G.R. No. 219744, March 1, 2021
LEVI STRAUSS & CO., PETITIONER, VS. ANTONIO SEVILLA AND ANTONIO L. GUEVARRA, RESPONDENTS.

FACTS

Petitioner Levi Strauss & Co., a foreign corporation, is the owner of the word mark “LEVI’S” since 1946 for goods under Class 25. Respondents Antonio Sevilla and Antonio L. Guevarra were the registrants of the trademark “LIVE’S” also for goods under Class 25. In 1995, a consumer survey (“Project Cherokee 5”) commissioned by petitioner’s licensee indicated that a high percentage of the public associated the “LIVE’S” mark with “LEVI’S.” Consequently, on December 13, 1995, petitioner filed a Petition for Cancellation before the Intellectual Property Office (IPO) Bureau of Legal Affairs (IPO-BLA), arguing that “LIVE’S” is confusingly similar to its “LEVI’S” mark. The IPO-BLA denied the petition, finding no confusing similarity, a ruling affirmed by the IPO Director General (IPO-DG). Petitioner elevated the case to the Court of Appeals (CA) via a petition for review under Rule 43. The CA dismissed the petition on the grounds of mootness (due to respondents’ assignment of the “LIVE’S” mark to a third party, Dale Sy, during the pendency of the case) and res judicata (citing the Court’s prior ruling in G.R. No. 162311). Petitioner moved for reconsideration, which was denied, prompting the filing of the instant petition for review on certiorari.

ISSUE

1. Whether the CA correctly ruled that the case was rendered moot and academic and that G.R. No. 162311 constitutes res judicata.
2. Whether the petition for cancellation should be granted on the ground of confusing similarity between petitioner’s “LEVI’S” mark and respondents’ “LIVE’S” mark.

RULING

The petition is meritorious.
1. The CA erred in dismissing the case. The case was not rendered moot and academic by the assignment of the “LIVE’S” mark to Dale Sy during the pendency of the cancellation proceedings. The registration remained valid and subsisting, and as a transferee pendente lite, Dale Sy would be bound by the resolution of the case. Furthermore, G.R. No. 162311 is not res judicata to the instant case. Res judicata requires a judgment on the merits by a court of competent jurisdiction. G.R. No. 162311 emanated from preliminary investigation proceedings concerning a probable cause determination for unfair competition by the Department of Justice (DOJ), which is an administrative, not adjudicative, function. The dismissal of a complaint in a preliminary investigation does not constitute a valid and final judgment on the merits for purposes of res judicata.
2. The petition for cancellation should be granted. Applying the dominancy test, the marks “LEVI’S” and “LIVE’S” are confusingly similar. Visually, the marks share the same first letter “L,” the same last three letters “VI’S,” and the same letter count. The stylized presentation of respondents’ “LIVE’S” mark, particularly the design of the letters “V” and “E,” makes it appear as “LEVI’S.” Aurally, the marks are almost identical in pronunciation. Conceptually, both marks are used on identical goods (denim pants and jeans under Class 25). The overall impression is that “LIVE’S” is a colorable imitation of “LEVI’S,” likely to cause confusion among ordinary purchasers. The consumer survey results further substantiate this likelihood of confusion. Therefore, respondents’ “LIVE’S” mark is ordered cancelled for being confusingly similar to petitioner’s registered “LEVI’S” mark.