Title
Gloria Maris Shark's Fin Restaurant, Inc. vs. Pacifico Q. Lim
Case
G.R. No. 264919-21
Decision Date
May 20, 2024
Gloria Maris Shark's Fin Restaurant challenged Lim's trademark registrations, asserting prior use. The Supreme Court ruled Lim's trademarks were registered in bad faith, reinstating the BLA's decisions.
trademark
registration
good faith

Case Summary (G.R. No. 264919-21)

Factual Background

Records showed that a restaurant bearing the trade name Gloriamaris operated in the CCP Complex as early as 1992 and that Gloria Maris Shark's Fin Restaurant, Inc. was incorporated in 1994 by Dominador B. Menguito, Pedro O. Manalo, Lorenzo Q. Dy, Edmundo L. Tan, and Pacifico Q. Lim. Petitioner alleged that it used a trademark combining the words “Gloria Maris” with a shark’s fin logo in its operations and that the Board of Directors entrusted Lim with registering that mark with the IPO. Lim denied that he was merely an agent and asserted that he conceived the name, concept, and logo and that he personally registered the marks.

Trademark Registrations and Use

Three marks were later registered in the name of Lim: “GLORIA MARIS WOK SHOP & DESIGN” (Certificate No. 4-2004-009149) and “GLORIA MARIS DIMSUM KITCHEN WITH LOGO” (Certificate No. 4-2004-009150), both dated August 28, 2005, and “GLORIA MARIS SHARK’S FIN RESTAURANT AND LOGO” (Certificate No. 4-2004-009151) dated October 31, 2005. Lim thereafter franchised the restaurant concept to several companies. Petitioner discovered the registrations only after the marks were in use and filed petitions for cancellation.

Proceedings Before the BLA-IPO

On February 23, 2012, the Bureau of Legal Affairs of the IPO issued three Decisions dismissing petitioner’s cancellation petitions. The BLA-IPO relied on Lim’s prima facie status as registered owner and found that the marks had been coined or created by Lim prior to petitioner’s SEC registration. The BLA-IPO credited the Affidavit of Joey Rodriguez, a graphic artist who testified that Lim instructed him in 1993 to design the restaurant’s interior and logo, and noted that petitioner and its officials did not oppose the trademark applications when published.

Proceedings Before the ODG-IPO

Petitioner appealed to the Office of the Director General. On August 6, 2019 the ODG reversed the BLA-IPO and ordered cancellation of the three certificates. The ODG found that petitioner had used the name “Gloria Maris” as its corporate name and business identity for more than ten years prior to Lim’s registration, that Rodriguez’s affidavit did not establish that Lim coined the name, and that Lim’s subsequent registration and use of “Gloria Maris” was unlawful.

Proceedings Before the Court of Appeals

The Court of Appeals reversed the ODG on March 18, 2022 and reinstated the BLA-IPO Decisions. The CA held that petitioner failed to overcome Lim’s prima facie ownership established by registration, that petitioner’s documentary proofs were insufficient as substantial evidence of prior use in trade, that petitioner did not show deliberate vexatious delay warranting relief against Lim, and that laches barred petitioner’s challenge because petitioner had been aware of Lim’s use yet delayed filing the cancellation petitions.

Issue Presented to the Supreme Court

The sole issue before the Supreme Court was whether the Court of Appeals erred in reversing the ODG Decisions and reinstating the BLA-IPO Decisions, namely whether Lim’s registrations were properly obtained and whether they should be canceled.

Parties’ Contentions

Gloria Maris Shark's Fin Restaurant, Inc. argued that Lim’s registrations were unlawful and obtained in bad faith, that Lim was not the owner of the marks, and that laches did not bar its claim because the registrations were procured in bad faith. Lim maintained that his registrations created a prima facie presumption of ownership that petitioner failed to overcome and that laches barred petitioner’s relief.

Standard of Review and Administrative Context

The Court recognized that petitions under Rule 45 normally raise questions of law but noted that trademark disputes are highly factual and that conflicting findings between the ODG and CA warranted review of evidence. The Court reiterated that IPO proceedings are administrative and governed by administrative adjudication principles, with the quantum of proof required being substantial evidence.

Supreme Court Findings on Prior Use and Ownership

The Supreme Court found that petitioner proved by substantial evidence that it used the name “Gloria Maris” in commerce years before Lim’s registrations and that Lim knew of that prior use. The Court examined Rodriguez’s affidavit and concluded it did not establish that Lim coined the name; instead the affidavit indicated an existing plan for a restaurant to be named “Gloria Maris” when Lim engaged Rodriguez. The Court noted petitioner’s SEC incorporation and BIR registration predating Lim’s registrations and observed that Lim registered the marks more than ten years later.

Supreme Court Findings on Bad Faith

The Court held that Lim registered the subject trademarks in bad faith. The Court explained that bad faith in trademark registration means knowledge by the registrant of prior creation, use, or registration by another of an identical or similar mark. The Court identified circumstances supporting bad faith: Lim’s full knowledge of petitioner’s long prior use; Lim’s role as incorporator and director of the corporation that established the goodwill; and Lim’s effort to reap the fruits of that goodwill by registering the marks in his own name and franchising the concept. The Court treated a trademark registered in bad faith as unlawful under the IP Code and cited sec. 151(b) as authority to cancel registrations obtained fraudulently or contrary to the IP Code.

Supreme Court Findings on Laches and Remedy

The Court rejected Lim’s laches defense. It explained that laches is an equitable doctrine and cannot be used to condone fraudulent or bad faith conduct. The Court observed that sec. 151 permits cancellation of registrations obtained fraudulently “at any time,” and held that laches could not bar petitioner’s action given Lim’s bad faith. The Court therefore ordered cancellation of the three Certificates of Registration in Lim’s name: Certificate No. 4-2004-009149 for GLORIA MARIS WOK SHOP AND DESIGN, Certificate No. 4-2004-009150 for GLORIA MARIS DIMSUM KITCHEN WITH LOGO, and Certificate No. 4-2004-009151 for GLORIA MARIS SHARK’S FIN RESTAURANT AND LOGO.

Disposition

The Supreme Court granted the petition, reversed the Court of Appeals Decision dated March 18, 2022 and Resolution dated December 19, 2022, reinstated the BLA-IPO Decisions dated February 23, 2012 in favor of cancellation, and directed the Bureau of Legal Affairs, the Bureau of Trademarks, and the Documentation, Information and Technology Transfer Bureau to be furnished copies for appropriate action.

Doctrinal Takeaway

The Court reaffirmed that a certific

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