Since 1 January 1998, our jurisdiction has adhered to the first-to-file rule as far as priority for trademark registration is concerned. The priority right, however, ceases if the first filer acted in bad faith. This principle is reiterated in the recent case Zulueta vs Cyma Greek Taverna Co. (G.R. 205699, 23 January 2023).
This case is between one of the Partners of the Cyma Greek Taverna Co. and the Cyma Partnership relative to the trademark “Cyma.” The partner filed an earlier application for trademark registration in his name. In contrast, Cyma Partnership filed its own trademark application for the same mark a few months later.
During the pendency of the proceedings on the partner’s trademark application, the IPOPHL approved Cyma Partnership’s Trademark Application and, accordingly, was issued a Registration Certificate.
Consequently, the IPOPHL rejected the partner’s Application and held that the registration in favor of Cyma Partnership is prima facie evidence of exclusive ownership and the rights corollary thereto.
The IPOPHL found that Cyma Partnership was the first to have bona fide used the “Cyma” mark, as evinced by its continued commercial use since 2005, which, thus, predates the partner’s trademark application over the said mark.
In this regard, the IPOPHL-ODG opined that while the partner was the first to file a trademark application, nothing in the Intellectual Property Code states that it is the first person or entity to apply for registration which necessarily obtains ownership of the mark.
Further, the partner failed to show that he had used the trademark in any business enterprise or restaurant. Both the Court of Appeals and the Supreme Court affirmed the ruling.
The SC explained that under the first-to-file rule, “a registered mark or a mark with an earlier filing or priority date generally bars the future registration and the future acquisition of rights in an identical or a confusingly similar mark, in respect of the same or closely related goods or services if the resemblance will likely deceive or cause confusion.”
Prior use is no longer required to obtain ownership of a trademark. However, the first-to-file rule should not be interpreted to mean that the first application to be filed should, in all cases, be the application that is granted.
Where the first application is unregistrable, it will not obtain the priority right provided for under the IPC. Registrations resulting from trademark applications tainted with bad faith or fraud are void ab initio; thus, it follows that such trademark applications are inherently unregistrable and do not confer any priority rights on the applicant’s part.
In relation to trademark registration, “[b]ad faith means that the applicant or registrant has knowledge of prior creation, use, and/or registration by another of an identical or similar trademark. In other words, it is copying and using somebody else’s trademark.
Fraud, on the other hand, may be committed by making false claims in connection with the trademark application and registration, particularly on the issues of origin, ownership, and use of the trademark in question, among other things.
The High Court noted the factual findings that although the partner was the first to file a trademark application, his knowledge of the prior use by Cyma Partnership of the trademark meant that the application was filed in bad faith.
Consequently, his trademark application cannot be granted, and he did not obtain any priority rights under the IPC. On the other hand, Cyma Partnership validly obtained a Certificate of Registration and ownership over the subject mark.