SKETCHERS, USA, INC., vs.

INTER PACIFIC INDUSTRIAL TRADING

CORP., et al.
G.R. No. 164321, November 30, 2006.

FACTS:
Sketchers, USA is a foreign company engaged in the manufacture of
footwear, not doing business in the Philippines. Sketchers registered the trademark
“S” within an oval design to be used in men, women, and children’s footwear.
Sometime in 2002, Sketchers engaged the service of Zetetic Far East, Inc., a
private investigative firm, to conduct an investigation on Inter Pacific Industrial
Corp., in coordination with the NBI to confirm if Inter Pacific is indeed engaged in
the importation, distribution, and sale of unauthorized products bearing the S logo.
On April 2002, Alvin Ambion, market researcher for Zetetic, visited the warehouse
of Inter Pacific. He saw different kinds of footwear bearing the S logo and found
out through the caretakers that Inter Pacific is importing footwear from China and
the same is distributing the footwear to wholesalers and retailers. He further
discovered that Inter Pacific has an outlet store in Baclaran.
With this information, the counsel of Sketchers filed a letter complaint with
the NBI to assist them to stop the importation, distribution, and sale of Inter pacific
footwear bearing the S logo. The NBI conducted further investigation; and as a
result, thereof, applied for a search warrant in Manila RTC for infringement of
trademark allegedly committed by Inter Pacific. The RTC found probable cause
and issued a search warrant on the warehouse and outlet store of Inter Pacific. By
virtue thereof, the NBI seized footwear belonging to Inter pacific bearing the S
logo. Inter Pacific filed a motion to quash the search warrant alleging that there is
no confusing similarity between Inter Pacific’s footwear and Sketchers’ footwear.
The RTC ruled that Inter Pacific’s footwear is not confusingly similar to Sketchers’
and therefore there is no infringement committed. Because of such ruling, the RTC
granted the motion to quash.

ISSUE:
Whether or not the RTC erred in granting the motion to quash.

RULING:
In the case at bar, the subject warrant was issued allegedly in connection
with trademark infringement, particularly the unauthorized use of the S logo by
respondent in their Strong rubber shoes. After conducting the hearing on the
application for search warrant, the court a quo was initially convinced that there
was sufficient reason to justify the issuance of the search warrant. However, upon
motion of the respondent to quash the search warrant, the lower court changed its

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position and declared that there was no probable cause to issue the search warrant
as there was no colorable imitation between respondent’s trademark and the
petitioner. In light of the factual milieu prevalent in the instant case, the court may
not be faulted for reversing its initial finding that there was no probable cause.

Learnings:
Based on the courts’ inherent power to issue search warrants and to quash the
same, the courts must be provided with the opportunity to correct itself of an error
inadvertently committed. After re-evaluating the evidence presented before it, the
trial court may reverse its initial finding of probable cause in order that its
conclusion may be made to conform to the facts prevailing in the instant case.