FIRST DIVISION

[G.R. No. 132993. June 29, 2005.]

LEVI STRAUSS (PHILS.), INC. , petitioner, vs . VOGUE TRADERS

CLOTHING COMPANY , respondent.

DECISION

AZCUNA , J : p

This is a petition for review on certiorari seeking to annul the decision 1 of the
Court of Appeals, dated August 13, 1997, which annulled and set aside the orders, 2
dated December 10, 1996 and April 11, 1997, issued by the Regional Trial Court of
Manila, Branch 1 and which directed the trial court to desist from proceeding with the
said case until the Bureau of Patents, Trademarks and Technology Transfer (BPTTT)
has nally resolved Inter Partes Cases Nos. 4216 and 4217, and the resolution of the
Court of Appeals, dated March 5, 1998, denying petitioner's motion for reconsideration.
The factual antecedents are as follows:
In 1972, per "Trademark, Technical Data, and Technical Assistance Agreement," 3
Levi Strauss & Co., the principal based in Delaware, United States of America, granted
petitioner Levi Strauss (Phils.) a non-exclusive license to use LEVI’S trademark, design,
and name in the manufacturing, marketing, distribution, and sale of its clothing and
other goods. 4 The licensing agreement was renewed several times, the recent one
being under Certi cate of Registration No. 1379-A. 5 Levi Strauss & Co. obtained
certi cates of registration from the BPTTT for the following trademarks: "LEVI’S" 6 ;
"501" 7 ; "Two Horse Design" 8 ; "Two Horse Label" 9 ; "Two Horse Patch" 1 0 ; "Two Horse
Label with Patterned Arcuate Design" 1 1 ; "Arcuate Design" 1 2 ; and the composite
trademarks, 1 3 namely, "Arcuate," "Tab," and "Two Horse Patch."
Petitioner discovered the existence of some trademark registrations belonging
to respondent which, in its view, were confusingly similar to its trademarks. Thus, it
instituted two cases before the BPTTT for the cancellation of respondent's trademark
registrations, to wit: Inter Partes Case No. 4216, a petition for cancellation of
Certi cate of Registration No. 53918 (for "LIVE'S") and Inter Partes Case No. 4217, a
petition for cancellation of Certi cate of Registration No. 8868 (for "LIVE'S" Label
Mark). ESDcIA

Petitioner then applied for the issuance of a search warrant on the premises of
respondent Vogue Traders Clothing Company, owned by one Tony Lim, with the
Regional Trial Court of Manila, Branch 3. On December 12, 1995, said trial court issued
Search Warrant No. 95-757 1 4 and Search Warrant No. 95-758 1 5 based on its nding of
probable cause that the respondent had violated Article 189 of the Revised Penal Code
1 6 in manufacturing, selling, and incorporating designs or marks in its jeans which were
confusingly similar to petitioner's "LEVI's jeans." These search warrants commanded
the seizure of certain goods bearing copies or imitations of the trademarks which
belonged to petitioner. 1 7 On December 13, 1995, the search warrants were enforced
and several goods belonging to respondent were seized. 1 8 Meanwhile, it appears that
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 criminal charges were filed against Tony Lim of respondent company in the Department
of Justice, 1 9 but the same were eventually dismissed and the search warrants were
quashed.
Consequently, on February 1, 1996, respondent led a complaint 2 0 for damages
in the Regional Trial Court of Manila, Branch 50, against petitioner. The complaint
alleged that since January 1, 1988, respondent, through Antonio Sevilla, with business
address at 1082 Carmen Planas Street, Tondo, Manila, had been a lawful assignee and
authorized user of: (a) the trademark "LIVE'S" under Certi cate of Registration No.
53918 issued by the BPTTT, (b) the trademark "LIVE'S LABEL MARK" under Certi cate
of Registration No. SR 8868 issued by the BPTTT, and (c) the copyright registrations of
"LIVE'S ORIGINAL JEANS," its pocket design, and hand tag; that the goods, articles, and
effects seized from respondent's establishment were manufactured and used in its
legitimate business of manufacturing and selling of the duly registered trademark
"LIVE'S" and "LIVE'S ORIGINAL JEANS;" and that the trademarks of respondent did not
have any deceptive resemblance with the trademarks of petitioner. Respondent sought
to recover the seized assorted sewing materials, equipment, and nished products or
the value thereof, in case the same had been destroyed or impaired as a result of the
seizure. Respondent also prayed that, after due trial, judgment be rendered ordering the
petitioner to pay compensatory damages of P320,000 with an additional amount of
damages of P11,000 per day until the seized properties are restored; P2,000,000 as
exemplary damages; P100,000 for attorney's fees with an additional amount of
P100,000 in the event of an appeal plus P1,500 per court appearance and the costs of
the suit.
In its amended answer with counterclaim, 2 1 petitioner countered that
respondent’s LIVE'S brand infringed upon its licensed brand name LEVI'S. It sought to
cancel respondent's Copyright Registration No. I-3838 and enjoin the respondent from
further manufacturing, selling, offering for sale, and advertising the denim jeans or
slacks by using a design substantially, if not exactly similar to, or a colorable imitation
of the trademarks 2 2 of petitioner.
Upon manifestation/motion 2 3 by petitioner, the RTC of Manila, Branch 50 issued
an order dated May 9, 1996, 2 4 forwarding the case to the Executive Judge (RTC of
Manila, Branch 23) for re-ra e among the courts designated as Special Courts to try
and decide cases involving violations of Intellectual Property Rights pursuant to
Administrative Order No. 113-95, dated October 2, 1995. On May 17, 1996, Branch 23
issued an order 2 5 directing that the case be forwarded to Branch 1 (a designated
Special Court per said administrative order) for further proceedings. cITaCS

On the scheduled hearing on December 4, 1996 in the RTC of Manila, Branch 1,

respondent (as therein plaintiff) failed to appear. Upon motion of petitioner, the trial
court declared respondent to have waived its right to present evidence to controvert
petitioner's application for a writ of preliminary injunction. 2 6
In an order dated December 10, 1996, the trial court found that the respondent
intended to appropriate, copy, and slavishly imitate the genuine appearance of
authentic LEVI's jeans and pass off its LIVE's jeans as genuine LEVI's jeans. Thus,
In opposing defendant's application for preliminary in injunction, plaintiff
alleges that it has obtained Certi cates of Registration for the trademarks
"LIVE[']S," "LIVE[']S LABEL MARK," ["]LIVE[']S ORIGINAL JEANS["] as well as the
patch pocket design and hand tag. It did not, however, present any evidence to
support the same.
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 In any event, plaintiff's backpocket design is not copyrightable, as it is
neither an original work nor a novel design. Rather it is a copy or slavish imitation
of LS & Co./LSPI's Arcuate trademark which was rst used by LS & Co. worldwide
in 1873 and the Philippines Registration of which is based on LS & Co.'s US
Certi cate of Registration No. 404243, issued on November 16, 1943. Thus, no
rights attendant to a copyright can ever attach to plaintiff's infringing backpocket
design.

Also, it could not have been pure chance or coincidence that plaintiff's
LIVE'S jeans use a trademark, symbol or design which is substantially, if not
exactly similar to, or a colorable imitation of LS & CO./LSPI trademarks, since
there is a practically limitless array of other marks, words, numbers, devices,
symbols and designs which plaintiff could have used on its products to identify
and distinguish them from those of defendant and other manufacturers. All told,
from the mass of evidence adduced, plaintiff's intent to appropriate, copy, and
slavishly imitate the genuine appearance of authentic LEVI's jeans and pass off
its LIVE's jeans as genuine LEVI'S jeans is much too stark.

As above-discussed, through more than a century's use and continuous

substantial promotions and advertising of the LEVI's TRADEMARKS on its
products — on jeans and trousers in particular — LS & Co. has cultivated, gained
and established an invaluable goodwill in its name "LEVI's STRAUSS &
COMPANY" and in the products which carry such name and the LEVI's
TRADEMARKS. Hence, unless plaintiff is immediately enjoined from further
manufacturing, selling, offering for sale and advertising denims, jeans or slacks
using a design substantially, if not exactly similar to, or a colorable imitation of
the LS & Co./LSPI trademarks, it will continue to have a free ride on, and erode
such invaluable goodwill and reputation by the mere effortless expedient of
imitating the overall visual impression of genuine LEVI's JEANS on its own
designs, employing minute points of distinction su cient to muddle the overall
conclusion which is actually generated, but do not dispel the similitude between
the trademarks. Well has been said that the most successful form of copying is to
employ enough points of similarity to confuse the public with enough points of
difference to confuse the court. [(]Del Monte Corporation vs. Court of Appeals, 181
SCRA 418[)]. TSHIDa

There is no question that the above-discussed circumstances call for the

intervention of equity to prevent further irreparable harm to defendant's goodwill
and reputation. In consonance with Section 3 (a), (b) and (c), Rule 58 of the Rules,
defendant is thus entitled to the ancillary relief demanded either for a limited
period or perpetually.
Corollarily, defendant is hereby directed to execute a bond to the party
enjoined to the effect that defendant will pay to plaintiff all damages it may
sustain by reason of the injunction if the court should nally decide that
defendant is not entitled thereto.

WHEREFORE, upon the ling of a bond in the sum of FIVE HUNDRED

THOUSAND PESOS (P500,000.00), let a writ of preliminary injunction issue
restraining plaintiff, its o cers, employees, agents, representatives, dealers,
retailers or assigns from manufacturing, distributing, selling, offering for sale,
advertising or otherwise using denims or jeans with a design which is
substantially, if not exactly similar to defendant's trademarks.

Meanwhile, the hearing on the main cause of action is hereby set on

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 February 5 and 12, 1997, both at 9:00 a.m.
SO ORDERED. 2 7

On motion for reconsideration, respondent prayed that the petitioner's

counterclaim be dismissed and that the order dated December 10, 1996, be set aside.
In an order dated April 11, 1997, the trial court denied the motion, stating that:
Considering:

(1) That the defendant's application for injunctive relief was properly
directed against the real property in interest, the self-proclaimed lawful assignee
and authorized user of the subject trademarks, hence, the party who would be
benefited or injured by this court's final decision on the application;

(2) That the acts which plaintiff was enjoined from doing are within
the scope of the reliefs demanded by defendant;
(3) That the institution of defendant's counterclaim for infringement
and damages does not amount to forum-shopping in that the elements of litis
pendentia which form the basis for a charge for forum-shopping are not all
present in the instant case; aHATDI

(4) That the injunctive order sought to be reconsidered, by its very

nature, is merely provisional and does not dispose of the case on the merits.
Hence, it would not amount to a prejudgment considering that the defendant still
has the burden of proving during trial on the merits that it is entitled to protection
and that confusion does, in fact, or likely to exist, and, on the other hand, plaintiff
would have its opportunity to prove that confusion does not exist or is not likely to
happen; and
(5) That the evidence on record justi es the injunctive relief granted by
this court in favor of defendant.
WHEREFORE, in view of all the foregoing, plaintiff's motion for
reconsideration and supplemental motion for reconsideration are DENIED for lack
of merit.
SO ORDERED. 2 8

Respondent took the matter to the Court of Appeals. On August 13, 1997, the
Court of Appeals rendered a decision in favor of the respondent, enjoining the trial court
from further proceeding with the case. The dispositive portion thereof reads:
WHEREFORE, the petition is GRANTED. The assailed Orders dated
December 10, 1996 and April 11, 1997 are annulled and set aside for having been
issued with grave abuse of discretion and in excess of jurisdiction. Respondent
court is ordered to desist from proceeding with Civil Case No. 96-76944, entitled
"Vogue Traders Clothing Company, Plaintiff, versus Levi Strauss (Phil.), Inc.,
Defendant.", until the Bureau of Patents, Trademarks and Technology Transfer
has finally resolved Inter Partes Cases Nos. 4216 and 4217.
No costs.

SO ORDERED. 2 9

After its motion for reconsideration was denied, petitioner led the present
petition for review on certiorari, raising the following assignment of errors:
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 I
THE COURT OF APPEALS COMMITTED CLEARLY REVERSIBLE ERROR IN
HOLDING THAT THE DOCTRINE OF PRIMARY JURISDICTION OPERATES TO
SUSPEND ANY AND ALL PROCEEDINGS IN CIVIL CASE NO. 96-76944,
PARTICULARLY THE ABILITY OF THE TRIAL COURT TO ISSUE PRELIMINARY
INJUNCTIVE RELIEF, AND THAT THE TRIAL COURT JUDGE THEREFORE
COMMITTED ABUSE OF DISCRETION IN GRANTING SUCH RELIEF.

II
THE COURT OF APPEALS ERRED IN FAILING TO HOLD THAT THE
CERTIFICATION AGAINST FORUM-SHOPPING ATTACHED BY RESPONDENT TO
ITS PETITION FOR CERTIORARI AND PROHIBITION IS FATALLY DEFECTIVE. CAacTH

III

THE COURT OF APPEALS ERRED IN HOLDING THAT THE TRIAL COURT

JUDGE COMMITTED GRAVE ABUSE OF DISCRETION IN DECLARING
RESPONDENT TO HAVE WAIVED ITS RIGHT TO ADDUCE EVIDENCE TO
COUNTER PETITIONER'S EVIDENCE IN SUPPORT OF ITS APPLICATION FOR
PRELIMINARY INJUNCTIVE RELIEF.
IV
THE COURT OF APPEALS ERRED IN HOLDING THAT THE PRELIMINARY
INJUNCTIVE ORDER ISSUED IN CIVIL CASE NO. 96-76944 PREJUDGES THE
CASE. 3 0

The petition has merit.

First. Petitioner points out that while the Court of Appeals categorically stated
that it did not commit forum-shopping when it led its counterclaim for infringement
(to the petitioner's complaint for damages in the Regional Trial Court of Manila, Branch
1 — Civil Case No. 96-76944) as the causes of action in the said civil case and the two
inter partes cases (Inter Partes Cases Nos. 4216 and 4217 pending before the BPTTT)
are different and do not involve the same subject matter and issues, it erred in applying
the "doctrine of primary jurisdiction." The appeals court declared that the trial court
never had the authority to hear and grant petitioner's prayer for injunctive relief nor to
proceed with the hearing of the case in view of the pendency of the two inter partes
cases.
Petitioner is a holder of Certi cate of Registration No. 1379-A for its Levi's
trademarks. The registration gives rise to a presumption of its validity and the right to
the exclusive use of the same. As set forth in Section 17 of Republic Act (R.A.) No. 166
or "The Trademark Law," an entity having a duly registered trademark can le a suit
against another entity for the protection of its right:
Sec. 17. Grounds for cancellation. — Any person, who believes that he
is or will be damaged by the registration of a mark or trade-name, may, upon the
payment of the prescribed fee, apply to cancel said registration upon any of the
following grounds:
(a) That the registered mark or trade-name becomes the common
descriptive name of an article or substance on which the patent has
expired;

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 (b) That it has been abandoned;

(c) That the registration was obtained fraudulently or contrary to the

provisions of section four, Chapter II hereof;
(d) That the registered mark or trade-name has been assigned, and is
being used by, or with the permission of, the assignee, so as to
misrepresent the source of the goods, business or services in
connection with which the mark or trade-name is used; or
(e) That cancellation is authorized by other provisions of this Act.

Section 27 thereof states that the proper Regional Trial Court shall have jurisdiction
over the damage suits.
In Conrad and Company, Inc. v. Court of Appeals , 3 1 as reiterated in the case of
Shangri-La International Hotel Management Ltd. v. Court of Appeals , 3 2 the Court
clari ed that while an administrative cancellation of a registered trademark, on any of
the grounds under Section 17 of R.A. No. 166, is within the ambit of the BPTTT, an
action for infringement or any other incidental remedy sought is within the jurisdiction
of the ordinary courts. Thus,
. . . It might be mentioned that while an application for the administrative
cancellation of a registered trademark on any of the grounds enumerated in
Section 17 of Republic Act No. 166, as amended, otherwise known as the Trade-
Mark Law, falls under the exclusive cognizance of BPTTT (Sec. 19, Trade-Mark
Law), an action, however, for infringement or unfair competition, as well as the
remedy of injunction and relief for damages, is explicitly and unquestionably
within the competence and jurisdiction of ordinary courts. ESacHC

xxx xxx xxx

Surely, an application with BPTTT for an administrative cancellation of a
registered trade mark cannot per se have the effect of restraining or preventing
the courts from the exercise of their lawfully conferred jurisdiction. A contrary rule
would unduly expand the doctrine of primary jurisdiction which, simply expressed,
would merely behoove regular courts, in controversies involving specialized
disputes, to defer to the ndings or resolutions of administrative tribunals on
certain technical matters. This rule, evidently, did not escape the appellate court
for it likewise decreed that for "good cause shown, the lower court, in its sound
discretion, may suspend the action pending outcome of the cancellation
proceedings" before BPTTT. (Underscoring supplied.)

The passage of Republic Act No. 8293, otherwise known as the "Intellectual
Property Code of the Philippines," 3 3 expanded the rights accorded to an owner of a
registered trademark. Sections 151 (2), 156, and 161 thereof state:
Section 151.2. Notwithstanding the foregoing provisions, the court or
the administrative agency vested with jurisdiction to hear and adjudicate any
action to enforce the rights to a registered mark shall likewise exercise jurisdiction
to determine whether the registration of said mark may be cancelled in
accordance with this Act. The ling of a suit to enforce the registered mark with
the proper court or agency shall exclude any other court or agency from assuming
jurisdiction over a subsequently led petition to cancel the same mark. On the
other hand, the earlier ling of petition to cancel the mark with the Bureau of
Legal Affairs [formerly BPTTT] shall not constitute a prejudicial question that
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 must be resolved before an action to enforce the rights to same registered mark
may be decided. (Sec. 17, R.A. No. 166a)
Section 156. Actions, and Damages and Injunction for Infringement. —
156.1 The owner of a registered mark may recover damages from any person
who infringes his rights, and the measure of the damages suffered shall be either
the reasonable pro t which the complaining party would have made, had the
defendant not infringed his rights, or the profit which the defendant actually made
out of the infringement, or in the event such measure of damages cannot be
readily ascertained with reasonable certainty, then the court may award as
damages a reasonable percentage based upon the amount of gross sales of the
defendant or the value of the services in connection with which the mark or trade
name was used in the infringement of the rights of the complaining party (Sec.
23, first par., R.A. No. 166a).
DAcSIC

156.2. On application of the complainant, the court may impound during

the pendency of the action, sales invoices and other documents evidencing sales.
(n)
156.3. In cases where actual intent to mislead the public or to defraud the
complainant is shown, in the discretion of the court, the damages may be
doubled. (Sec. 23, first par., R.A. No. 166)
156.4 . The complainant, upon proper showing, may also be granted
injunction. (Sec. 23, second par., R.A. No. 166a)
Section 161. Authority to Determine Right to Registration. — In any action
involving a registered mark, the court may determine the right to registration, order
the cancellation of a registration, in whole or in part, and otherwise rectify the
register with respect to the registration of any party to the action in the exercise of
this. Judgment and orders shall be certi ed by the court to the Director, who shall
make appropriate entry upon the records of the Bureau, and shall be controlled
thereby (Sec. 25, R.A. No. 166a). aEcHCD

Sections 155 (2), 156, and 163 of the said law further provide for the remedy of
an owner of a registered mark to institute an action for infringement or damages
against a person or entity that may reproduce, counterfeit, copy or colorably imitate a
registered mark or a dominant feature thereof and apply such reproduction, counterfeit,
copy or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or in connection with the sale,
offering for sale, distribution, or advertising of goods or services on or in connection
with which such use is likely to cause confusion, or to cause mistake, or to deceive.
Finally, Rule 8, Section 7 of the Regulations on Inter Partes Proceedings, provides:
Section 7. Effect of ling of a suit before the Bureau or with the proper
court. — The ling of a suit to enforce the registered mark with the proper court or
Bureau shall exclude any other court or agency from assuming jurisdiction over a
subsequently led petition to cancel the same mark. On the other hand, the earlier
ling of petition to cancel the mark with the Bureau shall not constitute a
prejudicial question that must be resolved before an action to enforce the rights to
same registered mark may be decided. (Emphasis supplied)
It bears stressing that an action for infringement or unfair competition, including
the available remedies of injunction and damages, in the regular courts can proceed
independently or simultaneously with an action for the administrative cancellation of a
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 registered trademark in the BPTTT. As applied to the present case, petitioner's prior
ling of two inter partes cases against the respondent before the BPTTT for the
cancellation of the latter's trademark registrations, namely, "LIVE'S" and "LIVE'S Label
Mark," does not preclude petitioner's right (as a defendant) to include in its answer (to
respondent's complaint for damages in Civil Case No. 96-76944) a counterclaim for
infringement with a prayer for the issuance of a writ of preliminary injunction.
Second. As to the procedural matter, petitioner argues that the Court of Appeals
erred in giving due course to the respondent's petition for certiorari even if it was the
latter's counsel, Atty. Danilo A. Soriano, not one of its duly authorized o cers, who
executed the certification of non-forum shopping.
Section 5, Rule 7 of the Rules of Civil Procedure incorporating Administrative
Circular Nos. 28-91 (effective January 1, 1992) and 04-94 (effective April 1, 1994)
states the requirement of a plaintiff or petitioner to include in his initiatory pleading or
petition a certification of non-forum shopping. Thus,
Sec. 5. Certi cation against forum shopping. — The plaintiff or
principal party shall certify under oath in the complaint or other initiatory pleading
asserting a claim for relief, or in a sworn certi cation annexed thereto and
simultaneously led therewith: (a) that he has not theretofore commenced any
action or led any claim involving the same issues in any court, tribunal or quasi-
judicial agency and, to the best of his knowledge, no such other action or claim is
pending therein; (b) if there is such other pending action or claim, a complete
statement of the present status thereof; and (c) if he should thereafter learn that
the same or similar action or claim has been led or is pending, he shall report
that fact within ve (5) days therefrom to the court wherein his aforesaid
complaint or initiatory pleading has been filed.
Failure to comply with the foregoing requirements shall not be curable by
mere amendment of the complaint or other initiatory pleading but shall be cause
for the dismissal of the case without prejudice, unless otherwise provided, upon
motion and after hearing. The submission of a false certi cation or non-
compliance with any of the undertakings therein shall constitute indirect
contempt of court, without prejudice to the corresponding administrative and
criminal actions. If the acts of the party or his counsel clearly constitute willful
and deliberate forum shopping, the same shall be ground for summary dismissal
with prejudice and shall constitute direct contempt, as well as a cause for
administrative sanctions.

I n Digital Microwave Corp. v. CA , 3 4 this Court gave the rationale for this rule,
namely, that the certi cation against forum shopping is required to be accomplished by
petitioner himself because only the petitioner himself has actual knowledge of whether
or not he has initiated similar actions or proceedings in different courts or agencies.
Even his counsel may be unaware of such fact as he may only be aware of the action for
which he has been retained. As to corporations, the law requires that the certi cation
could be made by its duly authorized director or o cer. The Court also stresses that
the petitioner's non-compliance and utter disregard of the rules cannot be rationalized
by invoking the policy of liberal construction.
The requirement of certi cation against forum shopping under the Rules is to be
executed by the petitioner, or in the case of a corporation, its duly authorized director or
o cer, but not petitioner's counsel whose professional services have been engaged to
handle the subject case. The reason is that it is the petitioner who has personal
knowledge whether there are cases of similar nature pending with the other courts,
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 tribunals, or agencies. Thus, in the present case, the Court of Appeals should have
outrightly dismissed the petition for certiorari led by the respondent (as therein
petitioner in the appeals court) due to the defective certi cation of non-forum
shopping. The certi cation made by Atty. Soriano, counsel for the respondent, who is
not one of its duly authorized directors or o cers, is defective. Even if Atty. Soriano
was the "in-house counsel," the fact remains that no board resolution, or even a
Secretary's Certi cate containing the board resolution, was submitted to show that he
was indeed authorized to file the said petition in the Court of Appeals.
Third. Petitioner avers that the Court of Appeals erred in nding that the
respondent was denied due process. It contends that the trial court had correctly ruled
that respondent was deemed to have waived its right to present evidence due to its
non-appearance at the scheduled hearing (to oppose the petitioner's application for the
issuance of a writ of preliminary injunction) on December 4, 1996.
The records show that respondent, through its former counsel, Atty. Alfonso R.
Yatco, was present during the hearing on November 6, 1996 as re ected in the minutes
of the court proceedings that day. The counsels for both parties had been duly noti ed
in open court. The Branch Clerk of Court of RTC of Manila, Branch 1, Atty. Joselito C.
Frial, even made a notation in the minutes that respondent (as oppositor) shall be given
a period of 10 days to interpose its opposition to the petitioner's prayer for injunctive
relief. 3 5 The Order dated November 6, 1996 states:
After witness Atty. Gilbert Raymond T. Reyes [witness for the petitioner]
had finished his testimony, the counsel for defendant [herein petitioner] moved for
and was allowed ten (10) days from today within which to le a written formal
offer of exhibits, copy furnish[ed] the counsel for plaintiff [herein respondent] who
is allowed a similar period of time from receipt thereof within which to le
comment and/or objection.
In the meantime, let the hearing be continued on December 4 & 11, 1996,
both at 9:00 a.m. as previously scheduled.
The counsels are notified of this order in open court.
SO ORDERED. 3 6

However, on December 4, 1996, Atty. Yatco failed to appear without proferring

any valid reason which prompted the trial court to issue an order that respondent was
deemed to have waived its right to present evidence:
On call for hearing, only the counsel for defendant [herein petitioner]
appeared. There was no appearance for plaintiff [herein respondent] although its
counsel was duly noti ed. In view thereof, upon motion of counsel for defendant,
plaintiff is considered to have waived its right to present evidence to controvert
defendant's application for a writ of preliminary injunction, which, consequently,
is hereby deemed submitted for resolution.
The counsel for defendant is noti ed in open court. Furnish the counsel for
plaintiff with a copy hereof.
SO ORDERED. 3 7

Respondent explained to the trial court that its former counsel, Atty. Yatco, had
honestly thought that the December 4, 1996 hearing had been rescheduled to
December 11, 1996 per agreement with the petitioner's counsel. This is not a su cient
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 ground. It was correct for the trial court, upon motion of petitioner, to consider the
matter submitted for resolution on the basis of petitioner's evidence. Respondent
cannot nd solace in its lame excuse of honest mistake which was, in fact, negligence
and lack of vigilance.
Fourth. Petitioner claims that the assailed orders of the trial court, dated
December 10, 1996 and April 11, 1997, did not prejudge the case. On the other hand,
respondent counters that the trial court's order dated December 10, 1996 amounted to
a prejudgment of the case, to wit: that its LIVE's backpocket design was not
copyrightable because it was neither an original work nor a novel design; that it was a
copy or slavish imitation of petitioner's LEVI's Arcuate trademark; and that no rights
attendant to a copyright can ever attach to respondent's backpocket design.
The trial court granted petitioner's prayer for the issuance of a writ of preliminary
injunction in its answer with counterclaim (to respondent's complaint for damages).
The writ did not have the effect of prejudging or disposing of the merits of the case, but
merely enjoined the respondent's acts of manufacturing, distributing, selling, or offering
for sale the jeans which had allegedly incorporated exact or colorable imitations of the
products belonging to petitioner. The Order dated April 11, 1997 of the trial court
denying the respondent's motion for reconsideration categorically stated that the said
Order did not amount to a prejudgment of the case. Petitioner has yet to establish
during the trial that it is entitled to a permanent injunction by reason of respondent's
confusingly similar LIVE'S products. Otherwise, the trial court could declare that the
LIVE'S trademark belonging to respondent was not confusingly similar with the LEVI's
trademark of petitioner.
Indeed, a writ of preliminary injunction is generally based solely on initial and
incomplete evidence adduced by the applicant (herein petitioner). The evidence
submitted during the hearing of the incident is not conclusive, for only a "sampling" is
needed to give the trial court an idea of the justi cation for its issuance pending the
decision of the case on the merits. As such, the ndings of fact and opinion of a court
when issuing the writ of preliminary injunction are interlocutory in nature. Moreover, the
sole object of a preliminary injunction is to preserve the status quo until the merits of
the case can be heard. Since Section 4 of Rule 58 of the Rules of Civil Procedure gives
the trial courts su cient discretion to evaluate the con icting claims in an application
for a provisional writ which often involves a factual determination, the appellate courts
generally will not interfere in the absence of manifest abuse of such discretion. 3 8 A writ
of preliminary injunction would become a prejudgment of a case only when it grants the
main prayer in the complaint or responsive pleading, so much so that there is nothing
left for the trial court to try except merely incidental matters. 3 9 Such fact does not
obtain in the present case.
WHEREFORE, the petition is GRANTED and the Decision of the Court of Appeals
dated August 13, 1997 and its Resolution dated March 5, 1998 are REVERSED and SET
ASIDE. The Regional Trial Court of Manila, Branch 1 is ORDERED to proceed with the
hearing of Civil Case No. 96-76944 with dispatch.
No costs.
SO ORDERED.
Davide, Jr., C.J., Quisumbing, Ynares-Santiago and Carpio, JJ., concur.
Footnotes
1. In CA-G.R. SP No. 44022, entitled "Vogue Traders Clothing Co. v. Hon. Rebecca G.
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 Salvador, in her capacity as Presiding Judge of the Regional Trial Court, City of Manila,
Branch 1 and Levi Strauss (Phils.), Inc."
2. In Civil Case No. 96-76944 entitled "Vogue Traders Clothing Co. v. Levi Strauss (Phils),
Inc."
3. Rollo, pp. 109-126.
4. "Arcuate Design (waistband type overalls)," "LEVI STRAUSS & CO. Button Design (men's,
women's, and children's pants, jacket[s], belts, and suspenders)," "Two Horse (trousers
and shirts)," "LEVI’S & Design — Housemark (trousers, jackets, shorts, etc.)," "Tab
(overall)," "LEVI'S (luggage, tote bags, notebook binders, telephone directory covers,
photo albums, scrap books, notebooks and address books, placemat and napkin set,
and bulletin boards)," "LEVI'S Salmon Ticket & Design (pants, shirts, and jackets)," "White
Tab Design (garments, particularly trousers)," "Black Tab Design (garments, particularly
trousers)," "Running 'L' (garments, particular[l]y trousers)," "Fresh Produce (garments,
namely slacks, jackets, shirts, sweaters, caps, and visors)," "LEVI STRAUSS & CO. —
Tradename (business of manufacture & sale of clothing, specifically pants, shirts,
jackets, skirts, blouses, and accessories)," "Two Horse Design (shoes)," "LEVI'S and
Device (shoes)," "LEVI'S (men's, women's, and children's overalls, jackets, outer sh[i]rts,
coats, slacks, and pants; women's and children's blouses, outer shirts, pedal pushers,
vests, skirts, culottes, and women's bras)," "DURA PLUS (garments, particularly
trousers)," "LEVI STRAUSS & CO. Button Design (shoes)," "Two Horse Label with
Patterned Arcuate Design (men's, women's, and children's overalls, jackets, outer shirts, t-
shirts, tops, coat[s], slacks, and pants; women's and children's blouses, outer shorts,
pedal pushers, vests, skirts, culottes, boo[t]s, shoes, and slippers)," "LEVI'S (clip board,
denim school bags & luggage tags, purses & denim shopping bags, back packs, duffle
bags, brief case portfolios, key cases & wallets, belts, hats, caps, visors & shoes),"
"Movin' On (garments, [nam]ely, pants, jackets, and [v]ests," "2-Horse (jeans and
trousers)," Quality Never Goes Out of Style — BATWING/QUALITY (pants, shirts, skirts,
jackets, vests, shoes, and socks)," "COMPOSITE ARCUATE/TAB/TWO HORSE PATCH
(trousers for men, wome[n], and children)," "LEVI STRAUSS & CO. patch (clothing
in[clu]ding shoes, boots, and slippers)," "501 (jeans)," "RED TAB (pants)," "DOCKERS
(pants)," "KLONDYKE (pants)," "DOCKERS & DESIGN (pants, shirts, blouses, skirts, shorts,
swe[at]shirts, and jackets)," "SILVER TAB AND DESIGN (pants)," "LEVI'S GUARANTEE
TICKET — Copyright (no goods)," and "QUALITY NEVER GOES OUT OF STYLE: Copyright
— Slogan (no goods)." (Rollo, pp. 119-125; RTC Records, Volume I, pp. 67-74).

5. It was issued on January 26, 1993 which was valid for five (5) years from July 1, 1992 to
June 30, 1997 (Rollo, p. 101).
6. LEVI'S: The trademark "LEVI'S" was first used in the Philippines on December 30, 1946,
per Original Certificate of Registration No. 8239, and duly registered on May 5, 1960. It
was filed on January 17, 1980 and duly registered on August 10, 1982 per Renewal
Certificate of Registration No. 2666, Serial No. R-3519 (Rollo, pp. 127-132).

7. 501: It was filed on January 3, 1986 and duly registered on March 3, 1989 per
Registration No. 43312, Serial No. 58067 (Rollo, pp. 133-135).
8. Two Horse Design: It was filed on March 1, 1973 and duly registered on February 12,
1974 per Registration No. 21399, Serial No. 23410 (Rollo, pp. 136-138).

9. Two Horse Label: It was filed on July 7, 1976 and duly registered on December 20, 1979
per Registration No. 28005, Serial No. 30212 (Rollo, pp. 139-140).

10. Two Horse Patch: It was filed on July 16, 1979 and duly registered on December 27,
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 1988 per Registration No. 42546 (Rollo, pp. 141-143). Note: The serial number was not
indicated.

11. Two Horse Label with Patterned Arcuate Design: It was duly registered on October 9,
1985 per Registration No. 34810 (Rollo, pp. 144-146). Note: The serial number and the
date when it was filed cannot be determined from the records.

12. Arcuate Design: It was filed on September 23, 1971 and duly registered on October 8,
1973 per Registration No. 20240 (Rollo, pp. 147-150).
13. The composite trademarks of "Arcuate," "Tab," and "Two Horse Patch" were filed on
May 3, 1979 and duly registered on December 12, 1988 per Registration No. 42324
(Rollo, pp. 151-154).

14. Search Warrant No. 95-757 in connection with "People of the Philippines v. Tony Lim of
Vogue Traders Clothing Company, 1082 Carmen Planas Street Tondo, Manila."
15. Search Warrant No. 95-758 in connection with "People of the Philippines v. Tony Lim of
Vogue Traders Clothing Company, 1042 Carmen Planas Street Tondo, Manila."
16. Art. 189. Unfair competition, fraudulent registration of trademark, tradename or service
mark, fraudulent designation of origin, and false description. — The penalty provided in
the next preceding Article shall be imposed upon:

1. Any person who, in unfair competition and for the purpose of deceiving or
defrauding another of his legitimate trade or the public in general, shall sell his goods
giving them the general appearance of goods of another manufacturer or dealer, either
as to the goods themselves, or in the wrapping of the packages in which they are
contained, or the device or words thereon, or in any other feature of their appearance
which would be likely to induce the public to believe that the goods offered are those of
a manufacturer or dealer other than the actual manufacturer or dealer, or shall give other
persons a chance or opportunity to do the same with a like purpose. . . .

17. a) Finished and unfinished jeans and other garment products bearing the general
appearance of genuine jeans and other garment products manufactured by LEVI
STRAUSS PHIL., INC., under license from LEVI STRAUSS & CO., and bearing copies or
imitations of various trademarks and other devices owned by LEVI STRAUSS & CO., or
used by LEVI STRAUSS PHIL., INC., either on the goods themselves or in their packaging
such as:

ARCUATE DESIGN with registration number 20240 registered on [October 8, 1973];

TWO HORSE BRAND with registration number 21399 registered on February 12,
1974;

TAB DESIGN with registration number 22283 registered on May 7, 1975;

LEVI STRAUSS & CO. (TRADENAME) with registration number 25818 registered
on March 21, 1978;

LEVI'S AND DESIGN (HOUSEMARK) with registration number 21407 registered on

February 12, 1974;
LEVI'S GUARANTEE TICKET (COPYRIGHT) with registration number PD-0-1108
registered on August 17, 1973;

501 with registration number 43312 on March 3, 1989;

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 QUALITY NEVER GOES OUT OF STYLE (COPYRIGHT) with registration number PD-R-
1881 registered on April 18, 1978;

b) Sundry items such as buttons, rivets, zippers, cloth and leather patches, labels
and hang tags, bearing said trademarks and/or logos and design or copies or imitations
of the same;
c) Finished and unfinished jeans, sundry items and all paraphernalia bearing the
deceptively similar brands of LEVI'S, LIVE'S, LIVE'S ORIGINAL JEANS and other brands
using any of the said trademarks and/or logos and designs or copies or imitations of the
same;

d) Any other finished jeans and other garment products bearing features which
give them the general appearance of genuine LEVI'S jeans and other products which
would likely induce the public to believe that the goods offered are those being
manufactured by LEVI STRAUSS PHILS., INC. and/or LEVI STRAUSS & CO.;

e) High-speed sewing machines, cutting machines and other machines,

equipment and other paraphernalia used or intended to be used in the illegal
manufacture, sale and/or distribution of the aforesaid products and;

f) Invoices, ledgers, journals, official receipts, delivery receipts, purchase orders

and all other books of account and documents pertaining to the production, distribution
and/or sale of the aforesaid products. (Annex "M-1" and "N-1" of Petitioner's Amended
Answer, RTC Records, Volume I, pp. 295-296 and 326-327).

18. Per Search Warrant No. 95-757, the following items were seized:
1. 100 sacks of Live's pants, 20 pcs./sack

2. 1 box containing 500 sets of Live's buttons

3. 12 sacks of Live's hand tags containing 25,000/sack

4. 2 sewing machines

5. 2 Riveter machines

(Annex "M-2" of Petitioner's Amended Answer, RTC Records, Volume I, pp. 298-299). Per
Search Warrant No. 95-758, the following items were seized:

1. 151 pcs. of unfinished pants w[ith] arcuate design

2. 160 pcs. of finished Westside jeans w[ith] arcuate design

3. 725 pcs. of Lives patches

4. 520 pcs. of Lives buttons

5. 900 pcs. of Lives rivets

6. 261 pcs. of back pocket w[ith] arcuate design

7. One (1) Singer U4864707342

8. One (1) Juki A555-59278

9. One (1) Juki A555-2-24344

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 10. One (1) Juki A227-03839

11. One (1) Singer U86400783

12. One (1) Juki D555-38961

13. One (1) Riveter

(Annex "N–2" of Petitioner's Amended Answer, RTC Records, Volume I, p. 329).

19. I.S. No. 95-799 for violation of Article 189 of the Revised Penal Code.

20. Docketed as Civil Case No. 96-76944, entitled "Vogue Traders Clothing Company, v.
Levi Strauss (Phils.), Inc." (RTC Records, Volume I, pp. 1-7).
21. RTC Records, Volume I, pp. 200-222.

22. "LEVI'S," "Levi Strauss & Co.," "Arcuate Stitching Design," "Two Horse Design," "Two
Horse Patch," "Two Horse Label with Patterned Arcuate Design," "Tab Design," "the
composite trademarks ('Arcuate,' 'Tab,' and 'Two Horse Patch')," "501," "Levi's Salmon
Ticket & Design," and "Levi's and Device" (RTC Records, Volume I, p. 214).

23. RTC Records, Volume I, pp. 163-165.

24. Id. at 169.
25. Id. at 170.
26. RTC Order dated December 4, 1996, RTC Records, Volume II, p. 478.
27. Rollo, pp. 349-350 (RTC Records, Volume II, pp. 488-489).
28. Rollo, pp. 351-352 (RTC Records, Volume II, pp. 556-557).
29. Rollo, p. 65.
30. Id. at 526-527.
31. G.R. No. 115115, July 18, 1995, 246 SCRA 691.
32. G.R. No. 111580, June 21, 2001, 359 SCRA 273.

33. R.A. No. 8293 (approved June 6, 1997 and effective on January 1, 1998), "An Act
Prescribing The Intellectual Property Code And Establishing The Intellectual Property
Office, Providing For Its Powers And Functions And For Other Purposes," repeals P.D. No.
49 (Decree on Intellectual Property), R.A. No. 165 (The Patent Law), R.A. No. 166 (The
Trademark Law), P.D. No. 285 (Reprint Foreign Textbooks), and Articles 188 and 189 of
the Revised Penal Code.

34. G.R. No. 128550, March 16, 2000, 328 SCRA 286.
35. RTC Records, Volume I, p. 463.

36. RTC Records, Volume I, p. 464.

37. RTC Records, Volume II, p. 478.

38. See Landbank of the Philippines v. Continental Watchman Agency, Inc., et al., G.R. No.
136114, January 22, 2004, 420 SCRA 624.

39. See Ticzon v. Video Post Manila, Inc., G.R. No. 136342, June 15, 2000, 333 SCRA 472.
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