G.R. No. 197482 March 6, 2017
FORIETRANS MANUFACTURING CORP., AGERICO CALAQUIAN and ALVIN MONTERO, Petitioners vs DAVIDOFF ET. CIE SA & JAPAN TOBACCCO, INC. (represented by SYCIP SALAZAR HERNANDEZ & GATMAITAN LAW OFFICE thru ATTY. RONALD MARK LLENO), Respondents

FACTS

Respondents Davidoff and Japan Tobacco, Inc., represented by their counsel, filed criminal complaints for trademark infringement and false designation of origin against petitioners Forietrans Manufacturing Corp. and its officers. The complaints were based on items seized from Forietrans’s warehouses under search warrants, alleging the manufacture of cigarettes bearing the “DAGETA” and “DAGETA International” marks, which were claimed to be confusingly similar to Davidoff’s registered trademarks and falsely designated as “Made in Germany.” The Provincial Prosecutor dismissed the complaints, finding no probable cause. This dismissal was affirmed by the Secretary of Justice. The prosecutor ruled that the affidavit supporting the search warrants was insufficient and that there was no confusing similarity between “DAGETA” and “DAVIDOFF.”
The Court of Appeals reversed the Secretary of Justice’s resolutions and directed the filing of informations against petitioners. The CA held that the Secretary of Justice committed grave abuse of discretion, as the determination of probable cause for filing the case is an executive function, and the prosecutor’s findings on the confusing similarity of marks were premature, as this is a factual matter best determined in a full-blown trial. Petitioners elevated the case to the Supreme Court via a petition for review on certiorari.

ISSUE

Whether the Court of Appeals erred in reversing the resolutions of the Secretary of Justice which found no probable cause to charge petitioners with trademark infringement and false designation of origin.

RULING

The Supreme Court denied the petition and affirmed the Court of Appeals. The Court held that the Secretary of Justice committed grave abuse of discretion in dismissing the complaints for lack of probable cause. The ruling emphasized that in a preliminary investigation, the prosecutor’s role is merely to determine whether there is sufficient ground to engender a well-founded belief that a crime has been committed and the respondent is probably guilty. The prosecutor exceeded this scope by making a definitive finding on the absence of confusing similarity between the trademarks “DAGETA” and “DAVIDOFF.” This is a factual issue involving the application of the “dominancy” or “holistic” tests, which requires a full examination of evidence, including the actual presentation of the products in court, and is therefore more appropriately determined in a trial on the merits. The presence of probable cause was established by the allegations in the complaints and the evidence from the search, which indicated that petitioners were manufacturing cigarettes with marks and packaging allegedly similar to the respondents’ registered trademarks. The Court reiterated that the determination of probable cause does not require certainty of guilt but only a reasonable belief based on the submitted evidence. Thus, the filing of the criminal informations was proper.