G.R. No. L-54158 August 31, 1984
PAGASA INDUSTRIAL CORPORATION, petitioner, vs. COURT OF APPEALS, TIBURCIO S. EVALLE as Director of Patents, and YOSHIDA KOGYO KABUSHIKI KAISHA, respondents.

FACTS

The case involves a conflict over the trademark “YKK” for zippers. Respondent Yoshida Kogyo Kabushiki Kaisha (Yoshida) obtained Certificate of Registration No. 9331 from the Director of Patents on November 9, 1961, claiming use of the mark since September 1, 1950. Despite this prior registration, the Director, due to an examiner’s oversight, issued Certificate of Registration No. 13756 for the identical mark to petitioner Pagasa Industrial Corporation (Pagasa) on April 4, 1968, based on Pagasa’s alleged use since March 1, 1966. Yoshida subsequently filed a petition for the cancellation of Pagasa’s registration.
The Director of Patents cancelled Pagasa’s certificate, attributing the duplicate registration to a costly administrative error and noting that Pagasa’s application should have been rejected outright. The Court of Appeals affirmed this cancellation, finding that Pagasa had prior knowledge of Yoshida’s registration and use of the “YKK” trademark, which is an acronym of Yoshida’s corporate name. The appellate court highlighted visits between officials of both companies in the 1960s and concluded Pagasa acted in bad faith, thus barring it from invoking equitable defenses.

ISSUE

Whether the Director of Patents and the Court of Appeals correctly ordered the cancellation of Pagasa’s trademark registration for “YKK.”

RULING

Yes. The Supreme Court, sitting En Banc, granted Yoshida’s second motion for reconsideration and affirmed the decisions below. The legal logic rests on the primacy of prior registration and the principle that equity aids only those with clean hands. Under Republic Act No. 166 (The Trademark Law), registration constitutes prima facie evidence of the registrant’s valid ownership and exclusive right to use the mark. Yoshida’s 1961 registration is therefore superior and must prevail over Pagasa’s later, erroneously issued registration.
The Court rejected Pagasa’s reliance on equitable principles such as laches, estoppel, or acquiescence. These defenses are unavailing because Pagasa could not claim good faith. The evidence established Pagasa’s awareness of Yoshida’s prior rights before it sought its own registration. One who seeks equity must do so with clean hands; Pagasa’s act of registering a known trademark belonging to another constitutes unlawful and inequitable conduct. The Director of Patents correctly rectified the administrative error by cancelling the registration issued to Pagasa, as it was void from the beginning for lack of a registrable right. Costs were imposed on Pagasa.