a showing of grave abuse of discretion.

Contentions of Parties

Berris contended that its mark "D-10 80 WP" was prior used since June 20, 2002 and that Abyadang’s mark would cause confusion given the shared element "D-10."
Berris argued that the Court of Appeals erred in reversing IPO findings without demonstrating grave abuse and erred in ordering cancellation absent a petition for cancellation.
Abyadang contended independent creation of "NS D-10 PLUS," reliance on FPA registration and market records since 2003, and absence of market encounter of "D-10 80 WP" in certain regions as shown in FPA certifications.
Abyadang asserted that the IPO and IPPDG wrongly r