Sambar v. Levi Strauss & Co.
REITERATIONFacts
The Antecedents: Private respondents Levi Strauss & Co. and Levi Strauss (Phil.), Inc. (respondents) demanded that petitioner Venancio Sambar, doing business as CVS Garment Enterprises (CVSGE), cease using a stitched arcuate design on its Europress jeans, alleging it infringed upon Levi's registered arcuate design trademark. Atty. Benjamin Gruba, counsel for CVSGE, asserted the designs were different and that his client held a copyright. Procedural History: Respondents filed a complaint against Sambar and the Director of the National Library. Summons was allegedly misdelivered to Atty. Gruba, who claimed ignorance of Sambar's whereabouts and stated CVSGE had ceased operations, with CVS Garment and Industrial Company (CVSGIC) taking over. The complaint was amended to include CVSGIC. After the case was revived upon learning Sambar's whereabouts, a preliminary injunction was issued. CVSGIC and Sambar waived their right to present evidence. The Regional Trial Court (RTC) made the injunction permanent, ordered CVSGIC and Sambar to pay damages and attorney's fees, and directed the cancellation of Sambar's Copyright Registration No. 1-1998. The Court of Appeals (CA) affirmed the RTC decision. The Petition: Petitioner Sambar sought reversal from the Supreme Court, arguing the CA erred in ruling infringement, his joint and solidary liability, and the award of damages and cancellation of his copyright.
Issue(s)
Whether petitioner Venancio Sambar infringed on private respondents' arcuate design trademark. Whether petitioner Sambar is jointly and solidarily liable with CVS Garment and Industrial Company for trademark infringement. Whether private respondents are entitled to nominal, temperate, and exemplary damages and the cancellation of petitioner's copyright registration.
Ruling
The Supreme Court modified the decision of the Court of Appeals by deleting the award of nominal damages, affirming the award of temperate damages, exemplary damages, attorney's fees, and the cancellation of petitioner's copyright registration. The writ of preliminary injunction was made permanent.
Ratio Decidendi
On the issue of infringement: The Court held that the factual findings of the lower courts regarding infringement are binding on the Supreme Court. The Court found no reason to disturb the CA's conclusion that Europress' use of the arcuate design constituted infringement of Levi's design. Private respondents presented evidence of market research showing public confusion, and the Court noted that trademark infringement does not require exact similarity but only a colorable imitation likely to deceive purchasers. The Court reiterated that the differences noted by the trial court were not sufficient to negate infringement. On the issue of joint and solidary liability: The Court affirmed the factual finding that petitioner Sambar had a copyright over the Europress arcuate design and consented to its use by CVSGIC, making him liable. The Court clarified that it was immaterial whether Sambar was directly connected with CVSGIC; his authorization of the use of the design was the relevant factor. The Court also addressed the burden of proof, stating that Sambar's defense that he did not allow the use of his copyrighted design constituted an affirmative defense, thus placing the burden of proof upon him to establish this claim, which he failed to do. On the entitlement to damages and cancellation of copyright: The Court agreed with the petitioner that the award of both nominal and temperate damages was erroneous, citing Ventanilla vs. Centeno. It held that temperate damages were appropriate where pecuniary loss is suffered but its amount cannot be proved with certainty, as provided by Article 2224 of the Civil Code. The Court affirmed the award of ₱50,000.00 as temperate damages, considering the reputation of Levi's. The award of exemplary damages was also affirmed as provided by law for infringement. Regarding the cancellation of the copyright, the Court held that a design that is a mere copy of a prior trademark is not original and therefore not copyrightable. Registration of such a design does not confer originality, and the copyright cannot prevail over the prior trademark registration.
Main Doctrine
The unauthorized use of a trademark or a design that is a colorable imitation of a registered mark, likely to cause confusion among purchasers, constitutes infringement and unfair competition. Registration of a copyright for a design that is a copy of a prior trademark is invalid and subject to cancellation.