SECOND DIVISION 2.

Whether or not the petitioners are guilty of infringement

[G.R. No. 159938. March 31, 2006.] Ruling:

SHANGRI-LA INTERNATIONAL HOTEL MANAGEMENT, LTD., SHANGRI-LA PROPERTIES,
INC., MAKATI SHANGRI-LA HOTEL & RESORT, INC., AND KUOK PHILIPPINES PROPERTIES,
INC., petitioners, vs. DEVELOPERS GROUP OF COMPANIES, INC., respondent.
Facts:
The petitioners, Shangri-La International hotel Management (Shangri-La), owned by
the Kuok Group have been operating and using the name “Shangri-La” in all Shangri-
La hotels and hotel-related establishments around the world since 1962, and since
1975, the “Shangri-La” mark and the “S” logo (to be collectively referred to as ‘marks’
)have been used consistently and continuously by the Kuok Group and had it patented
in different countries around the world. To centralize its operations, the marks were
incorporated in the Philippines to operate two hotels put up by the Kuok Group in
Mandaluyong and Makati respectively.
Petition is GRANTED and the resolutions of the CA are hereby DISMISSED.
The new Intellectual Property Code (IPC), pursuant to R.A. 8293 shows the resolve of
the Philippines to observe the Paris Convention for the Protection of Industrial Property
by incorporating the relevant portions of the Convention such that persons who may
question a mark (that is, oppose registration, petition for the cancellation thereof, sue
for unfair competition) include persons whose internationally well-known mark,
whether or not registered, is identical with or confusingly similar to or constitutes a
translation of a mark that is sought to be registered or is actually registered.
Furthermore, the Paris Convention states that protection internationally known marks
should be protected by its signatories without regard as to whether the foreign
corporation registered, licensed or doing business in the Philippines. Furthermore,
citing the doctrine of incorporation in the Article II, section 3 of the 1973 constitution,
international laws are of equal significance to municipal laws.

On the other hand, the respondents, Developers Group of Companies, Inc. (DGCI),
claims ownership of the said marks and logo as it was registered by them with the
Bureau of Patents, Trademarks, and Technology Transfer (BPTTT) since 1982, and in
1983, the BPTTT issued in favor of DCGI regarding the ownership of the said logos.

Petitioners filed a petition with the BPTTT for the cancellation of the registration of
the marks on the ground that DGCI illegally and fraudulently obtain the marks for their
restaurant business. Respondents then countered through filing a complaint against
petitioners for infringement and damages with the Quezon City (QC) Regional Trial
Court (RTC), and sought to prohibit the petitioners to use the marks in their businesses
in the Philippines.

The petitioners rebutted that they have been using the marks since 1962 and cited the
Paris Convention for the Protection of Industrial Property as reference to the security
and protection of the marks that they been using, and stated that only they have the
exclusive right to them.

After the subsequent filing of charges from both parties, the Court of Appeals (CA)
ruled in DCGI’s favor, prompting the petitioners to petition for review in the Supreme
Court (SC) in order to assail and seek aside the CA’s decision.

Issue/s:

1. Whether or not the Paris Convention for the Protection of Industrial Property
should yield to Philippine laws and jurisprudence