x x NOTICE OF DECISION

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1 INTELLECTUAL PROPEllTY OFFICE OF THEPHILIPPINES OFFICIAL PILLOWTEX LLC., IPC No Opposer, Opposition to: Application No Date Filed: 08 March 2017 TM: "CHARISMA" -versus AMRAPUR OVERSEAS, INC., Respondent- Applicant. x x BETITA CABILAO CASUELA SARMIENTO Counsel for Opposer Suite 1004, Page One Building 1215 Acacia Avenue Madrigal Business Park Ayala Alabang, Muntinlupa City NOTICE OF DECISION HECHANOVA AND CO. INC. Counsel for Respondent-Applicant Ground Floor, Salustiana D. Ty Tower 104 Paseo de Roxas Avenue Makati City GREETINGS: Please be informed that Decision No ?d.y...- dated October 31, 2018 (copy enclosed) was promulgated in the above entitled case. Pursuant to Section 2, Rule 9 of the IPOPHL Memorandum Circular No series of 2016, any party may appeal the Decision to the Director of the Bureau of Legal Affairs within ten (10) days after receipt of the Decision together with the payment of applicable fees. Taguig City, November 06,2018. MAR~~AL IPRS IV Bureau of Legal Affairs Intellectual Propert y Center e mail@ipophil.gov.ph #28 Upper Mc Kinley Road Mckinl ey Hill Town Cent er o Fort Bonifacio. Taguig City Philippines

2 , OFFICIAL PILLOWTEX LLC., Opposer, -versus- AMRAPUR OVERSEAS, INC., Respondent-Applicant. x x IPC NO Opposition to: App.Ser. No Date Filed : 08 March 2017 TM: "CHARISMA" Decision No SliP DECISION OFFICIAL PILLOWTEX LLC. ("Opposer")l, filed an opposition to Trademark Application Serial No The application filed by AMRAPUR OVERSEAS INC. ("Respondent-Applicant")? covers the mark "CHARISMA" for use on linens under Class 24 of the International Classification of Goods.' Opposer alleges that the registration of Respondent-Applicant's CHARISMA mark is contrary to jurisprudence on registration of marks in good faith and to the provision of law, particularly Section (e) of Republic Act No. 8293, as amended. According to Opposer, its CHARISMA mark being an internationally well-known mark is entitled to protection as such and registration of Respondent-Applicant's confusingly similar CHARISMA mark is contrary to Article 6bis of the Paris Convention, in relation to Section 3 and (e) of the IP Code. Opposer further contends that as the prior user and owner of the mark CHARISMA it is also entitled to protection against damage arising from confusion on the source of goods, products and services covered by its mark; confusion of reputation and goodwill attached to the business of Opposer, attributed to the CHARISMA mark; and dilution of the CHARISMA trademark. Opposer's evidence consists of the following: 1. Authenticated Affidavit of David Jones; 2. Legalized and authenticated Officer's Certificate and Special Power of Attorney; 3. List of registrations for the mark CHARISMA secured in other countries; 4. Copies of certificate of registrations for the mark CHARISMA issued in other countries; I A company organized and existing under the laws of the Phil ippines with address at 22nd Floor Office Tower, Ayala Avenue. Makat i City. 2 A company organi zed and existing under the laws ofthe U.S.A. with address at 1560 East Sixth Street, Corona, CA 92879, U.S.A. 'The Nice Classification is a classification of goods and services for the purpose of registering trademarks and serv ice marks based on a multilateral treaty administered by the World Intellectual Property Organizati on. This treaty is called the Nice Agre ement Concerning the International Classificati on ofgoods and Services for the Purposes of Registrati on of Marks concluded in f) e wwwapo phil.qov.pn mail@lpophil.gov.ph Q II tnt"' I" " tlldl Pro portv ~.' ;r : 11 7H Upper McKinll! r",' McKin ley H,II to w n '.,, " : f u rl Bonllil clo. I. lq,ii', t : H d l Pt uilppli ll ::. r

3 5. Copies of pages from a US Securities and Exchange Commission filing by Iconix Brand Group, Inc. 6. Screenshots of Opposer's website showing CHARISMA mark; and 7. Screenshots of sample promotional and marketing materials and social media pages. This Bureau issued on 27 October 2017 a Notice to Answer and served a copy thereof to the Respondent-Applicant's counsel on 29 November However, despite the receipt of the Notice, Respondent-Applicant failed to file the answer. On 06 July 2018, Respondent-Applicant was declared in default. Accordingly, this case is submitted for decision on the basis of the affidavit, if any, and documentary evidence submitted by the Opposer. The sole issue to be resolved in this case is whether Respondent-Applicant's mark CHARISMA should be registered? A trademark is any distinctive word, name, symbol, emblem, sign, or device, or any combination thereof, adopted and used by a manufacturer or merchant on his goods to identify and distinguish them from those manufactured, sold, or dealt by others. Inarguably, it is an intellectual property deserving protection by law.s In trademark controversies, each case must be scrutinized according to its peculiar circumstances, such that jurisprudential precedents should only be made to apply if they are specifically in point." Opposer anchors its opposition to the application for registration of Respondent Applicant's mark CHARISMA in Section (e) of Republic Act No. 8293, also known as the Intellectual Property Code of the Philippines (IP Code), which provides: Section 123.Registrability A mark cannot be registered if it: x x x (e) Is identical with, or confusingly similar to, or constitutes a translation of a mark which is considered by the competent authority of the Philippines to be well-known intemationally and in the Philippines, whether or not it is registered here, as being already the mark of a person other than the applicant for registration, and used for identical or similar goods or services: Provided, That in determining whether a mark is well-known, account shall be taken of the knowledge of the relevant sector of the public, rather than of the public at large, including knowledge in the Philippines which has been obtained as a result of the promotion of the mark; It is clear from the above provision of the IP Code that whenever a mark subject of an application for registration, resembles a well-known mark, said mark cannot be registered. 4 Prosource International, Inc. v. Horphag Research Management SA, G.R. No , November , 605 SCRA 523, 528; McDonalds Corporati on v. MacJoy Fastfood Corporation, G.R No , February 2, 2007, 514 SCRA 95, Philip Morris, Inc. v. Fortune Tobacco Corporation, GR. No , June 27, 2006, 493 SCRA 333,

4 Records will show that at the time Respondent-Applicant filed its trademark application for the mark CHARISMA on 08 March 2017, Opposer has no registration or pending application for the mark CHARISMA. As such, there was no bar to the registration of Respondent-Applicant's mark before this Office. However, Opposer's claims that its mark is a well-known mark and as such is entitled to protection even without registration for identical or similar goods or services against a mark which is identical with, or confusingly similar to, or constitutes a translation of a well-known mark. Under Section of the IP Code, a mark cannot be registered if it is identical or confusingly similar to a mark which has been declared well-known in the Philippines and internationally by the competent authority in the Philippines. In order to determine whether a mark is well-known, account shall be taken of the knowledge of the relevant sector of the public including knowledge in the Philippines which is obtained through the promotion of the mark. Corollary, in determining whether a mark is a well-known mark, Rule 102 of Trademark Regulation finds application, to wit: Rule 102. Criteria for determining whether a mark is well-known. - In determining whether a mark is well-known, the following criteria or any combination thereof may be taken into account: a)the duration, extent and geographical area of any use of the mark, in particular, the duration, extent and geographical area of any promotion of the mark, including advertising or publicity and the presentation, at fairs or exhibitions, of the goods and/or services to which the mark applies; b)the market share, in the Philippines and in other countries, of the goods and/or services to which the mark applies; c)the degree of the inherent or acquired distinction of the mark; d) the quality-image or reputation acquired by the mark; e) the extent to which the mark has been registered in the world; f) the exclusivity of registration attained by the mark in the world; g) the extent to which the mark has been used in the world; h) the exclusivity of use attained by the mark in the world; i) the commercial value attributed to the mark in the world; j) the record of successful protection of the rights in the mark; k) the outcome of litigations dealing with the issue of whether the mark is a well known mark; and 1) the presence or absence of identical or similar marks validly registered for or used on identical or similar goods or services and owned by persons other than the person claiming that his mark is a well-known mark.

5 The rule requires that the party claiming a mark to be well-known satisfies at least a combination of the above stated criteria. After an evaluation of the evidence on record, this Bureau is not convinced that Opposer's CHARISMA mark has gained the status of a wellknown mark. Based on the evidence submitted by Opposer, the mark CHARISMA has been registered in many countries. However, Opposer failed to show the extent of the market share, in the Philippines and in other countries or that it meets a combination of the criteria as provided in Rule 102. As such, Opposer's reliance on Section (e) of the IP Code cannot stand to oppose the registration of the herein subject mark. Nonetheless, even if Opposer's CHARISMA mark is not a well-known mark, the registration of Respondent-Applicant's mark may still be disallowed. Section of the IP Code provides: Section 123.Registrability A mark cannot be registered if it: x x x (d) Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or pri ority date, in respect of: i, The same goods or services, or ii. Closely related goods or services, or iii. If it nearly resembles such a mark as to be likely to deceive or cause confusion; The representative images of Opposer's and Respondent-Applicant's mark are reproduced below: CHARISMA Opposer's Mark Charisma Respondent-Applicant's Mark There is no doubt that Opposer and Respondent-Applicant's mark are similar if not identical. As such, what is left to be determined is who between them has a better right over the mark. It is worth to note that registration of a mark is based on ownership. This is because a trademark is a creation of use and belongs to one who first used it in trade or commerce.s While Republic Act No espouses the first-to-file rule as stated under Sec (d) which means that the registration of a mark is prevented with the filing of an earlier application for registration. This must not, however, be interpreted to mean that ownership should be based upon an earlier filing date. While RA 8293 removed the previous requirement of proof of actual use prior to the filing of an application for registration of a 6 Berris v. Norvy Abdayang, G.R. No , October 13,

6 mark, proof of prior and continuous use is necessary to establish ownership of a mark. Such ownership constitutes sufficient evidence to oppose the registration of a mark. In E.Y. Industrial Sales, Inc. et. AI. v. Shendar Electricity and Machinenj Co. Lid", the Supreme Court held: Sec. 134 of the IP Code provides that any person who believes that he would be damaged by the registration of a mark x x x may file an opposition to the application. The term any person encompasses the true owner of the mark, the prior and continuous user. Notably, the Court has ruled that the prior and continuous use of a mark may even overcome the presumptive ownership of the registrant and be held as the owner of the mark. As aptly stated by the Court in Shangri-la International Hotel Management, Ltd. v. Developers Group of Companies, Inc.: Registration, without more, does not confer upon the registrant an absolute right to the registered mark. The certificate of registration is merely a prima facie proof that the registrant is the owner of the registered mark or trade name. Evidence of prior and continuous use of the mark or trade name by another can overcome the presumptive ownership of the registrant and may very well entitle the former to be declared owner in an appropriate case. xxx Ownership of a mark or trade name may be acquired not necessarily by registration but by adoption and use in trade or commerce. As between actual use of a mark without registration, and registration of the mark without actual use thereof, the former prevails over the latter. For a rule widely accepted and firmly entrenched, because it has come down through the years, is that actual use in commerce or business is a pre-requisite to the acquisition of the right of ownership. xxx By itself, registration is not a mode of acquiring ownership. When the applicant is not the owner of the trademark being applied for, he has no right to apply for registration of the same. Registration merely creates a prima facie presumption of the validity of the registration, of the registrants ownership of the trademark and of the exclusive right to the use thereof. Such presumption, just like the presumptive regularity in the performance of official functions, is rebuttable and must give way to evidence to the contrary. Clearly, it is not the application or registration of the mark which confers ownership. A trademark is a creation of use and belongs to one who first used it in trade or commerce. "The registration system is not to be used in committing or perpetrating an unjust and unfair claim. A trademark is an industrial property and the owner thereof has property rights over it. The privilege of being issued a registration for its exclusive use, therefore, should be based on the concept of ownership. The IP Code implements the TRIPS 7 G.R. No , promulgated on October 20,2010.

7 Agreement and therefore, the idea of 'registered owner' does not mean that ownership is established by mere registration but that registration establishes merely a presumptive right of ownership. That presumption of ownership yields to superior evidence of actual and real ownership of the trademark and to the TRIPS Agreement requirement that no existing prior rights shall be prejudiced.r" Opposer has used in commerce the mark CHARISMA in the United States since 1977 for goods under Class 24, the same goods that Respondent-Applicant's Charisma mark is being applied for. Opposer also applied for registration of the mark CHARISMA here in the Philippines in 2010 although it was abandoned later on. That is why, when Respondent-Applicant applied for registration of its CHARISMA mark in 2017, there was no pending application for the same mark under Opposer's name. However, even if Respondent-Applicant was first to file the application for registration of the trademark CHARISMA, the Opposer as the true owner of the mark has the right and can oppose the application of the mark filed by Respondent-Applicant. The intellectual property system was established to recognize creativity and give incentives to innovations. Similarly, the trademark registration system seeks to reward entrepreneurs and individuals who through their own innovations were able to distinguish their goods or services by a visible sign that distinctly points out the origin and ownership of such goods or services. Accordingly, this Bureau finds that the Respondent-Applicant's trademark application is proscribed by the IP Code. WHEREFORE, premises considered, the instant opposition is hereby SUSTAINED. Let the filewrapper of Trademark Application Serial No , together with a copy of this Decision, be returned to the Bureau of Trademarks for information and appropriate action. SO ORDERED. Taguig City, 3 \ OC _ M d~~~~~~~ Bu au of Legal Affairs 8 See Decision, IPe No ,21 January 20 13, ava ilable at hnp Jlonlineservices.ipophi l.gov.ph/ipcaselibraryl <accessed 25 October