August 25, 2015

The Intellectual Property Office of the Philippines (IPOPHIL) took the initial step towards promoting the monetization of intellectual property assets in the Philippines. The IPOPHIL, in collaboration with KPMG, held a High-Level Forum on IP Financing last May 15, 2015. The forum was attended by representatives from various government agencies and research institutes, such as Bangko Sentral ng Pilipinas (BSP), Bureau of Internal Revenue (BIR), Department of Finance (DoF), Securities and Exchange Commission (SEC), Department of Science and Technology  (DoST), National Economic and Development Authority (NEDA), University of the Philippines – Los Banos,  Filipinas Copyright Licensing Society (FILCOLS), and the Philippine Institute of Certified Public Accountants (PICPA). The main purpose of the forum was to formally discuss the possibility of creating a framework for IP financing and IP valuation in the Philippines. This initiative of the IPOPHIL, as the government agency in-charge of advancing intellectual property rights, is a recognition of the growing trend of IP financing as an alternative source of credit, as well as the value of a good IP financing framework to the country’s economy.

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July 22, 2015

The Japanese company, Kawasaki, and its Philippine subsidiaries, filed suit to stop a local company (Eastworld) from manufacturing and selling Sapphire 125 model motorcycles. Kawasaki complained that this motorcycle copies the design elements of its own motorcycle model Fury 125.

Kawasaki alleged that the design elements of its Fury 125 motorcycle are protected by a design patent which was issued a year prior to the launching of Sapphire 125. Kawasaki also claimed that its Fury 125 was launched one year before Sapphire 125 began selling in the local market.

The suit was lodged as an administrative action with the Bureau of Legal Affairs, and relied on two causes of action, patent infringement and unfair competition. The complaint asked for preliminary injunction.

The Bureau refused to issue a preliminary injunction and ruled against Kawasaki’s charges of infringement and unfair competition. The Bureau pointed out that infringement is committed only when one uses, makes, sells or imports patented design without the consent of the patentee. In this case, Eastworld did not need to get the consent of Kawasaki because its Sapphire 125 motorcycle used design elements that were covered by its own design patent.

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June 18, 2015

An impending increase of 20% in official fees was announced by the Intellectual Property Office (“IPO”) in a public consultation held on June 15, 2015.  Under the Rules, the IPO is authorized to regularly evaluate the level of official fees and to increase the same when necessary.  The planned increase will cover official fees for all patent and trademark filings, but fees related to basic copyright filings will not increase.  The IPO also introduced new fees for patent services, including patent mapping, and those related to patent prosecution and accelerated substantive examination.

The IPO identified government programs, which shall be financed from income generated by the increase.  These are: (1) financing for the IPO’s application to be an International Search Authority (ISA); (2) creation of the Copyright Bureau and Enforcement Unit; (3) creation of Performance Governance System; (4) establishment of IPO Regional Offices; and (5) upgrading of IT related services.

The IPO reminded the public that there has been no increase in the fees since 2004 and that the 20% increase appears to be less than the last increase of 30%, which was implement between the years 1996 and 2000.

The new fees are expected to take into effect July 1, 2015 if the Secretary of the Department of Trade and Industry shall have given his approval before then.  Representatives of law firms expressed concerns that the July 1, 2015 target date leaves little time to notify their clients of the impending increase.  They suggested that the increase be delayed for a period of 3 to 6 months in order to adequately prepare their clients for the fee increase.

June 8, 2015

In a recent decision, the Supreme Court allowed the registrations owned by two competing companies, for an identical trademark, used in connection with goods in the same Class, thereby effectively throwing the doors wide open to trademark copying and creating a climate for potential consumer confusion.

This baffling decision stemmed from the decades old dispute between a local company, Kolin Electronics Co., Inc. (“KE”), and a foreign company, Taiwan Kolin Corporation (“TK”), over the use and registration of the trademark KOLIN for electronic goods.

The relevant facts leading up to the Supreme Court decision are: In December 2002, TK applied to register KOLIN for use on television sets, cassette recorder, and VCD amplifiers, which fall under Class 9 of the Nice Classification (the “Application”). In July 2006, KE opposed claiming that the applied mark is confusingly similar to its KOLIN trademark, which was already registered in November 2003 for automatic voltage regulator, converter, recharger, stereo booster, AC-DC regulated power supply, step-down transformer, and PA amplified AC-DC under Class 9 of the Nice Classification. Ironically, KE’s KOLIN registration was also the subject of a prior legal dispute between the same parties, in which TK opposed said application, but was denied by the Bureau of Legal Affairs and subsequently affirmed by the Director General of the IPO and the Court of Appeals. Thus, KE was able to register the KOLIN for various products under Class 9 and is now using the said registration to oppose TK’s application for the KOLIN mark for use on goods under Class 9.

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June 6, 2015

In a surprising decision, the Bureau of Legal Affairs (“Bureau”) dismissed Apple Inc.’s (“Apple”) opposition, which it lodged against an application for the mark “mylphone” in the name of a local entity, Solid Broadband Corporation (“Solid”) [Apple, Inc. vs. Solid Broadband Corporation (IPC No. 14-2010-00212)]. Solid sought the registration of “mylphone” used in connection with “distribution and sales of mobile and cellular phones including chargers, headsets, micro SD cards, T-Flash cards, extra phone batteries and stylus pens”, under Class 9 of the International Classification of Goods.

Apple anchored its opposition on Section 123.1 (d) of the IP Code, which prohibits the registration of a mark that is confusingly similar to an earlier filed or registered trademark. Apple contended that its “IPHONE” mark is well-known internationally and in the Philippines, and that the registration of “mylphone” is barred as being confusingly similar thereto.

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May 18, 2015

An opposition will be dismissed if an Opposer fails to submit original documents supporting its case at the time the opposition is filed. This was the ruling of the Court of Appeals in a recent decision which it issued affirming the dismissal of the opposition by the Director General and the Bureau of Legal Affairs. This decision was issued on a consolidated Rule 43 petition for review filed by both parties in a bid to protect their respective trademark rights after battling it out at the Intellectual Property Office for over a decade. At the center of the dispute is the trademark “KOLIN”.

The case of Kolin Electronics Co., Inc. vs. Taiwan Kolin Corp, Ltd. (CA-G.R. SP No. 122566), involved two unrelated companies, each one using the disputed mark “KOLIN” as part of its corporate name, and each one being involved in the same industry, which is the manufacture, assembly and sale of electronics products.

For practitioners, the case is noteworthy as it applies strictly Sections 7.1 and 7.3 of Office Order No. 79 (Series 2005), which revised the 1998 Rules and Regulations on Inter Partes Proceedings. Under the rules, parties must submit only original documents in opposition and cancellation proceedings. Certified copies of public documents may be admitted in lieu of originals.

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May 11, 2015

Stability and certainty in judicial decisions – that’s where the rule of law best thrives. The familiar doctrine of stare decisis commands that once a question of law has been examined and decided, it should be deemed settled and closed to further argument. This simply means that a ruling on a certain state of facts established in a final decision of the Philippine Supreme Court has to be followed in subsequent cases by all courts in the land where the facts are substantially the same, regardless of whether the parties and property are the same.

This doctrine, however, disappears in the realm of confusing similarity in trademark disputes.  In 2004, the Supreme Court ruled in the McDonald’s case that confusing similarity is to be resolved only by using the dominancy test because it is explicitly incorporated in Section 155.1 of the Philippine Intellectual Property Code (defining infringement as the “colorable imitation of a registered mark xxx or a dominant feature thereof”). For this reason, the Supreme Court expressly rejected the holistic test, even declaring it as contrary to the elementary postulate of trademark law. Thus, under the dominancy test, confusing similarity is found if one dominant feature is copied, notwithstanding the presence of differentiating words or design. In addition, if the element copied is the first word of the mark, this is deemed sufficient copying of the dominant element.

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April 20, 2015

Bridgestone Corporation emerges victorious once again in another suit against an applicant seeking the registration of a trademark that uses the suffix “STONE” in connection with goods in Class 12.

A Chinese company attempted to register “R-STONE” in the Philippines for use in Class 12.  In its opposition, Bridgestone alleged that it was the first to use and register “BRIDGESTONE” in connection with the design, manufacture and technology of tires.  It claimed that the ownership and association of the word “STONE” as a distinctive word element of its house mark “BRIDGESTONE” was bolstered by its acquisition in 1998 of Firestone Tire & Rubber Corporation, along with the “FIRESTONE” trademark.  In fact, the “BRIDGESTONE” mark has already been declared a well-known mark in view of approximately 500 trademark applications and registrations, as well as approximately 243 domain name registrations, in numerous countries around the world.  Bridgestone further pointed out that Applicant’s mark contains the word “STONE”, which has been declared as the dominant element of the “BRIDGESTONE” mark, and the letter “R” is found in both marks.

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April 13, 2015

Abbott Laboratories, the company responsible for bringing the nutrition drink ENSURE, which is popular among seniors and the elderly, has suffered a set back in the Philippines in relation to its infant formula bearing the trademark EYE-Q.  A local businessman applied for the trademark EYE Q in connection with school and office supplies in Class 16.  Abbott opposed the application claiming that it is the first to use and register the trademark EYE-Q in the Philippines in connection with infant formula.  Abbott alleged that since the application covers an identical trademark, registration is barred by Sections 123.1(d) to (g) of the IP Code.  Abbott further argued that the goods covered by the application are within its natural zone of potential business expansion.

The BLA rejected the opposition convinced that no consumer can possibly be deceived by the Applicant’s trademark and mistakenly purchase the Applicant’s goods while intending to purchase the Abbott’s goods.  On appeal, the Director General upheld the dismissal noting that the parties’ trademarks cover different and unrelated goods thereby negating likelihood of confusion.  The Director General rejected Abbott’s argument that the Applicant’s goods, i.e. school and office supplies, are within its natural zone of business expansion.  It noted that Abbott failed to explain why dealing with office supplies can be considered a normal expansion of its infant formula business.

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