Row at Figaro
() - August 28, 2011 - 12:00am

What should have been a straightforward business deal is now turning out to be a nightmare.

You see, a wealthy Taiwanese businessman by the name of Jerry Liu reportedly bought into Figaro Coffee Systems, Inc. in 2008. But what Liu and company did not realize was that the business purchase did not include the trademarks for Figaro itself and its products, reportedly for “Frost” and many other marks.

Liu reportedly owns Cirtek Electronics, which is said to be planning an initial public offering late this year.

The trademarks, at the time, were personally held by Figaro founding owner Pacita “Chit” Juan, who held their certificates of tegistration. Trademarks, as intellectual property, can be owned either by corporations or personalities. And for some entrepreneurs, it actually makes good business sense to personally own such as intellectual property as opposed to transferring them to the business. This proved to be the case with Juan and Figaro.

Anyway, in the case of Figaro Coffee Systems and Liu, it is not clear how they could have missed the fact that when they bought into Figaro, the sale excluded intellectual property owned by Juan herself. Note that Juan “lost” control of the company via what seemed to have been a hostile takeover by her business partners, who later invited Liu to come in.

To date, almost three years since the takeover, Figaro Coffee Systems continues to enjoy the use of the trademarks via a Makati court order for status quo. Incidentally, before the court order was issued, Juan voluntarily ceded her rights to some of the trademarks to Lifeworth Marketing Inc., which in turn sold them to Le Café Figaro Enterprises, Inc.

It was only fair that Juan manages to enjoy the fruits of her property, in this case intellectual in nature. She owned them, after all. To date, she continues to own three trademarks, which may be deemed as assets or investments.

Meantime, by virtue of a court order, Figaro Coffee Systems continues to franchise the brand, and profit from it, even if it does not own the trademarks it uses.

It has been several years, and yet the issue is still pending before the Makati courts.

Le Cafe, of course, does not seek to deny Figaro the use of the trademarks but simply wants fair compensation for it. A previous offer of P10 million was reportedly made for the trademarks but this was deemed unacceptable, more so with Figaro reportedly selling franchises for P1.5 million per store, and collects royalties of about five percent for marketing support.

Also, other “brands” such as Barrio Fiesta and Le Coeur De France had been sold in the past for a lot, lot more than P10 million. Why should the marks’ owner in the case of Figaro opt for anything less. Le Cafe, in particular, deserves more.

To further its interest, Le Café even pursued its case before the Intellectual Property Office. However, seven months have reportedly passed and yet the matter doesn’t seem to be getting closer to resolution. Perhaps the IPO Director General, Ric Blancaflor, would want to look into it.

Another round of negotiations has been scheduled in the coming weeks, and perhaps the parties will soon come to an agreement.

Just so that everybody can move on especially Figaro.

For how can the Figaro operators justify to potential franchisees the fact that it is offering them a business to which the trademarks are not actually theirs?

Overcharging the Navy

Who is this desperate lady contractor involved in maritime business who is bad mouthing her competitors, using it as leverage among port and maritime officials to resolve the uncollected fees representing services it rendered to the port call of the United States Navy in the country recently?

The contractor is said to frequently visit her cohorts at the Philippine Ports Authority and Marina sowing intrigues, blaming her business rivals for the long delay in the collection of her fees from the US Navy.

The US Navy is being billed P1,500 per cubic meter of waste water or CHT when, based on PPA Administrative Order 20-2003, the government can only charge any visiting foreign warships P5,000 per port call (flat rate) regardless of the ships dimension and volume of CHT.

It is highly doubtful that the US Navy would settle the fees considering that it may have been overcharged and that a PPA agent is reportedly covering up the overcharging.

If the CHT issue is not satisfactorily clarified and resolved by the PPA, it could have huge diplomatic, military, and environmental repercussions.

The technical services of the local agent, meanwhile, was also put in question during the port visit of the Navy when the water taxis carrying ranking government officials and a business tycoon got stuck in the waters off Manila Bay. The agent blamed engine trouble, but unfortunately, it endanger the safety of the visitors and caused huge embarrassment.

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