TRADEMARKS

FACTS: X, a foreign corporation registered in the United States the trademark of coffee
Folgers.
1. Y in the Philippines produces instant chocolate drink using Polgers. Is Y liable for
trademark infringement?
No, Y is not liable for trademark infringement. In the case of McDonalds Corp.
v. L.C. Big Mak Burger, 437 SCRA 10, the court stated that to establish trademark
infringement, the following elements must be shown:
a. The validity of the plaintiffs mark;
b. The plaintiffs ownership of the mark; and
c. The use of the mark or its colorable imitation by the alleged infringer results
in likelihood of confusion.
A mark which is not registered in the Principal Register and thus not distinctive has no
real protection. In case at hand, the validity of the plaintiffs mark is not shown. It has not also
been proven that the plaintiff owns the mark being used by Y, nor is it shown that the trademark
of X is registered or is well known in the Philippines. There is no basis in charging Y of trademark
infringement since a mark which is not registered or which is not well known in the Philippines is
not protected by our intellectual property laws. Since the first two elements of trademark
infringement are not present, it can be easily concluded that Y is not liable for trademark
infringement.

2. a) Is X, correct to say it is benefitted by the well-known-mark rule hence eligible to

file suit?
Yes, it is correct to say that X is benefitted by the well-known-mark rule hence
eligible to file suit. Article 6bis of the Paris Convention, wherein both the Philippines and
the United States are signatories, states: The countries of the Union undertake, ex
officio if their legislation so permits, or at the request of an interested party, to refuse or
to cancel the registration, and to prohibit the use, of a trademark which constitutes a
reproduction, an imitation, or a translation, liable to create confusion, of a mark
considered by the competent authority of the country of registration or use to be well
known in that country as being already the mark of a person entitled to the benefits of
this Convention and used for identical or similar goods.
This is a self executing provision and does not need legislative enactments to
give it effect in the member country. Furthermore, the internal laws of the Philippines
observe the well-known-mark rule. X therefore is eligible to file suit in this country.

b) Is it correct for Y to allege that chocolate drinkers are different from coffee
drinkers?

Yes, it is correct for Y to allege that chocolate drinkers are different from coffee
drinkers.
Coffee drinkers are usually adults while chocolate drinkers consist mostly of
children and young people.
Coffee drinkers are most likely to be after the caffeine while chocolate drinkers
are after the taste of chocolate.
The following cases show that even if the products seem to be similar, there is still no
infringement:
(Loft Company v. Guan, 18 SCRA 944) tango was permitted registration despite
opposition by tangee because the former was for hair pomade while the latter was for
cosmetics.
(Mead v. Van Dorp, 7 SCRA 768) Alacta was registered as it is milk for babies while
Alaska was milk for daily use.
(Myers v. Director of Patents, 17 SCRA 128) Bioferin was granted as it was for
antibiotics while Bufferin was for analgesic.
3. Y registered BARAKO as trademark of his chocolate. He later learned that X is
registering BARAK as trademark of an instant chocolate drink in the United States. Is
Y eligible to file suit under the well-known-mark rule?
It depends. If the laws of the United States allow the filing of a foreign national
of a suit based on the well-known-mark rule in its courts then Y is eligible to file suit. The
intellectual property law of the Philippines is limited only within its territory. It cannot
extend to other nations.
Although the United States is a signatory to the Paris Convention which
mandates the signatory countries to allow other member countries to sue under the
well known mark rule, it is still within its discretion under its municipal law to determine
whether one is eligible to sue under its courts.
4. X wants to establish a manufacturing plant in the Philippines Folgers. Explain the
two primary requirements if a sister corporation undertakes to perform the
production in the Philippines?
First is that a license contract for the registration and use of the protected mark
shall first be executed between the two companies. This is necessary in order to allow
the sister company to use the protected mark here in the Philippines. After the
execution of the license contract, the same must be registered in the IPO so that it will
have effect against third parties.
The second is that the license contract concerning the registration of a mark, or
an application therefor, shall provide for effective control by the licensor of the quality
of the goods or services of licensee in connection with which the mark is used.