Susan D. Villanueva
In a Decision promulgated on 22 January 2025, the Supreme Court affirmed the cancellation of a trademark registration obtained in violation of the Intellectual Property Code’s protection of trade names, clarifying that, while registration generally confers ownership, it must not be contrary to law.
In Campbridge Waterproofing Systems, Inc. v. Greenseal Products (M) Sdn. Bhd. (G.R. No. 269302), the Supreme Court ruled that the registration of Campbridge Waterproofing Systems, Inc. (“Campbridge”) was void for appropriating the trade name of Greenseal Products (M) Sdn. Bhd. (“Greenseal Malaysia”), which had been used in the Philippines prior to Campbridge’s trademark application.
The dispute arose when Greenseal Malaysia, a company that has used the “GREENSEAL” mark internationally since 1993 and in the Philippines since 2004, filed a petition to cancel Campbridge’s trademark registration filed on 18 February 2009 and registered on 04 May 2009.
Greenseal Malaysia had distributed its waterproofing and sealant products in the Philippines through its exclusive distributor, Greenseal Philippines, which was registered as a corporate name with the Securities and Exchange Commission (SEC) in 2006 and the “GREENSEAL” trade name had already been used in the Philippines since 2004. Campbridge, a local company, registered the “GREENSEAL” mark in 2009 for similar elastomeric sealant products. Notably, Campbridge had previously marketed its product under the name “FlexSeal” before changing it to “GREENSEAL” in the mid-2000s.
Campbridge argued that under the “first-to-file” rule of the Intellectual Property (“IP”) Code, it acquired ownership of the mark through its 2009 registration. It contended that Greenseal’s foreign registration and prior use were irrelevant under the principle of territoriality and the doctrine established in Zuneca Pharmaceutical v. Natrapharm, Inc. (“Zuneca”).
The Supreme Court ruled in favor of Greenseal, holding that Campbridge’s trademark registration was contrary to law and thus void.
The Court reiterated the doctrine in Zuneca that ownership is generally acquired through valid registration. However, it clarified that this rule is subject to the condition that the registration itself is not contrary to law. The Court cited Section 165.2 of the IP Code, which protects trade names even prior to or without registration against unlawful acts by third parties. The Court found that “GREENSEAL” was the trade name of the respondents, used in the Philippines since 2004 and registered with the SEC since 2006, predating the filing date of Campbridge’s 2009 trademark application.
The Court held that “Petitioner’s use of the mark ‘GREENSEAL’ on its products is unlawful as it is likely to mislead the public, giving the incorrect impression that its products are actually from (the) respondent, when in fact they are not.”
Consequently, appropriating a protected trade name as a trademark renders the registration void, regardless of the registrant’s claim to the first-to-file status.
The Supreme Court also clarified that under the Paris Convention and Section 131 of the IP Code, a priority right must be claimed within six months of the foreign application. Since Greenseal did not apply in the Philippines within that window, it could not claim priority based on its 1993 Malaysian registration.
Moreover, the Court found insufficient evidence to prove Campbridge acted in bad faith. The coincidence of Campbridge adopting the specific invented word “GREENSEAL” after years of using “FlexSeal” was noted but the Court ruled that bad faith must be established by clear and convincing evidence.
Despite the absence of bad faith, the Court ruled the registration was contrary to law due to the violation of trade name protection which alone warranted cancellation.
This decision serves as a critical reminder to business owners and IP practitioners that trade names used in commerce are protected under the IP Code even without trademark registration. A third party cannot validly register a trademark that appropriates an existing, protected trade name. Further, while the Philippines follows the first-to-file system, a registration certificate is only prima facie evidence of ownership. It can be cancelled if the registration violates substantive provisions of the law, such as the prohibition against misleading the public or appropriating protected trade names.
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