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In 2005, Mr. Zulueta (“Mr. Zulueta”) claimed that he
invited Raoul Goco (“Mr. Goco”) to open a Greek
restaurant in the Philippines, and they conceptualized the name of
the restaurant to be CYMA while on vacation in Greece. Their first
branch was a test kitchen in D Mall, Boracay. To formalize the
arrangement, they decided to form and register a partnership called
“Cyma Greek Taverna Company”.
A year after the formalization of the partnership, Mr. Zulueta
filed a trademark application in his own name for the mark CYMA.
Mr. Zulueta alleged that while he was out of the country, Mr. Goco
and his sister, Anna Goco (“Ms. Goco”), fraudulently
transferred Mr. Zulueta’s partnership interests to Ms. Goco,
hence, he had to file the application independently.
Five months after this filing, the partnership also filed a
trademark application for the nearly identical mark, except that it
includes the words “Greek Taverna” in it. The disputed
marks are shown below:
Manuel Zulueta’s
Cyma Greek Taverna’s
The Intellectual Property Office eventually approved the
partnership’s trademark application, a ruling which was
subsequently upheld by the Court of Appeals.
In an Opposition filed by the partnership, it was claimed that
Mr. Zulueta falsely represented that he was the originator of the
mark.
Who owns the disputed trademark “CYMA”?
The Supreme Court acknowledged that the partnership itself had
used the trademark in its commercial dealings, way back since 2005.
In fact, Mr. Zulueta himself had admitted that the name was
intended to be exclusive used by the partnership.
In its Decision, the Supreme Court emphasized that while the
general rule is that ownership of a mark is acquired through the
“first-to-file” rule, applications tainted with bad faith
are void from the beginning.
Registration of trademark applications which are tainted by bad
faith or fraud are void ab initio, i.e., invalid from the very
beginning. In relation to trademark registration, the term bad
faith is defined as “one who has knowledge of a prior
creation, use and/or registration by another of an identical or
similar trademark”, while the term fraud is defined as
“one who makes false claims in connection to trademark
applications and registration”.
To determine the existence of bad faith in the course of a
trademark application, the Supreme Court enumerated circumstances
or conditions, that if found, the application will be considered
unregistrable and will consequently be denied if:
- An entity (person A) has prior use, creation and/or
registration of a trademark, and - The applicant (person B) has knowledge of the said prior use,
creation and/or registration.
In this case, the applicant, Mr. Zulueta, was found by the Court
to have registered his trademark application in bad faith. It is
without doubt that he was aware of the prior use of the trademark
by the partnership. He and Mr. Goco conceptualized the trademark
together, he further knew that it had been in use since 2005 at a
test kitchen restaurant in Boracay. Moreover, he was also aware
that he formed part of the same partnership. Therefore, if Mr.
Zulueta, as alleged, was the first to file a trademark application,
his knowledge of the trademark’s prior use by the partnership
meant that the application was filed in bad faith.
Originally published February 7, 2024
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