Case Summary (G.R. No. 192294)
Factual Background
On July 31, 2002, Danilo M. Caralde, Jr. filed with the Bureau of Legal Affairs (BLA) of the Intellectual Property Office (IPO) an application to register the mark SHARK & LOGO for goods in Class 25, including slippers, shoes and sandals. Great White Shark Enterprises, Inc. opposed that application on the ground that it owned a shark device known as the GREG NORMAN LOGO which it had applied for on February 19, 2002 and which it used on apparel, and that the respondent’s mark was confusingly similar and likely to deceive the purchasing public.
Proceedings Before the BLA
The inter partes opposition proceeded at the BLA. While the opposition was pending, opposer’s application matured into registration and it was issued Certificate of Registration No. 4-2002-001478 on October 23, 2006 covering clothing, headgear and footwear including socks and shoes. The parties submitted evidence and briefs before the BLA.
Ruling of the BLA Director
On June 14, 2007, the BLA Director rendered a decision rejecting Caralde’s application. The Director found that the dominant feature in both marks was an illustration of a shark and that, despite certain differences, the overall impressions were strikingly similar. The Director noted that both marks were applied to goods in Class 25 and that similarity of goods increased the likelihood of confusion. The Director, however, rejected opposer’s claim that its mark was famous for insufficiency of evidence under Rule 102.
Ruling of the IPO Director General
On appeal, the Director General of the IPO affirmed the BLA decision and denied registration to Caralde. The Director General agreed that the competing marks were confusingly similar and observed that opposer had an earlier filing date. The decision reiterated that both marks were used on related goods such as footwear. The IPO Director General likewise found that opposer failed to establish that its mark was well-known under Rule 102.
Proceedings Before the Court of Appeals
Caralde sought review with the Court of Appeals. The CA reversed and set aside the IPO Director General’s decision and directed the IPO to grant registration of SHARK & LOGO. The CA concluded that, notwithstanding that both marks contained a shark figure as a dominant element, there was no confusing similarity because respondent’s mark was more fanciful and colorful and contained several distinguishable elements. The CA also relied on differences in price, target market and channels of trade to negate likelihood of confusion.
Issues Presented to the Supreme Court
The petition identified as errors the CA’s conclusion that the respondent’s mark was not confusingly similar to petitioner’s registered mark, the CA’s consideration that the cost of goods could negate likelihood of confusion, and the CA’s reversal of the prior rulings of the IPO Director General and the BLA Director.
Trademark Registrability and Legal Tests
The Court stated the governing rule that a trademark device is registrable if it is fashioned in a fanciful or arbitrary manner and is capable of identifying and distinguishing the goods of one seller from those of another, with distinctiveness as the benchmark. The Court explained that Section 123.1(d) of the IP Code prohibits registration of a mark that is identical with or confusingly similar to a registered mark of another proprietor with earlier filing date for the same or closely related goods. The Court identified the two principal judicial tests for similarity and likelihood of confusion: the Dominancy Test, which focuses on resemblance of dominant features and the impressions they create on the ordinary purchaser while giving less weight to factors such as price and trade channels; and the Holistic or Totality Test, which considers the entirety of the marks as applied to the products, including labels and packaging, and all salient features that may cause confusion.
Application of Tests to the Competing Marks
Applying both the Dominancy Test and the Holistic Test, the Court found no confusing similarity between the marks. The Court described opposer’s GREG NORMAN LOGO as an outline of a shark formed with green, yellow, blue and red lines or strokes. The Court described respondent’s SHARK & LOGO as a shark silhouette constituted by letter outlines with the letter S forming the head, H forming fins, A and R forming the body and K forming the tail, accompanied by the word SHARK in a different font beneath the
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Case Syllabus (G.R. No. 192294)
Parties and Procedural Posture
- Great White Shark Enterprises, Inc. filed a Notice of Opposition to respondent's trademark application before the Bureau of Legal Affairs of the Intellectual Property Office.
- Danilo M. Caralde, Jr. filed Trademark Application for the mark SHARK & LOGO for footwear under Class 25 on July 31, 2002.
- The case proceeded administratively through the BLA Director, the IPO Director General, then to the Court of Appeals by petition for review, and thereafter to the Supreme Court by a petition for review on certiorari under Rule 45, Rules of Court.
- The Court of Appeals rendered the assailed Decision on December 14, 2009, reversing the IPO Director General and directing registration of respondent's mark.
- The Supreme Court resolved the petition by denying the petition and affirming the Court of Appeals’ Decision.
Key Factual Allegations
- Great White Shark Enterprises, Inc. claimed ownership of a shark device known as GREG NORMAN LOGO and alleged confusing similarity with respondent’s SHARK & LOGO mark.
- Great White Shark had an application filed on February 19, 2002, and was later issued Certificate of Registration No. 4-2002-001478 on October 23, 2006 for clothing, headgear, and footwear including shoes and socks.
- Caralde applied for the SHARK & LOGO mark for manufactured goods such as slippers, shoes and sandals under Class 25 on July 31, 2002.
- The parties’ marks both prominently featured the shape or silhouette of a shark but differed in specific composition, color usage, and ancillary elements.
Prior Administrative Rulings
- The BLA Director rendered a Decision on June 14, 2007 rejecting Caralde’s application on the ground of confusing similarity between the shark illustrations and relatedness of goods.
- The BLA Director found insufficient evidence to establish that opposer’s mark was famous or well-known.
- The IPO Director General affirmed the final rejection and held the competing marks to be confusingly similar while also finding that opposer failed to prove that its mark was well-known under Rule 102.
Court of Appeals Ruling
- The Court of Appeals reversed the IPO Director General and ordered the grant of registration to Caralde for SHARK & LOGO.
- The Court of Appeals found the competing marks not confusingly similar due to respondent’s mark being more fanciful and colorful and containing several distinguishable elements.
- The Court of Appeals considered price disparity and different channels of trade as factors negating likelihood of confusion.
Issues Presented
- Whether the Court of Appeals erred in ruling that respondent’s SHARK & LOGO mark is not confusingly similar to petitioner’s registered mark.
- Whether price disparity and differing channels of trade may negate likelihood of confusion.
- Whether the Court of Appeals erred in reversing the rulings of the IPO Director General and the BLA Director.
Legal Standards Applied
- The b