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Birkenstock v Philippine Shoe Expo

Background
In 1994, the German company Birkenstock Orthopaedie Gmbh & Co., filed several trade mark
applications for its mark BIRKENSTOCK and its variants in the Philippines. To its surprise, Birkenstock
learned that its BIRKENSTOCK trade mark was already registered to a Philippine company called
Philippine Shoe Expo Marketing Corporation (Shoe Expo).
Birkenstock quickly filed actions for cancellation against the registered mark. While the cancellation case
was pending, Shoe Expo failed to file the required 10th year Declaration of Actual Use (DAU). Failure to
file the DAU results in the trade mark registrations being deemed withdrawn. Because of this, the
cancellation action filed by Birkenstock was dismissed for being moot and academic, paving the way for
its own trade mark applications to be allowed. Shoe Expo, not deterred by the cancellation of its
registration, filed oppositions to the trade mark applications of Birkenstock, on the grounds that it had
been using the mark BIRKENSTOCK for over 16 years in the Philippines and that it had re-applied for
said trade marks, and had also obtained copyright registration for the word BIRKENSTOCK in 1991.
The Bureau of Legal Affairs (BLA), adjudicating bureau of the Intellectual Property Office in the
Philippines (IPOPHL), consolidated the opposition actions, and on May 28 2008 issued a decision
sustaining ShoeExpos oppositions and rejecting the applications of Birkenstock based on the following:
(i) Shoe Expo was the prior user and adopter of the BIRKENSTOCK trade mark in the Philippines.
(ii) Birkenstock did not present evidence of actual use of the mark in the Philippines.
(iii) The marks of Birkenstock are not internationally well-known.
(iv) Birkenstock submitted only photocopies of its certificates of registrations from other countries which
were not considered admissible as evidence.

Action taken
Birkenstock appealed the BLA decision to the IPOPHL Director General (DG) who reversed the BLA, and
held that with the cancellation of Shoe Expos registrations, the reason to reject Birkenstocks applications
on the ground of prior registration no longer existed, and that the evidence presented showed that
Birkenstock was the true and lawful owner and prior user of the mark BIRKENSTOCK. The DG
disregarded Shoe Expos copyright registration for the Birkenstock word since copyright and trade marks
are different forms of intellectual property rights and cannot be interchanged.
Dissatisfied, Shoe Expo appealed the DGs decision to the Court of Appeals (CA) which reinstated the
BLA decision. Birkenstock then appealed the CA decision to the Supreme Court.

Outcome

The Supreme Court, in its decision issued on November 20, 2013 (G.R. 194307), reversed the CA
decision and held the following:
(i) The photocopied documents submitted by Birkenstock were admissible in evidence since the IPOPHL
is not bound by strict rules of evidence, and moreover, the IPOPHL already had the original documents in
the earlier cancellation case.
(ii) The failure of Shoe Expo to file the DAU is tantamount to abandonment, hence, it had lost any right or
interest over the said mark.
(iii) Birkenstock had proven by clear and convincing evidence that it was the true owner of the mark, citing
evidence relating to the origin and history of the mark, and demonstrating that Shoe Expo registered an
identical mark in its name in bad-faith.
The Supreme Court emphasised that it is not the registration of a mark by itself which is the mode of
acquiring ownership since the applicant, if not the owner of the mark, has no right to apply for its
registration; it is the ownership of a mark that confers the right to register it. The Supreme Court also,
quoting the IPOPHL DG, stated that BIRKENSTOCK is obviously of German origin and is a highly
distinct and arbitrary mark, adding that it is very remote and incredible that two persons could coin the
same or identical mark for use in the same line of business without any plausible explanation from Shoe
Expo.
It must be noted that this case went through four stages of contentious litigation, from the BLA up to