ETEPHA, A.G., Petitioner, vs. DIRECTOR OF PATENTS and WESTMONT PHARMACEUTICALS, INC., Respondents .

(G.R. No. L-20635, March 31, 1966)

FACTS:

Respondent Westmont Pharmaceuticals, Inc., a New York corporation, sought registration of trademark "Atussin"
placed on its "medicinal preparation of expectorant antihistaminic, bronchodilator sedative, ascorbic acid (Vitamin
C) used in the treatment of cough". The trademark is used exclusively in the Philippines since January 21, 1959.

Petitioner, Etepha, A. G., a Liechtenstin (principality) corporation, objected claiming that it will be damaged
because Atussin is so confusedly similar to its Pertussin used on a preparation for the treatment of coughs, that the
buying public will be misled into believing that Westmont's product is that of petitioner's which allegedly enjoys
goodwill.

The Director of Patents ruled that the trademark ATUSSIN may be registered even though PERTUSSIN had been
previously registered from the same office, hence, this appeal.

ISSUE: Whether or not ATUSSIN may be registered?

HELD:

We are to be guided by the rule that the validity of a cause for infringement is predicated upon colorable imitation.
The phrase "colorable imitation" denotes such a "close or ingenious imitation as to be calculated to deceive
ordinary persons, or such a resemblance to the original as to deceive an ordinary purchaser, giving such attention
as a purchaser usually gives, and to cause him to purchase the one supposing it to be the other.

A practical approach to the problem of similarity or dissimilarity is to go into the whole of the two trademarks
pictured in their manner of display. Inspection should be undertaken from the viewpoint of a prospective buyer.
Confusion is likely between trademarks, however, only if their over-all presentations in any of the particulars of
sound, appearance, or meaning are such as would lead the purchasing public into believing that the products to
which the marks are applied emanated from the same source.

We concede the possibility that buyers might be able to obtain Pertussin or Attusin without prescription. When
this happens, then the buyer must be one thoroughly familiar with what he intends to get, else he would not have
the temerity to ask for a medicine — specifically needed to cure a given ailment. In which case, the more
improbable it will be to palm off one for the other. For a person who purchases with open eyes is hardly the man
to be deceived.

For the reasons given, the appealed decision of the respondent Director of Patents — giving due course to the
application for the registration of trademark ATTUSIN is hereby affirmed. Cost against petitioner. So ordered.

KHO V. CA (CASE DIGEST. G.R. NO. 115758)

CASE DIGEST: 429 Phil. 140. SECOND DIVISION [ G.R. No. 115758, March 19, 2002 ] ELIDAD C. KHO, DOING
BUSINESS UNDER THE NAME AND STYLE OF KEC COSMETICS LABORATORY, PETITIONER, VS. HON. COURT OF
APPEALS, SUMMERVILLE GENERAL MERCHANDISING AND COMPANY, AND ANG TIAM CHAY, RESPONDENTS. DE
LEON, JR., J.:

FACTS: On December 20, 1991, petitioner Elidad C. Kho filed a complaint for injunction and damages with a prayer
for the issuance of a writ of preliminary injunction, docketed as Civil Case No. Q-91-10926, against the respondents
Summerville General Merchandising and Company (Summerville, for brevity) and Ang Tiam Chay.

The petitioner’s complaint alleges that petitioner, doing business under the name and style of KEC Cosmetics
Laboratory, is the registered owner of the copyrights Chin Chun Su and Oval Facial Cream Container/Case, as
shown by Certificates of Copyright Registration No. 0-1358 and No. 0-3678; that she also has patent rights on Chin
Chun Su & Device and Chin Chun Su for medicated cream after purchasing the same from Quintin Cheng, the
registered owner thereof in the Supplemental Register of the Philippine Patent Office on February 7, 1980 under
Registration Certificate No. 4529; that respondent Summerville advertised and sold petitioner’s cream products
under the brand name Chin Chun Su, in similar containers that petitioner uses, thereby misleading the public, and
resulting in the decline in the petitioner’s business sales and income; and, that the respondents should be enjoined
from allegedly infringing on the copyrights and patents of the petitioner.

The respondents, on the other hand, alleged as their defense that Summerville is the exclusive and authorized
importer, re-packer and distributor of Chin Chun Su products manufactured by Shun Yi Factory of Taiwan; that the
said Taiwanese manufacturing company authorized Summerville to register its trade name Chin Chun Su
Medicated Cream with the Philippine Patent Office and other appropriate governmental agencies; that KEC
Cosmetics Laboratory of the petitioner obtained the copyrights through misrepresentation and falsification; and,
that the authority of Quintin Cheng, assignee of the patent registration certificate, to distribute and market Chin
Chun Su products in the Philippines had already been terminated by the said Taiwanese Manufacturing Company.

After due hearing on the application for preliminary injunction, the trial court granted the same in an Order dated
February 10, 1992. Motion for reconsideration, denied.

On April 24, 1992, the respondents filed a petition for certiorari with the Court of Appeals, docketed as CA-G.R. SP
No. 27803, praying for the nullification of the said writ of preliminary injunction issued by the trial court. After the
respondents filed their reply and almost a month after petitioner submitted her comment, or on August 14 1992,
the latter moved to dismiss the petition for violation of Supreme Court Circular No. 28-91, a circular prohibiting
forum shopping. According to the petitioner, the respondents did not state the docket number of the civil case in
the caption of their petition and, more significantly, they did not include therein a certificate of non-forum
shopping. The respondents opposed the petition and submitted to the appellate court a certificate of non-forum
shopping for their petition.

On May 24, 1993, the appellate court rendered a Decision in CA-G.R. SP No. 27803 ruling in favor of the
respondents.

The petitioner filed a motion for reconsideration. This she followed with several motions to declare respondents in
contempt of court for publishing advertisements notifying the public of the promulgation of the assailed decision
of the appellate court and stating that genuine Chin Chun Su products could be obtained only from Summerville
General Merchandising and Co.

In the meantime, the trial court went on to hear petitioner’s complaint for final injunction and damages. On
October 22, 1993, the trial court rendered a Decision[7] barring the petitioner from using the trademark Chin Chun
Su and upholding the right of the respondents to use the same, but recognizing the copyright of the petitioner over
the oval shaped container of her beauty cream. The trial court did not award damages and costs to any of the
parties but to their respective counsels were awarded Seventy-Five Thousand Pesos (P75,000.00) each as
attorney’s fees. The petitioner duly appealed the said decision to the Court of Appeals.

On June 3, 1994, the Court of Appeals promulgated a Resolution[8] denying the petitioner’s motions for
reconsideration and for contempt of court in CA-G.R. SP No. 27803.

The petitioner faults the appellate court for not dismissing the petition on the ground of violation of Supreme
Court Circular No. 28-91. Also, the petitioner contends that the appellate court violated Section 6, Rule 9 of the
Revised Internal Rules of the Court of Appeals when it failed to rule on her motion for reconsideration within
ninety (90) days from the time it is submitted for resolution. The appellate court ruled only after the lapse of three
hundred fifty-four (354) days, or on June 3, 1994. In delaying the resolution thereof, the appellate court denied the
petitioner’s right to seek the timely appellate relief. Finally, petitioner describes as arbitrary the denial of her
motions for contempt of court against the respondents.

ISSUE: [1] Would the copyright and patent over the name and container of a beauty cream product entitle the
registrant to the use and ownership over the same to the exclusion of others?

[2] Should an injunctive writ (plus damages) issue?

HELD: We rule in favor of the respondents. WHEREFORE, the petition is DENIED. The Decision and Resolution of
the Court of Appeals dated May 24, 1993 and June 3, 1994, respectively, are hereby AFFIRMED. With costs
against the petitioner.

Trademark, copyright and patents are different intellectual property rights that cannot be interchanged with one
another. A trademark is any visible sign capable of distinguishing the goods (trademark) or services (service mark)
of an enterprise and shall include a stamped or marked container of goods.[12] In relation thereto, a trade name
means the name or designation identifying or distinguishing an enterprise.[13] Meanwhile, the scope of
a copyright is confined to literary and artistic works which are original intellectual creations in the literary and
artistic domain protected from the moment of their creation.[14] Patentable inventions, on the other hand, refer
to any technical solution of a problem in any field of human activity which is new, involves an inventive step and is
industrially applicable.[15]

Petitioner has no right to support her claim for the exclusive use of the subject trade name and its container. The
name and container of a beauty cream product are proper subjects of a trademark inasmuch as the same falls
squarely within its definition. In order to be entitled to exclusively use the same in the sale of the beauty cream
product, the user must sufficiently prove that she registered or used it before anybody else did. The petitioner’s
copyright and patent registration of the name and container would not guarantee her the right to the exclusive use
of the same for the reason that they are not appropriate subjects of the said intellectual rights. Consequently,
a preliminary injunction order cannot be issued for the reason that the petitioner has not proven that she has a
clear right over the said name and container to the exclusion of others, not having proven that she has registered a
trademark thereto or used the same before anyone did.

FINAL INJUNCTION AND DAMAGES: We cannot likewise overlook the decision of the trial court in the case for final
injunction and damages. The dispositive portion of said decision held that the petitioner does not have trademark
rights on the name and container of the beauty cream product. The said decision on the merits of the trial court
rendered the issuance of the writ of a preliminary injunction moot and academic notwithstanding the fact that the
same has been appealed in the Court of Appeals.

SASOT V. PEOPLE
GR 143193, 29 June 2005

FACTS: The National Bureau of Investigation (NBI) investigated the petitioners, pursuant to a complaint by the NBA
Properties, Inc., for possible violation of Article 189 of the Revised Penal Code on unfair competition.

NBA Properties, Inc., is a foreign corporation organized under the laws of the United States of America, and is the
registered owner of NBA trademarks and names of NBA basketball teams such as “USA BASKETBALL,” “CHICAGO
BULLS,” “ORLANDO MAGIC,” “LOS ANGELES LAKERS,” “ROCKETS,” “PHOENIX SUNS,” “BULLETS,” “PACERS,”
“CHARLOTTE HORNETS,” “BLAZERS,” “DENVER NUGGETS,” “SACRAMENTO KINGS,” “MIAMI HEAT, ”UTAH JAZZ,”
“DETROIT PISTONS,” “MILWAUKEE BUCKS,” “SEATTLE SONICS,” “TORONTO RAPTORS,” “ATLANTA HAWKS,”
“CAVS,” “DALLAS MAVERICKS,” “MINNESOTA TIMBERWOLVES,” and “LOS ANGELES CLIPPERS.” These names are
used on hosiery, footwear, tshirts, sweatshirts, tank tops, pajamas, sport shirts, and other garment products,
allegedly registered with the Bureau of Patents, Trademarks and Technology Transfer.

During the investigation on the petitioners, it was discovered that they are engaged in the manufacture, printing,
sale, and distribution of counterfeit "NBA" garment products. Hence, NBI recommended petitioners' prosecution
for unfair competition under Article 189 of the Revised Penal Code.

An information was filed against the petitioners, ALLANDALE SASOT and MELBAROSE SASOT of Allandale
Sportslines, Inc., but before arraignment, petitioners filed a Motion to Quash the Information. Petitioners contend
that the complainant is a foreign corporation not doing business in the Philippines and cannot be protected by
Philippine patent laws since it is not a registered patentee. Petitioners aver that they have been using the business
name ALLANDALE SPORTSLINE, INC. since 1972, and their designs are original and do not appear to be similar to
complainant’s, and they do not use complainant’s logo or design. The trial court and the Court of Appeals both
ruled against the petitioner.

ISSUE: Whether a foreign corporation not engaged and licensed to do business in the Philippines may maintain a
cause of action for unfair competition?

HELD: Yes. The crime of Unfair Competition punishable under Article 189 of the Revised Penal Code is a public
crime. It is essentially an act against the State and it is the latter which principally stands as the injured party. The
complainant’s capacity to sue in such case becomes immaterial.

In La Chemise Lacoste, S.A. vs. Fernandez, a case akin to the present dispute, as it involved the crime of Unfair
Competition under Article 189 of the Revised Penal Code, and the quashal of search warrants issued against
manufacturers of garments bearing the same trademark as that of the petitioner, the Court succinctly ruled that:

More important is the nature of the case which led to this petition. What preceded this petition for
certiorari was a letter-complaint filed before the NBI charging Hemandas with a criminal offense, i.e.,
violation of Article 189 of the Revised Penal Code. If prosecution follows after the completion of the
preliminary investigation being conducted by the Special Prosecutor the information shall be in the
name of the People of the Philippines and no longer the petitioner which is only an aggrieved party
since a criminal offense is essentially an act against the State. It is the latter which is principally the
injured party although there is a private right violated. Petitioner's capacity to sue would become,
therefore, of not much significance in the main case. We cannot allow a possible violator of our criminal
statutes to escape prosecution upon a far-fetched contention that the aggrieved party or victim of a crime
has no standing to sue.

In upholding the right of the petitioner to maintain the present suit before our courts for unfair
competition or infringement of trademarks of a foreign corporation, we are moreover recognizing our
duties and the rights of foreign states under the Paris Convention for the Protection of Industrial Property
to which the Philippines and France are parties. We are simply interpreting and enforcing a solemn
international commitment of the Philippines embodied in a multilateral treaty to which we are a party and
which we entered into because it is in our national interest to do so.

CRISANTA Y. GABRIEL vs.

DR. JOSE R. PEREZ and HONORABLE TIBURCIO EVALLE as Director of Patents

 G.R. No. L-24075 January 31, 1974

FACTS:
In January, 1959, respondent Dr. Jose Perez, owner and inventor of Wonder Soap, made an agreement with a
certain company named "Manserco" for the distribution of his soap. It was then being managed by Mariano S.
Yangga who happens to be the brother of the Petitioner Crisanta Y. Gabriel

Because the corporation was allegedly going bankrupt and the members were deserting, the Respondent
terminated the agreement in July, 1959, and thereafter he asked the Petitioner to become the distributor of his
products, hence, the contract of "Exclusive Distributorship".

On Feb 23, 1961, Dr. Jose R. Perez filed with the Patents Office an application for registration of the trademark
"WONDER" in the Supplemental Register. The said petition was approved and the trademark "WONDER" was
registered.

Petitioner Crisanta Y. Gabriel on the other hand, earlier filed on October 3, 1960 with the Patent Office a petition
to register the same trademark "WONDER" and claimed March 7, 1959 as the date of first use of said trademark in
commerce. Said petition was dismissed on November 18, 1960 by the Patents Office (thru its examiner) on the
ground that said petitioner was not the owner of the trademark sought to be registered, informing at the same
time petitioner that "as shown on the labels submitted, it appear that Dr. Jose R. Perez is the owner of the present
mark ... ."

In support of her petition, she further alleged the written contract between her and the Dr. Perez, wherein,
according to her, the latter has recognized her right of use and ownership of said trademark; and that the labels
submitted by the registrant are the very containers bearing the trademark "WONDER" which are owned by her and
which she has been exclusively and continuously using in commerce .

Issue: WON the respondent, as an exclusive distributor has the right to register the mark.

Ruling

No. The statute provides that "the owner of a trademark use in commerce may register his trademark ... ." By
statutory definition a trademark is "any word, name, symbol or device or any combination thereof  adopted and
used by a manufacture or merchant to identify his goods and distinguish them from those manufactured by others.
There is nothing in the statute which remotely suggests that one who merely sells a manufacturer's goods bearing
the manufacturer's mark acquires any rights in the mark; nor is there anything in the statute which suggests that
such a person may register a mark which his supplier has adopted and used to identify his goods. 

The exclusive distributor does not acquire any proprietary interest in the principal's trademark. In the absence of
any inequitable conduct on the part of the manufacturer, an exclusive distributor who employs the trademark of
the manufacturer does not acquire proprietary rights of the manufacturer, and a registration of the trademark by
the distributor as such belongs to the manufacturer, provided the fiduciary relationship does not terminate before
application for registration is filed.

Taiwan Kolin Corporation, Ltd., v. Kolin Electronics Co. Inc.

FACTS:

On February 29, 1996, Taiwan Kolin filed with the Intellectual Property Office (IPO), for the use of “KOLIN” on a
combination of goods, including colored televisions, refrigerators, window-type and split-type air conditioners,
electric fans and water dispensers. The application would eventually be considered abandoned for Taiwan Kolin’s
failure to respond to IPO’s Paper No. 5 requiring it to elect one class of good for its coverage. However, the same
application was subsequently revived through another application, with petitioner electing Class 9 as the subject of
its application, particularly: television sets, cassette recorder, VCD Amplifiers, camcorders and other audio/video
electronic equipment, flat iron, vacuum cleaners, cordless handsets, videophones, facsimile machines, teleprinters,
cellular phones and automatic goods vending machine.

On July 13, 2006, respondent Kolin Electronics Co., Inc. (Kolin Electronics) opposed petitioner’s revived application
arguing that the mark Taiwan Kolin seeks to register is identical, if not confusingly similar, with its “KOLIN” mark
registered on November 23, 2003, covering the following products under Class 9 of the NCL: automatic voltage
regulator, converter, recharger, stereo booster, AC-DC regulated power supply, step-down transformer, and PA
amplified AC-DC.

ISSUE: WON petitioner is entitled to its trademark registration of “KOLIN” over its specific goods of television sets
and DVD players.

HELD:

The Supreme Court held that the petitioner’s trademark registration not only covers unrelated good, but is also
incapable of deceiving the ordinary intelligent buyer. The ordinary purchaser must be thought of as having, and
credited with, at least a modicum of intelligence to be able to see the differences between the two trademarks in
question.

It agreed with the petitioner on the following:

 Taiwan Kolin’s goods are classified as home appliances as opposed to Kolin Electronics’ goods which are
power supply and audio equipment accessories;
 Taiwan Kolin’s television sets and DVD players perform distinct function and purpose from Kolin
Electronics’ power supply and audio equipment; and
 Taiwan Kolin sells and distributes its various home appliance products on wholesale and to accredited
dealers, whereas Kolin Electronics’ goods are sold and flow through electrical and hardware stores.

On the arguments that both their goods belong to Class 9 of the NCL, the Supreme Court ruled that identical marks
may be registered for products from the same classification. The mere uniformity in categorization, by itself, does
not automatically preclude the registration of what appears to be an identical mark, if that be the case.

Moreover, the Supreme Court stated that the products covered by petitioner’s application and respondent’s
registration are unrelated.

B0E: Diaz v. People of the Philippines and Levi Strauss (Phils.), Inc.,
GR 180677, 18 February 2013, First Division, Bersamin [J]

FACTS: The Department of Justice filed 2 Informations in the RTC in Las Piñas City charging Victorio Diaz with
violation of Sec. 155, in relation to Sec. 179 of R.A. No. 8293 (Intellectual Property Code) for infringement of the
registered trademarks particularly LEVI’S 501 jeans. Diaz was alleged to have reproduced, counterfeited, copied
and colorably imitated Levi’s registered trademarks or dominant features thereof such as the actuate design, two
horse brand, two horse patch, two horse label with patterned arcuate design, tab and composite actuate/tab/two
horse patch and sold, offered to sale, manufactured, distributed counterfeit patches and jeans, including other
preparatory steps necessary to carry out the sale of said patches and jeans, which likely caused confusion, mistake,
and/or deceived the general consuming public, without the consent, permit or authority of the registered owner,
Levi’s, thus depriving and defrauding the latter of its right to the exclusive use of its trademarks and legitimate
trade, to the damage and prejudice of Levi’s.

Levi Strauss Philippines, Inc. is a licensee of Levi’s. After receiving information that Diaz was selling counterfeit
Levi’s 501 jeans in his tailoring shops in Almanza and Talon, Las Piñas City, Levi’s Philippines hired a private
investigation group to verify the information. Surveillance and the purchase of jeans from the tailoring shops of
Diaz established that the jeans bought from the tailoring shops of Diaz were counterfeit or imitations of Levi’s 501.
Armed with search warrants, NBI agents searched the tailoring shops of Diaz and seized several fake Levi’s 501
jeans from them. Levi’s Philippines claimed that it did not authorize the making and selling of the seized jeans; that
each of the jeans were colorable imitations of genuine Levi’s 501 jeans by each of them bearing the registered
trademarks, like the arcuate design, the tab, and the leather patch; and that the seized jeans could be mistaken for
original Levi’s 501 jeans due to the placement of the arcuate, tab, and two-horse leather patch.

On his part, Diaz admitted being the owner of the shops searched, but he denied any criminal liability. Diaz stated
that he did not manufacture Levi’s jeans, and that he used the label “LS Jeans Tailoring” in the jeans that he made
and sold; that the label “LS Jeans Tailoring” was registered with the Intellectual Property Office; that his shops
received clothes for sewing or repair; that his shops offered made-to-order jeans, whose styles or designs were
done in accordance with instructions of the customers; that since the time his shops began operating in 1992, he
had received no notice or warning regarding his operations; that the jeans he produced were easily recognizable
because the label “LS Jeans Tailoring,” and the names of the customers were placed inside the pockets, and each
of the jeans had an “LSJT” red tab; that “LS” stood for “Latest Style;” and that the leather patch on his jeans had
two buffaloes, not two horses.

ISSUE(S): Whether there exists a likelihood of confusion between the trademarks of Levi’s and Diaz.

RULING: NO. The Court held, through the application of the holistic test, that there was no likelihood of confusion
between the trademarks involved. Accordingly, the jeans trademarks of Levi’s Philippines and Diaz must be
considered as a whole in determining the likelihood of confusion between them. The maongpants or jeans made
and sold by Levi’s Philippines, which included LEVI’S 501, were very popular in the Philippines. The consuming
public knew that the original LEVI’S 501 jeans were under a foreign brand and quite expensive. Such jeans could be
purchased only in malls or boutiques as ready-to-wear items, and were not available in tailoring shops like those of
Diaz’s as well as not acquired on a “made-to-order” basis. Under the circumstances, the consuming public could
easily discern if the jeans were original or fake LEVI’S 501, or were manufactured by other brands of jeans.

Diaz used the trademark “LS Jeans Tailoring” for the jeans he produced and sold in his tailoring shops. His
trademark was visually and aurally different from the trademark “LEVI STRAUSS & CO” appearing on the patch of
original jeans under the trademark LEVI’S 501. The word “LS” could not be confused as a derivative from “LEVI
STRAUSS” by virtue of the “LS” being connected to the word “tailoring”, thereby openly suggesting that the jeans
bearing the trademark “LS Jeans Tailoring” came or were bought from the tailoring shops of Diaz, not from the
malls or boutiques selling original LEVI’S 501 jeans to the consuming public.

The prosecution also alleged that the accused copied the “two horse design” of the petitioner-private complainant
but the evidence will show that there was no such design in the seized jeans. Instead, what is shown is “buffalo
design.” Again, a horse and a buffalo are 2 different animals which an ordinary customer can easily distinguish.

The prosecution further alleged that the red tab was copied by the accused. However, evidence will show that the
red tab used by the private complainant indicates the word “LEVI’S” while that of the accused indicates the letters
“LSJT” which means LS Jeans Tailoring. Again, even an ordinary customer can distinguish the word LEVI’S from the
letters LSJT.

In terms of classes of customers and channels of trade, the jeans products of the private complainant and the
accused cater to different classes of customers and flow through the different channels of trade. The customers of
the private complainant are mall goers belonging to class A and B market group – while that of the accused are
those who belong to class D and E market who can only afford Php 300.00 for a pair of made-to-order pants.

Moreover, based on the certificate issued by the Intellectual Property Office, “LS Jeans Tailoring” was a registered
trademark of Diaz. He had registered his trademark prior to the filing of the present cases. The IPOPHL would
certainly not have allowed the registration had Diaz’s trademark been confusingly similar with the registered
trademark for LEVI’s “501” jeans.

Thus, the Supreme Court acquitted as there is no likelihood of confusion between the expensive boutique brand as
against the locally cheaper custom-made denims of the supposed copycat.

WILTON DY and/or PHILITES ELECTRONIC & LIGHTING PRODUCTS, petitioner, vs. KONINKLIJKE PHILIPS

ELECTRONICS, N.V., respondent.||| 

G.R. No. 186088. March 22, 2017

Facts:

On April 12, 2000, petitioner Wilton Dy and/or Philites Electronic & Ligthing Products (Philites) filed a trademark
application, Application Serial Number 4-2000-002937, covering its fluorescent bulb, incandescent light, starter
and ballast. After publication, respondent Konkklijke Philips Electronics, N.V. (Philips) filed its opposition on March
17, 2006. Philites filed an answer, stating that its “Philites &Letter device trademark and respondent’s “Philips”
have vast dissimilarities in terms of spelling, sound and meaning. At the conclusion of the hearing, on November 9,
2006, IPP-BLA Director Estrelita Beltran-Abelardo rendered a decision denying the opposition filed by respondent
Philips.

In upholding Philites’s trademark application the IPP-BLA stated that assuming Philip’s mark was well-known in the
Philippines, there should have been prior determination of whether or not the mark under application for
registration was identical with, or confusingly similar to, or constitutes a translation of such well-known
mark in order that the owner of the well-known mark can prevent its registration. From the evidence
presented, the IPP-BLA concluded that the “Philips” and “Philites” marks were so unlike, both visually and
aurally. It held that no confusion was likely to occur, despite their simultaneous use.

Upon appeal, the IPP-DG rendered a decision on April 16, 2008, affirming the ruling of the IPP-BLA. In so ruling, the
IPP-DG noted that the dominant feature of the respondent’s trademark is “Philips” while that of the petitioner’s
trademark is “philites” while the first syllables of the marks are identical the second syllables are not. The
differences in the last syllable accounted for the variance of the trademarks visually and aurally. Moreover, there
were glaring differences and dissimilarities in the design and general appearance of the Philips shield emblem mark
and the letter P of Philites mark.

Upon appeal, the CA ruled in favor of Philips and dismissed the application for trademark registration respondent
Philites. The CA reasoned that the drawing of the trademark submitted by Philites has a different appearance from
that of Philites’s actual wrapper or packaging that contain the light bulbs, which the CA find confusingly similar
with that of Philips’s registered trademark and packaging. Moreover, it found to be self-serving the Philite’
asseveration that the mark “philites” is a coined or arbitrary mark from the words Philippines and lights. Of all the
marks that the petitioner could possibly think of for his light bulbs, it is odd that he chose a mark with the letters
phili, which are the same prevalent or dominant five letters found in respondent’s trademark “Philips” for the
same products, light bulbs. Hence, the CA concluded that Philites had intended to ride on the long-established
reputation and goodwill of Philips’s trademark. Philites filed a motion for reconsideration, however, it was denied;
hence this petition.

Issue:

Whether or not the mark applie for by Philites is identical or confusingly similar with that of Philips?

Held: Yes!

The mark applied for by Philites is identical or confusingly similar with that of Philips. Despite Philips’s
diversification to numerous and varied industries, the records show that both parties are engaged in the same line
of business: selling identical or similar goods such as fluorescent bulbs, incandescent lights, starters and ballasts. In
determining similarity and likelihood of confusion, jurisprudence has developed two tests: the dominancy test, and
the holistic or totality test.

The dominancy test focuses on the similarity of the prevalent or dominant features of the competing trademarks
that might cause confusion, mistake, and deception in the mind of the purchasing public. Duplication or imitation is
not necessary; neither is it required that the mark sought to be registered suggest an effort to imitate. Given more
consideration are the aural and visual impressions created by the marks on the buyers of goods, giving little weight
to factors like prices, quality, sales outlets, and market segments. While the holistic or totality test necessitates a
consideration of the entirety of the marks as applied to the products, including the labels and packaging, in
determining confusing similarity. The discerning eye of the observer must focus not only on the predominant
words, but also on the other features appearing on both labels so that the observer may draw conclusion on
whether one is confusingly similar to the other.

Applying the dominancy test in the case at bar, required the Court to look only at the mark submitted by Philites in
its application, while giving importance to the aural and visual impressions the mark is likely to create in the minds
of the buyers, the Court agrees with the findings of the CA that the mark philites bears an uncanny resemblance or
confusing similarity with respondent’s mark Philips. An examination of the trademarks shows that their dominant
or prevalent feature is the five-letter Phili, for Philips and Philites respectively. The marks are confusingly similar
with each other that an ordinary purchaser can conclude an association or relation between the marks. The
consuming public does not have the luxury of time to ponder the phonetic sounds of the trademarks, to find out
which one has a short or long vowel sound. At bottom, the letter Phili, visually catch the attention of the
consuming public and the use of respondent’s trademark will likely to deceive or cause confusion. Most
importantly, both trademarks are used in the sale of the same goods, which are light bulbs. The confusing
similarity becomes even more prominent when we examine the entirety of the marks used by both parties,
including the way the products are packaged.

In using the holistic test, the Court find that there is a confusing similarity between the registered marks Philips
and Philites, and note that the mark philites seeks to register is vastly different from that which it actually uses in
the packaging of its products. The holistic test entails a consideration of the entirety of the marks as applied to the
products, including the labels and packaging, in determining confusing similarity. A comparison between Philips’s
registered trademark Philips as used in the wrapper or packaging of its light bulbs and that of Philites’s applied for
trademark Philites as depicted in the container or actual wrapper/packaging of the latter’s light bulbs will readily
show that there is a strong similitude and likeness between the two trademarks that will likely cause deception or
confusion to the purchasing public. The fact that the parties’ wrapper or packaging reflects neglible differences
considering the use of a slightly different font and hue of the yellow is immaterial because taken in their entirety,
Philites’s trademark Philites will likely cause confusion or deception to the ordinary purchaser with a modicum of
intelligence.

Doctrine: A mere distributor of a product bearing a trademark, even if permitted to use said trademark has no right
to and cannot register the said trademark.

B01

[G.R. No. L-24075 January 31, 1974] CRISANTA Y. GABRIEL vs.DR. JOSE R. PEREZ

Facts: Dr. Perez, a medical researcher and manufacturer, was experimenting on the creation of a beauty soap. He
discovered a workable formula then applied from the Bureau of Health for the issuance of a Certificate of Label
Approval. He was issued such certificate. It covers a beauty soap for bleaching, which whitens or sometimes
softens the skin "Dr. Perez" Wonder Beauty Soap. He continued experimenting until he was able to discover an
improved soap formula which he claims that aside from bleaching or whitening the skin it also allegedly removes
pimples, freckles, dandruff, scabies, itching, head lice(s), rashes, falling of hair, and shallow wrinkles. Then he
obtained another certificate of label approval from the Bureau of Health on August 10, 1959, "Dr. Perez Wonder
Beauty Soap (Improved Formula)." In January, 1959 he made an agreement with "Manserco" for the distribution of
his soap. It was then being managed by Mariano S. Yangga who happens to be the brother of the Petitioner
Gabriel. This was corroborated by Mr. August Cesar Espiritu who testified in favor of the Respondent. Mr. Espiritu
claims to be the organizer and one of the incorporators of "Manserco," although really no document of its
corporate existence was introduced as evidence. Because the corporation was allegedly going bankrupt and the
members were deserting, Dr. Perez terminated the agreement in July, 1959, and thereafter he asked the Petitioner
Gabriel to become the distributor of his products and on September 1, 1959, a contract of "Exclusive
Distributorship" was executed between the Petitioner and the Respondent.

Petitioner Crisanta Y. Gabriel filed with the Patent Office a petition for cancellation of the trademark "WONDER
from the supplemental register. Gabriel alleged that the registrant was not entitled to register the said trademark
at the time of his application for registration; that the trademark was not used and has not been actually used by
registrant at the time he applied for its registration; that it was thru fraud and misrepresentation that the
registration was procured by the registrant; that it was she who has been actually using the said trademark since
March, 1959, and as such is the rightful and recognized owner thereof and therefore entitled to its registration;
that the written contract between her and the registrant (respondent) wherein the registrant has recognized her
right of use and ownership of said trademark; and that the labels submitted by the registrant are the very
containers bearing the trademark "WONDER" which are owned by her and which she has been exclusively and
continuously using in commerce.

Respondent Dr. Jose R. Perez filed his answer denying each and every ground for cancellation alleged in the said
petition. Perez alleged that there is pending in the CFI of Bulacan for unfair competition with injunction and
damages filed by him against Gabriel involving the manufacture of beauty soap and the use of the trademark
"WONDER"; that a writ of preliminary injunction has been issued on September 7, 1961 by the said court against
Gabriel restraining her "from making, manufacturing and producing 'Wonder Bleaching Beauty Soap' with the
same labels and chemical ingredients as those of the plaintiff, and from advertising, selling and distributing the
same products"; and that no right of petitioner had been violated and therefore no cause of action exists in favor
of petitioner. Respondent Director of Patents denied the petition to cancel the certificate of registration, Gabriel
filed a motion for reconsideration but was also denied.
Counsel for private respondent filed a motion alleging that "respondent Dr. Jose R. Perez had died already and still
Gabriel, has been continuously harassing the rights of the late Dr. Jose R. Perez as far as the ownership and use of
the trademark are concerned.

ISSUE: Whether the petitioner can register the trademark.

RULING:

No. A mere distributor of a product bearing a trademark, even if permitted to use said trademark has no right to
and cannot register the said trademark.

There was already a label or trademark known as "Dr. Perez' WONDER Beauty Soap" as supported by a Certificate
of Label Approval and another Certificate of Label Approval, which are both issued by the Bureau of Health to Dr.
Jose R. Perez as manager of the Dr. Jose R. Perez Cosmetic Laboratory. Both certificates identified the product
covered as "Dr. Perez' Wonder Beauty Soap" and further indicated that said product emanated from the Dr. Jose R.
Perez Cosmetic Laboratory. Furthermore, the certificates show that the Bureau of Health referred to and relied on
the said label or trademark of the product as the basis for its certification that the same (product) "was found not
adulterated nor misbranded." Dr. Jose R. Perez was the originator, producer and manufacturer of the soap product
identified as "DR. JOSE R. PEREZ WONDER BEAUTY SOAP. petitioner Crisanta Y. Gabriel appears to be a mere
distributor of the product by contract with the manufacturer, respondent Dr. Jose R. Perez, only for a term. "Dr.
Perez Wonder  Beauty Soap," a phrase clearly coined by, and associated with, the Respondent. The connotation in
itself is sufficient to clothe the product as an item or a commodity emanating from a particularly identified source
who is none other than Dr. Jose R. Perez. The words serve as an indication of origin, and the product identified by
the words can never be regarded as having emanated or originated from another individual, typical of which is the
Petitioner, mere distributor." Under Section 2 and 2-A of the Trademark Law, Republic Act No. 166, amended, the
right to register trademark is based on ownership and a mere distributor of a product bearing a trademark, even if
permitted to use said trademark, has right to and cannot register the said trademark.

The agreement provides that the petitioner "has the exclusive right of ownership of the packages and that said
party is responsible for the costs as well as the design and manner of packing the same" did not necessarily grant
her the right to the exclusive use of the trademark; because the agreement never mentioned transfer of ownership
of the trademark. It merely empowers the petitioner as exclusive distributor to own the package and to create a
design at her pleasure, but not the right to appropriate unto herself the sole ownership of the trademark so as to
entitle her to registration in the Patent Office. In fact, the agreement does not even grant her the right to register
the mark. The exclusive distributor does not acquire any proprietary interest in the principal's trademark.

Objects of a trademark are "to point out distinctly the origin or ownership of the goods to which it is affixed, to
secure to him, who has been instrumental in bringing into market a superior article of merchandise, the fruit of his
industry and skill, and to prevent fraud and imposition.

A trademark can only be used in connection with the sale of the identical article that has been sold under the
trademark or tradename to the extent necessary to establish them as such.

In this instant case, the trademark "WONDER" has long been identified and associated with the product
manufactured and produced by the Dr. Jose R. Perez Cosmetic Laboratory

B1A Prosource International Inc. v. Horphag Research Management SA

GR 180073, 25 November 2009,

Facts:

Horphag Research Management SA is a corporation duly organized and existing under the laws of Switzerland and
the owner of trademark PYCNOGENOL, a food supplement sold and distributed by Zuellig Pharma Corporation.
Horphag Research Management SA discovered that Prosource International, Inc., was distributing a similar food
supplement using the mark PCO-GENOLS since 1996. This prompted Horphag Research Management SA to
demand Prosource International, Inc. cease and desist from using the said mark. Without notifying Horphag
Research Management SA, Prosource International, Inc. discontinued the use and withdrew from the market, the
products under the name PCO-GENOLS and changed its mark from PCO-GENOLS to PCO-PLUS. Horphag Research
Management SA filed a Complaint for Infringement of Trademark against Prosource International, Inc. that the
brand PCO-GENOLS is being confusingly used similar with Horphag Research Management SA trademark
PYCNOGENOL.
In their answer Prosource International, Inc., contended that Horphag Research Management SA could not file the
infringement case considering that they are not the registered owner of the trademark PYCNOGENOL, but one
Horphag Research Limited. They also claimed that the two marks were not confusingly similar and denied liability,
since it discontinued the use of the mark prior to the institution of the infringement case.

The Trial Court decided in favor of Horphag Research Management SA. It observed that PYCNOGENOL and PCO-
GENOLS have the same suffix "GENOL" which appears to be merely descriptive and thus open for trademark
registration by combining it with other words. They also concluded that the marks, when read, sound similar, and
thus confusingly similar especially since they both refer to food supplements. On appeal to the Appellate court
Prosource International, Inc. failed to obtain a favorable decision. In which the appellate court explained that
under the Dominancy or the Holistic Test, PCO-GENOLS is deceptively similar to PYCNOGENOL. Hence this petition 

Issue: Whether the names are confusingly similar?

Held:

Yes,In determining similarity and likelihood of confusion, jurisprudence has developed two tests: the Dominancy
Test and the Holistic or Totality Test. 

1. The Dominancy Test focuses on the similarity of the prevalent features of the competing trademarks that
might cause confusion and deception, thus constituting infringement.
2. the Holistic Test entails a consideration of the entirety of the marks as applied to the products, including
the labels and packaging, in determining confusing similarity

Here the trial and appellate court applied the Dominancy Test in determining whether there was a confusing
similarity between the marks PYCNOGENOL and PCO-GENOL.

Both the words have the same suffix "GENOL" which on evidence, appears to be merely descriptive and furnish no
indication of the origin of the article and hence, open for trademark registration by Prosource International, Inc
through combination with another word or phrase. When the two words are pronounced, the sound effects are
confusingly similar not to mention that they are both described by their manufacturers as a food supplement and
thus, identified as such by their public consumers. Although there were dissimilarities in the trademark due to the
type of letters used as well as the size, color and design employed on their individual packages or bottles, still the
close relationship of the competing products’ name in sounds as they were pronounced, clearly indicates that
purchasers could be misled into believing that they are the same or originates from a common source and
manufacturer.

BIRKENSTOCK ORTHOPAEDIE GMBH AND CO. KG (FORMERLY BIRKENSTOCK ORTHOPAEDIE GMBH) vs.
PHILIPPINE SHOE EXPO MARKETING
Facts:

Petitioner applied for various trademark registrations before the Philippine IPO, namely: a) “BIRKENSTOCK”; b)
“BIRKENSTOCK BAD HONNEF-RHEIN & DEVICE COMPRISING OF ROUND COMPANY SEAL AND REPRESENTATION OF
A FOOT, CROSS AND SUNBEAM”; c) “BIRKENSTOCK BAD HONNEF-RHEIN & DEVICE COMPRISING OF ROUND
COMPANY SEAL AND REPRESENTATION OF A FOOT, CROSS AND SUNBEAM”. However, the registration
proceedings were suspended in view of an existing registration of mark “BIRKENSTOCK AND DEVICE” in the name
of Shoe Town International and Industrial Corporation, the predecessor-in-interest of respondent Philippine Shoe
Expo Marketing Corporation. Here, petitioner filed a petition for cancellation of the registration on the ground that
it is the lawful and rightful owner of the Birkenstock marks.

Respondent filed an opposition, alleging that: a) it, together with its predecessor-in-interest, has been using
Birkenstock marks in the Philippines for more than 16 years through the mark “BIRKENSTOCK AND DEVICE”; b) the
marks covered by the subject applications are identical to the one covered by the registration and thus, petitioner
has no right to the registration of such marks; d) that while respondent failed to file the 10th Year DAU, it
continued the use of “BIRKENSTOCK AND DEVICE” in lawful commerce, among others.

The BLA rejected the petitioner’s application for registration. It ruled that the competing marks of the parties are
confusingly similar since they contained the work “BIRKENSTOCK” and are used on the same and related goods. It
found respondent as the prior user and adopter of “BIRKENSTOCK” in the Philippines.

IPO Director General reversed BLA’s ruling, and allowed the registration of petitioner’s application. CA reversed,
and reinstated BLA’s ruling.

Issue:

Whether or not the subject marks should be allowed registration in the name of petitioner.

Ruling:

Yes.

Respondent is deemed to have abandoned the mark when it failed to file the 10th Year DAU for Registration on or
before the lawful period. As a consequence, it was deemed to have abandoned or withdrawn any right or interest
over the mark “BIRKENSTOCK”.
Petitioner has duly established its true and lawful ownership of the mark “BIRKENSTOCK”. Under Sec. 2 of RA 166,
in order to register a trademark, one must be the owner thereof and must have actually used the mark in
commerce in the Philippines for 2 months prior to the application for registration.

The registration of a trademark is not a mode of acquiring ownership. If the applicant is not the owner of the
trademark, he has no right to apply for its registration. Registration merely creates a prima facie presumption of
validity of the registration, of the registrant’s ownership of the trademark, and of the exclusive right to the use
thereof. Clearly, it is not the application or registration of a trademark that vests ownership thereof, but it is the
ownership of a trademark that confers the right to register the same.

Here, petitioner was able to establish that it is the owner of the mark “BIRKENSTOCK”. It has used it in commerce
long before respondent was able to register the same here in the Philippines.
B1D
Fredco Manufacturing Corporation v. President and Fellows of Harvard College
G.R. No. 185917, 1 June 2011

Facts:

Fredco Manufacturing Corporation (Fredco) filed before the Bureau of Legal Affairs of the Philippine
Intellectual Property Office a Petition for Cancellation of Registration No. 56561 issued to President and Fellows of
Harvard College (Harvard University) for the mark “Harvard Veritas Shield Symbol” under classes 16, 18, 21, 25 and
28.

Fredco claimed that Harvard University had no right to register the mark in class 25, since its Philippine
registration was based on a foreign registration. Thus, Harvard University could not have been considered as a
prior adopter and user of the mark in the Philippines.
Fredco explained that the mark was first used in the Philippines by its predecessor-in-interest New York Garments
as early as 1982, and a certificate of registration was issued in 1988 for goods under class 25. Although the
registration was cancelled for the non-filing of an affidavit of use, the fact remained that the registration preceded
Harvard University’s use of the subject mark in the Philippines.

Harvard University, on the other hand claimed that the name and mark “Harvard” was adopted in 1639 as
the name of Harvard College of Cambridge, Massachusetts, USA. The marks “Harvard” and “Harvard Veritas Shield
Symbol,” had been used in commerce since 1872, and was registered in more than 50 countries.

The Bureau of Legal Affairs ruled in favor of Fredco and ordered the cancellation of Registration No.
56561. It found Fredco to be the prior user and adopter of the mark “Harvard” in the Philippines. On appeal, the
Office of the Director General of the Intellectual Property Office reversed the BLA ruling on the ground that more
than the use of the trademark in the Philippines, the applicant must be the owner of the mark sought to be
registered. Fredco, not being the owner of the mark, had no right to register it.

The Court Appeals affirmed the decision of the Office of the Director General. Fredco appealed the
decision with the Supreme Court. In its appeal, Fredco insisted that the date of actual use in the Philippines should
prevail on the issue of who had a better right to the mark.

Issue:

Whether or not respondent’s trade name is infringed.

Held: 

Yes. Fredco’s use of the mark “Harvard,” coupled with its claimed origin in Cambridge, Massachusetts,
obviously suggests a false connection with Harvard University. On this ground alone, Fredco’s registration of the
mark “Harvard” should have been disallowed. Indisputably, Fredco does not have any affiliation or connection with
Harvard University, or even with Cambridge, Massachusetts. Fredco or its predecessor New York Garments was not
established in 1936, or in the U.S.A. as indicated by Fredco in its oblong logo.

Under Philippine law, a trade name of a national of a State that is a party to the Paris Convention,
whether or not the trade name forms part of a trademark, is protected “without the obligation of filing or
registration.” “Harvard” is the trade name of the world famous Harvard University, and it is also a trademark of
Harvard University. Under Article 8 of the Paris Convention, as well as Section 37 of R.A. No. 166, Harvard
University is entitled to protection in the Philippines of its trade name “Harvard” even without registration of such
trade name in the Philippines. This means that no educational entity in the Philippines can use the trade name
“Harvard” without the consent of Harvard University. Likewise, no entity in the Philippines can claim, expressly or
impliedly through the use of the name and mark “Harvard,” that its products or services are authorized, approved,
or licensed by, or sourced from, Harvard University without the latter’s consent.

AMIGO MANUFACTURING, INC. v. CLUETT PEABODY CO., INC.

G.R. No. 139300, 14 March 2001; Panganiban, J.

FACTS:

Petitioner Amigo Manufacturing, Inc. challenges, under Rule 45 of the Rules of Court,

the decision of the Court of Appeals upholding the judgment of the trial court in favor

of respondpent Cluett Peabody Co., Inc.

Amigo, a Philippine-based company and a successor-in-interest of Great American

Knitting Mills, Inc., sought the cancellation of the trademark and devices Cluett, a US-

based company, was using on men’s socks and claimed exclusive ownership over it.

Amigo:

BRAND NAME: Gold Toe

DEVICE: representation of a sock and magnifying glass on the toe of a sock consisting of a ‘plurality of gold
colored lines arranged in parallel relation within triangular are of toe of the stocking and spread from each other
by lines of contrasting color of the major part of the stocking.

Cluett

BRAND NAME: Gold Top

DEVICE: has dominant color white at the center and a blackish brown background with a magnified design of the
socks garter, and is labeled ‘Amigo Manufacturing Inc., Mandaluyong, Metro Manila, Made in the Philippines.
The trial court rendered decision in favor of Cluett Peabody Co., Inc,.

The Court of Appeals affirmed the decision of the trial court:

a. There is hardly any variance in the appearance of the marks GOLD TOP and GOLD TOE since both show a
representation of a man’s foot wearing a sock, and the marks are printed in identical lettering.

b. The finding of the Bureau of Patents that the two trademarks are confusingly and deceptively similar to each
other are binding upon the courts, absent any sufficient evidence to the contrary.

c. Amigo’s version is only registered with the Supplemental Registry which gives no right of exclusivity to the
owner and cannot overturn the presumption of validity and exclusivity given to the registered mark, whereas,
Cluett was able to present Certificates of Registration.

d. The Philippines and the United States are parties to the Paris Convention and by virtue of Philippines’
membership, trademark rights in favor of the respondent were created.

ISSUES:

1. The date of actual use of the two trademarks;

2. Their confusing similarities; and

3. The applicability of the Paris Convention.

RULING: Petition has no merit.

1. Absent any clear showing to the contrary, the finding of the Bureau of Patents that it was Cluett which had prior
use of the trademark as shown in the various Certificates of Registration issued in its favor.

The registration of a mark upon the supplemental register is not, as in the case of the principal register, prima facie
evidence of (a) the validity of registration, (2) registrant’s ownership of the mark, and (3) registrant’s exclusive
right to use the mark.

Section 20, RA 166. A certificate of registration of a mark or tradename shall be prima facie evidence of the validity
of the registration, the registrant’s ownership of

the mark or tradename, and of the registrant’s exclusive right to use the same subject to any conditions and
limitations stated therein.

Thus, it was Cluett, which first validly registered the trademarks and was able to present proof of registration that
first used the trademark and device in question.

2. Findings of the Director of the Bureau of Patents was accorded great respect on its used of Dominancy Test
and the Holistic Test. Amigo presented no explanation why it chose the representation or marks almost similar
to that of Cluett’s, which trademark was validly registered on its name.
Emerald Garment Manufacturing Corp. v. Court of Appeals stated that in determining whether trademarks
are confusingly similar, jurisprudence has developed two kinds of tests, the Dominancy Test and the Holistic
Test.

a. Dominancy Test – focuses on the similarity of the prevalent features of the competing trademarks which
mightcause confusion or deception, and thus constitutes infringement.

b. Holistic Test – the entirety of the marks in question must be considered in determining confusing similarity.

Applying the two tests, there are some minor differences between the two sets of marks. The similarities are of
such degree, the number and quality that the overall impression given is that the two brands of socks are
deceptively the same, or at

least very similar to each other:

a. Both products used the same type of lettering. Both also included a representation of man’s foot wearing
a sock and the word linenized with arrows printed on label;

b. The names of the brands are similar: Gold Top and Gold Toe;

c. Petitioner and respondent are engaged in the same line of business.

Since Amigo did not present any explanation why it chose the representation, it is

so far from claiming ownership over the trademark and device. Hence, violating

the applicable trademark provision at that time.

3. The Philippines and the United States are members of the Paris Convention,

thus entitling them to the international protection provided therein relating to

protection of trademarks.

B1F UFC Phils Inc. v. Barrio Fiesta Manufacturing Corp, GR 198889, 20 Jan 2016, 1st Division, Leonardo-De Castro
[J]

FACTS: On April 4, 2002, Barrio Fiesta filed an application with the IPO for the mark “PAPA BOY & DEVICE” for
“lechon sauce.” UFC opposed the application. It contended that “PAPA BOY & DEVICE” is confusingly similar with
its “PAPA” marks and its variations inasmuch as the former incorporates the term “PAPA,” which is the dominant
feature of petitioner’s “PAPA” marks. UFC averred that the use of “PAPA BOY & DEVICE” mark for lechon sauce
product, if allowed, would likely lead the consuming public to believe that said lechon sauce product originates
from or is authorized by UFC, and that the “PAPA BOY & DEVICE” mark is a variation or derivative of UFC’s “PAPA”
marks. UFC argued that this was especially true considering that UFC’s ketchup product and Barrio Fiesta’s lechon
sauce product are related articles. The IPO denied the application as it is confusingly similar to the mark of UFC.
The CA applied the holistic test and granted Barrio Fiesta’s application.
ISSUE: WON the CA is correct in granting Barrio Fiesta’s application for the mark “PAPA BOY & DEVICE”
 
No. Barrio Fiesta’s mark cannot be registered. The Dominancy Test and not the Holistic Test must be employed in
this case. The test of dominancy is now explicitly incorporated into law in Section 155.l of R.A. No. 8293. The
Dominancy Test focuses on the similarity of the prevalent features of the competing trademarks that might cause
confusion or deception. It is applied when the trademark sought to be registered contains the main, essential and
dominant features of the earlier registered trademark, and confusion or deception is likely to result. Duplication or
imitation is not even required; neither is it necessary that the label of the applied mark for registration should
suggest an effort to imitate. The important issue is whether the use of the marks involved would likely cause
confusion or mistake in the mind of or deceive the ordinary purchaser, or one who is accustomed to buy, and
therefore to some extent familiar with, the goods in question. Given greater consideration are the aural and visual
impressions created by the marks in the public mind, giving little weight to factors like prices, quality, sales outlets,
and market segments.

The Barrio Fiesta’s mark is related to a product, lechon sauce, an everyday all-purpose condiment and sauce, that
is not subjected to great scrutiny and care by the casual purchaser, who knows from regular visits to the grocery
store under what aisle to find it, in which bottle it is contained, and approximately how much it costs. Since UFC’s
product, catsup, is also a household product found on the same grocery aisle, in similar packaging, the public could
think that UFC had expanded its product mix to include lechon sauce, and that the “PAPA BOY” lechon sauce is
now part of the “PAPA” family of sauces, which is not unlikely considering the nature of business that UFC is in.
Thus, if allowed registration, confusion of business may set in, and UFC’s hard-earned goodwill may be associated
to the newer product introduced by Barrio Fiesta, all because of the use of the dominant feature of UFC’s mark on
Barrio Fiesta’s mark, which is the word “PAPA.” The words “Barrio Fiesta” are not included in the mark, and
although printed on the label of Barrio Fiesta’s lechon sauce packaging, still do not remove the impression that
“PAPA BOY” is a product owned by the manufacturer of “PAPA” catsup, by virtue of the use of the dominant
feature. It is possible that UFC could expand its business to include lechon sauce, and that would be well within
UFC’s rights, but the existence of a “PAPA BOY” lechon sauce would already eliminate this possibility and deprive
UFC of its rights as an owner of a valid mark included in the Intellectual Property Code.

E.Y. INDUSTRIAL SALES vs. SHEN DAR ELECTRICITY

PETITIONERS: E.Y. INDUSTRIAL SALES, INC. and ENGRACIO YAP

RESPONDENTS: SHEN DAR ELECTRICITY AND MACHINERY CO., LTD

DOCTRINE/S:

1. Ownership of a mark or trade name may be acquired not necessarily by registration but by adoption and use
in trade or commerce. As between actual use of a mark without registration, and registration of the mark without
actual use thereof, the former prevails over the latter. For a rule widely accepted and firmly entrenched, because it
has come down through the years, is that actual use in commerce or business is a pre-requisite to the acquisition
of the right of ownership.

2. By itself, registration is not a mode of acquiring ownership. When the applicant is not the owner of the
trademark being applied for, he has no right to apply for registration of the same. Registration merely creates
a prima facie presumption of the validity of the registration, of the registrant’s ownership of the trademark and of
the exclusive right to the use thereof. Such presumption, just like the presumptive regularity in the performance of
official functions, is rebuttable and must give way to evidence to the contrary.

FACTS:

1. EYIS is a domestic corporation engaged in the production, distribution and sale of air compressors and other
industrial tools and equipment. Petitioner Engracio Yap is the Chairman of the Board of Directors of EYIS .

a. Respondent Shen Dar is a Taiwan-based foreign corporation engaged in the manufacture of air
compressors.

2. Both companies claimed to have the right to register the trademark “VESPA” for air compressors.

a. EYIS: From 1997 to 2004, EYIS imported air compressors from Shen Dar through sales contracts. The
sales contract would describe these as air compressors “SD”. There is no documentary evidence to show that
such air compressors were marked “VESPA.”

b. FILING FOR TRADEMARK APPLICATION:

1. June 9, 1997, Shen Dar filed for Trademark Application with the IPO for the mark “VESPA,
Chinese Characters and Device” for use on air compressors and welding machines.

2. July 28, 1999, EYIS filed Trademark Application, also for the mark “VESPA,” for use on air
compressors

c. ISSUANCE OF CERTIFICATE OF REGISTRATION (COR)

 1. January 18, 2004 IPO issued COR No. 4-1999-005393 in favor of EYIS.

2. February 8, 2007, Shen Dar was also issued COR No. 4-1997-121492

3. Shen Dar filed a Petition for Cancellation of EYIS’ COR with the Bureau of Legal Affairs (BLA) of the IPO.

a. Shen Dar primarily argued that the issuance of the COR in favor of EYIS violated Section 123.1
paragraphs (d), (e) and (f) of Republic Act No. (RA) 8293, otherwise known as the Intellectual Property Code (IP
Code), having first filed an application for the mark (June 9, 1997 (Shen Dar) v. July 28, 1999 (EYIS).

b. Shen Dar further alleged that EYIS was a mere distributor of air compressors bearing the mark “VESPA”
which it imported from Shen Dar. Shen Dar also argued that it had prior and exclusive right to the use and
registration of the mark “VESPA” in the Philippines under the provisions of the Paris Convention.

4. Defense of EYIS:

a. Denied the claim of Shen Dar to be the true owners of the mark “VESPA” being the sole assembler and
fabricator of air compressors since the early 1990s.

b. Alleged that the air compressors that Shen Dar allegedly supplied them bore the mark “SD” for Shen
Dar and not “VESPA.” Shen Dar, then not being the owner of the mark, could not seek protection from the
provisions of the Paris Convention or the IP Code.

5. RULING:

a. Director of BLA: In favor of EYIS.

b. Director General of IPO: Upon appeal by Shen Dar – upheld the decision of the BLA. Cancelled the COR
of Shen Dar.

c. CA: Reversed the decision.

ISSUE: Whether or not EYIS is the true owner of the mark VESPA.
 It is the true owner of the mark VESPA. Prior and continuous use of a mark may even overcome
the presumptive ownership of the registrant and be held as the owner of the mark.

RATIO:

1. RA 8293 espouses the “first-to-file” rule as stated under Sec. 123.1(d) which states:

“Section 123. Registrability.—123.1. A mark cannot be registered if it:

xxxx

(d) Is identical with a registered mark belonging to a different proprietor or a mark with an  earlier filing
or priority date, in respect of

(i) The same goods or services, or

(ii) Closely related goods or services, or

(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion.” (Emphasis
supplied.)

2. Under this provision, the registration of a mark is prevented with the filing of an earlier application for
registration. This must not, however, be interpreted to mean that ownership should be based upon an earlier filing
date. While RA 8293 removed the previous requirement of proof of actual use prior to the filing of an application
for registration of a mark, proof of prior and continuous use is necessary to establish ownership of a mark. Such
ownership constitutes sufficient evidence to oppose the registration of a mark.

3. Sec. 134 of the IP Code provides that “any person who believes that he would be damaged by the registration of
a mark x x x” may file an opposition to the application. The term “any person” encompasses the true owner of the
mark the prior and continuous user.

4. Notably, the Court has ruled that the prior and continuous use of a mark may even overcome the presumptive
ownership of the registrant and be held as the owner of the mark.

a. Shangri-la International Hotel Management, Ltd. v. Developers Group of Companies, Inc:

1. Registration, without more, does not confer upon the registrant an absolute right to the
registered mark. The certificate of registration is merely a prima facie proof that the registrant is
the owner of the registered mark or trade name. Evidence of prior and continuous use of the
mark or trade name by another can overcome the presumptive ownership of the registrant and
may very well entitle the former to be declared owner in an appropriate case.
 2. Ownership of a mark or trade name may be acquired not necessarily by registration but by
adoption and use in trade or commerce. As between actual use of a mark without registration,
and registration of the mark without actual use thereof, the former prevails over the latter. For a
rule widely accepted and firmly entrenched, because it has come down through the years, is
that actual use in commerce or business is a pre-requisite to the acquisition of the right of
ownership.

3. By itself, registration is not a mode of acquiring ownership. When the applicant is not the
owner of the trademark being applied for, he has no right to apply for registration of
the same. Registration merely creates a prima facie presumption of the validity of the
registration, of the registrant’s ownership of the trademark and of the exclusive right to the use
thereof. Such presumption, just like the presumptive regularity in the performance of official
functions, is rebuttable and must give way to evidence to the contrary

5. The use by EYIS in the concept of owner is shown by commercial documents, sales invoices unambiguously
describing the goods as “VESPA” air compressors. It has sold the air compressors bearing the “VESPA” to various
locations in the Philippines, as far as Mindanao and the Visayas since the early 1990’s. There were 371 invoices and
shipment documents which show that “VESPA” air compressors were sold not only in Manila, but to locations such
as Iloilo City, Cebu City, Dumaguete City, Zamboanga City, Cagayan de Oro City, Davao City to name a few. There is
no doubt that it is through private respondents’ efforts that the mark “VESPA” used on air compressors has gained
business goodwill and reputation in the Philippines for which it has validly acquired trademark rights. EYIS’ right
has been preserved until the passage of RA 8293 which entitles it to register the same.

6. Shen Dar argued that EYIS is a mere distributor of VESPA air compressor. When Shen Dar sold to EYIS the air
compressor for distribution, the label was just “SD” air compressor and not “VESPA.”

7. EYIS must be considered as the prior and continuous user of the mark “VESPA” and its true owner. Hence,
EYIS is entitled to the registration of the mark in its name.

DISPOSITIVE PORTION:

WHEREFORE, the petition is hereby GRANTED. The CA’s February 21, 2008 Decision and October 6, 2008
Resolution in CA-G.R. SP No. 99356 are hereby REVERSED and SET ASIDE. The Decision dated May 25, 2007 issued
by the IPO Director General in Inter PartesCase No. 14-2004-00084 and the Decision dated May 29, 2006 of the
BLA Director of the IPO are hereby REINSTATED.

No costs.

SO ORDERED.
ABS-CBN v. Director of the Bureau of Trademarks

G.R. No. 217916 || June 20, 2018

PETITIONER: ABS-CBN Publishing, Inc.

RESPONDENT: Director of the Bureau of Trademarks

DOCTRINE:

1. Section 123.1(d) of the Intellectual Property Code of the Philippines (IPC), a mark cannot be registered if it is
“identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority
date,” in respect of the following: (i) the same goods or services, or (ii) closely related goods or services, or (iii) if it
nearly resembles such a mark as to be likely to deceive or cause confusion.

2. To determine whether a mark is to be considered as “identical” or that which is confusingly similar with that of
another, the Court has developed two (2) tests: the dominancy and holistic tests. While the Court has time and
again ruled that the application of the tests is on a case to case basis, upon the passage of the IPC, the trend has
been to veer away from the usage of the holistic test and to focus more on the usage of the dominancy test.

3. Similarity in size, form, and color, while relevant, is not conclusive. If the competing trademark contains the
main or essential or dominant features of another, and confusion and deception is likely to result, infringement
takes place.

FACTS:

1. In 2004, ABS-CBN filed with the Intellectual Property Office of the Philippines (IPO) its application for the
registration of its trademark “METRO” (applicant mark) under class 16 of the Nice classification, with specific
reference to “magazines.”

a. The case was assigned to Examiner Arlene M. Icban (Examiner Icban), who, after a judicious
examination of the application, refused the applicant mark’s registration for the following reasons:
 1. The applicant mark is identical with three other cited marks, and is therefore unregistrable
according to Section 123.1(d) of the Intellectual Property Code of the Philippines (IPC)

a. “Metro” (word) by applicant Metro International S.A.

b. “Metro” (logo) also by applicant Metro International S.A.

c. “Inquirer Metro” by applicant Philippine Daily Inquirer, Inc.

2. ABS-CBN appealed.

a. Director of the Bureau of Trademarks of the IPO: Affirmed Examiner Icban’s findings.

b. The Office of the Director General (ODG) of the IPO: Affirmed Examiner Icban’s findings. Upheld Bureau
Director’s decision.

1. There is no merit in the petitioner’s appeal because (1) the applicant and cited marks are
identical and confusingly similar, (2) the petitioner’s mark was deemed abandoned under the old
Trademark Law, and thus, petitioner’s prior use of the same did not create a vested right under
the IPC, and (3) the applicant mark has not acquired secondary meaning.

c. CA: Denied:

ISSUE: Whether or not the ODG was correct in refusing to register the applicant mark for being identical and
confusingly similar with the cited marks already registered with the IPO.

ODG was correct. The dominant feature of the applicant mark is the word “METRO” which is
identical, both visually and aurally, to the cited marks already registered with the IPO.

RATIO:

1. According to Section 123.1(d) of the Intellectual Property Code of the Philippines (IPC), a mark cannot be
registered if it is “identical with a registered mark belonging to a different proprietor or a mark with an earlier filing
or priority date,” in respect of the following: (i) the same goods or services, or (ii) closely related goods or services,
or (iii) if it nearly resembles such a mark as to be likely to deceive or cause confusion.

2. To determine whether a mark is to be considered as “identical” or that which is confusingly similar with that of
another, the Court has developed two (2) tests: the dominancy and holistic tests. While the Court has time and
again ruled that the application of the tests is on a case to case basis, upon the passage of the IPC, the trend has
been to veer away from the usage of the holistic test and to focus more on the usage of the dominancy test.
 a. McDonald’s Corporation v. L.C. Big Mak Burger, Inc.: The “test of dominancy is now explicitly
incorporated into law in Section 155.1 of the Intellectual Property Code which defines infringement as the
‘colorable imitation of a registered mark x x x or a dominant feature thereof.

SECTION 155. Remedies; Infringement.—Any person who shall, without the consent of the

owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of

a registered mark or the same container or a dominant feature thereof in connection
with the sale, offering for sale, distribution, advertising of any goods or services
including other preparatory steps necessary to carry out the sale of any goods or
services on or in connection with which such use is likely to cause confusion, or to cause
mistake, or to deceive.

3. But differences of variations in the details of one trademark and of another are not the legally accepted tests of
similarity in trademarks. It has been consistently held that the question of infringement of a trademark is to be
determined by the test of dominancy. Similarity in size, form, and color, while relevant, is not conclusive. If the
competing trademark contains the main or essential or dominant features of another, and confusion and
deception is likely to result, infringement takes place.

4. In committing the infringing act, the infringer merely introduces negligible changes in an already registered
mark, and then banks on these slight differences to state that there was no identity or confusing similarity,
which would result in no infringement. This kind of act, which leads to confusion in the eyes of the public, is
exactly the evil that the dominancy test refuses to accept.

5. In the present case, the dominant feature of the applicant mark is the word “METRO” which is identical, both
visually and aurally, to the cited marks already registered with the IPO. The concurrent use by the parties of the
word METRO is likely to cause confusion among purchasers as well as confusion of business or origin hence,
registration of this subject application is proscribed under R.A. 8293, Sec. 123.1(d).

6. The Court cannot emphasize enough that the cited marks “METRO” (word) and “METRO” (logo) are identical
with the registrant mark “METRO” both in spelling and in sound. In fact, it is the same exact word. Considering that
both marks are used in goods which are classified as magazines, it requires no stretch of imagination that a
likelihood of confusion may occur.

7. As a final point, the petitioner, in the pleadings submitted, manifested that the cited marks are no longer valid. It
said that: (1) the cited mark “METRO” (logo) was removed from the IPO register for nonuse, citing the IPO online
database, (2) the cited mark “INQUIRER METRO,” while valid according to the IPO online database, was cancelled
according to a certain certification from the Bureau of Trademarks of the IPO; and (3) the cited mark “METRO”
(word) already expired on June 26, 2016 according to yet another certification from the IPO.

a. A perusal of the records, however, would reveal that these alleged deregistration and cancellation all
allegedly occurred after the ODG has already ruled on the instant case. Considering that the Court is not a
trier of facts, the Court could therefore not make a determination of the validity and accuracy of the
 statements made in the petitioner’s manifestation. As such, the Court, through the limited facts extant in
the records, could not give weight and credence thereto.

DISPOSITIVE PORTION: WHEREFORE, premises considered, the Resolutions of the Court of Appeals dated May 20,
2014 and April 15, 2015, are hereby AFFIRMED without prejudice to the petitioner’s refiling of its application for
the registration of the trademark “METRO” before the Intellectual Property Office.

Levi Strauss (Phils.) v. Vogue Traders Clothing Company (G.R. No. 132993)

Facts:

Petitioner Levi Strauss Phils. is a grantee of license by its US-based principal to use LEVI’S trademark in the
manufacturing and sale of its clothing and other goods. Later, petitioner discovered the existence of respondent’s
trademark LIVE’S which in its view was confusingly similar to its trademark. Thus, petitioner instituted an
administrative case for its cancellation. Respondent on the other hand, filed a civil action for damages against
petitioner. Petitioner counterclaimed that its trademark is infringed and moved to enjoin respondent from using
said confusingly similar mark. Trial court ruled for petitioner. CA ordered the trial court to desist from proceeding
with the civil case until the pending administrative action has been resolved.

Issue:

Whether or not the administrative action to cancel the trademark registration can proceed independently from an
action of infringement or unfair competition.

Ruling: YES.

The passage of Republic Act No. 8293, otherwise known as the “Intellectual Property Code of the Philippines,”
expanded the rights accorded to an owner of a registered trademark. Sections 151 (2) 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
filing 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 filed petition to cancel the same mark.  On the other hand,
the earlier filing of petition to cancel the mark with the Bureau of Legal Affairs {formerly BPTTT] shall not constitute
a prejudicial question that must be resolved before an action to enforce the rights to same registered mark may be
decided.
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 registered trademark in the BPTTT. As applied to the present case, petitioner’s
prior filing 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. No. 96-76944) a
counterclaim for infringement with a prayer for the issuance of a writ of preliminary injunction.

Facts: Petitioner offers ATM services in the Philippines since 1995. It has 29 ATMs and issues ATM cards labelled
“CITICARD.” The trademark CITICARD is owned by Citibank N.A. and is registered in the Intellectual Property Office
(IPO) of the Philippines on September 27, 1995. In addition, petitioner or Citibank N.A., a wholly-owned subsidiary
of petitioner, owns the following other trademarks currently registered with the IPO to wit: “CITI and arc design,”
“CITIBANK,” “CITIBANK PAYLINK,” “CITIBANK SPEEDCOLLECT,” “CITIBANKING,” “CITICARD,” “CITICORP ,”
“CITIFINANCIAL,” “CITIGOLD,” “CITIGROUP ,” “CITIPHONE BANKING,” and “CITISERVICE.”

On the other hand, sometime in the mid-nineties, a group of Filipinos and Singaporean companies formed
a consortium to establish respondent Citystate Savings Bank, Inc. Respondent’s registered mark has in its name
affixed a lion’s head, which is likened to the national symbol of Singapore, the Merlion.

In 1997, respondent opened its initial branch in Makati City. From then on, it endeavored to expand its
branch network. At present it has 19 branches in key cities and municipalities including 3 branches in the province
of Bulacan and 1 in Cebu City. Respondent had also established off site ATMs in key locations in the Philippines as
one of its banking products and services. In line with this, respondent led an application for registration with the
IPO on June 21, 2005 of the trademark “CITY CASH WITH GOLDEN LION’S HEAD” for its ATM service. This caused
the petitioner to file an opposition against the said application. Citigroup claimed that the “CITY CASH WITH
GOLDEN LION’S HEAD” mark is confusingly similar to its own “CITI” marks.

Issue: Whether or not there exists a confusing similarity between the petitioner and respondent’s marks.

Ruling: None. There is no objective test for determining whether the confusion is likely. Likelihood of confusion
must be determined according to the particular circumstances of each case. To aid in determining the similarity
and likelihood of confusion between marks, our jurisprudence has developed two (2) tests: the dominancy test and
the holistic test.

The dominancy test focuses on the similarity of the prevalent features of the competing trademarks that
might cause confusion and deception, thus constituting infringement. If the competing trademark contains the
main, essential, and dominant features of another, and confusion or deception is likely to result, infringement
occurs. Exact duplication or imitation is not required. The question is whether the use of the marks involved is
likely to cause confusion or mistake in the mind of the public or to deceive consumers. In contrast, the holistic test
entails a consideration of the entirety of the marks as applied to the products, including the labels and packaging,
in determining confusing similarity. The discerning eye of the observer must focus not only on the predominant
words but also on the other features appearing on both marks in order that the observer may draw his conclusion
whether one is confusingly similar to the other.
 With these guidelines in mind, the Court considered “the main, essential, and dominant features” of the
marks in this case, as well as the contexts in which the marks are to be used. The Court finds that the use of the
“CITY CASH WITH GOLDEN LION’S HEAD” mark will not result in the likelihood of confusion in the minds of
customers. A visual comparison of the marks reveals no likelihood of confusion. The most noticeable part of
respondent’s mark is the golden lion’s head device, and after noticing the image of the lion’s head, the words
“CITY” and “CASH” are equally prominent. On the other hand, petitioner’s marks often include the red arc device.
Petitioner’s marks can best be described as consisting of the prefix “CITI” added to other words.

Applying the dominancy test, the Court sees that the prevalent feature of respondent’s mark, the golden
lion’s head device, is not present at all in any of petitioner’s marks. The only similar feature between respondent’s
mark and petitioner’s collection of marks is the word “CITY” in the former, and the “CITI” prefix found in the latter.
This similarity alone is not enough to create a likelihood of confusion.

The SC also agrees with the CA that the context where respondent’s mark is to be used, namely, for its
ATM services, which could only be secured at respondent’s premises and not in an open market of ATM services,
further diminishes the possibility of confusion on the part of prospective customers.

B2D MATTEL INC. V. FRANCISCO

GR 166886 | 30 July 2008 | Austria-Martinez

Case Summary: Section 124.2 of R.A. No. 8293 provides: The applicant or the registrant shall file a declaration of actual use of the
mark with evidence to that effect, as prescribed by the Regulations within three (3) years from the filing date of the application.
Otherwise, the applicant shall be refused, or the marks shall be removed from the Register by the Director.

Petitioner: MATTEL, INC.

Respondent: EMMA FRANCISCO, Director-General of the Intellectual Property Office, HON. ESTRELLITA B.
ABELARDO, Director of the Bureau of Legal Affairs (IPO), and JIMMY UY.

Facts: Jimmy A. Uy (Uy) filed a trademark application with the Bureau of Patents, Trademarks and Technology
Transfer (BPTTT) for registration of the trademark "BARBIE" for use on confectionary products, such as milk,
chocolate, candies, milk bar and chocolate candies.

Mattel, Inc. (Mattel), filed a Notice of Opposition against Uy's "Barbie" trademark as the latter was confusingly
similar to its trademark on dolls, doll clothes and doll accessories, toys and other similar commercial products.

While the case was pending, Republic Act (R.A.) No. 8293, otherwise known as the Intellectual Property Code of
the Philippines was enacted and took effect on January 1, 1998. The BPTTT was abolished and its functions
transferred to the newly created Intellectual Property Office (IPO).
Public respondent Estrellita B. Abelardo, the Director of the Bureau of Legal Affairs, IPO, rendered a Decision
dismissing Mattel's opposition and giving due course to Uy's application for the registration of the trademark
"Barbie" used on confectionary products. The Director held that there was no confusing similarity between the two
competing marks because the goods were non-competing or unrelated.

Mattel filed an appeal. Public respondent Emma C. Francisco, the Director General, rendered a Decision denying
the appeal on the ground that there was no proof on record that Mattel had ventured into the production of
chocolates and confectionary products under the trademark "Barbie" to enable it to prevent Uy from using an
identical "Barbie" trademark on said goods; that the records were bereft of the fact that the Director of the Bureau
of Trademarks (BOT) had already declared the subject trademark application abandoned due to the non-filing of
the Declaration of Actual Use (DAU) by Uy.

Issue/s: Whether the application is deemed withdrawn or abandoned for failure to file the Declaration of Actual
Use.

Ruling: The instant case has been rendered moot and academic.

Uy's declaration in his Comment and Memorandum before this Court that he has not filed the DAU as mandated
by pertinent provisions of R.A. No. 8293 is a judicial admission that he has effectively abandoned or withdrawn any
right or interest in his trademark.

Section 124.2 of R.A. No. 8293 provides:

The applicant or the registrant shall file a declaration of actual use of the mark with evidence
to that effect, as prescribed by the Regulations within three (3) years from the filing date of
the application. Otherwise, the applicant shall be refused, or the marks shall be removed from
the Register by the Director.

Moreover, Rule 204 of the Rules and Regulations on Trademarks provides:

Declaration of Actual Use. The Office will not require any proof of use in commerce in the
processing of trademark applications. However, without need of any notice from the Office,
all applicants or registrants, shall file a declaration of actual use of the mark with evidence to
that effect within three years, without possibility of extension, from the filing date of the
application. Otherwise, the application shall be refused, or the mark shall be removed from
the register by the Director motu propio.

Meanwhile, Memorandum Circular No. BT 2K1-3-04 dated March 29, 2001 of the IPO provides:

2. For pending applications prosecuted under R.A. 166 we distinguish as follows:

 2.1. Based on use - must submit DAU and evidence of use on or before December 1, 2001,
subject to a single six (6) month extension. (Sec. 3.2, Final Provisions of the Trademark
Regulations, R.A. 8293, IPO Fee Structure and MC. No. BT Y2K-8-02)

Uy's admission in his Comment and Memorandum of non-compliance with the foregoing requirements is a judicial
admission and an admission against interest combined. A judicial admission binds the person who makes the same.
In the same vein, an admission against interest is the best evidence which affords the greatest certainty of the
facts in dispute. The rationale for the rule is based on the presumption that no man would declare anything against
himself unless such declaration is true. Thus, it is fair to presume that the declaration corresponds with the truth,
and it is his fault if it does not.

In the present case, Mattel is seeking a ruling on whether Uy's "Barbie" trademark is confusingly similar to its
(Mattel's) "Barbie" trademark. Given Uy's admission that he has effectively abandoned or withdrawn any rights or
interest in his trademark by his non-filing of the required DAU, there is no more actual controversy, or no useful
purpose will be served in passing upon the merits of the case. It would be unnecessary to rule on the trademark
conflict between the parties. A ruling on the matter would practically partake of a mere advisory opinion, which
falls beyond the realm of judicial review. The exercise of the power of judicial review is limited to actual cases and
controversies. Courts have no authority to pass upon issues through advisory opinions or to resolve hypothetical or
feigned problems

Mang Inasal v IFP FACTS: IFP Manufacturing Corp. filed an application for the registration of the mark, “OK Hotdog
Inasal Cheese Hotdog Flavor Mark”, in connection with goods under Class 30 of the Nice Classification. It was
intended to be used on one of its curl snack products. However, the said application was opposed by Mang Inasal,
that owned the mark, “Mang Inasal, Home of Real Pinoy Style Barbecue and Device”, for services under Class 43. It
has been registered with the IPO in 2006 and has been used by petitioner since 2003. Petitioner contended that
the registration of OK Hotdog is prohibited under Sec. 123.1d. The OK Hotdog and Mang Inasal marks share
similarities, as to their appearance and to the goods or services they represent, thus suggesting a false connection
or association between the said marks, and would likely cause confusion to the public. 1. The dominant element –
the word “Inasal”, is printed and stylized in the exact manner. 2. The goods that the OK Hotdog Inasal mark is
intended to identify are closely related to the services represented by the Mang Inasal mark. The IPO-BLA
dismissed petitioner’s opposition. IPO-DG affirmed such dismissal. 1. There are other words found in the OK
Hotdog Inasal mark that are not present in the Mang Inasal mark. 2. The underlying goods and services are not
closely related. CA denied the appeal of the petitioner. MR was also denied. ISSUE:W/N the trademark may be
registered? NO. HELD: Sec.123.1d provides that a mark that is similar to a registered mark or a mark with an earlier
filing, and which is likely to cause confusion on the part of the public cannot be registered with the IPO. The
concept of the confusion could refer to the (1) confusion of goods; or (2) confusion of business. Confusion, in both
forms, is only possible when the goods or services covered by allegedly similar marks are identical, similar, or
related in some manner. To fall under the ambit of Sec. 123.1d and be regarded as likely to deceive or cause
confusion, a prospective mark must meet two minimum conditions: 1. The prospective mark must nearly resemble
or be similar to an earlier mark; and a. The OK Hotdog Inasal Mark is Similar to the Mang Inasal Mark. Similarity
does not mean absolute identity of marks. It is enough that a prospective mark be a colorable imitation of the
former. Colorable imitation denotes such likeness in form, content, words, sound, meaning, special arrangement
or general appearance of one mark with respect to another as would likely mislead an average buyer in the
ordinary course of purchase. b. In determining whether there is similarity or colorable imitation, authorities may
use two tests: i. Dominancy Test focuses on the similarity of the prevalent features of the competing trademark
which might cause confusion or deception. If the competing trademark contains the main, essential or dominant
features of another, and confusion or deception is likely to result, infringement takes place. The question is
whether the use of the marks involved is likely to cause confusion or mistake in the mind of the public or deceive
purchasers. ii. Holistic Test requires that the entirety of the marks in question be considered in resolving confusing
similarity. The trademarks in their entirety as they appear in their respective labels or hang tags must also be
considered in relation to the goods to which they are attached. iii. Recent case law seems to indicate an
overwhelming judicial preference to applying the dominancy test. iv. In the mark, the word “INASAL” is dominant
and the way it is stylized is similar to Mang Inasal’s. It is a descriptive term that cannot be appropriated, but the
way it is stylized is not. Thus, Mang Inasal can claim exclusive use of such element. Even if there are differences,
the average buyer would pay more attention to the prominent feature compared to the peripheral details. 2. The
prospective mark must pertain to goods or services that are either identical, similar or related to the goods or
services represented by the earlier mark. a. Related goods and services are those that, though non-identical or
non-similar, are so logically connected to each other that they may reasonably be assumed to originate from one
manufacturer or from economically-linked manufacturers. In determining whether goods or services are related,
several factors may be recognized: i. The business (and its location) to which the goods belong; ii. The class of
product to which the goods belong; iii. The product’s quality, quantity, or size, including the nature of the package,
wrapper or container; iv. The nature and cost of the articles; v. The descriptive properties, physical attributes or
essential characteristics with reference to their form, composition, texture or quality; vi. The purpose of the goods;
vii. Whether the article is bought for immediate consumption, that is, day-today household items; viii. The fields of
manufacture; ix. The conditions under which the article is usually purchased; and x. The channels of trade through
which the goods flow, how they are distributed, marketed, displayed, and sold. A very important circumstance is
whether there exists a likelihood that an appreciable number of ordinarily prudent purchasers will be misled, or
simply confused, as to the source of the goods in question. The simulation, in order to be objectionable, must be
such as appears likely to mislead the ordinary intelligent buyer who has a need to supply and is familiar with the
article that he seeks to purchase. b. The two are related as it may lead to a confusion of business. i. Petitioner uses
the Mang Inasal mark in connection with its restaurant services that is particularly known for its chicken inasal. ii.
The mark has been used for petitioner’s business since 2003. iii. Respondent seeks to market under the OK Hotdog
Inasal mark curl snack products which it publicizes as having a cheese hotdog inasal flavor. iv. It is the fact that the
underlying goods and servicesthat involve inasal and inasal-flavored products ultimately fixes the relations
between such goods and services. Thus, an average buyer is likely to be confused as to the true source of such
curls.

GR No. 190065 August 16, 2010

Dermaline, Inc. vs. Myra Pharmaceuticals, Inc.

Nachura, J.:

FACTS: Dermaline filed with the IPO an application to register the trademark “Dermaline.” Myra opposed this
alleging that the trademark resembles its trademark “Dermalin” and will cause confusion, mistake and deception
to the purchasing public. “Dermalin” was registered way back 1986 and was commercially used since 1977. Myra
claims that despite attempts of Dermaline to differentiate its mark, the dominant feature is the term “Dermaline”
to which the first 8 letters were identical to that of “Dermalin.” The pronunciation for both is also identical.
Further, both have 3 syllables each with identical sound and appearance.

ISSUE: Whether the IPO should allow the registration of the trademark “Dermaline”

HELD: The petition is without merit.

A trademark is any distinctive word, name, symbol, emblem, sign, or device, or any combination thereof, adopted
and used by a manufacturer or merchant on his goods to identify and distinguish them from those manufactured,
sold, or dealt by others.[15] Inarguably, it is an intellectual property deserving protection by law. In trademark
controversies, each case must be scrutinized according to its peculiar circumstances, such that jurisprudential
precedents should only be made to apply if they are specifically in point.

As Myra correctly posits, it has the right under Section 147 of R.A. No. 8293 to prevent third parties from using a
trademark, or similar signs or containers for goods or services, without its consent, identical or similar to its
registered trademark, where such use would result in a likelihood of confusion. In determining confusion, case law
has developed two (2) tests, the Dominancy Test and the Holistic or Totality Test.

The Dominancy Test focuses on the similarity of the prevalent features of the competing trademarks that might
cause confusion or deception. Duplication or imitation is not even required; neither is it necessary that the label of
the applied mark for registration should suggest an effort to imitate. Relative to the question on confusion of
marks and trade names, jurisprudence noted two (2) types of confusion, viz: (1) confusion of goods (product
confusion), where the ordinarily prudent purchaser would be induced to purchase one product in the belief that he
was purchasing the other; and (2) confusion of business (source or origin confusion), where, although the goods of
the parties are different, the product, the mark of which registration is applied for by one party, is such as might
reasonably be assumed to originate with the registrant of an earlier product, and the public would then be
deceived either into that belief or into the belief that there is some connection between the two parties, though
inexistent.

Using this test, the IPO declared that both confusion of goods and service and confusion of business or of origin
were apparent in both trademarks. While it is true that the two marks are presented differently, they are almost
spelled in the same way, except for Dermaline’s mark which ends with the letter "E," and they are pronounced
practically in the same manner in three (3) syllables, with the ending letter "E" in Dermaline’s mark pronounced
silently. Thus, when an ordinary purchaser, for example, hears an advertisement of Dermaline’s applied trademark
over the radio, chances are he will associate it with Myra’s. When one applies for the registration of a trademark or
label which is almost the same or that very closely resembles one already used and registered by another, the
application should be rejected and dismissed outright, even without any opposition on the part of the owner and
user of a previously registered label or trademark.

Further, Dermaline’s stance that its product belongs to a separate and different classification from Myra’s products
with the registered trademark does not eradicate the possibility of mistake on the part of the purchasing public to
associate the former with the latter, especially considering that both classifications pertain to treatments for the
skin.

EMERALD GARMENT MANUFACTURING CORPORATION vs. HON. COURT OF APPEALS, BUREAU OF PATENTS,

TRADEMARKS AND TECHNOLOGY TRANSFER and H.D. LEE COMPANY, INC.

G.R. No. 100098, December 29, 1995

FACTS:

            On 18 September 1981, private respondent H.D. Lee Co., Inc. filed with the Bureau of Patents, Trademarks &
Technology Transfer (BPTTT) a Petition for Cancellation of Registration No. SR 5054 for the trademark "STYLISTIC
MR. LEE" used on skirts, jeans, blouses, socks, briefs, jackets, jogging suits, dresses, shorts, shirts and lingerie under
Class 25, issued on 27 October 1980 in the name of petitioner Emerald Garment Manufacturing Corporation.

Private respondent averred that petitioner's trademark "so closely resembled its own trademark, 'LEE' as
previously registered and used in the Philippines cause confusion, mistake and deception on the part of the
purchasing public as to the origin of the goods.
On 19 July 1988, the Director of Patents rendered a decision granting private respondent's petition for cancellation
and opposition to registration. The Director of Patents, using the test of dominancy, declared that petitioner's
trademark was confusingly similar to private respondent's mark because "it is the word 'Lee' which draws the
attention of the buyer and leads him to conclude that the goods originated from the same manufacturer. It is
undeniably the dominant feature of the mark.

ISSUE:

            Whether or not a trademark causes confusion and is likely to deceive the public is a question of fact which is
to be resolved by applying the "test of dominancy", meaning, if the competing trademark contains the main or
essential or dominant features of another by reason of which confusion and deception are likely to result.

HELD:

          The word "LEE" is the most prominent and distinctive feature of the appellant's trademark and all of the
appellee's "LEE" trademarks. It is the mark which draws the attention of the buyer and leads him to conclude that
the goods originated from the same manufacturer. The alleged difference is too insubstantial to be noticeable. The
likelihood of confusion is further made more probable by the fact that both parties are engaged in the same line of
business.

Although the Court decided in favor of the respondent, the appellee has sufficiently established its right to
prior use and registration of the trademark "LEE" in the Philippines and is thus entitled to protection from any
infringement upon the same. The dissenting opinion of Justice Padilla is more acceptable.

B3A Canon Kabushiki Kaisha v. Court of Appeals, GR 120900, 20 July 2000, Third Division, Gonzaga-Reyes [J]

FACTS:

On January 15, 1985 , NSR Rubber Corporation applied for the registration of the mark CANON for sandals in the
Bureau of Patents, Trademarks, and Technology Transfer. Canon Kabushiki Kaisha, a foreign corporation filed a
Verified Notice of Opposition, alleging that it will be damaged by the registration of the trademark Canon in the
name of NSR. Canon Kabushiki Kaisha presented as evidence, its certificate of registration of the mark CANON in
various countries covering goods belonging to class This includes paints, chemical products, toner, dye stuff. It also
submitted as evidence its Philippine Trademark Registration No. 39398.

The BPTTT, on November 10, 1992, rendered its decision favoring NSR’s application for the registration of the
trademark CANON. Canon Kabushiki appealed to the CA which affirmed the BPTTT’s decision.

ISSUE:

W/N CANON KABUSHIKI KAISHA IS ENTITLED TO THE EXCLUSIVE USE OF THE MARK CANON BECAUSE IT IS ITS
TRADEMARK AND IS ALSO USE FOR FOOTWEAR

HELD:
NO. Ordinarily, the ownership of a trademark or tradename is a property right that the owner is entitled to
protect. However, when the trademark is used by a party for a product in which the other party does not deal, its
use on the latter’s product cannot be validly objected to.

Canon Kabushiki, in its certificate of registration is using the trademark CANON for its paints, chemical products,
toner, and dye stuff, goods classified as class 2. On the other hand, NSR is registering the trademark CANON for its
sandals, classified as class 25. There is a great difference between the two classes of products and the petitioner
has not made known its intention to venture into the business of producing sandals. The two classes of products
are so different to cause confusion to the purchasing public because they are not related.. Goods are related when
they belong to the same class or have the same descriptive properties; when they possess the same physical
attributes or essential characteristics with reference to their form, composition, texture or quality. They are also
said to be related when they serve the same purpose and are sold in grocery stores. Products of Canon Kabushiki
are sold in chemical stores while that of NSR Rubber are not. The likelihood of confusion of goods or business is a
relative concept, to be determined only according to the particular, and sometimes peculiar, circumstances of each
case. SC: DENIED the instant petition for review on certiorari.

B3B KABUSHI KAISHA ISETAN v. IAC November 15, 1991 | Guitierrez, Jr., J
FACTS:
1. Kabushi Kaisha Isetan is a foreign corporation (Kabushi) organized and existing under the laws of Japan. It is the
owner of the trademark "Isetan" and the "Young Leaves Design".
2. Kabushi alleges that it first used the trademark Isetan in 1936. It states that the trademark is a combination of
"Ise" taken from "Iseya" the first name of the rice dealer in Kondo, Tokyo in which the establishment was first
located and "Tan" which was taken from "Tanji Kosuge the First". Kabushi claims to have expanded its line of
business internationally from 1936 to 1974. The trademark "Isetan" and "Young Leaves Design" were registered in
Japan covering more than 34 classes of goods.
3. In 1983, the Kabushi applied for the registration of "Isetan" and "Young Leaves Design" with the Philippine
Patent Office.
4. Isetann Department Store, on the other hand, is a domestic corporation organized and existing under the laws
of the Philippines.
5. It claims that it used the word "Isetann" as part of its corporated name and on its products particularly on shirts
in Joymart Department Store sometime in January 1979. The suffix "Tann" means an altar, the place of offering in
Chinese and this was adopted to harmonize the corporate name and the corporate logo of two hands in cup that
symbolizes the act of offering to the Supreme Being for business blessing.
6. In May 1980 Isetann registered "Isetann Department Store, Inc." and Isetann and Flower Design in the Philippine
Patent Office.
7. In November 1980, Kabushi filed with the Phil. Patent Office two (2) PETITIONS FOR THE CANCELLATION of
Certificates of Supplemental Registration stating among others that: • except for the additional letter "N" in the
word "Isetan", the mark registered by the registrant is exactly the same as the trademark ISETAN owned by the
petitioner and that the young leaves registered by the registrant is exactly the same as the young leaves design
owned by the petitioner.
• Isetann's act of registering a trademark which is exactly the same as Kabushi’s trademark and adopting a
corporate name similar to that of the Kabushi were with the illegal and immoral intention of cashing in on the long
established goodwill and popularity of the Kabushi's reputation, thereby causing great and irreparable injury and
damage to it
• both Kabushi's and Isetann's goods move in the same channels of trade, and ordinary people will be misled to
believe that the products of Istetann originated or emanated from, are associated with, or are manufactured or
sold, or sponsored by the petitioner by reason of the use of the challenged trademark. • It is a member of the
Convention of Paris for the Protection of Industrial Property of which the Philippines and Japan are both members.
The petitioner stressed that the Philippines' adherence to the Paris Convention committed to the government to
the protection of trademarks belonging not only to Filipino citizens but also to those belonging to nationals of
other member countries who may seek protection in the Philippines.
8. In 1986, the Director of Patents dismissed the petitions for cancellation. Thus, Kabushi appealed to the IAC (now
CA). The appeal was denied as well.

ISSUE:
Whether or not the petition for cancellation should be granted. NO.

RULING:
WHEREFORE, premises considered, the petition [for review on certiorari] is hereby DISMISSED.
1. A fundamental principle of Philippine Trademark Law is that actual use in commerce in the Philippines is a pre-
requisite to the acquisition of ownership over a trademark or a tradename. 2. The trademark Law, Republic Act No.
166, as amended, under which this case heard and decided provides: SEC. 2. What are registrable.- Trademark,
tradenames and service marks owned by persons, corporation, partnerships or associations domiciled in the
Philippines and by persons, corporations, partnerships or associations domicided in any foreign country may be
registered in accordance with the provisions of this Act: Provided, That said trademarks, tradenames, or service
marks are actually in use in commerce and services not less than two months in the Philippines before the time the
applications for registration are filed: And provided, further, That the country of which the applicant for
registration is a citizen grants by law substantially similar privileges to citizens of the Philippines, and such fact is
officially certified, with a certified true copy of the foreign law translated into the English language, by the
government of the foreign country to the Government of the Republic of the Philippines. (As amended by R.A. No.
865). SEC. 2-A. Ownership of trademarks, tradenames and service marks; HOW ACQUIRED. - Anyone who lawfully
produces or deals in merchandise of any kind or who engages in any lawful business, or who renders any lawful
service in commerce, by actual use thereof in manufacture or trade, in business, and in the service rendered, may
appropriate to his exclusive use a trademark, a tradename, or a service mark not so appropriated by another, to
distinguish his merchandise, business or service from the merchandise, business or service of others. The
ownership or possession of a trademark, tradename, service mark, heretofore or hereafter appropriated, as in this
section provided, shall be recognized and protected in the same manner and to the same extent as are other
property rights known to the law. (As amended by R.A. No. 638)" These provisions have been interpreted in
Sterling. v. Bayer in this way: A rule widely accepted and firmly entrenched because it has come down through the
years is that actual use in commerce or business is a prerequisite to the acquisition of the right of ownership over a
trademark. ... Adoption alone of a trademark would not give exclusive right thereto. Such right grows out of their
actual use. Adoption is not use. One way make advertisements, issue circulars, give out price lists on certain goods;
but these alone would not give exclusive right of use. For trademark is a creation of use. The underlying reason for
all these is that purchasers have come to understand the mark as indicating the origin of the wares. Flowing from
this is the trader's right to protection in the trade he has built up and the goodwill he has accumulated from use of
the trademark.
3. In fact, a prior registrant cannot claim exclusive use of the trademark unless it uses it in commerce. We ruled in
Pagasa Industrial Corporation v. CA: The Trademark Law is very clear. It requires actual commercial use of the mark
prior to its registration. - There is no dispute that respondent corporation was the first registrant, YET it failed to
fully substantiate its claim that IT USED in trade or business in the Philippines the subject mark; it did not present
proof to invest it with exclusive, continuous adoption of the trademark which should consist among others, of
considerable sales since its first use. The invoices submitted by respondent which were dated way back in 1957
show that the zippers sent to the Philippines were to be used as "samples" and "of no commercial value". The
evidence for respondent must be clear, definite and free from incosistencies. (Sy Ching v. Gaw Lui.) "Samples" are
not for sale and therefore, the fact of exporting them to the Philippines cannot be considered to be equivalent to
the "use" contemplated by the law. Respondent did not expect income from such "samples". "There were no
receipts to establish sale, and no proof were presented to show that they were subsequently sold in the
Philippines." (Pagasa Industrial Corp. v. Court of Appeals)
4. The records show that the Kabushi has never conducted any business in the Philippines. It has never promoted
its tradename or trademark in the Philippines. It has absolutely no business goodwill in the Philippines. It is
unknown to Filipinos except the very few who may have noticed it while travelling abroad. It has never paid a
single centavo of tax to the Philippine government. Under the law, it has no right to the remedy it seeks.
5. There can be no question from the records that Kabushi has never used its tradename or trademark in the
Philippines. 6. The petitioner's witnesses, Mr. Mayumi Takayama and Mr. Hieoya Murakami, admitted that: 1) The
petitioner's company is not licensed to do business in the Philippines; 2) The petitioner's trademark is not
registered under Philippine law; and 3) The petitioner's trademark is not being used on products in trade,
manufacture, or business in the Philippines.
7. It was also established from the testimony of Atty. Villasanta, Kabushi's witness, that the Kabushi has never
engaged in promotional activities in the Philippines to popularize its trademark because not being engaged in
business in the Philippines, there is no need for advertising. The claim of Kabushi that millions of dollars have been
spent in advertising the Kabushi’s products, refers to advertising in Japan or other foreign places. No promotional
activities have been undertaken in the Philippines, by the petitioner's own admission.
8. Any goodwill, reputation, or knowledge regarding the name Isetann is purely the work of the private
respondent. Evidence was introduced on the extensive promotional activities of the private respondent.
9. It might be pertinent at this point to stress that what is involved in this case is not so much a trademark as a
tradename. Isetann Department Store, Inc. is the name of a store and not of product sold in various parts of the
country. This case must be differentiated from cases involving products bearing such familiar names as "colgate",
"Singer". "Toyota", or "Sony" where the products are marketed widely in the Philippines. There is not product with
the name "Isetann" popularized with that brand name in the Philippines. Unless one goes to the store called
Isetann in Manila, he would never know what the name means. Similarly, until a Filipino buyer steps inside a store
called "Isetan" in Tokyo or Hongkong, that name would be completely alien to him. The records show that among
Filipinos, the name cannot claim to be internationally well-known.
10. The mere origination or adoption of a particular tradename without actual use thereof in the market is
insufficient to give any exclusive right to its use (Johnson Mfg. Co. v. Leader Filling Stations Corp. 196 N.E. 852, 291
Mass. 394), even though such adoption is publicly declared, such as by use of the name in advertisements,
circulars, price lists, and on signs and stationery. (Consumers Petrolum Co. v. Consumers Co. of ILL. 169 F 2d 153)
11. The Paris Convention for the Protection of Industrial Property does not automatically exclude all countries of
the world which have signed it from using a tradename which happens to be used in one country. To illustrate - If a
taxicab or bus company in a town in the United Kingdom or India happens to use the tradename "Rapid
Transportation", it does not necessarily follow that "Rapid" can no longer be registered in Uganda, Fiji, or the
Philippines.
12. As stated by the Director of Patents - Indeed, the Philippines is a signatory to this Treaty and, hence, we must
honor our obligation thereunder on matters concerning internationally known or well-known marks. However, this
Treaty provision clearly indicated the conditions which must exist BEFORE any trademark owner can claim and be
afforded rights such as Kabushi herein seeks and those conditions are that: a) the mark must be internationally
known or well known; b) the subject of the right must be a trademark, not a patent or copyright or anything else;
c) the mark must be for use in the same or similar kinds of goods; and d) the person claiming must be the owner of
the mark.
13. The Isetann registered its trademark in 1979. It has continuously used that name in commerce. It has
established a goodwill through extensive advertising. The people who buy at Isetann Store do so because of
Isetann's efforts. There is no showing that the Japanese firm's registration in Japan or Hongkong has any influence
whatsoever on the Filipino buying public.

B3C
Heirs of Gabriel-Almoradie v. Court of Appeals
GR 91385
4 January 1994

Facts:

The origin of the case traces back as far as 1953. Dr. Jose Perez discovered a soap which whitens and
softens the skin which was eventually labeled “Dr. Perez Wonder Beauty Soap.” In order to have a wider
distribution of his product he entered first an agreement with a company (Manserco) which later became
bankrupt. He then turned to Crisanta Gabriel in order to distribute his product.
 Issues began to arise when Gabriel filed an application with the Patent office to register the trademark
“Wonder.” It was denied since record would show that she is not the owner of the trademark. Her agreement
with Dr. Perez to distribute the product did not grant her the right to own the trademark. Later on Dr. Perez now
deceased was represented by Emilia Sumera in the application for the trademark “Wonder.” Any opposition to this
was dismissed by the Director of Patents granting trademark "WONDER" in the name of "The Testate Estate of Dr.
Jose R. Perez."

Despite the foregoing, Gabriel continued distributing and selling beauty soap products using the mark
"Wonder." Sumera filed an action against Gabriel for Infringement of Trademark with Damages and a Prayer for a
Writ of Preliminary Injunction before the Regional Trial Court.

Gabriel in her answer, she again alleged that:

1. the registrations of the trademark in the name of Dr. Perez were unlawfully, wrongfully, irregularly
and fraudulently procured;
2. that the trademark " has been registered with the Patents Office in the name of a certain Go Hay as
early as 1959, which registration was assigned to her and as successor-in-interest, her right to the
trademark dates back from 1959; and
3. that she created and developed the package bearing the trademark "WONDER" and is the true and
lawful owner.

While the case was on going, the registration of the trademark "WONDER" in the name of the Estate of
Dr. Jose R. Perez, had been cancelled in Cancellation Order No. 143, dated November 16, 1984. Sumera's cause of
action had become non-existent, as she no longer had rights to protect and interest to pursue. Sumera pleaded
before the Court of Appeals to review and set aside the order of the trial court dismissing the civil case. CA rules in
favor of Sumera and as a result Gabriel appealed to the SC.

Issue:

W/N Gabriel indeed commit infringement of trademark and shall be held liable for damages?

Ruling:

YES. Apparently, Gabriel never used or adopted the trademark of Go Hay in her products and instead she
has all along been using the trademark registered in the name of Perez. . What is worse is that there is obvious bad
faith on the part of Gabriel in acquiring the mark "Wonder GH." Undoubtedly her intent in having the mark
assigned to her is merely to give color to the use of the mark "WONDER" on her products. R.A. 166 describes what
constitutes infringement as provided for in Sec. 22 which states that:

Infringement, what constitutes — Any person who shall use, without the consent of the
registrant, any reproduction, counterfeit, copy or colorable imitation of any registered mark or
trade-name in connection with the sale, offering for sale or advertising of any goods, business or
services on or in connection with which such use is likely to cause confusion or mistake or to
deceive purchasers or others as to the source or origin of such goods or services, or identity of
such business; or reproduce, counterfeit, copy or colorably imitate any such mark or trade
name and apply such reproduction, counterfeit, copy or colorable imitation to labels, signs,
prints, packages, wrappers, receptacles or advertisements intended to be used upon or in
connection with such goods, business or services, shall be liable to a civil action by the registrant
for any or all of the remedies herein provided. The law also provides that any person whose
trademark or trade name is infringed may recover damages in a civil action, and upon proper
showing, may also be granted injunction.

The law requires that in the adoption of a mark there should not be any likelihood of confusion, mistake or
deception to the consumer. In the case at bar, although the presentation of the marks as registered appears to be
different, still confusion is bound to result, since the marks are used on related goods.
G.R. No. L-27906 January 8, 1987

CONVERSE RUBBER CORPORATION, petitioner, 

vs.
UNIVERSAL RUBBER PRODUCTS, INC. and TIBURCIO S. EVALLE, DIRECTOR OF PATENTS, respondents. 

FACTS:

Respondent Universal Rubber Products, Inc. filed an application with the Philippine Patent office for registration of
the trademark "UNIVERSAL CONVERSE AND DEVICE" used on rubber shoes and rubber slippers.

Petitioner Converse Rubber Corporation filed its opposition to the application for registration on grounds that:

a) The trademark sought to be registered is confusingly similar to the word "CONVERSE" which is part of
petitioner's corporate name "CONVERSE RUBBER CORPORATION" as to likely deceive purchasers of products on
which it is to be used to an extent that said products may be mistaken by the unwary public to be manufactured by
the petitioner;

b) The registration of respondent's trademark will cause great and irreparable injury to the business reputation
and goodwill of petitioner in the Philippines and would cause damage to said petitioner within the meaning of
Section 8, R.A. No. 166, as amended.

Thereafter, respondent filed its answer and at the pre-trial, the parties submitted the following partial stipulation
of facts:

"1) The petitioner's corporate name is 'CONVERSE RUBBER CORPORATION' and has been in existence since July 31,
1946; it is duly organized under the laws of Massachusetts, USA.

2) Petitioner is not licensed to do business in the Philippines, and it is not doing business on its own in the
Philippines; and

3) Petitioner manufactures rubber shoes and uses thereon the trademarks 'CHUCK TAYLOR' and 'ALL STAR AND
DEVICE'

Eventually, the Director of Patents dismissed the opposition of the petitioner and gave due course to respondent's
application.

His decision reads in part:

I cannot find anything that will prevent registration of the word 'UNIVERSAL CONVERSE' in favor, of the
respondent. In arriving... at this conclusion, I am guided by the fact that the opposer failed to present proof that
the single word "CONVERSE' in its corporate name has become so identified with the corporation that whenever
used, it designates to the mind of the public that particular corporation.

Furthermore, inasmuch as the Opposer never presented any label herein, or specimen of its shoes, whereon the
label may be seen, notwithstanding its witness' testimony touching upon her identification of the rubber shoes
sold in her stores, no determination can be made as to whether the word 'CONVERSE' appears thereon. The record
is wanting in proof to establish likelihood of confusion so as to cause probable damage to the Opposer ."

ISSUE:

Whether Universal Rubber can appropriate “Converse”.

RULING:

NO.
Converse Rubber has earned a business reputation and goodwill in the Philippines. The word “converse” has been
associated with its products, “converse chuck Taylor,” “Converse all Star,” “All Star Converse Chuck Taylor,” or
“Converse Shoes Chuck and Taylor.” “Converse” has grown to be identified with Converse rubber products and has
acquired a second meaning within the context of trademark and tradename laws. There is confusing similarity
between “Universal converse and Device” and “Converse chuck Taylor” and “All Star Device” which would confuse
the public to the prejudice of Converse Rubber’ inasmuch as “Universal Converse and Device” is imprinted in a
circular manner on the side of its rubber shoes, similar to that of “Converse Chuck Taylor.”

From a cursory appreciation of the petitioner's corporate name "CONVERSE RUBBER CORPORATION', it is evident
that the word "CONVERSE" is the dominant word which identifies petitioner from other corporations engaged in
similar business. Respondent admitted petitioner's existence since 1946 as a duly organized foreign corporation
engaged in the manufacture of rubber shoes. This admission necessarily betrays its knowledge of the reputation
and business of petitioner even before it applied for registration of the trademark in question. Knowing, therefore,
that the word "CONVERSE" belongs to and is being used by petitioner and is in fact the dominant word in
petitioner's corporate name, respondent has no right to appropriate the same for use on its products which are
similar to those being produced by petitioner.

Another factor why respondent's application should be denied is the confusing similarity between its trademark
"UNIVERSAL CONVERSE AND DEVICE" and petitioner's corporate name and/or its trademarks "CHUCK TAYLOR" and
"ALL STAR DEVICE" which could confuse the purchasing public to the prejudice of petitioner.

The trademark of respondent "UNIVERSAL CONVERSE and DEVICE" is imprinted in a circular manner on the side of
its rubber shoes. In the same manner, the trademark of petitioner which reads "CONVERSE CHUCK TAYLOR" is
imprinted on a circular base attached to the side of its rubber shoes.

The similarity in the general appearance of respondent's trademark and that of petitioner would evidently create a
likelihood of confusion among the purchasing public. But even assuming, arguendo, that the trademark sought to
be registered by... respondent is distinctively dissimilar from those of the petitioner, the likelihood of confusion
would still subsist, not on the purchaser's perception of the goods but on the origins thereof. By appropriating the
word "CONVERSE", respondent's products are likely to be mistaken as having been produced by petitioner. "The
risk of damage is not limited to a possible confusion of goods but also includes confusion of reputation if the public
could reasonably assume that the goods of the parties originated from the same source.

It is unfortunate that respondent Director of Patents has concluded that since the petitioner is not licensed to do
business in the country and is actually not doing business on its own in the Philippines, it has no name to protect in
the forum and thus, it is futile for it to establish that "CONVERSE" as part of its corporate name identifies its rubber
shoes. That a foreign corporation has a right to maintain an action in the forum even if it is not licensed to do
business and is not actually doing business on its own therein has been enunciated many times by this Court.

The ruling in the aforecited case is in consonance with the Convention of the Union of Paris for the Protection of
Industrial Property to which the Philippines became a party

Article 8 thereof provides that "a trade name [corporate name] shall be protected in all the countries of the Union
without the obligation of filing or registration, whether or not it forms part of the trademark".

The object of the Convention is to accord a national of a member nation extensive protection "against
infringement and other types of unfair competition" [Vanitary Fair Mills, Inc. vs. T. Eaton Co., 234 F. 2d 633].

The mandate of the aforementioned Convention finds implementation in Sec. 37 of RA No. 166, otherwise known
as the Trademark Law:

"Sec. 37. Rights of Foreign Registrants.- Persons who are nationals of, domiciled in, or have a bona fide or
effective business... or commercial establishment in any foreign country, which is a party to an international
convention or treaty relating to marks or... tradenames on the repression of unfair competition to which the
Philippines may be a party, shall be entitled to... the benefits and subject to the provisions of this Act… x x x

"Tradenames of persons described in the first paragraph of this section shall be protected without the obligation of
filing or registration whether or not they form parts of marks.”

Additional Notes:

"A trade name is any individual name or surname, firm name, device or word used by manufacturers, industrialists,
merchants and others to identify their businesses, vocations or occupations".

"As the trade name refers to the business and its goodwill the trademark refers to the goods".

The ownership of a trademark or tradename is a property right which the owner is entitled to protect "since there
is damage to him from confusion or reputation or... goodwill in the mind of the public as well as from confusion of
goods. The modern trend is to give emphasis to the unfairness of the acts and to classify and treat the issue as
fraud".

"A corporation is entitled to the cancellation of a mark that is confusingly similar to its corporate name".

"Appropriation by another of the dominant part of a corporate name is an infringement".

B3E Puma Sportschuhfabriken Dassler, K.G v Intermediate Appellate Court

Facts: On July 25, 1985, the petitioner, a foreign corporation duly organized and existing under the laws of the
Federal Republic of Germany and the manufacturer and producer of "PUMA PRODUCTS," filed a complaint for
infringement of patent or trademark with a prayer for the issuance of a writ of preliminary injunction against the
private respondent before the Regional Trial Court of Makati. Prior to the filing of the said civil suit, three cases
were pending before the Philippine Patent Office, namely:

Inter Partes Case No. 1259 entitled 'PUMA SPORTSCHUHFABRIKEN v. MIL-ORO MANUFACTURING CORPORATION,
respondent-applicant which is an opposition to the registration of petitioner's trademark 'PUMA and DEVICE' in
the PRINCIPAL REGISTER;

Inter Partes Case No. 1675 similarly entitled, 'PUMA SPORTSCHUHFABRIKEN RUDOLF DASSLER, K.G., petitioner,
versus MIL-ORO MANUFACTURING CORPORATION, respondent-registrant,' which is a case for the cancellation of
the trademark registration of the petitioner; and

Inter Partes Case No. 1945 also between the same parties this time the petitioner praying for the cancellation of
private respondent's Certificate of Registration No. 26875.

On July 31, 1985, the trial court issued a temporary restraining order, restraining the private respondent and the
Director of Patents from using the trademark "PUMA' or any reproduction, counterfeit copy or colorable imitation
thereof, and to withdraw from the market all products bearing the same trademark. On August 9, 1985, the private
respondent filed a motion to dismiss on the grounds that the petitioners' complaint states no cause of action,
petitioner has no legal personality to sue, and litis pendentia. On August 19, 1985, the trial court denied the
motion to dismiss and at the same time granted the petitioner's application for a writ of injunction. The private
respondents appealed to the Court of Appeals. On June 23, 1986, the Court of Appeals reversed the order of the
trial court and ordered the respondent judge to dismiss the civil case filed by the petitioner.
Issue: Whether or not there is presence of infringement as well as unfair competition.

Held: Yes, even assuming the truth of the private respondents allegation that the petitioner failed to allege
material facto in its petition relative to capacity to sue, the petitioner may still maintain the present suit against
respondent Hernandes. As early as 1927, this Court was, and it still is, of the view that a foreign corporation not
doing business in the Philippines needs no license to sue before Philippine courts for infringement of trademark
and unfair competition. Thus, in Western Equipment and Supply Co. v. Reyes, this Court held that a foreign
corporation which has never done any business in the Philippines and which is unlicensed and unregistered to do
business here, but is widely and favorably known in the Philippines through the use therein of its products bearing
its corporate and trade name, has a legal right to maintain an action in the Philippines to restrain the residents and
inhabitants thereof from organizing a corporation therein bearing the same name as the foreign corporation, when
it appears that they have personal knowledge of the existence of such a foreign corporation, and it is apparent that
the purpose of the proposed domestic corporation is to deal and trade in the same goods as those of the foreign
corporation. The ruling in the aforecited case is in consonance with the Convention of Converse Rubber
Corporation v. Universal Rubber Products, Inc., we likewise re-affirmed our adherence to the Paris Convention: the
Union of Paris for the Protection of Industrial Property to which the Philippines became a party on September 27,
1965. Article 8 thereof provides that 'a trade name [corporation name] shall be protected in all the countries of the
Union without the obligation of filing or registration, whether or not it forms part of the trademark.' The object of
the Convention is to accord a national of a member nation extensive protection 'against infringement and other
types of unfair competition. The mandate of the aforementioned Convention finds implementation in Section 37 of
RA No. 166, otherwise known as the trademark Law: Rights of Foreign Registrants. — Persons who are nationals of,
domiciled in, or have a bona fide or effective business or commercial establishment in any foreign country, which is
a party to an international convention or treaty relating to marks or tradenames on the represssion of unfair
competition to which the Philippines may be party, shall be entitled to the benefits and subject to the provisions of
this Act. Tradenames of persons described in the first paragraph of this section shall be protected without the
obligation of filing or registration whether or not they form part of marks.
chanrob1es virtual 1aw library

FACTS: On March 12, 1993, E. & J. GALLO WINERY and THE ANDRESONS GROUP, INC (respondents) sued MIGHTY
CORPORATION and LA CAMPANA FABRICA DE TABACO, INC. (petitioners) in the RTC-Makati for trademark and
trade name infringement and unfair competition, with a prayer for damages and preliminary injunction.

Respondents claimed that petitioners adopted the Gallo trademark to ride on Gallo Winery’s and Gallo
and Ernest & Julio Gallo trademark’s established reputation and popularity, thus causing confusion, deception and
mistake on the part of the purchasing public who had always associated Gallo and Ernest and Julio & Gallo
trademarks with Gallo Winery’s wines.

In their answer, petitioners alleged, among other affirmative defenses that: petitioners Gallo cigarettes
and Gallo Winery’s wine were totally unrelated products beacause Gallo Winery’s GALLO trademark registration
certificates covered wines only, and not cigarettes. Also, that GALLO cigarettes and GALLO wines were sold through
different channels of trade and that the target market of Gallo Winery’s wines was the middle or high-income
bracket while Gallo cigarette buyers were farmers, fishermen, laborers and other low-income workers.
Additionally, the dominant feature of the Gallo cigarette was the rooster device with the manufacturer’s name
clearly indicated as MIGHTY CORPORATION, while in the case of Gallo Winery’s wines, it was the full names of the
founders-owners ERNEST & JULIO GALLO or just their surname GALLO;

The Makati RTC denied, for lack of merit, respondent’s prayer for the issuance of a writ of preliminary
injunction. CA likewise dismissed respondent’s petition for review on certiorari.
 After the trial on the merits, however, the Makati RTC held petitioners liable for committing trademark
infringement and unfair competition with respect to the GALLO trademark.

On appeal, the CA affirmed the Makati RTC’s decision and subsequently denied petitioner’s motion for
reconsideration.

ISSUE: Whether petitioners are liable for trademark infringement, unfair competition and damages,

RULING: They are not liable for trademark infringement or unfair competition and reaffirmed the doctrine that the
use of an identical mark does not, by itself, lead to a legal conclusion that there is trademark infringement.not
liable for trademark infringement or unfair competition and reaffirmed the doctrine that the use of an identical
mark does not, by itself, lead to a legal conclusion that there is trademark infringement.

The GALLO trademark registration certificates in the Philippines and in other countries expressly state that they
cover wines only, without any evidence or indication that registrant Gallo Winery expanded or intended to expand
its business to cigarettes. Wines and cigarettes are not identical, similar, competing or related goods.

In resolving whether goods are related, several factors come into play:

· the business (and its location) to which the goods belong

· the class of product to which the good belong

· the product’s quality, quantity, or size, including the nature of the package, wrapper or container

· the nature and cost of the articles

· the descriptive properties, physical attributes or essential characteristics with reference to their form,
composition, texture or quality

· the purpose of the goods

· whether the article is bought for immediate consumption, that is, day-to-day household items

· the field of manufacture

· the conditions under which the article is usually purchased and

· the articles of the trade through which the goods flow, how they are distributed, marketed, displayed and
sold.

The test of fraudulent simulation is to the likelihood of the deception of some persons in some measure
acquainted with an established design and desirous of purchasing the commodity with which that design has been
associated. The simulation, in order to be objectionable, must be as appears likely to mislead the ordinary
intelligent buyer who has a need to supply and is familiar with the article that he seeks to purchase.

B4A Co v. Yeung, GR 212705, 10 September 2014, First Division Resolution, Perlas-Bernabe

FACTS: On July 27, 2000, Sps. Yeung filed a civil complaint for trademark infringement and unfair competition
before the Regional Trial Court against Ling Na Lau, her sister Pinky Lau, and Co, for allegedly conspiring in the sale
of counterfeit Greenstone products.

Greenstone Medicated Oil Item No. 16 (Greenstone) is manufactured by Greenstone Pharmaceutical, a traditional
Chinese medicine manufacturing firm based in Hong Kong and owned by Keng HuanJerry Yeung (Yeung), and is
exclusively imported and distributed in the Philippines by Taka Trading owned by Yeung’s wife, Emma Yeung. In
the complaint, Sps. Yeung averred that Emma’s brother, Jose Ruivivar III, bought a bottle of Greenstone from Royal
Chinese Drug Store, owned by Ling Na Lau. However, Ruivivar doubted its authenticity considering that it had a
different smell, and the heat it produced was not as strong as the original Greenstone he frequently used.

Having been informed, Yeung went to Royal on May 4, 2000 to investigate the matter and found seven (7) bottles
of counterfeit Greenstone on display for sale. He was then told by Pinky Lau – the store’s proprietor – that the
items came from Roberto Co of Kiao An Chinese Drug Store. Co allegedly offered the products as "Tienchi Fong Sap
Oil Greenstone" which she eventually availed from him. Upon Yeung’s prodding, Pinky wrote a note stating these
events.

Co denied having supplied counterfeit items to Royal and maintained that the stocks of Greenstone came only
from Taka Trading. Meanwhile, the Laus denied selling Greenstone and claimed that the seven items of Tienchi
were left by an unidentified male person at the counter and that when Yeung came and threatened to report the
matter to the authorities, the items were surrendered to him. As to Pinky’s note, it was claimed that she was
merely forced by Yeung to sign the same.

Subsequently the RTC ruled in favor of Sps. Yeung. It found that the Sps. Yeung had proven by preponderance of
evidence that the Laus and Co committed unfair competition through their conspiracy to sell counterfeit
Greenstone products that resulted in confusion and deception not only to the ordinary purchaser, like Ruivivar, but
also to the public. It did not find the Laus and Co liable for trademark infringement as there was no showing that
the trademark "Greenstone" was registered at the time the acts complained of occurred.

On appeal, the Court of Appeals affirmed the RTC Decision. Accordingly, it sustained the RTC’s finding of unfair
competition, considering that Sps. Yeung’s evidence preponderated over that of the Laus and Co which was
observed to be shifty and contradictory. Resultantly, all awards of damages in favor of Sps. Yeung were upheld. Co
filed the instant petition.

ISSUE: Whether the Co and the Lau’s are liable for trademark infringement and unfair competition?

HELD: Defendants here cannot be liable for trademark infringement. However, the case for unfair competition
shall prosper. Unfair competition is defined as the passing off or attempting to pass off upon the public of the
goods or business of one person as the goods or business of another with the end and probable effect of deceiving
the public. Here, it has been established that Co conspired with the Laus in the sale/distribution of counterfeit
Greenstone products to the public, which were even packaged in bottles identical to that of the original, thereby
giving rise to the presumption of fraudulent intent. It is thus clear that Co together with the Laus, committed unfair
competition, and be held liable therefor. Although liable for unfair competition, the Court deems it apt to clarify
that Co was properly exculpated from the charge of trademark infringement considering that the registration of
the trademark "Greenstone" – essential as it is in a trademark infringement case – was not proven to have existed
during the time the acts complained of were committed, i.e. in May 2000.

Distinction Between Unfair Competition and Trademark Infringement

(a) The former is the unauthorized use of a trademark, whereas the latter is the passing off of one’s goods as those
of another;
(b) Fraudulent intent is unnecessary in the former, while it is essential in the latter; and
(c) In the former, prior registration of the trademark is a prerequisite to the action, while it is not necessary in the
latter.
B4B General Garments Corporation v. Director of Patents, GR L-24295, 30 September 1971,
Facts: Puritan Sportswear Corporation, organized and existing in and under the laws of the state of Pennsylvania,
U.S.A., filed a petition with the Philippine Patent Office for the cancellation of the trademark "Puritan" registered in
the name of General Garments Corporation, alleging ownership and prior use in the Philippines of the said
trademark on the same kinds of goods, which use it had not abandoned; and alleging further that the registration
thereof by General Garments Corporation had been obtained fraudulently and in violation of Section 17(c) of
Republic Act No. 166, as amended, in relation to Section 4(d) thereof.

Petitioner argues that Section 21-A militates against respondent's capacity to maintain a suit for cancellation, since
it requires, before a foreign corporation may bring an action, that its trademark or tradename has been registered
under the Trademark Law. The argument misses the essential point in the said provision, which is that the foreign
corporation is allowed there under to sue "whether or not it has been licensed to do business in the Philippines"
pursuant to the Corporation Law (precisely to counteract the effects of the decision in the Mentholatum case).

Issue: Whether or not Puritan Sportswear Corporation, which is a foreign corporation not licensed to do business
and not doing business in the Philippines, has legal capacity to maintain a suit in the Philippine Patent Office for
cancellation of a trademark registered therein. 

Held: Trademark Law on Foreign Industrial Property: "The necessary provisions to qualify the Philippines under the
international convention for the protection of industrial property have been specifically incorporated in the
Act."3 In the meantime, regardless of Section 37, aliens or foreign corporations are accorded benefits under the
law. Thus, under Section 2, for instance, the trademarks, tradenames and service-marks owned by persons,
corporations, partnerships or associations domiciled in any foreign country may be registered in the Philippines,
provided that the country of which the applicant for registration is a citizen grants bylaw substantially similar
privileges to citizens of the Philippines.

VICTORIAS MILLING COMPANY, INC. vs. ONG SU AND THE HONORABLE TIBURCIO S. EVALLE, IN HIS CAPACITY AS
DIRECTOR OF PATENTS
G.R. No. L-28499. September 30, 1977

FACTS: The petitioner, Victorias Milling Company, Inc., a domestic corporation and engaged in the manufacture
and sale of refined granulated sugar, is the owner of the trademark “VICTORIAS” and diamond design registered in
the Philippines Patent Office on November 9, 1961. The respondent ONG Su is engaged in the repacking and sale of
refined sugar and is the owner of the trademark “VALENTINE” and design registered in the Philippines Patent
Office on June 20, 1961.

On October 4, 1963, Victorias Milling Company, Inc. filed with the Philippines Patent Office a petition to cancel the
registration of the ONG Su trademark “Valentine.” The petitioner alleged that its trademark “Victorias” and
diamond design has become distinctive of its sugar long before the respondent used its trademark; that the
registration of “Valentine” and design has caused and will cause great damage to petitioner by reason of mistake,
confusion, or deception among the purchasers because it is similar to its “Victorias” trademark; that registration
was fraudulently obtained by respondent ONG Su; and that “Valentine” falsely suggests a connection with Saint
Valentine or with an institution or belief connected therewith.
In his answer to the petition the respondent averred that he is doing business under the name and style “Valentine
Packaging” and has registered the trademark “Valentine” with a design for sugar and was issued Certificate of
Registration No. 8891 dated June 20, 1961; that the trademark “Victorias” with diamond design and the trademark
“Valentine” with a design are two different marks; and that there is absolutely no likelihood of confusion, mistake
or deception to purchasers through the concurrent use of the petitioner’s mark “Victorias” with a diamond design
and the respondents’ mark “Valentine” with a design in connection with sugar.

The Director of Patents denied the petition to cancel the certificate of registration of the respondent ONG Su
covering the trademark “Valentine” and design. “Herein that the petitioner failed to establish that diamond design
component of its mark has acquired a secondary meaning and that the literal portion of the marks have no
similarity, there is no reasonable likelihood of purchaser confusion resulting from registrant’s use of VALENTINE
within a diamond and petitioner’s use of VICTORIAS within a diamond.”

ISSUE: Whether or not there is a substantial similarity between the trademark of the petitioner and the
respondent.

RULING: The contention of petitioner that the diamond design in its trademark is an index of origin has no merit.
The petitioner has not shown that the design portion of the mark has been so used that purchasers recognize the
design, standing alone, as indicating goods coming from the registrant. As correctly stated by the Director of
Patents, common geometric shapes such as diamonds ordinarily are not regarded as indicia of origin for goods to
which the marks are applied unless they have acquired a secondary meaning. And there is no evidence that the
diamond design in the trade mark of the petitioner has acquired a secondary meaning with respect to its sugar
business. The work “Victorias” in what identifies the sugar contained in the bag as the product of the petitioner.
Indeed, the petitioner has advertised its sugar in bags marked victorias’ with oval, hexagon and other designs.

It seems clear that the words “Valentine” and “Victorias” and the names and places of business of Victorias Milling
Company, Inc. and Ong Su are the dominant features of the trademarks in question. The petitioner has not
established such a substantial similarity between the two trademarks in question as to warrant the cancellation of
the trademark ‘valentine’ of the respondent Ong Su.

The words “Victorias” and “Valentine” are not similar in spelling and do not have a similar sound when
pronounced. Even the diamond designs are different. The diamond design of the trade mark “Valentine” has
protruding lines at the corners. Even an illiterate person can see the difference between the two diamond designs.

There is no evidence that the respondent Ong Su had obtained the registration of his trademark “Valentine” and
design by means of fraud. The said trade mark was registered in the Philippines Patent Office before the petitioner
registered its trademark.

RUEDA HERMANOS & CO., plaintiff-appellant, vs. FELIX PAGLINAWAN & CO.,
defendant-appellant.
G.R. No. 10738. January 14, 1916

FACTS:

This is a civil action for damages for unfair completion. Both parties are manufacturing
a chocolate candy. Rueda Hermanos had been engaged in the business for many years and registered a
trademark for its product in the year 1910. In March, 1914, Felix Paglinawan commenced the
manufacture of its confection. Both parties made their products in the shape of flat, circular pieces, each package
containing five pieces. The packages were thus cylindrical in shape, were of practically the same diameter and
length, and were wrapped in the same quality and color of paper. The printing on both packages
extended longitudinally and the corresponding lines on each were printed in the same size of type, although
the shading was lighter and some of the lines were printed in italics on the defendant's package.
Judgment in the court below went in favor of the plaintiff for a permanent injunction against the defendant and for
damages in the sum of P1,200. Both parties have appealed, the defendant on the question of its liability, and the
plaintiff on the alleged insufficiency of the damages allowed.

ISSUE: Whether or not the defendant is liable for unfair competition

RULING: YES. The true test of unfair competition is whether certain goods have been clothed with an appearance
which is likely to deceive the ordinary purchaser exercising ordinary care, and not whether a certain limited class of
purchasers with special knowledge not possessed by the ordinary purchaser could avoid mistake by the exercise of
this special knowledge.

If the contents of two packages are the same commodity, it is no defense to an action for unfair competition to
show minor differences in the size or shape of the packages or in the wording or color of the labels or wrappers of
the packages. If the exterior size, shape, color and description, in other words, those things which go to make up
the general outside appearances of the article, are so substantially similar as to "likely deceive the ordinary
purchaser exercising ordinary care," the defendant is guilty of unfair competition. A review of former cases
decided fails to show a single one wherein there were fewer differences in the general appearance of the
packages put up for sale by the respective parties that there are in the several packages presented as
exhibits in the case at bar.

In so far as the finding of actual intent to imitate the plaintiff's product is concerned, it must be remembered that
this "may be inferred from similarity in the appearance of the goods as packed or offered for sale to those of the
complaining party." Unfair competition is fully proven 'from the similarity in the appearance of the goods as
packed or offered for sale.' Indeed, in most cases of unfair competition the similarity of the goods must appear
from the form of
general appearance of the goods sold.

In the case at bar, it appears that Felix Paglinawan, a member of the defendant company, representing himself to
be a retailer of plaintiff's product, induced plaintiff's officers to show him through the factory and explain to him
their process of making chocolate candy mixed with peanuts. This was before the defendant company started to
make their product, and ignorance of the style, size, color and shape of plaintiff's article, as it was offered to the
retail trade, cannot, therefore, be maintained by the defendant company.

B4E: Faberge Incorporated v. Intermediate Appellate Court, GR 71189, 4 November 1992 DOCTRINE: The Doctrine
of Unrelated Goods provides that one who has adopted and used a trademark on his goods does not prevent the
adoption and use of the same trademark by others for products, which are of different description. FACTS: 1. The
Director of Patents allowed Co Beng Kay to register the trademark "BRUTE" for briefs despite petitioner's
opposition grounded on similarity of said trademark with petitioner's own symbol "BRUT" which it previously
registered for after-shave lotion, shaving cream, deodorant, talcum powder, and toilet soap. 2. Both marks are
similar in appearance, sound and style of presentation. ISSUE: Are briefs on one hand and aftershave lotion,
shaving cream, deodorant, talcum powder and toilet soap on the other hand, related goods? RULING: 1. The Court
ruled that the private respondent may be permitted to register the trademark "BRUTE" for briefs. Petitioner has
not ventured into the production of briefs, an item not listed in its certificate of registration. One who has adopted
and used a trademark on his goods does not prevent the adoption and use of the same trademark by others for
products which are of a different description. 2. The Supreme Court trenchantly held that the protective mantle of
the Trademark Law extends only to the goods used by the first user as specified in the certificate of registration,
following the clear mandate conveyed by Section 20 of Republic Act 166, as amended, otherwise known as the
Trademark Law, which reads: SEC. 20. Certification of registration prima facie evidence of validity.- A certificate of
registration of a mark or trade-name shall be prima facie evidence of the validity of the registration, the registrants
ownership of the mark or trade-name, and of the registrants exclusive right to use the same in connection with the
goods, business or services specified in the certificate, subject to any conditions and limitations stated therein. As a
result of this decision, Article 138 of R.A. 8293 now provides that a "certificate of registration of a mark shall be
prima facie evidence of...the registrant's exclusive right to use the same in connection with the goods or service
and those that are related thereto specified in the certificate." Under the old trademark law, the phrase "and those
that are related thereto" is not found.

AMERICAN CYANAMID COMPANY, petitioner,

Vs.

THE DIRECTOR OF PATENTS and TIU CHAN, respondents.

G.R. No. L-23954, April 29, 1977

Facts:

Petitioner, Cyanamid, field on April 3, 1959, a petition to cancel certificate of registration No. 5348 issued on July 6,
1956, in favor of respondent Tiu Chian of the Latter's trademark SULMETINE used on medicine for the control of
infectious coryza and for the prevention of cold rhinitis, roup, cecal coccidiosis and intestinal coccidiosis of chicken
and other domesticated birds. Cyanamid claims that it is the owner of a trademark SULMET which it had used for
many years in the United States since 1946 and which was duly Registration No. 431929 and which was first used
in the Philippines on May 25, 1950, for which it filed an application for registration of the same in this country on
May 3, 1956. SULMET is the trademark of a veterinary product used, among other purposes, "for the control of
outbreaks of ceal and intestinal coccidiosis in turkeys' and for reducing mortality in pullorum disease in baby
chicks, acute fowl cholera in chickens, turkeys and ducks and anatipistifer disease in ducks." Through long use in
the country, SULMET has become popular and well-known and enjoys widespread reputation brought about by
extensive advertisement and promotion through the media. Notwithstanding the above, respondent filed an
application for registration of SULMETINE as his trademark on a veterinary product used for the same purposes
thereby making respondent's product confusing similarity with that of petitioner which is unfair and unjust to the
label. In support of its Petition for cancellation, Cyanamid presented a sample of the label used on its product and
as a sample of the label of respondent Tiu Chian used on the latter's product. It likewise submitted several indent
orders issued by F.E. ZUELLIG, INC. to various business companies covering petitioner's Sulmet Solution. 

Respondent Tiu Chian opposed this Petition for cancellation of his trademark SULMETINE.

On June 9, 1964, the Director of Patents rendered his decision denying the Petition for cancellation of respondent's
certificate of registration of the trademark SULMETINE, based on the following findings:
 (1) Petitioner's trademark SULMET is used on a preparation for practically all domesticated animals such as
fowl, cattle, pigs, horses and sheep, whereas, SULMENTINE is limited only to chicken and other
domesticated birds. This distinction is evident from the printed matter appearing on the respective labels
of the parties. Thus, on respondent's label, it is indicated thereon that the preparation is for treatment of
birds and chicken, whereas, the label of petitioner indicates that the product is for chicken, turkey, duck,
and may be employed in the treatment of certain conditions in horses, cattle, calves, sheep, and swine.
(2) On top of petitioner's label, the word "CYANAMID" is printed in prominent letters and at the bottom of
the label there appears in bold letters the words "AMERICAN CYANAMID COMPANY, NEW YORK 20, N.Y."
indicating the manufacturer of the product. On the other hand, at the top of respondent's label, there
appears the pictures of two roosters with the word "HENRY'S" in-between, and at the bottom "HENRY'S
LABORATORIES PHILIPPINES" are clearly printed indicating the source of the product.
(3) Petitioner's preparation consists of a drinking water solution and this is clearly indicated in bold letters on
the label, whereas, the of respondent consists of tablets for veterinary use prominently indicated in red
letters on the label.

The above differences in the physical aspect or appearance of the respective labels were found by the Director of
Patents substantial and striking enough so as to prevent any confusing similarity between the two which may lead
a buyer to confuse one with the other.

With respect to Petitioner's contention that respondent's trademark bears the two syllables of petitioner's SULMET
and that respondent merely added the syllable "INE", the Director of Patents reasoned out that the syllables "SUL"
and "MET" are coined from a common source suggestive of chemical compounds which are attributes of the
products of the parties herein, that is, "SUL" being derived from "SULFA" and "MET" from methyl, so that neither
party may claim exclusive use to them, and that with the addition of the syllable "INE" by respondent, a marked
distinction is affected to distinguished the two trademarks.

The Director of Patents likewise found that no material damage was sustained by petitioner during the time that
respondent was using SULMETINE on its products. It is shown that the total of the sales of SULMET product was
P72,824.35 in 1959, which increased to P123,641.85 in 1960, and that although in 1961 the sales decreased slightly
to P118,621.25, that was offset considerably by the sudden increase to P161,238.65 in 1962.

Issue: Whether or not petitioner correctly claims that respondent's trademark SULMETINE was copied from its
trademark SULMETINE giving rise to a confusing similarity between the two in violation of Republic Act 166
otherwise known as the Trade-Mark Law.

Ruling: No.

The Court finds petitioner's submittal devoid of merit and hold that there is no infringement of trademark which
justify a cancellation of respondent's registered trademark SULMETINE.

An examination of the documentary evidence submitted by the parties confirms the findings of the Director of
Patents that there are striking differences between the two labels which preclude the possibility of the purchasing
public confusing one product with the other. Said labels are entirely different in size, background, colors, contents,
and pictorial arrangement: in short. the general appearances of the labels bearing the respective trademarks are
so distinct from each other that petitioner cannot assert that the dominant features, if any, of its trademark were
used or appropriated in respondent's own. Thus —

(a) The coloring scheme: Petitioner's SULMETINE label has a white background with the word SULMETINE
printed in dark green, while respondent's SULMETINE label is dark yellow in color, and the word
SULMETINE. is printed in dark blue. In fact, Exhibit B carries mainly two colors — white and green, while
Exhibit C uses yellow, blue, and red
(b) The pictorial representation: Respondent's label presents at its top the pictures of two roosters and in
between is the word "HENRY'S" printed in an egg-shaped enclosure, while petitioner's label carries no
such pictorial representation nor even one similar to it, for what appears on the top of its label is the word
"CYANAMID" printed in bold and widely-spaced green letters.
(c) The printed matter on the label: A very important point of difference between the labels of the parties is
found in the contents of the printed matter. In the label, the product is described in bold green letters as
"Drinking Water Solution" and the printed directions indicate that it is for use of chicken flocks, turkeys,
ducks, as well as in certain conditions for horses, cattle, calves, sheep, and swine. On the other hand, in
respondent's label, what are printed in bold red letters are "Tablets Veterinary". Except for the use of the
words "Adult birds" and "Small chicks", there is nothing in which indicates that the preparation may be
used for turkeys, ducks, or for any other domesticated animals mentioned in the SULMET label. On this
point, it is significant to note that the product represented by the trademarks of the parties is a medicinal
preparation for veterinary use, consequently, a prospective buyer will be cautious and prudent enough to
examine the contents of the printed matter on the label, unlike in a situation where the product is for
ordinary personal or household use, such as soap and other toilet articles, biscuits, candies, and their like
where the consumer is not expected to exercise more than ordinary diligence in the choice or selection a
purchase not to ascertain that what he is purchasing is a animals, and in the process mistake a water
solution for a tablet over vice versa.
(d) The clear indication of the source: Petitioner's label clearly indicates that the product SULMET is of foreign
origin.

Not only is the word "CYANAMID" printed in big widely-spaced letters at the top of the label but at the bottom
thereof the words "AMERICAN CYANAMID COMPANY, NEW YORK 20, N.Y." are printed in white capital letters
against a dark green background. In respondent's SULMENTINE label, the name "HENRY'S" in turn is printed clearly
above the word SULMETINE and at the bottom of the label the phrase "HENRY'S LABORATORIES PHILIPPINES"" is
printed in white letters against a dark blue background making it distinctly visible.

Thus, looking at the two labels it is quite apparent that the source of the product is predominantly indicated
thereby discounting petitioner's assertion that the SULMETINE trademark is a plain copy of its own with intent to
pass respondent's article as coming from the same source as that of petitioner's medicinal preparation.

In this case of SULMET and SULMETINE, the product is for medicinal veterinary use and consequently, the
purchaser will be more wary of the nature of the product he is buying. Contrary to the allegation of petitioner
herein, the source or manufacturer of the article will be a most important factor in the mind of the purchaser in
selecting the article he will buy, and a preparation manufactured by a well-known foreign company such as the
"American Cyanamid Company, New York", enjoys a decided advantage over one which is locally produced and
manufactured by an unknown entity such as "Henry's Laboratories".

As correctly stated by the Director of Patents, the word SULMET is derived from a combination of the syllables
"SUL" which is derived from Sulfa and "MET" from methyl both of which are chemical compounds present in the
article manufactured by the contending parties, and the addition of the syllable "INE" in respondent's label is
sufficient to distinguish respondent's product or trademark from that of petitioner.

The Court cannot agree with petitioner that the trademarks are used on Identical goods because as already
indicated earlier, petitioner's SULMET label is used on a drinking water solution while that of respondent labels
tablets. That both products are for Identical use may be admitted to the extent that respondent's tablets are
indicated for the treatment, control and prevention in chicken of infectious coryza also known as colds, rhinitis and
roup) and for the prevention of cecal and intestinal coccidiosis which is also indicate in petitioner's SULMET label.
However, no one including petitioner can claim a monopoly in the preparation of a medicinal product for the use
indicated above. The field is open for the manufacture of medicinal preparations for the same veterinary purposes.
What the law prohibits is that one manufacturer labels his product in a manner strikingly Identical with or similar
to that of another manufacturer as to deceive or confuse the buying public into believing that the two
preparations are one and come from the same source. In the case however of SULMETINE and SULMETINE it is
satisfactorily shown from the evidence of the parties that while their products may be for a similar use, their
presentation to the purchasing public come in totally different forms.

Absent a finding of confusing similarity between two trademarks, the priority in the use of the marks SULMET by
the petitioner will have no decesive effect in the granting of his petition for cancellation of the registration of
respondent trademark (First Assignment of Error).

B05 ESSO STANDARD EASTERN, INC. v. COURT OF APPEALS

GR L-29971 | 31 August 1982 | Teehankee

Facts: Esso Standard Eastern, Inc., then a foreign corporation duly licensed to do business in the Philippines, is
engaged in the sale of petroleum products which are Identified with its trademark ESSO United Cigarette
Corporation is a domestic corporation then engaged in the manufacture and sale of cigarettes, after it acquired in
November, 1963 the business, factory and patent rights of its predecessor La Oriental Tobacco Corporation, one of
the rights thus acquired having been the use of the trademark ESSO on its cigarettes, for which a permit had been
duly granted by the Bureau of Internal Revenue.

The complaint of ESSO alleged that it had been for many years engaged in the sale of petroleum products and its
trademark ESSO had acquired a considerable goodwill to such an extent that the buying public had always taken
the trademark ESSO as equivalent to high quality petroleum products. It asserted that the continued use by United
Cigarettes Corporation of the same trademark ESSO on its cigarettes was being carried out for the purpose of
deceiving the public as to its quality and origin to the detriment and disadvantage of its own products.

Unite Cigarettes Corporation admitted that it used the trademark ESSO on its own product of cigarettes, which was
not Identical to those produced and sold by the petitioner and therefore did not in any way infringe on or imitate
petitioner's trademark. It further argues that in order that there may be trademark infringement, it is
indispensable that the mark must be used by one person in connection or competition with goods of the same kind
as the complainants.

Issue/s: Is there trademark infringement?

Ruling: None.

It is undisputed that the goods on which petitioner uses the trademark ESSO, petroleum products, and the product
of respondent, cigarettes, are non-competing. But as to whether trademark infringement exists depends for the
most part upon whether or not the goods are so related that the public may be, or is actually, deceived and misled
that they came from the same maker or manufacturer. For non-competing goods may be those which, though they
are not in actual competition, are so related to each other that it might reasonably be assumed that they originate
from one manufacturer. Non-competing goods may also be those which, being entirely unrelated, could not
reasonably be assumed to have a common source. in the former case of related goods, confusion of business could
arise out of the use of similar marks; in the latter case of non-related goods, it could not. The vast majority of
courts today follow the modern theory or concept of "related goods" which the Court has likewise adopted and
uniformly recognized and applied.

Goods are related when they belong to the same class or have the same descriptive properties; when they possess
the same physical attributes or essential characteristics with reference to their form, composition, texture or
quality.

In the present case, the goods are obviously different from each other with "absolutely no iota of similitude" as
stressed in respondent court's judgment. They are so foreign to each other as to make it unlikely that purchasers
would think that petitioner is the manufacturer of respondent's goods. The mere fact that one person has adopted
and used a trademark on his goods does not prevent the adoption and use of the same trademark by others on
unrelated articles of a different kind.

Considering the general appearances of each mark as a whole, the possibility of any confusion is unlikely. A
comparison of the labels of the samples of the goods submitted by the parties shows a great many differences on
the trademarks used. Even the lower court, which ruled initially for petitioner, found that a "noticeable difference
between the brand ESSO being used by the defendants and the trademark ESSO of the plaintiff is that the former
has a rectangular background, while in that of the plaintiff the word ESSO is enclosed in an oval background."

The petition is DISMISSED, and the decision of respondent Court of Appeals is hereby AFFIRMED.

GR 169504, 3 March 2010

Coffee Partners v. San Francisco Coffee & Roastery

CARPIO, J.:

FACTS: Petitioner Coffee Partners entered into a franchise agreement with Coffee Partners Ltd. to operate coffee
shops in the country using the trademark ‘San Francisco Coffee.’ Respondent on the other hand, is a local
corporation engaged in the wholesale and retail sale of coffee and uses the business name ‘San Francisco Coffee &
Roastery’ registered with the DTI. Later, respondent filed an infringement and/or unfair competition complaint
against petitioner alleging that the latter was about to open a coffee shop under the name ‘San Francisco Coffee’
causing confusion in the minds of the public as it bore a similar name and is engaged also in selling of coffee.
Petitioner contended no infringement would arise because respondent’s tradename was not registered.

ISSUE: Whether petitioner’s trademark would infringe respondent’s tradename.

HELD: Yes. In Prosource International, Inc. v. Horphag Research Management SA, this Court laid down what
constitutes infringement of an unregistered trade name, thus:

(1) The trademark being infringed is registered in the Intellectual Property Office; however, in
infringement of trade name, the same need not be registered;

(2) The trademark or trade name is reproduced, counterfeited, copied, or colorably imitated by the
infringer;

(3) The infringing mark or trade name is used in connection with the sale, offering for sale, or advertising
of any goods, business or services; or the infringing mark or trade name is applied to labels, signs, prints,
packages, wrappers, receptacles, or advertisements intended to be used upon or in connection with such
goods, business, or services;

(4) The use or application of the infringing mark or trade name is likely to cause confusion or mistake or to
deceive purchasers or others as to the goods or services themselves or as to the source or origin of such
goods or services or the identity of such business; and

(5) It is without the consent of the trademark or trade name owner or the assignee thereof.

RA 8293, which took effect on 1 January 1998, has dispensed with the registration requirement. Section 165.2 of
RA 8293 categorically states that trade names shall be protected, even prior to or without registration with the
IPO, against any unlawful act including any subsequent use of the trade name by a third party, whether as a trade
name or a trademark likely to mislead the public.

It is the likelihood of confusion that is the gravamen of infringement. Applying the dominancy test or the holistic
test, petitioner’s “SAN FRANCISCO COFFEE” trademark is a clear infringement of respondent’s “SAN FRANCISCO
COFFEE & ROASTERY, INC.” trade name. The descriptive words “SAN FRANCISCO COFFEE” are precisely the
dominant features of respondent’s trade name. Petitioner and respondent are engaged in the same business of
selling coffee, whether wholesale or retail. The likelihood of confusion is higher in cases where the business of one
corporation is the same or substantially the same as that of another corporation. In this case, the consuming public
will likely be confused as to the source of the coffee being sold at petitioner’s coffee shops.

Ang Si Heng v. Wellington Department Store Inc., GR L-4531, 10 January 1953 Facts: Plaintiff-appellant Ang Si Heng
is a manufacturer of articles of wear and registered owner of the mark ‘Wellington.’ Meanwhile, defendant is a
store for different articles and is registered with the business name ‘Wellington Department Store.’ Plaintiff Heng
filed a complaint for unfair competition against defendant alleging that the latter’s use of its business
name/corporate name deceives the public into buying defendant’s goods under the mistaken belief that the goods
are of plaintiff’s or have the same source as plaintiff’s goods. The court dismissed the complaint. Issue: Whether or
not defendant has misled the public constitutive of unfair competition. Ruling: NO. While there is similarity
between the trademark or trade name “Wellington Department Store,” no confusion or deception can possibly
result or arise from such similarity because the latter is a “department store,” while the former does purport to be
so. The name “Wellington” is admittedly the name of the trademark on the shirts, pants, drawers, and other
articles of wear for men, women and children, whereas the name used by the defendant indicates not these
manufactured articles or any similar merchandise, but a department store. Neither can the public be said to be
deceived into the belief that the goods being sold in defendant’s store originate from the plaintiffs, because the
evidence shows that defendant’s store sells no shirts or wear bearing the trademark “Wellington,” but other
trademarks. Neither could such deception be by any possibility produced because defendant’s store is situated on
the Escolta, while plaintiffs’ store or place of business is located in another business district far away from the
Escolta. The mere fact that two or more customers of the plaintiffs thought of the probable identity of the
products sold by one and the other is not sufficient proof of the supposed confusion that the public has been led
into by the use of the name adopted by the defendants. As we have stated, appellant have not shown any well-
established reputation or goodwill previous to the establishment of appellees’ business, such that it can be said
that something was unfairly taken by the use of such reputation by the appellees’ department store. We agree,
therefore, with the trial court that plaintiffs-appellants have not been able to show the existence of a cause of
action for unfair competition against the defendantsappellees.

CONRAD VS CA
G.R. No. 115115 July 18, 1995

FACTS:

The respondents Fitrite, Inc. and its sister company, Victoria Biscuit Co., Inc. are domestic corporations engaged in
the business of manufacturing, selling and distributing biscuits and cookies. Their products bear the trademark
"SUNSHINE" in the Philippines which was awarded by the Bureau of Patents, Trademarks and Technology Transfer
(BPTTT) listing Fitrite as principal registrant.

Since May 20, 1983 when Fitrite was issued the Certificate of Registration for its trademark to the filing of its
complaint against Conrad Company Inc., Fitrite and Victoria Biscuit have been manufacturing, selling and
distributing on a massive scale biscuits and cookies bearing the "Sunshine" trademark making it popular in Metro
Manila and in the provinces.

On May 30, 1990, Conrad's own Import Manager and Executive Assistant, Raul Olaya, executed an affidavit stating
that Conrad had also been importing, selling and distributing biscuits and cookies, and other items bearing the
same trademark as Fitrite and Victoria's. It was traced by the mentioned domestic corporations that on April 18,
1988, Conrad was designated as an exclusive importer and dealer of the products of "Sunshine Biscuits, Inc." for
sale in the Philippine market.

 A few days later, Conrad started its first importation and continuously did so. Through their counsel, Fitrite and
Victoria addressed a letter to Conrad demanding that it cease and desist from continuing its operation and use of
the subject trademark, but was ignored. This led Fitrite and Victoria to file a complaint against Conrad for
infringement and unfair competition. Conrad sought to dismiss the complaint by invoking litis pendentia, the
doctrine of primary jurisdiction, and failure to state a cause of action. Conrad argued that it has been granted
distributorship by Sunshine Biscuits USA over the Philippine territory, and so, it follows that the basis of Fitrite and
Victoria's claim is lodged under the exclusive jurisdiction of the BPTTT. The trial court found merit on the motion to
dismiss the complaint.

Fitrite and  Victoria filed a motion for reconsideration, but was denied by the lower court. The Court of Appeals,
however, found merit on their claims and reinstated the complaint. Hence, this petition by Conrad praying that the
Civil Case for "Injunction with Damages with Prayer for Preliminary Injunction" based on infringement and unfair
competition filed by Fitrite and Victoria be dismissed.

ISSUE:

Whether or not Fitrite and Victoria’s civil action against Conrad which was based on infringement and unfair
competition be dismissed because of the doctrine of litis pendentia.

RULING:

No. An application for administrative cancellation of a registered trademark on any of the grounds enumerated in
Section 17 of R.A. No. 166 or the Trade-Mark Law, as amended, falls under the exclusive jurisdiction of BPTTT. But,
for infringement or unfair competition, as well as the remedy of injunction and relief for damages, it is explicitly
and unquestionably within the competence and jurisdiction of ordinary courts. As held in an earlier decision by the
Supreme Court, that the registration in the Principal Register gives rise to a presumption of validity of the
registration and of the registrant's ownership and right to the exclusive use of the mark. Such registration can
serve as the basis for an action of infringement which entitles the registrant whose right was invaded for court
protection and relief. 

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 findings of resolutions of
administrative tribunals on certain technical matters. Needless to say, we cannot at this stage delve into the merits
of the cancellation case. In this instance, the sole concern, outside of the jurisdictional aspect of the petition
hereinbefore discussed, would be that which focuses on the propriety of the injunction order of the appellate
court. CA’s ruling is correct that FITRITE should be protected in the use thereof and considering that it is apparent
from the record that the invasion of the right FITRITE sought to protect is material and substantial; that such right
of FITRITE is clear and unmistakable; and that there is an urgent necessity to prevent serious damage to FITRITE's
business interest, goodwill and profit. Thus, a preliminary injunction may be issued in favor of FITRITE to maintain
the status quo pending trial of the action a quo on the merits without prejudice to the suspension of such action if
the aforesaid cancellation proceeding before the BPTTT has not been concluded.

SAMSON VS. CA

G.R. No. 139983, March 26, 2008

(Samson vs. Ca G.R. No. 139983 March 26, 2008)

FACTS:

On 26 February 1982, petitioner Manuel P. Samson (Samson) applied for the registration of the "OTTO" trademark
with the Philippine Patent Office on belts, bags, t-shirts, blouses, briefs, pants, jackets, jeans, and bra. On 21
January 1983, respondent Wilfro Luminlun (Luminlun) likewise filed fo the registration of the "OTTO" trademark on
jeans, sportswear, skirts, and socks.

On 29 December 1983, Samson executed the following document [3] granting Luminlun the authority to use the
"OTTO" trademark for jeans only

On 19 March 1984, the Philippine Patent Office issued to Samson a Certificate of Registration for the mark "OTTO"
in the principal register for use on belts, bags, t-shirts, blouses, briefs, pants, jackets, jeans, and bra.

In a letter dated 29 March 1989, Samson, through counsel, informed Luminlun that he was revoking the latter's
authority to use the trademark "OTTO." Samson advised Luminlun to "cease and desist from further manufacturing
and distributing OTTO jeans" otherwise he would confiscate jeans using the unauthorized "OTTO" trademark.
Samson likewise demanded the payment of royalties
Samson also filed with the Philippine Patent Office a Revocation of Authority to Use Trademark.[5]

As a result, Luminlun filed a complaint before the Regional Trial Court, Pasig City questioning the validity of
Samson's revocation of his authority to use the "OTTO" trademark. Luminlun likewise prayed that he be
compensated for the loss of sales he suffered since the sales outlets refused to accept his deliveries for fear that
the goods would be confiscated and removed from their stores.

On 10 April 1989, the trial court issued an Order restraining Samson from "proceeding and carrying out the
confiscation and the removal of jeans with trademark `OTTO' pending hearing on the petition for preliminary
Injunction." On 19 April 1989, Samson filed an "Opposition to Motion for Issuance of preliminary Injunction and/or
Motion to Lift Restraining Order."

After presentation of evidence and submission of memoranda by both parties, on 28 April 1989, the trial court
issued an Order granting Luminlun's prayer for preliminary Injunction.

On 9 May 1989, Samson filed his Answer. Samson raised, among others, the defenses that: (1) Luminlun failed to
pay royalties for the use of the trademark; and (2) Luminlun violated the terms and conditions of the Authority to
Use Trademark when he used the "OTTO" trademark for other products.

The Ruling of the Trial Court

In its Decision dated 15 May 1990, the trial court dismissed Luminlun's complaint. The dispositive portion of the
decision reads:

WHEREFORE, foregoing considered, the complaint is ordered DISMISSED. With costs against plaintiff.

The writ of preliminary Injunction earlier issued by the Court is set aside and recalled.

On the counterclaim, plaintiff is ordered to pay defendant attorney's fees of P25,000.00.

SO ORDERED.[6]

The trial court ruled that Samson was justified in revoking the authority of Luminlun to use the trademark. The trial
court found that Luminlun's acts of manufacturing and selling products bearing the trademark "OTTO LTD." like
skirts, shorts, pants, jeans, as as well as products with the trademark "OTTO" like belts, buttons, and bags, clearly
violated the authority granted by Samson to use the "OTTO" trademark for jeans only. The trial court, however,
ruled that Samson failed to prove that he was entitled to royalties.

Upon motion for reconsideration of both parties, the trial court in an Order dated 7 December 1990 [7] affirmed its
decision with the modification of an award of moral damages of P20,000 in favor of Samson.

The Ruling of the Court of Appeals

On appeal, the Court of Appeals reversed the ruling of the trial court. The appellate court found that Samson
revoked the authority on the sole ground that Luminlun failed to pay royalties. According to the appellate court,
Samson could not validly revoke the authority based on this ground since he failed to prove that royalties were due
him. The appellate court further ruled that Luminlun suffered losses as a result of the revocation and thus awarded
damages. The dispositive portion of the Court of Appeals' decision reads:

WHEREFORE, judgment is hereby rendered setting aside the decision appealed from and a new one issue making
the Injunction permanent and ordering appellee to pay appellant the following sums of money:

a) actual and compensatory damages in the amount of P2,257,872.20.

b) attorney's fees in the amount of P50,000.00.

Costs against appellee.

SO ORDERED.[8]

The Issues

Thus, in this petition, Samson raises the following assignment of errors: [9]

(a) The Court of Appeals erred in concluding that the revocation of the Authority to Use Trademark made by
Samson was unjustified;

(b) The Court of Appeals erred in awarding actual or compensatory damages of P2,257,872.20 in spite of the total
absence of evidence to show that Luminlun sustained such damages as a consequence of the revocation of the
Authority to Use Trademark;

(c) The Court of Appeals erred in awarding attorney's fees of P50,000 in spite of the absence of any legal ground for
such award; and

d) The Court of Appeals erred in not sustaining the trial court's award of moral damages and attorney's fees in
favor of Samson.

The Court's Ruling

The resolution of this case hinges on whether Samson was justified in revoking Luminlun's authority to use the
"OTTO" trademark.

We rule in the affirmative.

In finding for respondent Luminlun, the appellate court rationalized:

x x x  In appellee's Opposition to Motion for Issuance of Preliminary  Injunction

and/or Motion to Lift Restraining Order dated April 18, 1989 (p. 37, Records), it is clearly stated that he revoked
the Authority to Use Trademark on the sole ground that appellant failed to pay royalty tax, thus:
"x x x. When plaintiff unjustly and illegally failed, refused and neglected and still fails, refuse, and neglects to pay
royalty tax, defendant revoked the grant of authority and the same was filed with the Patent Office on March 21,
1989, a copy of which was served on plaintiff and received by him contained in a letter dated March 29, 1989. (at
page 3 of Opposition)

x x x x x x x x x

"It is defendant who is entitled to the issuance of  Injunction  to restrain plantiff from further manufacturing and
distributing OTTO jeans after plaintiff's authority had been revoked for failure to comply with his obligation to
pay royalty tax due to defendant."

As correctly pointed out by appellant, the issue that appellee had been allegedly affected and his products allegedly
discredited by appellant's use of the trademark OTTO and OTTO Ltd. was but a belated attempt on the part of the
appellee to justify his illegal act of revoking the Authority to Use Trademark issued to the appellant. It was only
after realizing the weakness of his sole ground for revoking the authority that he raised said issue.

It is evident that when appellee executed the Revocation of Authority to Use Trademark on March 28, 1989 he
was not concerned with appellant's use of the trademark OTTO Ltd. on appellant's product and the trademark
OTTO on belts and buttons because there was no prejudice on
his part.  Otherwise, he could have mentioned the same in the Revocation and in the demand letter dated March
29, 1989 of his counsel, Atty Nelson Y. Ng  [10] (Emphasis supplied)

We disagree with the appellate court's ruling.

The authority granted to Luminlun to use the "OTTO" trademark was limited for use on jeans only. Under the
agreement, Samson could revoke the authority if Luminlun "should do or cause to be done any act which would in
any way prejudice or discredit the trademark OTTO not only in connection with its use for jeans but as well as for
other products" enumerated in Samson's registration certificates.

As correctly found by the trial court, Luminlun manufactured "OTTO" belts, buttons, and bags as well as "OTTO
LTD." clothing in violation of the terms and conditions of the authority which affected Samson and discredited his
products, thus:

On the second issue, the Court finds that defendant has been affected and his
products discredited by plaintiff's use of trademark "OTTO" and OTTO LTD." on other products, aside from jeans.
Plaintiff admitted manufacturing and selling products bearing the trademark "OTTO LTD." like skirts, shorts,
pants, jeans; also plaintiff manufactures and sells products with the trademark "OTTO", like belts, buttons and
bags. (Exh. "3"; also pp. 67, 68, 69, 91, rec.) The authority given to plaintiff was a non-transferable, non-
assignable, non-exclusive right and license to use said trademark "OTTO" for jeans only x x x". (Underlining
supplied) Clearly, plaintiff failed to comply with the terms and conditions enumerated in the agreement. Plaintiff
had the option to use the trademark "OTTO" but he had done acts constituting bad faith, necessarily discrediting
the interest of defendant on his products which were duly registered with the Philippine Patent Office, such as: Exh.
"6," photograph of over all with trademark "OTTO"; Exh. "7", issue of Panorama Magazine; Exh. "7-A", trousers
with "OTTO LTD.", Exh. "8", t-shirt with brand "OTTO [LTD.]"; Exh. "14", pants bearing "OTTO [LTD.]", Exh. "14-A"
Exh. "14-B"; belt and pant with "OTTO LTD." "OTTO"; Exh. "15" Cash invoice, pants "OTTO"; Exh. "17"- .", jeans
classic with trademark "OTTO".

Defendant therefore was justified when he served notice of revocation of the authority of
plaintiff to use the trademark.[11] (Emphasis supplied)
Under the circumstances and in accordance with the terms and conditions of the Authority to Use Trademark, we
find that Samson was justified in revoking Luminlun's authority to use the "OTTO" trademark.

However, the appellate court chose to ignore Luminlun's glaring violation of the terms and conditions of the
Authority. The appellate court instead resorted to hair-splitting and ruled that Samson could not justify the
revocation since he did not raise this ground in his "Opposition to Motion for Issuance of
Preliminary Injunction and/or Motion to Lift Restraining Order."

We find such reasoning flawed.

The records reveal that Samson, in his Answer, raised, among others, the affirmative defense that he had the right
to revoke the Authority to Use Trademark because Luminlun manufactured other "OTTO" products aside from
jeans:

Defendant had every right and prerogative to revoke the authority granted to plaintiff on the use of the trademark
for "OTTO" for jeans only when plaintiff failed to pay a single centavo of royalty and  had likewise violated the
grant of authority by illegally manufacturing and distributing aside from jeans, other products like jackets,
skirts, shirts, blouses and shorts which are not covered by the grant of authority granted to him. [12]  (Emphasis
supplied)

We find that Samson seasonably raised this defense and we do not see any basis for the apellate court's ruling that
Samson could not invoke this ground.

The appellate court further makes issue of the fact that Samson did not mention in both the Revocation of
Authority to Use Trademark and his demand letter dated 29 March 1989 that Luminlun's manufacture of other
"OTTO" products such as belts and buttons was prejudicial to him and was the cause for the revocation.

We note that the Revocation of Authority simply mentioned that "it was Luminlun's failure to comply with his
undertaking when the authority was executed as the reason for the revocation." The fact that Samson did not
indicate the specific reason for the revocation is of no moment and should not be taken against him. Thus, we find
no basis for the appellate court's conclusion that when Samsonexecuted the Revocation of Authority he was not
concerned with Luminlun's use of the "OTTO" trademark on other products because there was no prejudice on his
part. Samson was affected and his products discredited by Luminlun's unauthorized manufacture of other "OTTO"
products. Thus, in its Order resolving the Motions for Reconsideration filed by the parties, the trial court stated:

x x x it is not denied defendant was given the authority by the Patent Office and has been the registered owner of
the trademark "OTTO" under principal register no. 33064 and 29840 and supplemental register 7390 and 4166. The
license was issued to the defendant for the protection of his rights as a registered owner of the trademark in order
to identify the lawful user. It was intended to protect the public to be deceived of the use of the products.

On the issue of the violation of the conditions involving the claim of royalty, the Court said that defendant has been
affected and his products discredited by the plaintiff's use of trademark "OTTO" and "OTTO LTD," on other
products.  Plaintiff had admitted manufacturing and selling products with the same trademark on skirts, shorts,
pants and jeans. Bad faith was evident from the acts of plaintiff. The authority of plaintiff to use the trademark
"OTTO" for jeans was revoked for violation of the terms of the agreement. [13] (Emphasis supplied)

Considering that Samson was justified in revoking the authority of Luminlun to use the "OTTO" trademark, it
necessarily follows that the damages awarded by the appellate court in favor of Luminlun have no basis.
WHEREFORE, we GRANT the Petition. We SET ASIDE the assailed Decision and Resolution of the Court of
Appealsand REINSTATE the 15 May 1990 Decision and the 7 December 1990 Order of the Regional Trial Court,
Branch 160, Pasig City.

LA CHEMISE LACOSTE SA V. JUDGE FERNANDEZ

GRs L-63796-97, 2 May 1984

FACTS: La Chemise Lacoste S.A. is a foreign corporation, organized and existing under the laws of France and not
doing business in the Philippines. It is the actual owner of the trademarks “LACOSTE,” “CHEMISE LACOSTE,”
“CROCODILE DEVICE” and a composite mark consisting of the word “LACOSTE” and a representation of a
crocodile/alligator, used on clothings and other goods specifically sporting apparels sold in many parts of the world
and which have been marketed in the Philippines since 1964.

In 1975, Hemandas & Co., a duly licensed domestic firm applied for and was issued Reg. SR-2225 for the trademark
“CHEMISE LACOSTE & CROCODILE DEVICE” by the Philippine Patent Office. Two years later, it applied for the
registration of the same trademark under the Principal Register which the Patent Office eventually allowed,
holding the registrant to be presumed the owner of the mark until after the registration is declared cancelled.

In 1980, La Chemise Lacoste S.A. filed its application for registration of the trademark “Crocodile Device” and
“Lacoste”. The former was approved for publication while the latter was opposed by Games and Garments
(Gobindram Hemandas, assignee of Hemandas) in Inter Partes Case 1658.

In 1982, La Chemise Lacoste S.A. filed a Petition for the Cancellation of Reg. SR-2225 docketed as Inter Partes Case
1689.

In 1983, La Chemise Lacoste S.A. filed with the National Bureau of Investigation (NBI) a letter-complaint alleging
acts of unfair competition being committed by Hemandas and requesting their assistance in his apprehension and
prosecution. Two search warrants were issued by the trial court, and upon execution various goods and articles
were seized.

Hemandas filed a motion to quash the search warrants alleging that the trademark used by him was different from
petitioner’s trademark and that pending the resolution of IPC 1658 before the Patent Office, any criminal or civil
action on the same subject matter and between the same parties would be premature. Both the petitioner and the
State Prosecutor filed their opposition. The court granted the motion, thus, the search warrants were ordered to
be recalled and the seized items were ordered to be returned.

ISSUE:
1. Whether the proceedings before the patent office is a prejudicial question that need to be resolved
before the criminal action for unfair competition may be pursued?
2. Whether or not the right of owner of a trademark can be preempted by fact that another first secure its
registration in the Supplemental Register?

HELD:
1. No. The proceedings pending before the Patent Office do not partake of the nature of a prejudicial
question which must first be definitely resolved. The case which suspends the criminal action must be a
civil case, which is determinative of the innocence or guilt of the accused. The pending case before the
Patent Office is an administrative proceeding and not a civil case. The decision of the Patent Office cannot
be finally determinative of the private respondent’s innocence of the charges against him.
 The issue of whether or not the trademark used by the private respondent is different from the
petitioner’s trade mark is a matter of defense and will be better resolved in the criminal proceedings
before a court of justice instead of raising it as a preliminary matter in an administrative proceeding.

2. No. The records show that the goodwill and reputation of the petitioner’s products bearing the trademark
LACOSTE date back even before 1964 when LACOSTE clothing apparels were first marketed in the
Philippines. To allow Hemandas to continue using the trademark Lacoste for the simple reason that he
was the first registrant in the Supplemental Register of a trademark used in international commerce and
not belonging to him is to render nugatory the very essence of the law on trademarks and tradenames.

A certificate of registration in the Supplemental Register is not prima facie evidence of the validity of
registration, of the registrant’s exclusive right to use the same in connection with the goods, business, or
services specified in the certificate. Such a certificate of registration cannot be filed, with effect, with the
Bureau of Customs in order to exclude from the Philippines, foreign goods bearing infringement marks or
trade names.

Registration in the Supplemental Register, therefore, serves as notice that the registrant is using or has
appropriated the trademark. By the very fact that the trademark cannot as yet be entered in the Principal
Register, all who deal with it should be on guard that there are certain defects, some obstacles which the
user must still overcome before he can claim legal ownership of the mark or ask the courts to vindicate his
claims of an exclusive right to the use of the same. It would be deceptive for a party with nothing more
than a registration in the Supplemental Register to posture before courts of justice as if the registration is
in the Principal Register. It must be noted that one may be declared an unfair competitor even if his
competing trademark is registered.

Lacoste is one of the world famous trademarks, and by virtue of the November 20, 1980 Memorandum of
the Minister of Trade, in compliance with the Paris Convention for the Protection of Industrial Property,
instructed the Director of Patents to reject applications for Philippine registration of signature and other
world famous trademarks by applicants other than its original owners or users. The Director of Patents
was likewise ordered to require Philippine registrants of such trademarks to surrender their certificates of
registration.

G.R. No. L-13947             June 30, 1960

CUANCHOW SOY & CANNING CO., petitioner,

vs. THE DIRECTOR OF PATENTS and ROSARIO VILLAPANIA, respondents.

Facts:

Both petitioner Chuanchow Soy & Canning Co. and respondent Rosario Villapania are engaged in the manufacture
and sale of soy sauce.

Since 1950, petitioner had been using as trade mark the words "Carp Brand Soy", printed in a distinctive style of
lettering above the drawing of a fish to distinguish its product, on labels affixed directly to the bottles containing
soy sauce, and on tissue paper in which these bottles were wrapped. In 1953, the Patent Office issued Trademark
Registration Certificate 4384 to it for its aforesaid trademark.
Respondent Villapania since 1956 had been using as trademark of her soy sauce the name of "Bangos Brand"
written in the same distinctive style of lettering as that of the petitioner's "Carp Brand", above the drawing of the
fish similar to the fish drawing on the trademark of petitioner, on labels also attached to the bottles containing her
soy sauce, and the bottles were wrapped also in tissue paper bearing a similar design

1. On October 12, 1956, Villapania applied for registration of her trademark and upon examination of the
trademark, the examiner of the Office of the Director of Patents noted that the mark resembles CARP BRAND &
fish representation for soy sauce of the Chuanchow Soy & Caning Co. Hence, ordering the applicant to submit new
drawings and facsimiles for the word: "BANGOS BRAND" only as shown in the labels submitted, excluding SOY and
fish representation.

Complying with said ruling, respondent Villapania submitted a drawing of the word "Bangos Brand" only, the same
was published in the Official Gazette.

Petitioner company filed its opposition to respondent's application but was denied by the Director of Patents,
hence, the petition.

Issue: WON the respondents trademark would cause confusion and may deceive purchasers?

Ruling

Yes. We note and observe a very close resemblance between the two not only in the style of lettering of the words
"Carp" and "Brand" and the words "Bangos Brand", but also in the size of the letters, as well as the word "Soy" and
the Chinese characters underneath the said three words, including the letters beneath the two fishes, all of which
words are correspondingly in the same color, to say nothing of the similarity of the two fishes not only in their size
but even in the length and position of their respective tails and fins; so that we are fully convinced of the intention
and design of the respondent to imitate as much as possible in her label that of petitioner's evidently to confuse,
even to deceive prospective purchasers of soy sauce and thereby take advantage of and appropriate to herself the
goodwill previously acquired by petitioner in the sale of its product.

When two competing labels are placed together for inspection and still they may confuse an ordinary person,
specially cooks and maids, who as a rule are the one in charge of buying such household article as soy sauce, there
would be more confusion and doubt when the two labels are not placed together for comparison and the
prospective purchaser is guided only by his memory or recollection that the soy sauce he or she is planning to buy
has as its label the drawing of a fish with letters and Chinese characters, written in a certain style of lettering and
color.

When, as in the present case, one applies for the registration of a trademark or label which is almost the same or
very closely resembles one already used and registered by another, the application should be rejected and
dismissed outright, even without any opposition on the part of the owner and user of a previously registered label
or trademark, this not only to avoid confusion on the part of the public, but also to protect an already used and
registered trademark and an established goodwill.
Del Monte Corporation v. Court of Appeals, G.R. No. L-78325, January 25, 1990 FACTS: Del Monte Corporation is an
American corporation which is not engaged in business in the Philippines. Though not engaging business in the
Philippines, it has given authority to Philippine Packing Corporation (Philpack) the right to manufacture, distribute
and sell various agricultural products, including catsup, under the Del Monte trademark and logo. In 1965, Del
Monte also authorized Philpack to register with the Patent Office the Del Monte catsup bottle configuration.
Philpack was issued a certificate of trademark registration under the Supplemental Register. Later, Del Monte and
Philpack learned that Sunshine Sauce Manufacturing was using Del Monte bottles in selling its products and that
Sunshine Sauce’s logo is similar to that of Del Monte. The RTC of Makati as well as the Court of Appeals ruled that
there was no infringement because the trademarks used between the two are different in designs and that the use
of Del Monte bottles by Sunshine Sauce does not constitute unfair competition because as ruled in Shell Company
vs Insular Petroleum: “selling oil in containers of another with markings erased, without intent to deceive, was not
unfair competition.” ISSUE: Whether or not there is unfair competition and infringement in the case at bar. HELD:
Yes. The Supreme Court recognizes that there really are distinctions between the designs of the logos or
trademarks of Del Monte and Sunshine Sauce. However, it has been that side by side comparison is not the final
test of similarity. Sunshine Sauce’s logo is a colorable imitation of Del Monte’s trademark. The word “catsup” in
both bottles is printed in white and the style of the print/letter is the same. Although the logo of Sunshine is not a
tomato, the figure nevertheless approximates that of a tomato. The person who infringes a trade mark does not
normally copy out but only makes colorable changes, employing enough points of similarity to confuse the public
with enough points of differences to confuse the courts. What is undeniable is the fact that when a manufacturer
prepares to package his product, he has before him a boundless choice of words, phrases, colors and symbols
sufficient to distinguish his product from the others. When as in this case, Sunshine chose, without a reasonable
explanation, to use the same colors and letters as those used by Del Monte though the field of its selection was so
broad, the inevitable conclusion is that it was done deliberately to deceive. However, the Supreme Court ruled that
Del Monte does not have the exclusive right to use Del Monte bottles in the Philippines because Philpack’s patent
was only registered under the Supplemental Register and not with the Principal Register. In the case of Lorenzana
v. Macagba, the Court ruled that registration under the Supplemental Register is not a basis for a case of
infringement because unlike registration under the Principal Register, it does not grant exclusive use of the patent.
Nevertheless, the bottles of Del Monte do say in embossed letters: “Del Monte Corporation, Not to be Refilled”.
And yet Sunshine Sauce refilled these bottles with its catsup products. This clearly shows the Sunshine Sauce’s bad
faith and its intention to capitalize on the Del Monte’s reputation and goodwill and pass off its own product as that
of Del Monte.

Jose P. Sta. Ana, petitioner

Vs.

Florentino Maliwat and Tiburcio S. Evalle, in his capacity as Director of Parents

Facts:

- On 21 June 1962, Florentino Maliwat filed with the Patent Office an application for registration of the
trademark FLORMANN, which is used on shirts, pants, jackets and shoes for ladies, men, and children,
claiming first use in commerce of the said mark on 15 January 1962
 - On 18 September 1962, Jose P. Sta. Ana filed an application for the registration of the tradename
FLORMEN SHOE MANUFACTURERS which is used in the business of manufacturing ladies' and children's
shoes. His claim of first use in commerce of the said tradename is 8 April 1959.
- In view of the admittedly confusing similarity between the trademark FLORMANN and the tradename
FLORMEN, the Director of Patents declared an interference.
- Director of Patents gave due course to Maliwat's application and denied that of Sta. Ana.

Issue:

- Whether or not Maliwat was the prior adopter and user of the mark? – YES

Ruling:

- An application for registration is not bound by the date of first use as stated by him in his application, but
is entitled to carry back said stated date of first use to a prior date by proper evidence; but in order to
show an earlier date of use, he is then under a heavy burden, and his proof must be clear and convincing
- In the case at bar, the proof of date of first use (1953), earlier than that alleged in Maliwat's application
(1962), can be no less than clear and convincing because the fact was stipulated and no proof was
needed.
- There was an agreement in the stipulation of facts by the parties that Maliwat has been engaged in the
manufacture and sale of men's wear, shirts, polo shirts, and pants, since 1953, using FLORMANN as its
trademark. That Mr. Florentino Maliwat began using the trademark FLORMANN on shoes on January 1962
and the firm name FLORMANN SHOES under which these shoes with the trademark FLORMANN were
manufactured and sold was first used on January 1962, having also been registered with the Bureau of
Commerce on January 1962
- Maliwat would confine Sta. Ana’s use of the mark FLORMANN to tailoring and haberdashery only, but not
on shoes, on the ground that he had used the name FLORMEN on shoes since 1959, while the Sta. Ana
used his mark on shoes only in 1962.
- Modern law recognizes that the protection to which the owner of a trademark is entitled is not limited to
guarding his goods or business from actual market competition with identical or similar products of the
parties, but extends to all cases in which the use by a junior appropriator of a trademark or tradename is
likely to lead to a confusion of source, as where prospective purchasers would be misled into thinking that
the complaining party has extended his business into the field or is in any way connected with the
activities of the infringer; or when it forestalls the normal potential expansion of his business
- Director of Patents: I believe that it is now the common practice among local tailors and haberdashers to
branch out into articles of manufacture which have, one way or another, some direct relationship with or
appurtenance to garments or attire to complete one's wardrobe such as belts, shoes, handkerchiefs, and
the like, xxx. It goes without saying that shoes on one hand and shirts, pants and jackets on the other,
have the same descriptive properties for purposes of our Trademark Law.
- Mere dissimilarity of goods should not preclude relief where the junior user's goods are not too different
or remote from any that the owner would be likely to make or sell; and in the present case, wearing
apparel is not so far removed from shoes as to preclude relief, any more than the pancake flour is from
syrup or sugar cream or baking powder from baking soda or cosmetics and toilet goods from ladies'
wearing apparel and costume jewelry
- Republic Act No. 166, as amended, provides: SEC. 4. x x x. The owner of a trademark, tradename or
service mark used to distinguish his goods, business or services from the goods, business or services of
others shall have the right to register the same on the principal register, unless it: (d) Consists of or
comprises a mark or tradename which resembles a mark or tradename registered in the Philippines or a
mark or tradename previously used in the Philippines by another and not abandoned, as to be likely,
 when applied to or used in connection with the goods, business or services of the applicant, to cause
confusion or mistake or to deceive purchasers;
- The provision does not require that the articles of manufacture of the previous user and the late user of
the mark should possess the same descriptive properties or should fall into the same categories as to bar
the latter from registering his mark in the principal register
- Therefore, whether or not shirts and shoes have the same descriptive properties, or whether or not it is
the prevailing practice or the tendency of tailors and haberdashers to expand their business into
shoemaking, are not controlling.
- The meat of the matter is the likelihood of confusion, mistake or deception upon purchasers of the goods
of the junior user of the mark and the goods manufactured by the previous user.
B6C Kee Boc v. Director of Patents, GR L-26625, 31 August 1970, En Banc, Fernando [J]

Facts:

The case involved an application to register the trademark RACE, used on men’s undershirts and shirts, under class
40, was filed by Far Eastern Shirt Factory, successor in interest of Asari Yoko Ltd.

The petitioner, owner of the trademark “SUN RAYS” covering the same class of goods, namely, men’s undershirts,
filed an opposition against the registration of the respondent on ground that the trademark “SUN RAYS” of the
petitioner is confusingly similar to the trade mark RACE of the respondent.

Director of Patents granted the application of the respondent and dismissed the opposition of the petitioner on
ground that RACE was already in use long before the opposer adopted his trademark SUN RAYS. In such case it is
the Respondent- Applicant who would be damaged by the registration of SUN RAYS as it has acquired, as a
successor in interest, proprietary rights over the mark RACE.

Issue:

WON the respondent’s trademark would cause confusion or mistakes in the mind of the public or deceive
purchasers?

Ruling:

The court affirmed the decision of the Director of Patent. as noted likewise in the decision of respondent Director
of Patents, a power of attorney was executed by Asari Yoko Co., Ltd. in favor of one Go Seng Chay, from whom
now respondent Far Eastern Shirt Factory acquired, through a deed of assignment executed on March 2, 1962, the
right to such trademark RACE, after which the present application for registration was filed.  It is true that in the
meanwhile, on August 3, 1961, a registration of the trademark SUN RAYS was effected by now petitioner Kee Boc,
both trademarks being found to be confusingly similar.  If it were not for the above background facts that would
indicate the persistent and tenacious efforts on the part of petitioner Kee Boc to deprive Asari Yoko Co., Ltd.,
formerly, and now respondent Far Eastern Shirt Factory of whatever advantages might inhere in the use of the
trademark raised, then perhaps his stand would have been impressed with a greater degree of plausibility.  As it is
however, considering that he was a party to a litigation where this Court had recognized the right of the
predecessor-in-interest of respondent Far Eastern Shirt Factory to the use of such trademark, it would seem that
under an expansive view of the principle of the law of the case, petitioner is not to be indulged insofar as his
opposition would result in diluting the effectiveness of the aforesaid decision rendered by us where he himself was
a party.
B6D De La Rama Steamship Co. v. National Development Co.

GR L-26966, 30 October 1970

Facts:

This case is the outcome of an agreement entered into between the De la Rama Steamship Co., Inc. and the
National Development Company, where De la Rama undertook the management of the three vessels known as
“Doña Aurora,” “Doña Nati” and “Doña Alicia” which had been purchased by the Philippine Government from
Japan with the advise and technical supervision of De la Rama. In the management contract,De la Rama had the
option to buy the vessels at the fifth year following the purchase and delivery of each of the vessels, at a price
which is to consist of the cost price of each vessel, plus expenses as De la Rama have incurred in connection with
the construction, outfitting, provisioning and operation but should De la Rama fail to exercise the right of option it
should be reimbursed of the expenses it incurred.

In the decision in G.R. No. L8784 between De la Rama and National Development Company the Court upheld the
right of National Development Company to cancel the management contract, and the option of De la Rama to
purchase the vessels was declared ineffective.

De la Rama filed a “Supplemental Pleading” in the Court of First Instance in the nature of a supplemental
complaint, which De la Rama demanded that the National Development Company refrain from using the names
“Doña Aurora” “Doña Nati” and “Doña Alicia”, claiming that it had acquired exclusive property right to the use of
said names of the three vessels as trade names. In its answer, National Development Company denied De la
Rama’s exclusive right to use the names “Doña Aurora” “Doña Nati” and “Doña Alicia” on the vessels upon the
ground that said names (except Doña Nati) represented names of wives of former Presidents of the Philippines and
could not be appropriated by a private individual and further argues that as owner of the vessels it had registered
the "Doña" names in the Bureau of Customs with full knowledge and consent of De la Rama which, is now
estopped from questioning the right, or from denying the ownership, of National development company over the
"Doña" names.

The lower court ruled in favor of De la Rama which they found that De la Rama had been in the shipping business
since 1933 and had adopted, prior to the war in 1941, the word “Doña” in designating its vessels; that the three
oceangoing vessels that it operated under the management contract were named “Doña Nati” after the wife of the
late Don Esteban de la Rama, who was founder of the steamship company; “Doña Alicia” after the late wife of
former President Elpidio Quirino; and “Doña Aurora” after the late widow of President Manuel Quezon;that there
is unrebuttted testimony that in the shipping business, goodwill and reputation are inevitably acquired by the
names given to a vessel. Hence a petition of appeal filed by the National Development Company directly to the
Supreme Court.

Issue: Whether the lower court is right that De la Rama is entitled to the preferential right to the use of the "Doña"
names and enjoining and restraining the National Development Companys from using the "Doña" names or title on
any of its vessels?

Held:

Yes, Under Section 4(c) of Rep. Act No. 166 as amended, which apparently is the basis of the contention of
National Development Company, what is prohibited from being appropriated and being registered are trade
names consisting of, or comprising, a name identifying a particular living individual, or the name of a deceased
President of the Philippines. The names of deceased wives of Presidents are not included in the prohibition.
Moreover, Section 4(f) of said Act does not prohibit the registration, and hence appropriation, of a Trade name
that has become distinctive and the substantial and exclusive use of a trade name for five years is accepted as
prima facie proof that the trade name has become distinctive.
 
National Development Company does not dispute the fact that the “Doña” names had been originally used by De
la Rama, and according to the lower court De la Rama had been using the “Doña” names even before the war, and
that said names have acquired goodwill and reputation.

ACOJE MINING CO., INC., vs.

THE DIRECTOR OF PATENTS

Facts:
On September 14, 1965, Acoje Mining Co., Inc. a domestic corporation, filed an application for registration of the
trademark LOTUS, used on Soy Sauce, Class 47. Use in commerce in the Philippines since June 1, 1965 is asserted.
The Chief trademark Examiner finally rejected the application by reason of confusing similarity with the trademark
LOTUS registered in this Office under Certificate of Registration No. 12476 issued in favor of Philippine Refining
CO., Inc., another domestic corporation. The cited mark is being used on edible oil, Class 47." 2 The matter was then
elevated to respondent Director of Patents who, on January 31, 1968, upheld the view of the Chief Trademark
Examiner and rejected the application of Petitioner on the ground that while there is a difference between soy
sauce and edible oil and there were dissimilarities in the trademarks due to type of letters used as well as in the
size, color and design employed, still the close relationship of the products, soy sauce and edible oil, is such "that
purchasers would be misled into believing that they have a common source. Director of Patents denied the
application of petitioner. This petition for its review was filed with this Court on March 6, 1968. As set forth at the
outset the decision of respondent Director of Patents is reversed.

Issue:
WON petitioner Acoje Mining Company can register for the purpose of advertising its product., soy sauce, the
trademark LOTUS, there being already in existence one such registered in favor of the Philippine Refining Company
for its product, edible oil, it being further shown that the trademark applied for is in smaller type, colored
differently, set on a background which is dissimilar as to yield a distinct appearance?

Ruling:
Yes. It is clear from the above-quoted provision that the determinative factor in a contest involving registration of
trade mark is not whether the challenging mark would actually  cause confusion or deception of the purchasers but
whether the use of such mark would likely cause confusion or mistake on the part of the buying public. In short, to
constitute an infringement of an existing trade-mark patent and warrant a denial of an application for registration,
the law does not require that the competing trademarks must be so identical as to produce actual error or
mistake; it would be sufficient, for purposes of the law, that the similarity between the two labels, is such that
there is a possibility or likelihood of the purchaser of the older brand mistaking the newer brand for it.

Can it be said then that petitioner's application would be likely to cause confusion or mistake on the part of the
buying public? The answer should be in the negative. It does not defy common sense to assert that a purchaser
would be cognizant of the product he is buying. There is quite difference between soy sauce and edible oil. If one is
in the market for the former, he is not likely to purchase the latter just because of the trademark LOTUS. Even on
the rare occasions that a mistake does occur, it can easily be rectified. Moreover, there is no denying that the
possibility of confusion is remote considering the difference in the type used, the coloring, the petitioner's
trademark being in yellow and red while that of the Philippine Refining Company being in green and yellow, and
the much smaller size of petitioner's trademark. When regard is had for the principle that the two trademarks in
their entirety as they appear in their respective labels should be considered in relation to the goods advertised
before registration could be denied, the conclusion is inescapable that respondent Director ought to have reached
a different conclusion. Petitioner has successfully made out a case for registration.
Petition is granted; in favor of petitioner.

G.R. No. L-1750 October 26, 1905

GUILLERMO BAXTER AND G. GAXTER & CO., vs.

ZOSIMO ZUAZUA, ET AL.,

MAPA, J.:

FACTS: August 30, 1894: Guillermo Baxter (P) after complying with the necessary formalities, had secured the right
to use the trademark "Agua de Kananga", as well as the labels annexed thereto.

July 23, 1901: Guillermo Baxter associated himself with certain merchants in Manila for the purpose of organizing a
limited partnership for a period of 5 years, under the firm name and style of "Baxter & Company," for
manufacturing toilet water and perfume. Guillermo Baxter, as the manager & administrator of the partnership,
contributed the business which is now the basis of that carried on by the said partnership. Also, he contributed his
title to certain trade-marks, among them the one described as "Agua de Kananga." This trade-mark is actually used
by the plaintiffs to designate the ownership and origin of a certain toilet water manufactured and sold by them
under the said name of "Agua de Kananga."

The plaintiffs brought this action for unfair competition under section 7 of Act No. 666 of the Philippine
Commission. It is alleged that

1. the (D) Zosimo Zuazua, for the purpose of imitating and fraudulently simulating the "Agua de Kananga"
by selling a certain toilet water under the name of "Kananga Superior" and "Kanangue"

2. Zuazua disposed of the same in bottles with labels similar to those used by the plaintiffs for their own
goods.

3. that the other defendants were engaged in retailing to the public the product manufactured by the
defendant Zuazua.

Zuazua admitted that:

1. he had manufactured certain toilet water under the denomination of "Kananga Superior"and
"Kanangue", and

2. that he had also sold the same in bottles labeled as alleged in the complaint. As to the bottles, it was
stipulated, page 19 of the bill of exceptions, that "those used by the defendant Zuazua, as well as those used by
the plaintiffs, were universally used by all persons engaged in the manufacture of toilet water, and that the fact
that they were used by the defendant did not, of itself, constitute a violation of the rights of the plaintiffs, nor a
fraud or deceit upon the public."

TC: enjoined Zuazua from the further manufacture of toilet water based upon the ground that

1. the labels, words, and bottles in question, taken together, were an imitation of those used by the
plaintiffs, and tended to deceive the public by making it appear that the toilet water manufactured and sold by the
defendants was the same toilet water manufactured by the plaintiffs,

2. that the use of the said labels, words, and bottles was therefore illegal, and constituted a violation of
plaintiff's rights.

3. the grant by the Government did not give the plaintiffs an exclusive right to the use of the word
"Kananga," but to the phrase "Agua de Kananga;"
 4. that "Kananga" was the name of a well-known tree of the Philippine Islands, and held that, although the
plaintiffs had a right to the exclusive use of the phrase "Agua de Kananga," it did not follow that they had an
exclusive right to the use of any of the words contained in the said phrase.

Zuazua alleged that the labels used on his goods differed from those used by the plaintiffs as to the
drawing, color, and general appearance of the design, and he denies emphatically that he had any intention to
deceive the public thereby, alleging that the people clearly distinguished the goods of the plaintiffs from those of
the defendants, the former being known from the picture on the bottle as the "Payo Brand" and the latter as the
"Señorita Brand."

HELD: There is no identity nor even any similarity whatsoever between the goods, either in detail or as a whole.
The difference between the two is so apparent that it can be readily noticed. We do not believe that the public
could have been deceived by the appearance of the labels to the extent of taking the goods of the plaintiffs for
those manufactured and sold by the defendant. We make no finding as to the bottles because they were not
forwarded to this court for inspection, and, moreover, because it was stipulated by the parties that the said bottles
were universally used by all manufacturers of toilet water, and that their particular use by defendant was not,
therefore, an act of fraud or deceit practiced by him upon the plaintiffs or the public generally.

Section 7 of Act No. 666 provides in part as follows:

And in order that the action shall lie under this section, actual intent to deceive the public and defraud a
competitor shall affirmatively appear on the part of the person sought to be made liable, but such intent may be
inferred from similarity in the appearance of the goods as packed or offered for sale to those of the complaining
party.

Baxter has not proved, or attempted to prove, the fraudulent intent attributed to Zuazua by any means
other that the alleged similarity between the labels used by him and those used by the defendant to designate his
own goods. There being no such similarity between the labels, we find no reason for even inferring that the
defendant had any such intention, and therefore the action brought by the plaintiffs in this case can not be
maintained under the law. The judgment appealed from should be reversed in so far as it holds that such an action
lies in this case.

The ownership of the trade-mark "Agua de Kananga" did not give the plaintiffs a right to the exclusive use
of the word "Kananga." Zuazua alleged that "Kananga" could not be used as a trade-mark because it was the name
of a flower.

"Kananga" represents the name of a well-known tree in the Philippines. It is apparent, therefore, that the
said word could not be used exclusively as a trade-mark, any more than could the words "sugar," "tobacco," or
"coffee." The law is clear and conclusive upon the subject.

"A designation or part of a designation," says section 2 of Act No. 666, "which relates only to the name,
quality, or description of the merchandise ... can not be the subject of a trade-mark." This provision is in
conformity with the provisions of paragraph 3 of article 5 of the royal decree of the 26th of October, 1888, under
which Guillermo Baxter secured the registration of his trade-mark. The said royal decree provided that the
denominations generally used in commerce for the purpose of designating a class of goods could not be the
subject of labels or trade-marks.

Baxter alleges that the Zuazua did not prove, or even attempt to prove, that the goods manufactured by
them had anything to do with the "Kananga" flower. If the goods in question had really nothing to do with the said
flower, then it was not lawful for the plaintiffs to sell them to the public under the name of "Agua de
Kananga,"because the people might be deceived as to the nature of the goods, taking for "Kananga" an article
which, as a matter of fact, had nothing to do with the said flower. Both plaintiffs and defendant would be exactly in
the same position as one who should sell goods as "coffee" or "tobacco" which were neither one nor the other.

Such being the case the plaintiffs could not have maintained this action for unfair competition, because
under section 9 of said Act No. 666 such action would not lie "when the trade-mark or designation of its origin,
ownership, or manufacture has been used by the claimant for the purpose of deceiving the public as to the nature
of the goods in which he deals, his business, profession, or occupation." The law can not and does not permit that
trade-marks shall contain indications capable of deceiving the public as to the nature of the goods. This would be
exactly the case if under the trade-mark of "Agua de Kananga" the plaintiffs should sell goods that had in fact
nothing to do, as they say, with the "Kananga" flower. However the contention of the plaintiffs may be considered,
the proof is nevertheless insufficient to show that the word "Kananga," the name of a flower, can be appropriated
as the subject of a trade-mark, under the law.

JUDGMENT REVERSED. SC IN FAVOR OF Zuazua. The Baxter have no right to the exclusive use of the word
"Kananga".

Kalaw Ng Khe v. Level Brother Co., GR 46817, 18 April 1941, En Banc, Imperial FACTS: In 1930, Lever Brother,
registered with the Bureau of Commerce: - Lux and design with the words "toilet form"- Lifebuoy as its trademarks
for soap of all kinds, claiming that these have been used in business since 1921. In 1933, Teodoro Kalaw also
registered Lux and Lifebuoy as its trademarks for hair pomade, claiming that they are using the name since 1932. In
1934, plaintiff lever Brothers Co registered trademark of the word Lifebuoy in white letters and the words "Health
Soap" in yellow letters on a red background. Pending registration, there already was a trademark “Lifebuoy for Hair
Pomade” in the name of Kalaw, so that in the application for registration of plaintiff “except for hair pomade” were
used to differentiate it from the products of the defendant. The jars containing the hair pomade were displayed
side by side with the soaps and sold in the same stores. Plaintiff contends it is the first user of the trademarks, and
that the defendant's trade-mark should not have been registered, because they were intended for use upon goods
of the same descriptive properties as those of the plaintiff' and that the classification by the Bureau of Commerce
is not controlling and creates no right as against the first user. ISSUE: 1. Whether or not there is infringement when
the defendant registered his own lux and design and lifebuoy and design. 2. Whether or not there is unfair
competition in this case. yes 3. Whether or not "fanciful and arbitrary" may be registered as trade-mark.yes HELD:
1. YES. To entitle an owner of a registered trade-mark to restrain the use of his trade-mark upon goods
manufactured or dealt in by another, and to ask for accounting or recover damages for such infringement, three
elements must concur: 1. use by another person of a reproduction, counterfeit, copy, or spurious imitation of the
genuine registered trade-mark or a colorable imitation thereof; 2. similarity in kind of the goods manufactured or
dealt in by such person to which the trade-mark is attached, to those of the lawful owner of the registered trade-
mark; and 3. sale by such person of said goods with the trade-mark. 1st requisite: By a comparison of the plaintiff's
trade-mark consisting of the word Lux and a design, and the trade-mark of the defendant Teodoro Kalaw Ng Khe
consisting of the word Lux and design ,the latter is a colorable imitation of the former. In one case, US supreme
court ruled that the use of only one of the words constituting a trade-mark may be sufficient to constitute an
infringement, and it is not necessary to this end that all of the words comprising the trade-mark should be
appropriated. 2nd requisite: The next point to be determined is whether pomade and soap are goods of similar
kind. We are of the opinion that they are. Both are toilet articles. Goods are in the same class when the general
and essential characteristics of the goods are the same, so that the general public would be likely to be misled if
the same mark were used, or whenever the use of a given trade-mark or name or symbol would enable an
unscrupulous dealer to palm off on unsuspecting customers spurious goods as being the genuine goods of the
proprietor of the trade-marl, or when, for any another reason, they are so related or associated, either in fact or in
the mind of the public, that a common trade-mark would probably lead purchasers to conclude that the several
articles have a common origin. If the use of the marks by the contending parties would be likely to lead the public
to believe that the goods to which they are applied were produced by the same concern or person, the goods
possess the "same descriptive properties." 3rd requisite: The defendant Teodoro Kalaw Ng Khe sold the goods with
the limited trade-mark. 2. YES. It is now held that the doctrine of unfair competition is not confined to cases of
actual market competition between similar products of the parties, but that it extends to all cases in which one
party fraudulently seeks to sell his goods as those of another; that it does not necessarily involve unfair
competition in the sale of goods, but the unfair appropriation and use of a competitor's mark, with the intention to
profit in the sale of goods of a related character. There seems to be no question that under the law and
jurisprudence the defendant is guilty of unfair competition for having used the label consisting of the word "Lux"
and a design upon jars containing pomade manufactured and sold by him. The goods of the plaintiff and the
defendant are related goods, both being toilet articles; and the ordinary buyer of plaintiff's and defendant's goods
to which the trade-mark is applied would likely assume from such mark that they have a common source, or that
the defendant's goods are in some way connected with the plaintiff. The instant case involves an unfair
appropriate and use by the defendant of the plaintiff's trade-mark with the intention to profit by the sale of his
goods which are related to those of the plaintiff. As regards the plaintiff's trade-mark consisting of the words
"Lifebuoy Health Soap" although the alleged date of the use of the trade-mark, as stated by the plaintiff in its
verified declaration cannot be believed, for reasons hereinbefore stated, the evidence, however, shows that the
sale of the plaintiff's soap in the Philippines, the container of which bears its trade-mark Exhibit M, began in 1924.
For that reason, the plaintiff's trade-mark printed or lithographed on the container of its soap was known and in
use before the year 1932 when the defendant used his, and prior to the date of the registration of his trade-mark
which was on June 3, 1933. Under the rules and principles already set forth, the use by the defendant of the trade-
mark consisting of the words "Lifebuoy Hair Pomade," serial No. 11377, registered on June 3, 1933 upon pomade
manufactured and sold by him, constitutes an unfair competition. 3. YES. Arbitrary or fanciful word which is neither
descriptive nor deceptive may be adopted and used as a valid trade-mark. A "fanciful and arbitrary" word is not
only the safest, but also the strongest mark, since every infringer is suspected of attempting to capitalize upon the
reputation and good-will of its owner. Words in common use may be appropriated as trademarks if they are
adopted originally, or by usage have come to indicate primarily the origin or ownership of a commercial article to
which they are applied, and if they are not geographical, in the sense of being the names of localities of
production, or not the generic name of the article, or merely descriptive of it, or of its qualities, ingredients or
characteristics. Accordingly, the words Lux and Lifebuoy adopted, used and registered by Lever Brother are valid
trade-marks and should be accorded protection. Their use by another upon goods similar to those of the owner of
the registered trademarks should be enjoined.

ANG VS. TEODORO

G.R. No. L-48226         December 14, 1942

FACTS:

Respondent Toribio Teodoro, at first in partnership with Juan Katindig and later as sole proprietor, has
continuously used "Ang Tibay," both as a trade-mark and as a trade-name, in the manufacture and sale of slippers,
shoes, and indoor baseballs since 1910. Petitioner (defendant below) registered the same trade-mark "Ang Tibay"
for pants and shirts on April 11, 1932, and established a factory for the manufacture of said articles in the year
1937. In the following year (1938) her gross sales amounted to P422,682.09.. The respondent in his brief says that
petitioner "was unable to prove that she had spent a single centavo advertising "Ang Tibay" shirts and pants prior
to 1938. In that year she advertised the factory which she had just built and it was when this was brought to the
attention of the appellee that he consulted his attorneys and eventually brought the present suit."

The trial court (Judge Quirico Abeto) presiding absolved the defendant from the complaint, while the Court of
Appeals, reversed that

ISSUES:
 1. Whether or not the phrase “Ang Tibay” was valid trade-mark.

2. Whether or not the CA erred in holding that the words “Ang Tibay” had acquired a secondary meaning.

3. Whether or not the CA erred in holding that pants and shirt are goods similar to shoes and slippers within
the meaning of Sec 3 and 7, Act No. 666 and neither can there be an infringement of trade-mark under
said sections.

RULING:

1. Yes, “Ang Tibay was a valid trade-mark. The court holds no merit with the contention of petitioner thatthe
phrase "Ang Tibay" as employed by the respondent on the articles manufactured by him is a descriptive term
because, "freely translate in English," it means "strong, durable, lasting." He invokes section 2 of Act No. 666,
which provides that words or devices which related only to the name, quality, or description of the merchandise
cannot be the subject of a trade-mark. We find it necessary to go into the etymology and meaning of the Tagalog
words "Ang Tibay" to determine whether they are a descriptive term. The word "ang" is a definite article meaning
"the" in English. Tibay is a root word from which are derived the verb magpatibay (to strengthen. The phrase "Ang
Tibay" is an exclamation denoting administration of strength or durability The phrase "ang tibay" is never used
adjectively to define or describe an object. One does not say, "ang tibay sapatos" or "sapatos ang tibay" is never
used adjectively to define or describe an object

From all of this we deduce that "Ang Tibay" is not a descriptive term within the meaning of the Trade-Mark Law
but rather a fanciful or coined phrase which may properly and legally be appropriated as a trade-mark or trade-
name. In this connection we do not fail to note that when the petitioner herself took the trouble and expense of
securing the registration of these same words as a trademark of her products she or her attorney as well as the
Director of Commerce was undoubtedly convinced that said words (Ang Tibay) were not a descriptive term and
hence could be legally used and validly registered as a trade-mark.

2. No, “Ang Tibay” did not acquire a secondary meaning. It is unnecessary to apply here the doctrine of "secondary
meaning" in trade-mark parlance. This doctrine is to the effect that a word or phrase originally incapable of
exclusive appropriation with reference to an article of the market, because geographically or otherwise descriptive,
might nevertheless have been used so long and so exclusively by one producer with reference to his article that, in
that trade and to that branch of the purchasing public, the word or phrase has come to mean that the article was
his product. The phrase "Ang Tibay," being neither geographic nor descriptive, was originally capable of exclusive
appropriation as a trade-mark

3. The question raised by petitioner involve the scope and application of sections 3,7, 11, 13, and 20 of the Trade-
Mark Law (Act No. 666.)

In the present state of development of the law on Trade-Marks, Unfair Competition, and Unfair Trading, the test
employed by the courts to determine whether noncompeting goods are or are not of the same class is confusion as
to the origin of the goods of the second user. Although two noncompeting articles may be classified under two
different classes by the Patent Office because they are deemed not to possess the same descriptive properties,
they would, nevertheless, be held by the courts to belong to the same class if the simultaneous use on them of
identical or closely similar trade-marks would be likely to cause confusion as to the origin, or personal source, of
the second user's goods. They would be considered as not falling under the same class only if they are so dissimilar
or so foreign to each other as to make it unlikely that the purchaser would think the first user made the second
user's goods.

Such construction of the law is induced by cogent reasons of equity and fair dealing. The courts have come to
realize that there can be unfair competition or unfair trading even if the goods are non-competing, and that such
unfair trading can cause injury or damage to the first user of a given trade-mark, first, by prevention of the natural
expansion of his business and, second, by having his business reputation confused with and put at the mercy of the
second user. The original owner is entitled to the preservation of the valuable link between him and the public that
has been created by his ingenuity and the merit of his wares or services. The owner of a trade-mark or trade-name
has a property right in which he is entitled to protection, since there is damage to him from confusion of
reputation or goodwill in the mind of the public as well as from confusion of goods. The modern trend is to give
emphasis to the unfairness of the acts and to classify and treat the issue as a fraud.

B10

G.R. No. 169974               April 20, 2010

SUPERIOR COMMERCIAL ENTERPRISES, INC., Petitioner,vs. KUNNAN ENTERPRISES LTD. AND SPORTS CONCEPT &
DISTRIBUTOR, INC., Respondents

BRION, J.:

FACTS:

On October 1, 1982, KUNNAN appointed SUPERIOR as its exclusive distributor in the Philippines under a
Distributorship Agreement whereas Kunnan intends to acquire ownership of the Kennex trademark registered by
Superior Commercial in the Philippines and Superior is desirous of being appointed as the sole distributor of
Kunnan in the Philippines.

SUPERIOR’s President and General Manager, misled KUNNAN’s officers into believing that KUNNAN could
not acquire trademark rights in the Philippines. KUNNAN decided to assign its applications to register ‘Pro Kennex’
as a trademark to SUPERIOR, on condition that SUPERIOR acknowledged that KUNNAN was still the real owner of
the mark and agreed to return it to KUNNAN on request.

On December 3, 1991, upon the termination of its distributorship agreement with SUPERIOR, KUNNAN
appointed SPORTS CONCEPT as its new distributor. Subsequently, KUNNAN also caused the publication of a Notice
and Warning in the Manila Bulletin’s January 29, 1993 issue, stating that: (1) it is the owner of the disputed
trademarks; (2) it terminated its Distributorship Agreement with SUPERIOR; and (3) it appointed SPORTS CONCEPT
as its exclusive distributor. This notice prompted SUPERIOR to file its Complaint for Infringement of Trademark and
Unfair Competition with Preliminary Injunction against KUNNAN.

Prior to and during the pendency of the infringement and unfair competition case before the RTC,
KUNNAN filed with the Bureau of Patents, Trademarks and Technology Transfer (BPTTT) separate Petitions for the
Cancellation of Registration Trademarks well as Opposition to Applications (Consolidated Petitions for
Cancellation) involving the KENNEX and PRO KENNEX trademarks.

In essence, KUNNAN filed the Petition for Cancellation and Opposition on the ground that SUPERIOR
fraudulently registered and appropriated the disputed trademarks; as mere distributor and not as lawful owner, it
obtained the registrations and assignments of the disputed trademarks in violation of the terms of the
Distributorship Agreement and Sections 2-A and 17 of Republic Act No. 166, as amended. These cases were
resolved in favour of Kunnan by the BPTTT and the CA.

ISSUE:

WON Superior, as a distributor, is the true and rightful owner of the trademarks.

RULING:
 No. An exclusive distributor does not acquire any proprietary interest in the principal’s trademark and
cannot register it, unless the owner has assigned the right. To establish trademark infringement, the following
elements must be proven: (1) the validity of plaintiff’s mark; (2) the plaintiff’s ownership of the mark; and (3) the
use of the mark or its colorable imitation by the alleged infringer results in “likelihood of confusion. Based on these
elements, we find it immediately obvious that the second element – the plaintiff’s ownership of the mark – was
what the Registration Cancellation Case decided with finality. On this element depended the validity of the
registrations that, on their own, only gave rise to the presumption of, but was not conclusive on, the issue of
ownership. In no uncertain terms, the appellate court in the Registration Cancellation Case ruled that SUPERIOR
was a mere distributor and could not have been the owner, and was thus an invalid registrant of the disputed
trademarks. The right to register a trademark is based on ownership, and therefore only the owner can register it.
In finding that Kunnan owned the marks, the court considered the distributorship agreement and the so-called
assignment agreement in their entirety; it confirmed that Superior had sought to be Kunnan’s exclusive distributor.
As enunciated in the case of Gabriel vs. Perez, 50 SCRA 406, “a mere distributor of a product bearing a trademark,
even if permitted to use said trademark has no right to and cannot register the said trademark.

Unfair competition has been defined as the passing off (or palming off) or attempting to pass off upon the
public of the goods or business of one person as the goods or business of another with the end and probable effect
of deceiving the public. The essential elements of unfair competition are (1) confusing similarity in the general
appearance of the goods; and (2) intent to deceive the public and defraud a competitor. Jurisprudence also
formulated the following “true test” of unfair competition: whether the acts of the defendant have the intent of
deceiving or are calculated to deceive the ordinary buyer making his purchases under the ordinary conditions of
the particular trade to which the controversy relates. One of the essential requisites in an action to restrain unfair
competition is proof of fraud; the intent to deceive, actual or probable must be shown before the right to recover
can exist.

In the present case, no evidence exists showing that KUNNAN ever attempted to pass off the goods it sold
(i.e. sportswear, sporting goods and equipment) as those of SUPERIOR. In addition, there is no evidence of bad
faith or fraud imputable to KUNNAN in using the disputed trademarks. Specifically, SUPERIOR failed to adduce any
evidence to show that KUNNAN by the above-cited acts intended to deceive the public as to the identity of the
goods sold or of the manufacturer of the goods sold.

In this case, no issue of confusion arises because the same manufactured products are sold; only the
ownership of the trademarks is at issue.

Furthermore, KUNNAN’s January 29, 1993 notice by its terms prevents the public from being deceived
that the goods originated from SUPERIOR since the notice clearly indicated that KUNNAN is the manufacturer of
the goods bearing the trademarks “KENNEX” and “PRO KENNEX.”

Finally, with the established ruling that KUNNAN is the rightful owner of the trademarks of the goods that
SUPERIOR asserts are being unfairly sold by KUNNAN under trademarks registered in SUPERIOR’s name, the latter
is left with no effective right to make a claim. In other words, with the CA’s final ruling in the Registration
Cancellation Case, SUPERIOR’s case no longer presents a valid cause of action.

Co Tiong Sa v. Director of Patents

G.R. No. L-5378, May 24, 1954
FACTS: Co Tiong Sa is the applicant for registration of the trademark "Freedom" and its corresponding design. He
has used the trademark on undershirts and T-shirts since March, 1947. The trademark sought to be registered is
"Freedom". The word "Freedom" is in hand print, with a slight to the right. The label presented by Saw Woo Chiong
and Co. consist of the word "Freeman" including its design. This trademark was registered in 1947 in the Bureau of
Commerce and re-registered in the Patent Office on September 22, 1948. Freeman is in hand print, with a right
slant, above the middle of which is a vignette of a man wearing a to what, which vignette is preceded by the small
word "The" in print and followed by two parallel lines close to each other, and the words "PERFECT WEAR" in
smaller letters under the word "FREEMAN". This trademark is used not only on shirts, but also on polo shirts,
undershirts, pajamas, skippers, and T-shirts, although in the year 1947 Saw Woo Chiong and Co. discontinued
manufacturing skippers and T-shirts on the ground of scarcity of materials. This trademark has been used since
1938, and it had been advertised extensively in newspapers, magazines, etc.

ISSUE: Whether or not the trademarks are confusingly similar.

RULING: YES. There is no question that if the details of the two trademarks are to be considered, many differences
would be noted that would enable a careful and scrutinizing eye to distinguish one trademark from the other. But
differences of variations in the details of one trademark and of another are not the legally accepted tests of
similarity in trademarks. It has been consistently held that the question of infringement of a trademark is to be
determined by the test of dominancy. Similarity in size, form, and color, while relevant, is not conclusive.

A trademark can cause confusion in the mind of the public or in those unwary customers or purchasers when (a)
the universal test has been said to be whether the public is likely to be deceived; and (b) the average buyer usually
seeks a sign, some special, easily remembered earmarks of the brand he has in mind. It may be the color, sound,
design, or a peculiar shape or name. Once his eyes see that or his ear hears it, he is satisfied.

Upon examination of the trademark of the oppositor-respondent, one will readily see that the dominant feature is
the word "FREEMAN"  written  in a peculiar print, slightly slanting to the right, with a peculiarly written capital
letters "FF". These dominant features or characteristics of oppositor's trademarks are reproduced or imitated in
applicant's trademark. In the first place, the word "FREEDOM" conveys a similar idea as the word "FREEMAN". In
the second place, the style in which both capital "F" are written are similar. The print and slant of the letters are
also similar. An ordinary purchaser or an unsuspecting customer who has seen the oppositor's label sometime
before will not recognize the difference between that label and applicant's label. He may notice some variations,
but he will ignore these, believing that they are variations of the same trademark to distinguish one kind or quality
of goods from another. After a careful study, we find that the dominant characteristic of oppositor's trademark
"FREEMAN" has been imitated in applicant's trademark "FREEDOM," such as to confuse the public and unwary
customers and puchasers, and to deceive them into believing that the articles bearing one label are similar or
produced by the same manufacturer as those carrying the other label.

B12 Seri Somboonsakdikul v. Orlane SA, GR 188996, 1 February 2017, Third Division, Jardaleza [J]

Facts:

On September 23, 2003, petitioner Seri Somboonsakdikul (petitioner) filed an application for registration of the
mark LOLANE with the IPO for goods classified under Class 3 (personal care products) of the International
Classification of Goods and Services for the Purposes of the Registration of Marks (International Classification of
Goods). Orlane S.A. (respondent) filed an opposition to petitioner's application, on the ground that the mark
LOLANE was similar to ORLANE in presentation, general appearance and pronunciation, and thus would amount to
an infringement of its mark. Respondent alleged that: (1) it was the rightful owner of the ORLANE mark which was
first used in 1948; (2) the mark was earlier registered in the Philippines on July 26, 1967 under Registration No.
129961 with the following goods: x x x perfumes, toilet water, face powders, lotions, essential oils, cosmetics,
lotions for the hair, dentrifices, eyebrow pencils, make-up creams, cosmetics & toilet preparations under
Registration No. 12996 and (3) on September 5, 2003, it filed another application for use of the trademark on its
additional products. Petitioner denied that the LOLANE mark was confusingly similar to the mark ORLANE. He
averred that he was the lawful owner of the mark LOLANE which he has used for various personal care products
sold worldwide. He alleged that the first worldwide use of the mark was in Vietnam on July 4, 1995. Petitioner also
alleged that he had continuously marketed and advertised Class 3 products bearing LOLANE mark in the Philippines
and in different parts of the world and that as a result, the public had come to associate the mark with him as
provider of quality personal care products. Petitioner maintained that the marks were distinct and not confusingly
similar either under the dominancy test or the holistic test. The Bureau of Legal Affairs (BLA) rejected petitioner's
application in a Decision dated February 27, 2007, finding that respondent's application was filed, and its mark
registered, much earlier. The BLA ruled that there was likelihood of confusion based on the following observations:
(1) ORLANE and LOLANE both consisted of six letters with the same last four letters - LANE; (2) both were used as
label for similar products; (3) both marks were in two syllables and that there was only a slight difference in the
first syllable; and (4) both marks had the same last syllable so that if these marks were read aloud, a sound of
strong similarity would be produced and such would likely deceive or cause confusion to the public as to the two
trademarks.16 Petitioner filed a motion for reconsideration but this was denied by the Director of the BLA on May
7, 2007. On appeal, the Director General of the IPO affirmed the Decision of the BLA Director. Thus, petitioner filed
a petition for review before the CA arguing that there is no confusing similarity between the two marks. The Court
of Appeals denied the petition and held that there exists colorable imitation of respondent's mark by LOLANE. The
CA accorded due respect to the Decision of the Director General and ruled that there was substantial evidence to
support the IPO's findings of fact. Applying the dominancy test, the CA ruled that LOLANE' s mark is confusingly or
deceptively similar to ORLANE

Issue:

Wether or not there is confusing similarity between ORLANE and LOLANE which would bar the registration of
LOLANE before the IPO.

Ruling:

No, there is no confusing similarity between ORLANE and LOLANE which would bar the registration of LOLANE
before the IPO. The Court ruled that the CA erred when it affirmed the Decision of the IPO. There is no colorable
imitation between the marks LOLANE and ORLANE which would lead to any likelihood of confusion to the ordinary
purchasers. A trademark is defined under Section 121.1 of RA 8293 as any visible sign capable of distinguishing the
goods. It is susceptible to registration if it is crafted fancifully or arbitrarily and is capable of identifying and
distinguishing the goods of one manufacturer or seller from those of another. Thus, the mark must be distinctive.
The registrability of a trademark is governed by Section 123 of RA 8293. Section 123.1 provides: Section 123. 1. A
mark cannot be registered if it: xxx...d. Is identical with a registered mark belonging to a different proprietor or a
mark with an earlier filing or priority date, in respect of: i. The same goods or services, or ii. Closely related goods
or services, or iii. If it nearly resembles such a mark as to be likely to deceive or cause confusion; e. Is identical with,
or confusingly similar to, or constitutes a translation of a mark which is considered by the competent authority of
the Philippines to be well-known internationally and in the Philippines, whether or not it is registered here, as
being already the mark of a person other than the applicant for registration, and used for identical or similar goods
or services: provided, that in determining whether a mark is well-known, account shall be taken of the knowledge
of the relevant sector of the public, rather than of the public at large, including knowledge in the Philippines which
has been obtained as a result of the promotion of the mark; xxx. In determining the likelihood of confusion, the
Court must consider: [a] the resemblance between the trademarks; [b] the similarity of the goods to which the

trademarks are attached; [c] the likely effect on the purchaser and [d] the registrant's express or implied consent
and other fair and equitable considerations. Likewise, the Court finding that LOLANE is not a colorable imitation of
ORLANE due to distinct visual and aural differences using the dominancy test, it no longer finds necessary to
discuss the contentions of the petitioner as to the appearance of the marks together with the packaging, nature of
the goods represented by the marks and the price difference, as well as the applicability of foreign judgments. The
Court ruled that the mark LOLANE is entitled to registration. Hence, the petition is GRANTED and the Decision of
the Court of Appeals dated July 14, 2009 is REVERSED and SET ASIDE.

B03 In-N-Out Burger Inc. v. Shewani Incorporated, GR 179127, 24 December 2008, Third Division, Chico-Nazario
[J]

FACTS:

1. Petitioner In-N-Out filed an application for registration of the mark “In-NOut” and the mark “In-N-Out Burger
and Arrow Design” with the Bureau of Trademarks of the IPO.

2. Petitioner later found out that the mark was previously registered by respondent Sehwani Incorporated who
licensed the same to Benita Frites, Inc who was able to use the mark.

3. Thus, petitioner filed with the Bureau of Legal Affairs (BLA-IPO) an administrative complaint for unfair
competition and cancellation of trademark registration. Petitioner argues that they are the owner of the mark and
has registered it in different jurisdictions, additionally they argue that InN-Out is an internationally well-known
mark and have become distinctive.

4. Respondent filed with the BLA-IPO an Answer with Counter-claim that they are the owners and prior users of
the mark, having registered it validly in the Philippines and that they should enjoy the presumption of validity of
the registration. Additionally, they argue that petitioner In-N-Out does not use the mark in the Philippines.

5. The BLA-IPO ruled in favor of In-N-Out, ruling that In-N-Out is an internationally well-known mark hence should
be granted registration, but did not find Sehwani liable for unfair competition. The BLA also issued a Temporary
Restraining Order, prohibiting Sehwani from using the mark.

6. In-N-Out filed an appeal to the IPO Director General arguing that respondents are liable for unfair competition.
The Director General found Sehwani liable for unfair competition.

7. Aggrieved, respondent filed an appeal to the CA, which reversed the Director General. CA found on
jurisdictional grounds that the BLA-IPO and the Director General does not have jurisdiction over the case, since it is
a case for unfair competition. Under the IP Code, cases for unfair competition are within the jurisdiction of the
Regional Trial Courts.

8. Hence, this petition where petitioner In-N-Out contends that the BLA-IPO and the Director General has
jurisdiction over the case.

ISSUE/s: WoN the BLA-IPO and the Director General of IPO had jurisdiction to hear the administrative case for
cancellation of the mark of Sehwani

RULING: SC reversed the ruling of the Court of Appeals. RATIO:

1. Under Section 10 of the Intellectual Property Code, the Bureau of Legal Affairs of the IPO has jurisdiction over
administrative proceedings to: (1) hear and decide oppositions to the application of registration of marks,
cancellation of marks; (2) exercise original jurisdiction in administrative complaints for violations of law involving
intellectual property rights; Provided, That its jurisdiction is limited to complaints where the total damages claimed
are not less than Two Hundred Thousand Pesos (P200,000): Provided further, That availment of the provisional
remedies may be granted in accordance with the Rules of Court; (3) cancellation of any permit, license, authority,
or registration which may be granted by the Office; (4) and assessment of damages
2. The contention of Sehwani that the Regional Trial Court has sole jurisdiction over unfair competition cases is
mistaken. It is clear from Section 10 that the BLA-IPO has jurisdiction over administrative proceedings which
includes the cancellation of marks. Nothing in Section 163 states that Regional Trial Courts have sole jurisdiction
over unfair competition cases. Based on this, the BLA-IPO had jurisdiction to decide the petitioner’s administrative
case against respondents and the IPO Director General had exclusive jurisdiction over the appeal of the judgment
of BLA-IPO.

B14
Republic Gas Corporation v. Petron Corporation,
GR 194062,
17 June 2013,

Facts:

Petron and Shell are two of the largest bulk suppliers and producers of LPG in the Philippines. Petron is
the registered owner of the trademark GASUL and Gasul cylinders used for its LPG products. Shell on the other
hand is the registered owner the marks SHELL and Shellane LPG containers. Hence they are the only ones
authorized to sell their brands respectively. As members of the LPG Dealers Assoc. in the Philippines, the two
companies received reports that several entities were engaged in the unauthorized refilling, sale and distribution
of the LPG containers registered under their names. This prompted the two companies to file a complaint
regarding the illegal trading of their products. NBI investigated the matter and found out that several
establishments and persons located in Caloocan, Malabon, Novaliches and Valenzuela were in the business of
refilling and sale of LPG products bearing the marks owned by the two companies. Republic Gas Corporation
(REGASCO) was one of those who were engaged in refilling and selling those products. To verify the matter NBI
agents conducted a test-buy operation. They bought the products mentioned and they paid money in exchange. A
receipt was given as proof.

As a result a complaint was filed in the DOJ for violation of RA 8293 otherwise known as the Intellectual
Property Code of the Philippines. However both the prosecutor’s office and the DOJ held that REGASCO did not
violate any law in the conduct of its business stating that it was a legitimate business engaged in the refilling of LPG
containers. Refilling the containers were not a violation in itself. The Case was then brought to the CA where it
reversed the earlier ruling of the DOJ. Hence REGASCO appealed in the SC.

Issue:

W/N probable cause exists to hold petitioners liable for the crimes of trademark infringement and unfair
competition as de6ned and penalized under Sections 155 and 168, in relation to Section 170 of Republic Act (R.A.)
No. 8293?

Ruling:

YES. REGASCO have actually committed trademark infringement when they refilled, without the
respondents' consent, the LPG containers bearing the registered marks of the respondents. As noted by
respondents, petitioners' acts will inevitably confuse the consuming public, since they have no way of knowing that
the gas contained in the LPG tanks bearing respondents' marks is in reality not the latter's LPG product after the
same had been illegally re6lled. The public will then be led to believe that petitioners are authorized re6llers and
distributors of respondents' LPG products, considering that they are accepting empty containers of respondents
and refilling them for resale.

Passing off (or palming off) takes place where the defendant, by imitative devices on the general
appearance of the goods, misleads prospective purchasers into buying his merchandise under the impression that
they are buying that of his competitors. Thus, the defendant gives his goods the general appearance of the goods
of his competitor with the intention of deceiving the public that the goods are those of his competitor.
PRIBHDAS J. MIRPURI vs. CA, DIRECTOR OF PATENTS and the BARBIZON CORPORATION

FACTS:

On June 1970, Lolita Escobar, the predecessor-in-interest of petitioner Mirpuri, filed an application with the Bureau
of Patents for the registration of the trademark "Barbizon" for use in brassieres and ladies’ undergarments.
Escobar alleged that she had been manufacturing and selling these products under the firm name "L & BM
Commercial" since March 1970.

Private respondent Barbizon Corporation, a US corporation opposed the application. It claimed that:

1. The mark BARBIZON of respondent-applicant is confusingly similar to the trademark BARBIZON which
opposer owns and has not abandoned.
2. That opposer will be damaged by the registration of the mark BARBIZON and its business reputation and
goodwill will suffer great and irreparable injury.
3. It constitutes an unlawful appropriation of a mark previously used in the Philippines and not abandoned
and therefore a statutory violation of Section 4 (d) of Republic Act No. 166, as amended

This was docketed as Inter Partes Case No. 686 (IPC No. 686).

Director of Patents rendered judgment dismissing the opposition and giving due course to Escobar's application.

Escobar later assigned all her rights and interest over the trademark to petitioner Mirpuri who, under his firm
name then, the "Bonito Enterprises," was the sole and exclusive distributor of Escobar's "Barbizon" products.

In 1979, however, Escobar failed to file with the Bureau of Patents the Affidavit of Use of the trademark required
under Section 12 of R.A. 166. Due to this failure, the Bureau of Patents cancelled Escobar's certificate of
registration.

Escobar reapplied for registration of the cancelled trademark. Mirpuri filed his own application for registration of
Escobar's trademark. Escobar later assigned her application to herein petitioner and this application was opposed
by private respondent. The case was docketed as Inter Partes Case No. 2049 (IPC No. 2049).

Petitioner raised the defense of res judicata.

On March 2, 1982, Escobar assigned to petitioner the use of the business name "Barbizon International." Petitioner
registered the name with the Department of Trade and Industry (DTI) for which a certificate of registration was
issued in 1987.

Private respondent filed before the Office of Legal Affairs of the DTI a petition for cancellation of petitioner's
business name. DTI, Office of Legal Affairs, cancelled petitioner's certificate of registration, and declared private
respondent the owner and prior user of the business name "Barbizon International."

Meanwhile, in IPC No. 2049, the Director of Patents rendered a decision declaring private respondent's opposition
barred by res judicata and giving due course to petitioner's application for registration.

CA reversed the Director’s decision, finding that the case was not barred and ordered that the case be remanded
to the Bureau of Patents for further proceedings.

ISSUE/S:
Whether respondent is barred by res judicata and whether petitioner is liable for trademark infringement

DECISION:

YES.

The Paris Convention is a multilateral treaty that seeks to protect industrial property consisting of patents, utility
models, industrial designs, trademarks, service marks, trade names and indications of source or appellations of
origin, and at the same time aims to repress unfair competition. It is essentially a compact among various countries
which, as members of the Union, have pledged to accord to citizens of the other member countries trademark and
other rights comparable to those accorded their own citizens by their domestic laws for an effective protection
against unfair competition. Both the Philippines and the United States of America are signatories to the
Convention.

Private respondent anchors its cause of action on the first paragraph of Article 6bis of the Paris Convention, said
Article governing protection of well-known trademarks.

Art. 6bis is a self-executing provision and does not require legislative enactment to give effect in the member
country. It may be applied directly by the tribunals and officials of each member country by the mere publication
or proclamation of the Convention, after its ratification according to the public law of each state and the order for
its execution.

The essential requirement under Article 6bis is that the trademark to be protected must be "well-known" in the
country where protection is sought. The power to determine whether a trademark is well-known lies in the
"competent authority of the country of registration or use." This competent authority would be either the
registering authority if it has the power to decide this, or the courts of the country in question if the issue comes
before a court.

Pursuant to Article 6bis, then Minister Villafuerte of the Ministry of Trade issued a Memorandum instructing
Director of Patents to reject all pending applications for Philippine registration of signature and other world-
famous trademarks by applicants other than their original owners or users, enumerating several internationally-
known trademarks and ordered the Director of Patents to require Philippine registrants of such marks to surrender
their certificates of registration.

After, Minister Ongpin issued Memorandum which did not enumerate well-known trademarks but laid down
guidelines for the Director of Patents to observe in determining whether a trademark is entitled to protection as a
well-known mark in the Philippines under Article 6bis of the Paris Convention. All pending applications for
registration of world-famous trademarks by persons other than their original owners were to be rejected
forthwith.

The Supreme Court in the 1984 landmark case of La Chemise Lacoste, S.A. v. Fernandez ruled therein that under
the provisions of Article 6bis of the Paris Convention, the Minister of Trade and Industry was the "competent
authority" to determine whether a trademark is well-known in this country.

The Villafuerte Memorandum was issued in 1980. In the case at bar, the first inter partes case, was filed in 1970,
before the Villafuerte Memorandum but 5 years after the effectivity of the Paris Convention. Private respondent,
however, did not cite the protection of Article 6bis, neither did it mention the Paris Convention at all. It was only in
1981 when second case was instituted that the Paris Convention and the Villafuerte Memorandum, and, during the
pendency of the case, the 1983 Ongpin Memorandum were invoked by private respondent.
In Wolverine Worldwide, Inc. v. CA the Supreme Court held that the Memorandum and E.O. did not grant a new
cause of action because it did "not amend the Trademark Law," . . . "nor did it indicate a new policy with respect to
the registration in the Philippines of world-famous trademarks." In other words, since the first and second cases
involved the same issue of ownership, then the first case was a bar to the second case.

Here the second case raised the issue of ownership of the trademark, the first registration and use of the
trademark in the United States and other countries, and the international recognition and reputation of the
trademark established by extensive use and advertisement of private respondent's products for over forty years
here and abroad. These are different from the issues of confusing similarity and damage in first. The issue of prior
use may have been raised in first case but this claim was limited to prior use in the Philippines only. Prior use in
second stems from private respondent's claim as originator of the word and symbol "Barbizon," as the first and
registered user of the mark attached to its products which have been sold and advertised worldwide for a
considerable number of years prior to petitioner's first application for registration of her trademark in the
Philippines. Indeed, these are substantial allegations that raised new issues and necessarily gave private
respondent a new cause of action. Res judicata does not apply to rights, claims or demands, although growing out
of the same subject matter, which constitute separate or distinct causes of action and were not put in issue in the
former action.

Respondent corporation also introduced in the second case a fact that did not exist at the time the first case was
filed and terminated: the cancellation of petitioner's certificate of registration for failure to file the affidavit of use.
It did not and could not have occurred in the first case, and this gave respondent another cause to oppose the
second application. Res judicata extends only to facts and conditions as they existed at the time judgment was
rendered and to the legal rights and relations of the parties fixed by the facts so determined. When new facts or
conditions intervene before the second suit, furnishing a new basis for the claims and defenses of the parties, the
issues are no longer the same, and the former judgment cannot be pleaded as a bar to the subsequent action.

It is also noted that the oppositions in the first and second cases are based on different laws. The opposition in first
was based on specific provisions of the Trademark Law, i.e., Section 4 (d) on confusing similarity of trademarks and
Section 8 on the requisite damage to file an opposition to a petition for registration. The opposition in second
invoked the Paris Convention, particularly Article 6bis thereof, E.O. No. 913 and the two Memoranda of the
Minister of Trade and Industry. This opposition also invoked Article 189 of the Revised Penal Code which is a
statute totally different from the Trademark Law. Causes of action which are distinct and independent from each
other, although arising out of the same contract, transaction, or state of facts, may be sued on separately, recovery
on one being no bar to subsequent actions on others. The mere fact that the same relief is sought in the
subsequent action will not render the judgment in the prior action operative as res judicata, such as where the two
actions are based on different statutes.

Res judicata therefore does not apply to the instant case and respondent Court of Appeals did not err in so ruling.

IN VIEW WHEREOF, the petition is denied, and the Decision and Resolution of the CA are affirmed.

Additional Notes:

The Intellectual Property Code took effect on January 1, 1998 and by its express provision, 79 repealed the
Trademark Law, 80 the Patent Law, 81 Articles 188 and 189 of the Revised Penal Code, the Decree on Intellectual
Property, 82 and the Decree on Compulsory Reprinting of Foreign Textbooks. 83 The Code was enacted to
strengthen the intellectual and industrial property system in the Philippines as mandated by the country's
accession to the Agreement Establishing the World Trade Organization (WTO)
Trademark law view trademarks as performing three distinct functions: (1) they indicate origin or ownership of the
articles to which they are attached; (2) they guarantee that those articles come up to a certain standard of quality;
and (3) they advertise the articles they symbolize.

Res judicata means a matter adjudged, a thing judicially acted upon or decided; a thing or matter settled by
judgment. 34 In res judicata, the judgment in the first action is considered conclusive as to every matter offered
and received therein, as to any other admissible matter which might have been offered for that purpose, and all
other matters that could have been adjudged therein. 35 Res judicata is an absolute bar to a subsequent action for
the same cause; and its requisites are: (a) the former judgment or order must be final; (b) the judgment or order
must be one on the merits; (c) it must have been rendered by a court having jurisdiction over the subject matter
and parties; (d) there must be between the first and second actions, identity of parties, of subject matter and of
causes of action.

The Intellectual Property Code took effect on January 1, 1998 and by its express provision, 79 repealed the
Trademark Law, 80 the Patent Law, 81 Articles 188 and 189 of the Revised Penal Code, the Decree on Intellectual
Property, 82 and the Decree on Compulsory Reprinting of Foreign Textbooks. 83 The Code was enacted to
strengthen the intellectual and industrial property system in the Philippines as mandated by the country's
accession to the Agreement Establishing the World Trade Organization (WTO)

The WTO framework ensures a "single undertaking approach" to the administration and operation of all
agreements and arrangements attached to the WTO Agreement. Among those annexed is the Agreement on
Trade-Related Aspects of Intellectual Property Rights or TRIPs. 86 Members to this Agreement "desire to reduce
distortions and impediments to international trade, taking into account the need to promote effective and
adequate protection of intellectual property rights, and to ensure that measures and procedures to enforce
intellectual property rights do not themselves become barriers to legitimate trade." To fulfill these objectives, the
members have agreed to adhere to minimum standards of protection set by several Conventions. 87 These
Conventions are: the Berne Convention for the Protection of Literary and Artistic Works (1971), the Rome
Convention or the International Convention for the Protection of Performers, Producers of Phonograms and
Broadcasting Organisations, the Treaty on Intellectual Property in Respect of Integrated Circuits, and the Paris
Convention (1967), as revised in Stockholm on July 14, 1967.

B16 Batistis v. People

Facts: The Fundador trademark characterized the brandy products manufactured by Pedro Domecq, S.A. of Cadiz,
Spain. It was duly registered in the Principal Register of the Philippines Patent Office on July 12, 1968 under
Certificate of Registration No. 15987, for a term of 20 years from November 5, 1970. The registration was renewed
for another 20 years effective November 5, 1990. Allied Domecq Philippines, Inc., a Philippine corporation
exclusively authorized to distribute Fundador brandy products imported from Spain wholly in finished form,
initiated this case against Batistis. Upon its request, agents of the National Bureau of Investigation (NBI) conducted
a test-buy in the premises of Batistis, and thereby confirmed that he was actively engaged in the manufacture, sale
and distribution of counterfeit Fundador brandy products. Upon application of the NBI agents based on the
positive results of the test-buy, Judge Antonio M. Eugenio, Jr. of the Manila RTC issued on December 20, 2001
Search Warrant No. 01-2576, authorizing the search of the premises of Batistis located at No.1664 Onyx St., San
Andres Bukid, Sta. Ana, Manila. The search yielded 20 empty Carlos I bottles, 10 empty bottles of Black Label
whiskey, two empty bottles of Johnny Walker Swing, an empty bottle of Remy Martin XO, an empty bottle of
Chabot, 241 empty Fundador bottles, 163 boxes of Fundador, a half sack of Fundador plastic caps, two filled bottles
of Fundador brandy, and eight cartons of empty Jose Cuervo bottles. With Batistis pleaded not guilty on June 3,
2003, the RTC proceeded to trial. On Jan. 23, 2006, the RTC found Batistis guilty beyond reasonable doubt of
infringement of trademark and unfair competition. Batistis appealed to the CA, which on Sept. 13, 2007, affirmed
his conviction for infringement of trademark, but acquitted him of unfair competition.
Issue: Whether or not the Court erred in ruling that the Petitioner is guilty of violation of the Intellectual Property
Law.

Held: No. A review of the decision of the CA, assuming that the appeal is permissible, even indicates that both the
RTC and the CA correctly appreciated the evidence against the accused, and correctly applied the pertinent law to
their findings of fact. Article 155 of the Intellectual Property Code identifies the acts constituting infringement of
trademark, viz:Section 155. Remedies; Infringement. — Any person who shall, without the consent of the owner of
the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the
same container or a dominant feature thereof in connection with the sale, offering for sale, distribution,
advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods
or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive;
or

155.2. 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, shall be liable in a civil action for infringement by the registrant for
the remedies hereinafter set forth: Provided, That the infringement takes place at the moment any of the acts
stated in Subsection 155.1 or this subsection are committed regardless of whether there is actual sale of goods or
services using the infringing material.

Harvey Tan, Operations Manager of Pedro Domecq, S.A. whose task involved the detection of counterfeit products
in the Philippines, testified that the seized Fundador brandy, when compared with the genuine product, revealed
several characteristics of counterfeiting, namely: (a) the Bureau of Internal Revenue (BIR) seal label attached to the
confiscated products did not reflect the word tunay when he flashed a black light against the BIR label; (b) the
"tamper evident ring" on the confiscated item did not contain the word Fundador; and (c) the word Fundador on
the label was printed flat with sharper edges, unlike the raised, actually embossed, and finely printed genuine
Fundador trademark.There is no question, therefore, that Batistis exerted the effort to make the counterfeit
products look genuine to deceive the unwary public into regarding the products as genuine. The buying public
would be easy to fall for the counterfeit products due to their having been given the appearance of the genuine
products, particularly with the difficulty of detecting whether the products were fake or real if the buyers had no
experience and the tools for detection, like black light. He thereby infringed the registered Fundador trademark by
the colorable imitation of it through applying the dominant features of the trademark on the fake products,
particularly the two bottles filled with Fundador brandy. His acts constituted infringement of trademark as set
forth in Section 155.

Manuel C. Espiritu, petitioner

vs.

Petron Corporation and Carmen J. Doloiras, doing business under the name “Kristina Patricia Enterprises,
respondents
Facts:

- Petron Corporation (PETRON) sold and distributed liquefied petroleum gas (LPG) in cylinder tanks that
carried its trademark Gasul.
- Carmen J. Doloiras owned and operated Kristina Patricia Enterprises (KPE), the exclusive distributor of
Gasul LPGs in the whole of Sorsogon, managed by Jose Nelson Doloiras (JOSE).
- Bicol Gas Refilling Plant Corporation (BICOL GAS), also in the business of selling and distributing LPGs in
Sorsogon, their tanks carry the trademark Bicol Savers Gas, managed by Audie Llona (LLONA).
- Due to trade and competition, any distributor of LPGs at times acquired possession of LPG cylinder tanks
belonging to other distributors operating in the same area (a.k.a. captured cylinders)
- JOSE: April 2001 Bicol Gas agreed with KPE for the swapping of captured cylinders (one distributor could
not refill captured cylinders with its own brand of LPG).
- In the course of implementing this arrangement, JOSE visited the BICOL GAS refilling plant --- he noticed
several Gasul tanks in Bicol Gas’ possession.
- They agreed to have a swap (after LLONA was given permission for the swap) involving around 30 Gasul
tanks held by Bicol Gas in exchange for assorted tanks held by KPE.
- JOSE noticed that Bicol Gas still had a number of Gasul tanks in its yard --- offered to make a swap for
these but LLONA declined --- Bicol Gas owners wanted to send those tanks to Batangas.
- JOSE observed on almost a daily basis that Bicol Gas trucks carried a load of Gasul tanks (he noted that
KPEs volume of sales dropped significantly from June to July 2001).
- August 4, 2001 - JOSE saw a Bicol Gas truck on the Maharlika Highway --- it had on it one unsealed 50-kg
Gasul tank and one 50-kg Shellane tank.
- JOSE followed the truck and when it stopped at a store, he asked the driver, Jun Leorena, and the Bicol
Gas sales representative, Jerome Misal, about the Gasul tank in their truck (JOSE found that it wasn’t
empty) --- Misal and Leorena then admitted that the Gasul and Shellane tanks on their truck belonged to a
customer who had them filled up by Bicol Gas
- Because of the incident, KPE filed a complaintfor violations of R.A. 623 (illegally filling up registered
cylinder tanks), as amended, and Sections 155 (infringement of trade marks) and 169.1 (unfair
competition) of the Intellectual Property Code (R.A. 8293).

Issue:

- WON the corporation can be sued due to its owner’s/employee’s/stockholder’s criminal act/violation

Ruling:

- Bicol Gas is a corporation. As such, it is an entity separate and distinct from the persons of its officers,
directors, and stockholders. It has been held, however, that corporate officers or employees, through
whose act, default or omission the corporation commits a crime, may themselves be individually held
answerable for the crime
- The owners of a corporate organization are its stockholders and they are to be distinguished from its
directors and officers. The petitioners here, with the exception of Audie Llona, are being charged in their
capacities as stockholders of Bicol Gas. But the Court of Appeals forgets that in a corporation, the
management of its business is generally vested in its board of directors, not its stockholders. Stockholders
are basically investors in a corporation. They do not have a hand in running the day-to-day business
operations of the corporation unless they are at the same time directors or officers of the corporation.
 Before a stockholder may be held criminally liable for acts committed by the corporation, therefore, it
must be shown that he had knowledge of the criminal act committed in the name of the corporation and
that he took part in the same or gave his consent to its commission, whether by action or inaction.
- The finding of the Court of Appeals that the employees could not have committed the crimes without the
consent, [abetment], permission, or participation of the owners of Bicol Gas is a sweeping speculation
especially since, as demonstrated above, what was involved was just one Petron Gasul tank found in a
truck filled with Bicol Gas tanks. Although the KPE manager heard petitioner LLONA say that he was going
to consult the owners of Bicol Gas regarding the offer to swap additional captured cylinders, no indication
was given as to which Bicol Gas stockholders LLONA consulted. It would be unfair to charge all the
stockholders involved, some of whom were proved to be minors. No evidence was presented establishing
the names of the stockholders who were charged with running the operations of Bicol Gas. The complaint
even failed to allege who among the stockholders sat in the board of directors of the company or served
as its officers.

B19 Philip Morris Inc. v. Fortune Tobacco Corporation, GR 158589, 27 June 2006, Second Division, Garcia [J]

Facts:

Petitioner Philip Morris, Inc. a corporation organized under the laws of the state of Virginia, USA, is the
registered owner of the trademark MARK VII for cigarettes. Benson and Hedges (Canada), Inc., a subsidiary of
Philip Morris, Inc., is the registered owner of the trademark MARK TEN for cigarettes. Another subsidiary of Philip
Morris, Inc. the Swiss Company Fabriques de Tabac Reunies, S.A., is the assignee of the trademark LARK. All are
evidenced by Trademark Certificate of Registration. On the other hand, Fortune Tobacco Corporation, a company
organized in the Philippines, manufactures and sells cigarettes using the trademark MARK.
Philip Morris, Inc. filed a complaint for trademark infringement and damages against Fortune Tobacco
Corporation. The complaint was dismissed by the RTC Pasig City in its decision dated January 21, 2003.
Maintaining to have the standing to sue in the local forum and that respondent has committed trademark
infringement, petitioners went on appeal to the CA but CA affirmed the trial court’s decision. The CA found that
MARK VII, MARK TEN and LARK do not qualify as well-known marks entitled to protection even without the benefit
of actual use in the local market and that the similarities in the trademarks in question are insufficient as to cause
deception or confusion tantamount to infringement.
With the motion for reconsideration denied in the CA, the petitioners filed a petition for review with the
Supreme Court.

Issues:

1.) Whether or not petitioners, as Philippine registrants of trademarks, are entitled to enforce trademark
rights in the country.
2.) Whether or not respondent has committed trademark infringement against petitioners by its use of the
mark MARK for its cigarettes, hence liable for damages.

Ruling:
A trademark is any distinctive word, name, symbol, emblem, sign, or device, or any combination thereof
adopted and used by a manufacturer or merchant on his goods to identify and distinguish them from those
manufactured, sold, or dealt in by others. Inarguably, trademark deserves protection. It is for this reason that the
petitioner’s recourse for their entitlement to enforce trademark rights in this country and also the right to sue for
trademark infringement in Philippine courts and be accorded protection against unauthorized use of the
Philippine-registered trademarks is understandable. Their standing to sue in Philippine courts had been recognized
by the CA but such right to sue does not necessarily mean protection of their trademarks in the absence of actual
use in the Philippines.
But the petitioners are still foreign corporations. They may not sue on that basis alone of their respective
certificates of registration of trademarks unless their country grants similar rights and privileges to Filipino citizens
pursuant to Section 21-A of R.A. No. 166. This reciprocity requirement is a condition to file a suit by a foreign
corporation as ruled in Leviton Industries v. Salvador.
The respective home country of the petitioner, namely, the United States, Switzerland and Canada,
together with the Philippines are members of the Paris Union. Philippines adherence to the Paris Convention
obligates the country to honor and enforce its provisions, however, this does not automatically entitle petitioners
to the protection of their trademark in our country without actual use of the marks in local commerce and trade
because any protection accorded has to be made subject to the limitations of Philippine laws.
Significantly, registration in the Philippines of trademarks does not convey an absolute right or exclusive
ownership thereof. In Shangri-la v. Development Group of Companies, the Court emphasized that trademark is a
creation of use and, therefore, actual use is a prerequisite to exclusive ownership; registration is only an
administrative confirmation of the existence of the right of ownership of the mark, but does not perfect such right.
With the foregoing perspective, it may be stated right off that the registration of a trademark
unaccompanied by actual use in the country accords the registrants only the standing to sue for infringements in
Philippine Courts but entitlement to protection of such trademark in the country is entirely different matter.
On the main issue of infringement, the court, relying on the holistic test ruled against the likelihood of
confusion resulting in infringement arising from the respondent’s use of the trademark MARK for its particular
cigarette product. The striking dissimilarities are significant enough to warn any purchaser that one is different
from the other. This is upon considering the entire marking as a whole
For lack of convincing proof on the part of the petitioners of actual use of their registered trademark prior
to respondents use of its mark and for petitioners failure to demonstrate confusing similarity between said
trademarks, the dismissal of their basic complaint of infringement and the plea for damages are affirmed.
The petition is denied. The assailed decision and resolution of the Court of Appeals are affirmed.

B20 Ong v. People, GR 169440, 23 November 2011

Facts: Gemma Ong a.k.a. Maria Teresa Gemma Catacutan (Gemma) was charged before the RTC for Infringement
under Section 155 in relation to Section 170 of Republic Act No. 8293 or the Intellectual Property Code. The
accusatory portion of the Information reads:

That sometime in September 25, 1998 and prior thereto at Sta. Cruz, Manila and within the jurisdiction of this
Honorable Court, the above-named accused did then and there, knowingly, maliciously, unlawfully and feloniously
engage in the distribution, sale, [and] offering for sale of counterfeit Marlboro cigarettes which had caused
confusion, deceiving the public that such cigarettes [were] Marlboro cigarettes and those of the Telengtan
Brothers and Sons, Inc., doing business under the style of La Suerte Cigar and Cigarettes Factory, the exclusive
manufacturer of Marlboro Cigarette in the Philippines and that of Philip Morris Products, Inc. (PMP7) the
registered owner and proprietor of the MARLBORO trademark together with the devices, including the famous-
Root Device, to their damage and prejudice, without the accused seeking their permit or authority to manufacture
and distribute the same.

The EIIB team coordinated with officers of Philip Morris, Inc., owner of the trademark Marlboro Label in IPO.
Executive Judge Dolores L. Español issued a search warrant after finding probable cause to believe that Mr. Jackson
Ong has in his possession/control in the premises located at 1675-1677 Bulacan St. cor. M. Hizon St., Sta. Cruz,
Manila

She denied that she is the Gemma Ong accused in this case. She testified that she was arrested on August 4, 2000,
without the arresting officers asking for her name.

Issue: Whether or not the CA erred in not acquitting the petitioner for failure o the prosecution to prove the guilt
of the accused-appellant beyond reasonable doubt
Held: No. Gemma is guilty of violating Section 155 in relation to Section 170 of Republic Act No. 8293. To establish
trademark infringement, the following elements must be shown: (1) the validity of plaintiff’s mark; (2) the
plaintiff’s ownership of the mark; and (3) the use of the mark or its colorable imitation by the alleged infringer
results in "likelihood of confusion." Of these, it is the element of likelihood of confusion that is the gravamen of
trademark infringement.

both the RTC and the Court of Appeals have correctly held that the counterfeit cigarettes seized from Gemma’s
possession were intended to confuse and deceive the public as to the origin of the cigarettes intended to be sold,
as they not only bore PMPI’s mark, but they were also packaged almost exactly as PMPI’s products.

Gemma had the opportunity to raise the fact that she was not Gemma Ong; not only during her arrest, but also
during the posting of the cash bond for her bail, and more importantly, during her arraignment, when she was
asked if she understood the charges against her. Gemma also knew that the Information was filed against her on
the basis of the amended affidavits, thus, she could have filed a motion to quash the information before she
entered her plea, or asked that a reinvestigation be conducted.

LEVI STRAUSS (PHILS.), INC. vs.VOGUE TRADERS CLOTHING COMPANY

G.R. No. 132993 (June 29, 2005)

FACTS: In 1972, per “Trademark, Technical Data, and Technical Assistance Agreement,” 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.

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. Petitioner then applied for the issuance of a search warrant on the premises
of respondent Vogue Traders Clothing Company, owned by one Tony Lim. The search warrant was issued based on
its finding of probable cause that the respondent had violated Article 189 of the Revised Penal Code 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. Criminal charges were filed against Tony Lim of
respondent company in the Department of Justice, 19 but the same were eventually dismissed and the search
warrants were quashed.

The respondent filed a complaint for damages, alleging 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 Certificate of Registration No. 53918 issued by the BPTTT, (b)
the trademark “LIVE’S LABEL MARK” under Certificate 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. 

Petitioner countered that respondent’s LIVE’S brand infringed upon its licensed brand name LEVI’S. It sought to
cancel respondent’s Copyright Registration 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 of petitioner.

The case was re-raffled to a special court to try and decide cases involving violations of Intellectual Property Rights.
On the scheduled hearing, respondent 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. In an order, 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.

Respondent filed a Motion for Reconsideration, to which the trial court denied. Hence, filed an appeal to the CA.
The CA rendered a decision in favor of the respondent enjoining the trial court from further proceeding with the
case. The petitioner filed a Motion for Reconsideration was denied, hence they filed a petition for review on
certiorari.

ISSUE: Whether or not the administrative action to cancel the trademark registration can proceed independently
from an action of infringement or unfair competition.
RULING: The passage of Republic Act No. 8293, otherwise known as the “Intellectual Property Code of the
Philippines,” expanded the rights accorded to an owner of a registered trademark.

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.

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 registered trademark in the BPTTT. As applied to the present case, petitioner’s
prior filing 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. No. 96-76944) a
counterclaim for infringement with a prayer for the issuance of a writ of preliminary injunction.

COCA-COLA BOTTLERS, PHILIPPINES, INC. vs. QUINTIN GOMEZ & DANILO GALICIA

G.R. No. 154491

14 November 2008

FACTS:
 Petitioner Coca-Cola applied for a search warrant against Pepsi for hoarding empty Coke bottles in Pepsi’s
yard in Naga City, an act allegedly penalized as unfair competition under the Intellectual Property (IP) Code. The
MTC issued a search warrant to seize the empty Coke bottles. The local police seized the empty Coke bottles and
filed with the Office of the City Prosecutor a complaint against the respondents – Gomez (Pepsi’s general manager
in Naga) and Galicia (Pepsi’s regional sales manager).

In their counter-affidavits, the respondents claimed that the bottles came from Pepsi retailers and
wholesalers who included them in their return to make up for shortages of empty Pepsi bottles; the presence of
the bottles in their yard was not intentional; and there is no mention in the IP Code of the crime of possession of
empty bottles. They filed a motion to quash the search warrant contending that no probable cause existed to
justify the issuance of the search warrant because the facts charged do not constitute an offense.

The MTC denied the motion and also denied the respondents’ motion for reconsideration. The
respondents filed a petition for certiorari under Rule 65 of the ROC before the RTC on the ground that the subject
search warrant was issued without probable cause.

The RTC voided the warrant for lack of probable cause and the non-commission of the crime of unfair
competition.

Bypassing the CA, the petitioner asks the SC through a petition for review on certiorari under Rule 45 of
the ROC to reverse the decision of the RTC.

ISSUE: Whether hoarding is an act of unfair competition under the IP Code

RULING: No.

A first test that should be made when a question arises on whether a matter is covered by the IP Code is to ask if it
refers to an intellectual property as defined in the Code. If it does not, then coverage by the Code may be negated.

"Intellectual property rights" have been defined under Section 4 of the Code to consist of: a) Copyright
and Related Rights; b) Trademarks and Service Marks; c) Geographic Indications; d) Industrial Designs; e)
Patents; f) Layout-Designs (Topographies) of Integrated Circuits; and g) Protection of Undisclosed
Information.

A second test, if a disputed matter does not expressly refer to an intellectual property right as defined above, is
whether it falls under the general "unfair competition" concept and definition under Sections 168.1 and 168.2 of
the Code. The question then is whether there is "deception" or any other similar act in "passing off" of goods or
services to be those of another who enjoys established goodwill.
 SECTION 168. Unfair Competition, Rights, Regulation and Remedies. —

168.1. A person who has identified in the mind of the public the goods he manufactures or deals in, his
business or services from those of others, whether or not a registered mark is employed, has a property
right in the goodwill of the said goods, business or services so identified, which will be protected in the
same manner as other property rights.

168.2. Any person who shall employ deception or any other means contrary to good faith by which he
shall pass off the goods manufactured by him or in which he deals, or his business, or services for those of
the one having established such goodwill, or who shall commit any acts calculated to produce said result,
shall be guilty of unfair competition, and shall be subject to an action therefor.

168.3. In particular, and without in any way limiting the scope of protection against unfair competition,
the following shall be deemed guilty of unfair competition:

(a) Any person, who is selling his goods and gives 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 devices or words thereon, or in any other feature of their appearance, which
would be likely to influence purchasers to believe that the goods offered are those of a manufacturer or
dealer, other than the actual manufacturer or dealer, or who otherwise clothes the goods with such
appearance as shall deceive the public and defraud another of his legitimate trade, or any subsequent
vendor of such goods or any agent of any vendor engaged in selling such goods with a like purpose;

(b) Any person who by any artifice, or device, or who employs any other means calculated to induce the
false belief that such person is offering the services of another who has identified such services in the
mind of the public; or

(c) Any person who shall make any false statement in the course of trade or who shall commit any other
act contrary to good faith of a nature calculated to discredit the goods, business or services of another.

Hoarding does not fall within the coverage of the IP Code. It does not relate to any patent, trademark, trade name
or service mark that the respondents have invaded, intruded into or used without proper authority from the
petitioner. Nor are the respondents alleged to be fraudulently “passing off” their products or services as those of
the petitioner. The respondents are not also alleged to be undertaking any representation or misrepresentation
that would confuse or tend to confuse the goods of the petitioner with those of the respondents or vice versa.
What in fact the petitioner alleges is an act foreign to the Code, to the concept it embodies and to the acts it
regulates; as alleged, hoarding inflicts unfairness by seeking to limit the opposition’s sales by depriving it of the
bottles it can use for these sales. Hoarding, for purposes of destruction, is closer to what another law – RA No. 623
– covers.
B23: Shangri-La International Hotel Management Ltd. v. Developers Group of Companies Inc. GR 159938, 31 March
2006 DOCTRINE: The root of ownership of trademark is actual use in commerce. The law requires that before a
trademark can be registered, it must have been actually used in commerce and service for not less than 2 months
in the Philippines. Registration, without more, does not confer upon the registrant an absolute right to the
registered mark. It is merely a prima facie proof that the registrant is the owner of the registered mark or trade
name. Registration in the principal register gives rise to a presumption of the validity of the registration, the
registrant’s ownership of the mark and his right to the exclusive use thereof. Registration therefor is limited to the
actual ownership of the trademark (it passes upon the issue of ownership). It may be contested through opposition
or interference proceedings or, after registration, in a petition for cancellation. FACTS: 1. The Kuok Family owns
and operates a chain of hotels with interest in hotel and hotel-related transactions since 1969. Allegedly, it
adopted the Shangila Logo as far back as 1962 and used it in all of their hotels around the world. To centralize their
operations, the Kuok Group incorporated in Hong Kong and Singapore, among other places. Edsa- Shangri-La Hotel
and Resort and Makati Shangri-Law hotel and Resort were incorporated in the Philippines in 1987 to own and
operate 2 hotels put up by Kuok Group. On the other hand, complainant herein is DGCI who claims to have used
and registered the logo in October 1982 with the Bureau of Patents from a scribbled piece of paper given to him by
an unnamed artist for his restaurant business, the Shangri-La Finest Chinese Cuisine. It should be noted herein that
petitioners, Shangri-La International did not operate any establishment in the Philippines albeit they advertised
their hotels abroad since 1972. DGCI filed a complaint for infringement and damages against Shangri- La
International alleging that it has been the prior exclusive user in the Philippines of the mark and logo in question
since December 1982 and the registered owner thereof for its restaurant and allied services. It claims that the logo
of the latter is confusingly similar with that of its logo. Shangri-La claims protection under the Paris Convention and
sought the cancellation of the registration of DGCI. It claims that the Paris Convention affords them security and
protection as well as the exclusive right to the said mark and logo. They claimed that they have used this logo since
1975, internationally known and specially designed by on William Lee. 2. The trial court found for DGCI. CA
affirmed on the ground that the evidence presented by Shangri-La international shows that they used the
tradename abroad and not in the Philippines until 1987. It cannot claim ownership over the mark and logo. On the
other hand, respondent has a right to the mark by virtue of its prior use in the Philippines and the issuance of the
certificate of its registration. Furthermore, the CA ruled that the Paris Convention still requires commerce in the
Philippines in order to be protected. ISSUES: 1. Whether or not DGCI is the rightful owner of the trademark. 2.
Whether or not Shangri-La can claim protection under the Paris Convention. RULING: 1. DGCI does not have the
right to ownership over the trademark. The law at force at the time of the application of the trademark applies. In
this case, R.A. No. 166 as amended applies. It states that “The root of ownership of trademark is actual use in
commerce. The law requires that before a trademark can be registered, it must have been actually used in
commerce and service for not less than 2 months in the Philippines. Registration, without more, does not confer
upon the registrant an absolute right to the registered mark. It is merely a prima facie proof that the registrant is
the owner of the registered mark or trade name.” As between actual use of the mark without registration and
registration of the mark without actual use thereof, the former prevails over the latter. Here, it can be seen that as
a condition precedent to the registration of the trademark, the same must have been in actual use in the
Philippines before the application for registration. Applying such principle, DGCI cannot be the owner of the
trademark since according to his statement, the jeepney signboard artist he commissioned submitted his designs
only in December 1982. This was 2 months after the filing of the application for trademark application on October
18, 1982. It was also only on December 1982 when the restaurant opened for business. Hence, the registration is
void. It was also found by the court that DGCI’s president, Ramon Syhunliong has been a guest at the petitioner’s
hotel before he caused the registration of the mark and logo, and surmised that he must have copied the idea
there. The respondent here copied not only the words but also the exant font and lettering style and in addition,
he copies also the logo portion of the trademark. It is then apparent that the adoption was deliberate, malicious
and in bad faith. He cannot not bring an action for infringement against the owner of the mark. The requirements
for ownership of a trademark are enumerated in the law. There must be prior and actual use in commerce in the
Philippines for 2 months prior to the application for registration and the mark must not have been already
appropriated by someone else. 2. Nevertheless, Shangri-La cannot claim protection under the Paris convention
which gives them the remedy of applying for cancellation of a trademark for unfair competition whether or not
registered because under municipal laws, there must have been prior and actual use in the Philippines for a period
of not less than 2 months in order to be an owner of a mark4 Under the doctrine of incorporation as applied in
most countries, rules of international law are given a standing equal to and not superior to national legislative
enactments.

SHANGRI-LA INTERNATIONAL HOTEL MANAGEMENT LTD., SHANGRI-LA PROPERTIES, INC., MAKATI SHANGRI-LA
HOTEL AND RESORT, INC. and KUOK PHILIPPINE PROPERTIES, INC., petitioners,

Vs.

THE COURT OF APPEALS, HON. FELIX M. DE GUZMAN, as Judge of Quezon City Branch 99 and DEVELOPERS
GROUP OF COMPANIES, INC., respondents.

G.R. No. 111580, June 21, 2001

Facts:

On June 21, 1988, Petitioners, collectively referred as the "Shangri-La Group", filed with the Bureau of Patents,
Trademarks and Technology Transfer (BPTTT) a petition, docketed as Inter Partes Case No. 3145, praying for the
cancellation of the registration of the "Shangri-La" mark and "S" device/logo issued to the Developers Group of
Companies, Inc., on the ground that the same was illegally and fraudulently obtained and appropriated for the
latter's restaurant business. The Shangri-La Group alleged that it is the legal and beneficial owners of the subject
mark and logo; that it has been using the said mark and logo for its corporate affairs and business since March
1962 and caused the same to be specially designed for their international hotels in 1975, much earlier than the
alleged first use thereof by the Developers Group in 1982. Likewise, the Shangri-La Group filed with the BPTTT its
own application for registration of the subject mark and logo. The Developers Group filed an opposition to the
application, which was docketed as Inter Partes Case No. 3529.

Meanwhile, on October 28, 1991, the Developers Group filed in Inter Partes Case No. 3145 an Urgent Motion to
Suspend Proceedings, invoking the pendency of the infringement case it filed before the Regional Trial Court of
Quezon City. On January 10, 1992, the BPTTT, through Director Ignacio S. Sapalo, issued an Order denying the
Motion. A Motion for Reconsideration was filed which was, however, denied in a Resolution dated February 11,
1992.

On January 8, 1992, the Shangri-La Group moved for the suspension of the proceedings in the infringement case
on account of the pendency of the administrative proceedings before the BPTTT but the same was denied by the
trial court in a Resolution issued on January 16, 1992. The Shangri-La Group filed a Motion for
Reconsideration. Soon thereafter, it also filed a Motion to Inhibit against Presiding Judge Felix M. de Guzman. On
July 1, 1992, the trial court denied both motions.

The Shangri-La Group filed a petition for certiorari before the Court of Appeals, docketed as CA-G.R. SP No.
29006. On February 15, 1993, the Court of Appeals rendered its decision dismissing the petition for certiorari.  The
Shangri-La Group filed a Motion for Reconsideration, which was denied on the ground that the same presented no
new matter that warranted consideration.
From the denial by the BPTTT of its Urgent Motion to Suspend Proceedings and Motion for Reconsideration, the
Developers Group filed with the Court of Appeals a petition for certiorari, mandamus and prohibition, docketed as
CA-G.R. SP No. 27742. On March 29, 1994, the Court of Appeals dismissed the petition for lack of merit.

Issue: Whether, despite the institution of an Inter Partes case for cancellation of a mark with the BPTTT (now the
Bureau of Legal Affairs, Intellectual Property Office) by one party, the adverse party can file a subsequent action for
infringement with the regular courts of justice in connection with the same registered mark.

Ruling: Yes.

Section 151.2 of Republic Act No. 8293, otherwise known as the Intellectual Property Code, provides:

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 filing 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 filed petition to cancel
the same mark. On the other hand, the earlier filing of petition to cancel the mark with the Bureau of
Legal Affairs 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 provided)

Similarly, Rule 8, Section 7, of the Regulations on Inter Partes Proceedings, provides:

Section 7. Effect of filing of a suit before the Bureau or with the proper court. - The filing 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 filed petition to cancel the same mark. On the other hand, the
earlier filing 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 provided)

Hence, as applied in the case at bar, the earlier institution of an Inter Partes case by the Shangri-La Group for the
cancellation of the "Shangri-La" mark and "S" device/logo with the BPTTT cannot effectively bar the subsequent
filing of an infringement case by registrant Developers Group. The law and the rules are explicit.

The infringement case can and should proceed independently from the cancellation case with the Bureau so as to
afford the owner of certificates of registration redress and injunctive writs. In the same light, so must the
cancellation case with the BPTTT (now the Bureau of Legal Affairs, Intellectual Property Office) continue
independently from the infringement case so as to determine whether a registered mark may ultimately be
cancelled.
B25 McDonald's Corporation v. LC Big Mak Burger Inc., GR 143993, 18 August 2004,

Digest submitted by: Tejada, Mac Arthur V.

FACTS:

This is a Petition for Review 1 of the Decision dated 26 November 1999 of the Court of Appeals 2 finding respondent
L.C. Big Mak Burger, Inc. not liable for trademark infringement and unfair competition and ordering petitioners to
pay respondents P1,900,000 in damages, and of its Resolution dated 11 July 2000 denying reconsideration. The
Court of Appeals' Decision reversed the 5 September 1994 Decision 3 of the Regional Trial Court of Makati, Branch
137, finding respondent L.C. Big Mak Burger, Inc. liable for trademark infringement and unfair competition.

 Petitioner McDonald's Corporation ("McDonald's") is a US corporation operates, by itself or through its

franchisees, a global chain of fast-food restaurants. McDonald's 4 owns a family of marks5 including the
"Big Mac" mark for its "double-decker hamburger sandwich." 6 McDonald's registered this trademark with
the United States Trademark Registry on 16 October 1979.7 

 McDonald’s offered in the Philippines the “Big Mac” burgers on September 1981 and on 18 July
1985, the PBPTT (Philippine Bureau of Patents, Trademarks and Technology) now the IPO, allowed
registration of the "Big Mac" mark in the Principal Register based on its Home Registration in the United
States.

 Respondent L.C. Big Mak Burger, Inc. ("respondent corporation") is a domestic corporation which
operates fast-food outlets and snack vans in Metro Manila and nearby provinces and its menu includes
hamburger sandwiches and other food items.

 On 21 October 1988, respondent corporation (L.C. Big Mak, Inc.) applied with the PBPTT
for the registration of the "Big Mak" mark for its hamburger sandwiches. McDonald's opposed
respondent corporation's application on the ground that "Big Mak" was a colorable imitation of its
registered "Big Mac" mark for the same food products .

 On 6 June 1990, Pettioners (McDonald’s Corp. and McGeorge Food Industries, Inc., a domestic
corporation,the McDonald's Philippine franchisee) sued respondents in the Regional Trial Court of Makati,
Branch 137 ("RTC"), for trademark infringement and unfair competition. On 16 August 1990, the RTC
issued a writ of preliminary injunction.16

ARGUMENT OF RESPONDENTS:

 That McDonald's does not have an exclusive right to the "Big Mac" mark or to any other similar mark
because Isaiyas Group of Corporations ("Isaiyas Group") registered the same mark for hamburger
sandwiches with the PBPTT on 31 March 1979. One Rodolfo Topacio ("Topacio") similarly registered the
same mark on 24 June 1983, prior to McDonald's registration on 18 July 1985. 

 That they (Respondents) are not liable for trademark infringement or for unfair competition, as the "Big
Mak" mark they sought to register does not constitute a colorable imitation of the "Big Mac" mark.

 Respondents asserted that they did not fraudulently pass off their hamburger sandwiches as those of
petitioners' Big Mac hamburgers.17 
ARGUMENT OF PETITIONER/S:

 In their Reply, petitioners (McDonald’s) assert that they are the exclusive owner of the "Big Mac" mark.

 Petitioners asserted that while the Isaiyas Group and Topacio did register the "Big Mac" mark ahead of
McDonald's, the Isaiyas Group did so only in the Supplemental Register of the PBPTT and such registration
does not provide any protection.

 McDonald's disclosed that it had acquired Topacio's rights to his registration in a Deed of Assignment

dated 18 May 1981.18

RTC DECISION:

On 5 September 1994, the RTC  finds respondent corporation liable for trademark infringement and unfair
competition. 

Undeniably, the mark "B[ig] M[ac]" is a registered trademark for plaintiff McDonald's, and as such, it is entitled [to]
protection against infringement.

“The xxx provision of the law  concerning unfair competition is broader and more inclusive than the
law  concerning the infringement of trademark, which is of more limited  range, but within its narrower
range recognizes a more exclusive right derived by the adoption and registration of the trademark by the
person whose goods or services are first associated therewith. xxx Notwithstanding  the distinction
between an action for trademark infringement and an action for unfair competition, however, the law
extends substantially the same relief to the injured party for  both  cases. (See Sections 23 and 29 of
Republic Act No. 166)

Any  conduct may be said to constitute unfair competition if the effect is to pass off on the public the goods
of one man as the goods of another. The choice of "B[ig] M[ak]" as tradename by defendant corporation is
not merely for sentimental reasons but was clearly made to take advantage of the reputation, popularity
and the established goodwill of plaintiff McDonald's. For, as stated in Section 29, a person is guilty of
unfair competition who in selling his goods   shall  give 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 devices or words thereon, or in   any  other feature of their appearance, which
would likely influence purchasers to believe that the goods offered are those of a manufacturer or
dealer  other than  the  actual  manufacturer or dealer.  Thus, plaintiffs have established their valid cause of
action against the defendants for trademark infringement and unfair competition and for damages. ”

CA DECISION:

On 26 November 1999, the Court of Appeals reversed the RTC Decision and ordered McDonald's to pay
respondents P1,600,000 as actual and compensatory damages and P300,000 as moral damages. The
Court of Appeals held:

On the issue of Trademark Infringement:

 The Appelate Court is fully convinced that no colorable imitation exists . As the definition
dictates, it is not sufficient that a similarity exists in both names, but that more importantly, the
over-all presentation, or in their essential, substantive and distinctive parts is such as would likely
MISLEAD or CONFUSE persons in the ordinary course of purchasing the genuine article.
A careful comparison of the way the trademark "B[ig] M[ac]" is being used by plaintiffs-appellees
 and corporate name L.C. Big Mak Burger, Inc. by defendants-appellants, would readily  reveal that
no confusion could take place, or that the ordinary purchasers would be misled by it.

 The CA also further noted that Defendants-appellants corporation is using is not a trademark for
its food product but a business or corporate name.

On the issue of Unfair Competition:

 To constitute unfair competition therefore it must necessarily follow that there was malice and
that the entity concerned was in bad faith.

 In the case at bar, We find no sufficient evidence adduced by plaintiffs-appellees that

defendants-appellants deliberately tried to pass off the goods manufactured by them for those
of plaintiffs-appellees. The mere suspected similarity in the sound of the defendants-appellants'
corporate name with the plaintiffs-appellees' trademark is not sufficient evidence to conclude
unfair competition.

ISSUE:

WON THE RULING OF THE CA IS CORRECT IN REVERSING THE RULING OF THE RTC (FINDING
RESPONDENTS L.C BIG MAK LIABLE FOR TRADEMARK INFRINGEMENT AND UNFAIR COMPETITION)

SC HELD:

 The Court of Appeals made an error in reversing the decision and the ruling of the lower court was
REINSTATED;

 The Supreme Court to whether there was infringement relied on the dominancy test rather than the
holistic test (as used by the CA) to support its decision that Respondent LC Big Mak is liable for Trademark
Infringement;

 The dominancy test considers the dominant features in the competing marks in determining whether they
are confusingly similar. Under the dominancy test, courts give greater weight to the similarity of the
appearance of the product arising from the adoption of the dominant features of the registered mark,
disregarding minor differences.59 Courts will consider more the aural and visual impressions created by the
marks in the public mind, giving little weight to factors like prices, quality, sales outlets and market
segments.

Ruling On the Issue of Trademark Infringement:

Section 22 ("Section 22) of Republic Act No. 166, as amended ("RA 166"), the law applicable to this
case,32 defines trademark infringement as follows:

“Infringement, what constitutes. - Any  person who [1] shall use, without the consent of the
registrant, any reproduction, counterfeit, copy or colorable imitation of any registered mark or trade-
name in connection with  the sale, offering for sale, or advertising of any goods, business or services on
or in connection with which such use is likely to cause confusion or mistake or to deceive purchasers or
others  as to  the source or origin of such goods or services, or identity of such business; or [2] reproduce,
counterfeit, copy, or colorably imitate  any  such mark or trade-name and apply such reproduction,
counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or
 advertisements intended to be used upon or in connection with  such goods, business or
services, shall be  liable to a civil action by the registrant for any or all of the remedies  herein  provided.””

Petitioners base their cause of action under the first part of Section 22,  i.e. respondents allegedly used,
without petitioners' consent, a colorable imitation of the "Big Mac" mark in advertising and selling
respondents' hamburger sandwiches. This likely caused confusion in the mind of the purchasing public
on the source of the hamburgers or the identity of the business.

To establish trademark infringement, the following elements must be shown:

(1) the validity of plaintiff's mark;

(2) the plaintiff's ownership of the mark; and

(3) the use of the mark or its colorable imitation by the  alleged infringer results in "likelihood of
confusion."34 

Of these, it is the element of likelihood of confusion that is the gravamen of trademark infringement .35

The Court also finds that petitioners have duly established McDonald's exclusive ownership of the "Big
Mac" mark. Although Topacio and the Isaiyas Group registered the "Big Mac" mark ahead of McDonald's,
Topacio, as petitioners disclosed, had already assigned his rights to McDonald's. The Isaiyas Group, on the
other hand, registered its trademark only in the Supplemental Register. A mark which is not registered in
the Principal Register, and thus not distinctive, has no real protection. 47 Indeed, we have held that
registration in the Supplemental Register is not even a prima facie evidence of the validity of the
registrant's exclusive right to use the mark on the goods specified in the certificate. 48

Ruling On the issue of Unfair Competition:

On Types of Confusion caused:

Section 22 covers two types of confusion arising from the use of similar or colorable imitation
marks, namely,

1) confusion of goods (product confusion), and;

2) confusion of business (source or origin confusion).

Respondents is liable for unfair competition based on Sec. 29 (a) of RA 166 when it deceived the public by passing-
off its hamburgers as “Big Mak” and not indicating in their wrapper that it is not a product of Petitioner McDonalds
Corp. but of L.C. Big Mak Corporation.

“Section 29 ("Section 29")73 of RA 166 defines unfair competition, thus:

xxxx

Any  person who will employ deception or  any  other means contrary to good faith by which he  shall  pass
off the goods manufactured by him or in which he deals, or his business, or services for those of the one
having established such goodwill, or who  shall  commit  any  acts calculated to produce said result, shall be
guilty of unfair competition, and shall be subject to an action  therefor.
 In particular, and without in  any  way limiting the scope of unfair competition,  the following  shall be
deemed guilty of unfair competition:

(a)  Any  person, who in selling his goods  shall give 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 devices or words thereon, or in any feature of their appearance, which would
be likely to influence purchasers to believe that the goods offered are those of a manufacturer or
dealer, other than  the  actual  manufacturer or dealer, or who otherwise clothes the goods with such
appearance as  shall  deceive the public and defraud another of his legitimate trade, or any subsequent
vendor of such goods or any agent of  any  vendor engaged in selling such goods with a like purpose;””

SOLID TRIANGLE SALES CORPORATION and ROBERT SITCHON, petitioners, vs. THE SHERIFF OF RTC QC, Branch
93; SANLY CORPORATION, ERA RADIO AND ELECTRICAL SUPPLY, LWT CO., INCORPORATED; ROD CASTRO,
VICTOR TUPAZ and the PEOPLE OF THE PHILIPPINES, respondents.

FACTS:

Judge Apolinario D. Bruselas, Jr., issued Search Warrant No. 3324 (99) upon application of the Economic
Intelligence and Investigation Bureau (EIIB) against Sanly Corporation (Sanly), for violation of Section 168 of R.A.
No. 8293 (unfair competition). EIIB agents seized 451 boxes of Mitsubishi photographic color paper from
respondent Sanly.

Solid Triangle, through Robert Sitchon, its Marketing and Communication Manager, filed with the Office of the City
Prosecutor, Quezon City, an affidavit complaint for unfair competition against the members of the Board of Sanly
and LWT Co., Inc. (LWT). They alleged that ERA Radio and Electrical Supply (ERA), owned and operated by LWT, is
in conspiracy with Sanly in selling and/or distributing Mitsubishi brand photo paper to the damage and prejudice of
Solid Triangle, [which claims to be the sole and exclusive distributor thereof, pursuant to an agreement with the
Mitsubishi Corporation]. They also filed a motion for the transfer of custody of the seized items stored in the office
of EIIB.

Judge Bruselas denied the motion to quash the search warrant filed by Sanly, LWT and ERA but later on, granted
their motion for reconsideration and held that there is doubt whether the act complained of (unfair competition) is
criminal in nature. Solid Triangle filed a motion for reconsideration contending that the quashal of the search
warrant is not proper considering the pendency of the preliminary investigation for unfair competition wherein the
seized items will be used as evidence. Said Solid Triangle’s motion was denied.

In view thereof, Solid Triangle filed a Civil Case for damages and injunction with prayer for writs of preliminary
injunction and attachment against Sanly, LWT and ERA before the sala of Judge Lita S. Tolentino-Genilo. The
application for a preliminary attachment was denied because the same was not supported with an affidavit by the
applicant, through its authorized officer, who personally knows the facts.
Thereafter, Judge Bruselas issued an order directing EIIB to to divulge and report the exact location of the
warehouse where the goods were kept and that the Sheriff will take custody of the same and cause their delivery
to the person from whom the goods were seized.

The Solid Triangle questioned before the Court of Appeals said orders alleging grave abuse of discretion. The CA
rendered judgment initially granting certiorari stating that the quashing of the warrant deprived the prosecution of
vital evidence to determine probable cause but later on reversed itself by issuing an Amended Decision stating that
there was no probable cause for the issuance of the search warrant and that the evidence obtained by virtue of
said warrant was inadmissible in the preliminary investigation. The motion for reconsideration was denied. Hence,
this petition.

ISSUE:

Whether the respondents committed unfair competition in violation of the Intellectual Property Code.

HELD:

NO. Section 168 of the Intellectual Property Code provides:

SEC. 168.  Unfair Competition, Rights, Regulation and Remedies.—168.1 A person who has identified in the mind of
the public goods he manufactures or deals in, his business or services from those of others, whether or not a
registered mark is employed, has a property right in the goodwill of the said goods, business or services so
identified, which will be protected in the same manner as other property rights.

168.2 Any person who shall employ deception or any other means contrary to good faith by which he shall pass
off the goods manufactured by him or in which he deals, or his business, or services for those of the one having
established such goodwill, or who shall commit any acts calculated to produce said result, shall be guilty of unfair
competition, and shall be subject to an action therefor.

168.3 In particular, and without in any way limiting the scope of protection against unfair competition, the
following shall be deemed guilty of unfair competition:

(a)Any person, who is selling his goods and gives 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 devices or words thereon, or in any other feature of their
appearance, which would be likely to influence purchasers to believe that the goods offered are those
of a manufacturer or dealer, other than the actual manufacturer or dealer, or who otherwise clothes
the goods with such appearance as shall deceive the public and defraud another of his legitimate
trade, or any subsequent vendor of such goods or any agent of any vendor engaged in selling such
goods with a lie purpose;
 (b)Any person who by any artifice, or device, or who employs any other means calculated to induce the
false belief that such person is offering the service of another who has identified such services in the
mind of the public; or

(c)Any person who shall make any false statement in the course of trade or who shall commit any other
act contrary to good faith of a nature calculated to discredit the goods, business or services of
another.

The court disagreed with petitioners and find that the evidence presented before the trial court does not prove
unfair competition under said law. Sanly Corporation did not pass off the subject goods as that of another. Indeed,
it admits that the goods are genuine Mitsubishi photographic paper, which it purchased from a supplier in Hong
Kong. Petitioners also allege that private respondents “made it appear that they were duly authorized to sell or
distribute Mitsubishi Photo Paper in the Philippines.” Assuming that this act constitutes a crime, there is no proof
to establish such an allegation.

SOCIETE DES PRODUITS NESTLE, S.A., Petitioner, vs. MARTIN T. DY, JR., Respondent.

FACTS: Petitioner Societe Des Produits Nestle, S.A. (Nestle) is a foreign corporation organized under the laws of
Switzerland. It manufactures food products and beverages. Nestle owns the "NAN" trademark for its line of infant
powdered milk products, consisting of PRE-NAN, NAN-H.A., NAN-1, and NAN-2. NAN is classified under Class 6 —
"diatetic preparations for infant feeding." Nestle distributes and sells its NAN milk products all over the Philippines.
Dy, Jr. owns 5M Enterprises. He imports Sunny Boy powdered milk from Australia and repacks the powdered milk
into three sizes of plastic packs bearing the name "NANNY."

Nestle requested Dy, Jr. to refrain from using "NANNY" and to undertake that he would stop infringing the "NAN"
trademark. Dy, Jr. did not act on Nestle’s request. Nestle filed before the RTC a complaint against Dy, Jr. for
infringement. Dy, Jr. filed a motion to dismiss alleging that the complaint did not state a cause of action. The trial
court dismissed the complaint. Nestle appealed order to the Court of Appeals. The Court of Appeals set aside the
order and remanded the case to the trial court for further proceedings.

The RTC’s Ruling

The trial court found Dy, Jr. liable for infringement. The trial court held:

If determination of infringement shall only be limited on whether or not the mark used would likely cause
confusion or mistake in the minds of the buying public or deceive customers, such in [sic] the most considered
view of this forum would be highly unlikely to happen in the instant case. This is because upon comparison of the
plaintiff’s NAN and defendant’s NANNY, the following features would reveal the absence of any deceptive
tendency in defendant’s NANNY: (1) all NAN products are contained tin cans [sic], while NANNY are contained in
plastic packs; (2) the predominant colors used in the labels of NAN products are blue and white, while the
predominant colors in the plastic packings of NANNY are blue and green; (3) the labels of NAN products have at
the bottom portion an elliptical shaped figure containing inside it a drawing of nestling birds, which is overlapped
by the trade-name "Nestle", while the plastic packs of NANNY have a drawing of milking cows lazing on a vast
green field, back-dropped with snow covered mountains; (4) the word NAN are [sic] all in large, formal and
conservative-like block letters, while the word NANNY are [sic] all in small and irregular style of letters with curved
ends; and (5) all NAN products are milk formulas intended for use of [sic] infants, while NANNY is an instant full
cream powdered milk intended for use of [sic] adults.

The foregoing has clearly shown that infringement in the instant case cannot be proven with the use of the "test of
dominancy" because the deceptive tendency of the unregistered trademark NANNY is not apparent from the
essential features of the registered trademark NAN.

Dy, Jr. appealed the 18 September 1998 Decision to the Court of Appeals.

The Court of Appeals’ Ruling

The Court of Appeals reversed the trial courtDecision and found Dy, Jr. not liable for infringement. The Court of
Appeals held:

[T]he trial court appeared to have made a finding that there is no colorable imitation of the registered mark "NAN"
in Dy’s use of "NANNY" for his own milk packs. Yet it did not stop there. It continued on applying the "concept of
related goods."

While it is true that both NAN and NANNY are milk products and that the word "NAN" is contained in the word
"NANNY," there are more glaring dissimilarities in the entirety of their trademarks as they appear in their
respective labels and also in relation to the goods to which they are attached. The discerning eye of the observer
must focus not only on the predominant words but also on the other features appearing in both labels in order
that he may draw his conclusion whether one is confusingly similar to the other. Even the trial court found these
glaring dissimilarities as above-quoted. We need not add more of these factual dissimilarities.

In view of the foregoing, we find that the mark NANNY is not confusingly similar to NAN. Dy therefore cannot be
held liable for infringement. Nestle filed a motion for reconsideration. The Court of Appeals denied the motion for
lack of merit. Hence, the present petition.

Issue: whether Dy, Jr. is liable for infringement.

RULING: The petition is meritorious.

Section 22 of Republic Act (R.A.) No. 166, as amended, states:

Infringement, what constitutes. — Any person who shall use, without the consent of the registrant, any
reproduction, counterfeit, copy or colorable imitation of any registered mark or trade-name in connection with the
sale, offering for sale, or advertising of any goods, business or services on or in connection with which such use is
likely to cause confusion or mistake or to deceive purchasers or others as to the source or origin of such goods or
services, or identity of such business; or reproduce, counterfeit, copy or colorably imitate any such mark or trade-
name and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints, packages,
wrappers, receptacles or advertisements intended to be used upon or in connection with such goods, business or
services, shall be liable to a civil action by the registrant for any or all of the remedies herein provided.

Section 155 of R.A. No. 8293 states:

Remedies; Infringement. — Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the
same container or a dominant feature thereof in connection with the sale, offering for sale, distribution,
advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods
or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive;
or

155.2. 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, shall be liable in a civil action for infringement by the registrant for
the remedies hereinafter set forth: Provided, That the infringement takes place at the moment any of the acts
stated in Subsection 155.1 or this subsection are committed regardless of whether there is actual sale of goods or
services using the infringing material.

There are two tests to determine likelihood of confusion: the dominancy test and holistic test. The dominancy test
focuses on the similarity of the main, prevalent or essential features of the competing trademarks that might cause
confusion. Infringement takes place when the competing trademark contains the essential features of another.
Imitation or an effort to imitate is unnecessary. The question is whether the use of the marks is likely to cause
confusion or deceive purchasers.

The holistic test considers the entirety of the marks, including labels and packaging, in determining confusing
similarity. The focus is not only on the predominant words but also on the other features appearing on the labels.

This Court x x x has relied on the dominancy test rather than the holistic test. The dominancy test considers the
dominant features in the competing marks in determining whether they are confusingly similar. Under the
dominancy test, courts give greater weight to the similarity of the appearance of the product arising from the
adoption of the dominant features of the registered mark, disregarding minor differences. Courts will consider
more the aural and visual impressions created by the marks in the public mind, giving little weight to factors like
prices, quality, sales outlets and market segments.

Applying the dominancy test in the present case, the Court finds that "NANNY" is confusingly similar to "NAN."
"NAN" is the prevalent feature of Nestle’s line of infant powdered milk products. It is written in bold letters and
used in all products. The line consists of PRE-NAN, NAN-H.A., NAN-1, and NAN-2. Clearly, "NANNY" contains the
prevalent feature "NAN." The first three letters of "NANNY" are exactly the same as the letters of "NAN." When
"NAN" and "NANNY" are pronounced, the aural effect is confusingly similar.

WHEREFORE, we GRANT the petition. We SET ASIDE the 1 September 2005 Decision and 4 April 2006 Resolution
of the Court of Appeals.

LEVI STRAUSS (PHILS.), INC.,        vs TONY LIM,

 
FACTS:
 
Petitioner Levi Strauss (Phils.), Inc. Is a duly-registered domestic corporation.  It is a wholly-owned subsidiary of
Levi Strauss & Co. (LS & Co.) A Delaware,USA company. In 1972, LS & Co. Granted petitioner a non-exclusive license
to use its registered trademarks and trade names for the manufacture and sale of various garment products,
primarily pants, jackets, and shirts, in the Philippines.  Presently, it is the only company that has authority to
manufacture, distribute, and sell products bearing the LEVI’S trademarks or to use such trademarks in
the Philippines.  These trademarks are registered in over 130 countries, including the Philippines, and were first
used in commerce in the Philippines in 1946.  

Sometime in 1995, petitioner lodged a complaint before the Inter-Agency Committee on Intellectual Property
Rights, alleging  that  a  certain establishment owned by respondent Tony Lim, doing business under the name
Vogue Traders Clothing Company, was engaged in the manufacture, sale, and distribution of products similar to
those of petitioner and under the brand name “LIVE’S,” and was granted the filing of an information against
respondent. Respondent then filed his own motion for reconsideration of the Bello resolution, the DOJ then
ordered the dismissal of the complaint.. Dissatisfied with the DOJ rulings, petitioner sought recourse with the CA
via a petition for review under Rule 43 of the 1997 Rules of Civil Procedure.   On October 17, 2003, the appellate
court affirmed the dismissal of the unfair competition complaint. The CA pointed out that to determine the
likelihood of confusion, mistake or deception, all relevant factors and circumstances should be taken into
consideration, such as the circumstances under which the goods are sold, the class of purchasers, and the actual
occurrence or absence of confusion.

 Thus, the existence  of  some  similarities  between  LIVE’S jeans and LEVI’S garments would not ipso facto equate
to fraudulent intent on the part of respondent. The CA noted that respondent used affirmative and precautionary
distinguishing features in his products for differentiation.  The appellate court considered the spelling and
pronunciation of the marks; the difference in the designs of the back pockets; the dissimilarity between the carton
tickets; and the pricing and sale of petitioner’s products in upscale exclusive specialty shops.   The CA also
disregarded the theory of post-sale confusion propounded by petitioner, relying instead on the view that the
probability of deception must be determined at the point of sale.
 
ISSUES:
 
Petitioner submits that the CA committed the following errors:
 
 I. The court of appeals gravely erred in ruling that actual confusion is necessary to sustain a
charge of unfair competition, and that there must be direct evidence or proof of intent to
deceive the public.
II. The court of appeals gravely erred in ruling that respondent’s live’s jeans do not unfairly
compete with levi’s ® jeans and/or that there is no possibility that the former will be
confused for the latter, considering that respondent’s live’s jeans blatantly copy or colorably
imitate no less than six (6) trademarks of levi’s jeans.
HELD:
  
Generally, unfair competition consists in employing deception or any other means contrary to good faith
by which any person shall pass off the goods manufactured by him or in which he deals, or his business, or
services for those of the one having established goodwill, or committing any acts calculated to produce such result.
The elements of unfair competition under Article 189(1) of the Revised Penal Code are:
  (a)      That the offender gives his goods the general appearance of the goods of another manufacturer or
dealer;
(b)      That the general appearance is shown in the (1) goods themselves, or in the (2) wrapping
of their packages, or in the (3) device or words therein, or in (4) any other feature of their
appearance;
(c)      That the offender offers to sell or sells those goods or gives other persons a chance or
opportunity to do the same with a like purpose; and
(d)      That there is actual intent to deceive the public or defraud a competitor.
  All these elements must be proven.  In finding that probable cause for unfair competition does not exist,
the investigating prosecutor and Secretaries Guingona and Cuevas arrived at the same conclusion that there is
insufficient evidence to prove all the elements of the crime that would allow them to secure a conviction. Secretary
Guingona discounted the element of actual intent to deceive by taking into consideration the differences in
spelling, meaning, and phonetics between “LIVE’S” and “LEVI’S,” as  well  as  the  fact  that respondent had
registered his own mark.  While it is true that there may be unfair competition even if the competing mark is
registered in the Intellectual Property Office, it is equally true that the same may show  prima facie good
faith. Indeed,  registration  does  not negate unfair competition where the goods are packed or offered for sale and
passed off as those of complainant. However, the mark’s registration, coupled with the stark differences between
the competing marks, negate the existence of actual intent to deceive, in this particular case.
  Petitioner argues that the element of intent to deceive may be inferred from the similarity of the goods or
their appearance.  The argument is specious on two fronts.  First, where the similarity in the appearance of the
goods as packed and offered for sale is so striking, intent to deceive may be inferred. However, as found by the
investigating prosecutor and the DOJ Secretaries, striking similarity between the competing goods is not present.
Second, the confusing similarity of the goods was precisely in issue during the preliminary investigation.   As such,
the element of intent to deceive  could  not arise  without  the  investigating prosecutor’s or the DOJ
Secretary’s  finding  that  such  confusing similarity exists.  Since confusing similarity was not found, the element of
fraud or deception could not be inferred.
  We cannot sustain Secretary Bello’s opinion that to establish probable cause, “it is enough that the
respondent gave to his product the general appearance of the product of petitioner.  It bears stresing that that is
only one element of unfair competition.  All others must be shown to exist.  More importantly, the likelihood of
confusion exists not only if there is confusing similarity.  It should also be likely to cause confusion or mistake or
deceive purchasers. Thus, the CA correctly ruled that the mere fact that some resemblance can be pointed out
between the marks used does not in itself prove unfair competition. To reiterate, the resemblance must be such as
is likely to deceive the ordinary purchaser exercising ordinary care.
The consumer survey alone does not equate to actual confusion.  We note that the survey was made by
showing the interviewees actual samples of petitioner’s and respondent’s respective products,  approximately five
feet away from them.  From  that  distance, they were asked to identify the jeans’ brand and  state the reasons for
thinking so.  This method discounted the possibility that the ordinary intelligent buyer would be able to closely
scrutinize, and even fit, the jeans to determine if they were “LEVI’S” or not.   It also ignored that a consumer would
consider the price of the competing goods when choosing a brand of jeans.  It is undisputed that “LIVE’S” jeans are
priced much lower than “LEVI’S.”
            
 
B29

SHANG PROPERTIES REALTY CORPORATION (formerly THE SHANG GRAND TOWER CORPORATION) and SHANG
PROPERTIES, INC. (formerly EDSA PROPERTIES HOLDINGS, INC.), Petitioners, vs. ST. FRANCIS DEVELOPMENT
CORPORATION, Respondent. G.R. No. 190706, SECOND DIVISION, July 21, 2014, PERLAS-BERNABE, J.

FACTS: St. Francis Development Corporation (SFDC), a domestic corporation engaged in the real estate business
and the developer of St. Francis Square Commercial Center in Ortigas Center, filed complaint for unfair
competition against Shang Properties Realty Corporation (Shang) before the IPO – Bureau of Legal Affairs due to
Shang’s use and filing of applications for the registration of the marks “THE ST. FRANCIS TOWER” and “THE ST.
FRANCIS SHANGRILA PLACE” for use relative to Shang’s business, particularly the construction of permanent
buildings or structures for residential and office purposes. SFDC alleged that (1) it used “ST. FRANCIS: to identify
numerous property development projects in Ortigas Center and (2) as a use of its continuous projects in Ortigas
Center and real estate business, it has gained substantial goodwill with the public that consumers and traders
closely identify the mark with its property development projects. On the other hand, Shang contended that the
mark with its property cannot be exclusively owned by SFDC since the marks is geographically descriptive of the
goods or services for which it is intended to be used.

ISSUE: Whether or not petitioners are guilty of unfair competition in using the marks “THE ST. FRANCIS TOWERS”
and “THE ST. FRANCIS SHANGRI-LA PLACE.”

RULING: No. The mark “ST. FRANCIS” has a geographically-descriptive nature which thus bars its exclusive
appropriability, unless a secondary meaning is acquired. As its use of the mark is clearly limited to a certain locality,
it cannot be said that there was substantial commercial use of the same recognized all throughout the country, as
required by Section 123.2(a) of the IP Code in order to conclude that a geographically-descriptive mark has
acquired secondary meaning. Neither is there any showing of a mental recognition in buyers’ and potential buyers’
minds that products connected with the mark “ST. FRANCIS” are associated with the same source — that is, the
enterprise of respondent. Thus, absent any showing that there exists a clear goods/service-association between
the realty projects located in the aforesaid area and herein respondent as the developer thereof, the latter cannot
be said to have acquired a secondary meaning as to its use of the “ST. FRANCIS” mark. Also, assuming that
secondary meaning had been acquired, this does not automatically trigger the concurrence of the element of
fraud. There can be no unfair competition without this element.

Ecole de Cuisine Manille v. Renaud Cointreau & Cie, GR 185830, 5 June 2013 Facts: Respondent Cointreau, a
partnership registered under the laws of France, applied for the registration of the mark ‘Le Cordon Bleu & Device.’
Petitioner Ecole De Cuisine opposed on the ground that it is the owner of the mark ‘Le Cordon Bleu, Ecole De
Cuisine Manille’ used in its culinary activities and restaurant business and that the registration will create confusion
to the public. Respondent Cointreau answered claiming it is the true and lawful owner of the mark and had long
been using it worldwide. The IPO Bureau of Legal Affairs sustained petitioner’s opposition stating that Cointreau
had no prior use of the mark in the Philippines to be entitled to a proprietary right over it. The IPO Director General
reversed the decision and allowed the mark’s registration holding that under RA No. 166, actual use in the
Philippines is not necessary to acquire ownership of the mark. Issue: Whether or not respondent’s prior use of the
mark is a requirement for its registration. Ruling: YES. Under Section 2 of R.A. No. 166, in order to register a
trademark, one must be the owner thereof and must have actually used the mark in commerce in the Philippines
for 2 months prior to the application for registration. Section 2-A of the same law sets out to define how one goes
about acquiring ownership thereof. Under Section 2- A, it is clear that actual use in commerce is also the test of
ownership but the provision went further by saying that the mark must not have been so appropriated by another.
Additionally, it is significant to note that Section 2-A does not require that the actual use of a trademark must be
within the Philippines. Thus, as correctly mentioned by the CA, under R.A. No. 166, one may be an owner of a mark
due to its actual use but may not yet have the right to register such ownership here due to the owner’s failure to
use the same in the Philippines for 2 months prior to registration. In the instant case, it is undisputed that
Cointreau has been using the subject mark in France, prior to Ecole’s averred first use of the same in the
Philippines, of which the latter was fully aware thereof. On the other hand, Ecole has no certificate of registration
over the subject mark but only a pending application. Under the foregoing circumstances, even if Ecole was the
first to use the mark in the Philippines, it cannot be said to have validly appropriated the same. In any case, the
present law on trademarks, Republic Act No. 8293, otherwise known as the Intellectual Property Code of the
Philippines, as amended, has already dispensed with the requirement of prior actual use at the time of registration.
Thus, there is more reason to allow the registration of the subject mark under the name of Cointreau as its true
and lawful owner.

WILLAWARE VS. JESICHRIS

G.R. No. 195549               September 3, 2014

FACTS:

The respondent is a duly registered partnership engaged in the manufacture and distribution of plastic and metal
products located in Caloocan City. Since its registration in 1992, Jesichris Manufacturing Company has been
manufacturing and distributing plastic-made automotive parts. Willaware Products Corporation, on the other
hand, which is engaged in the manufacturing and distribution of kitchenware items made of plastic and metal
located near Jesichris Manufacturing Company. Respondent further alleged that the petitioner had been
manufacturing and distributing the same automotive parts with exactly similar design, same material and colors
but was selling these products at a lower price as respondent’s plastic-made automotive parts and to the same
customers. Claiming that due to the physical proximity of their offices, and the fact that respondent’s employees
transfer to the petitioner, the latter had developed familiarity their products, especially its plastic-made
automotive parts. Further, respondent claimed that the petitioner deliberately copied their products which
constitutes unfair competition, is and are contrary to law, morals, good customs and public policy and have caused
respondent damages in terms of lost and unrealized profits.

On the other hand, the petitioner posits that there was no unfair competition as the plastic products were mere
reproductions of the original parts which merely conform to their original designs and specifications. Thus, Jesichris
cannot claim that it originated the use of the plastic automotive parts, and even assuming that it did so, it still has
no exclusive right to sell these products since it has no patent over these products. In fact, other establishments
were offering them for sale as well.

ISSUE:

Whether or not there is unfair competition under human relations.

RULING:

Yes. In order to qualify the competition as “unfair,” it must have two characteristics: (1) it must involve an injury to
a competitor or trade rival, and (2) it must involve acts which are characterized as “contrary to good conscience,”
or “shocking to judicial sensibilities,” or otherwise unlawful; in the language of our law, these include force,
intimidation, deceit, machination or any other unjust, oppressive or high-handed method. The public injury or
interest is a minor factor; the essence of the matter appears to be a private wrong perpetrated by unconscionable
means. Here, both characteristics are present.
In the present case, both parties are competitors or trade rivals, both being engaged in the manufacture of plastic-
made automotive parts. Second, the acts of the petitioner were clearly “contrary to good conscience” as petitioner
admitted having employed respondent’s former employees, deliberately copied respondent’s products and even
went to the extent of selling these products to respondent’s customers. Pieces of evidence suggest that efforts
have been made to copy the product of the respondent. Finally, it is evident from the petitioner’s act of suddenly
shifting his business from manufacturing kitchenware to plastic-made automotive parts, his luring the employees
of the respondent to transfer to his employ and trying to discover the trade secrets of the respondent is engaged
to an unfair competition.

GSIS FAMILY BANK - THRIFT BANK [Formerly Inc.], Petitioner, -versus- BPI FAMILY BANK, Respondent G.R. NO.
175278, THIRD DIVISION, SEPTEMBER 23, 2015, JARDELZA, J.

If the proposed name is similar to the name of a registered firm, the proposed name must contain at least one
distinctive word different from the name of the company already registered. Section 3 states that if there be
identical, misleading or confusingly similar name to one already registered by another corporation or partnership
with the SEC, the proposed name must contain at least one distinctive word different from the name of the
company already registered.

To show contrast with respondent's corporate name, petitioner used the words "GSIS" and "thrift." But these are
not sufficiently distinct words that differentiate petitioner's corporate name from respondent's. While "GSIS" is
merely an acronym of the proper name by which petitioner is identified, the word "thrift" is simply a classification
of the type of bank that petitioner is. Even if the classification of the bank as "thrift" is appended to petitioner's
proposed corporate name, it will not make the said corporate name distinct from respondent's because the latter is
likewise engaged in the banking business.

FACTS:

Petitioner was originally organized as Royal Savings Bank and started operations in 1971 but encountered liquidity
problems. It was placed under receivership and later temporarily closed by the Central Bank of the Philippines.
Two (2) months after its closure, petitioner reopened and was renamed Comsavings Bank, Inc. under the
management of the Commercial Bank of Manila.

In 1987, GSIS acquired petitioner from the Commercial Bank of Manila. Petitioner's management and control was
thus transferred to GSIS. To improve its marketability to the public, especially to the members of the GSIS,
petitioner sought Securities and Exchange Commission (SEC) approval to change its corporate name to "GSIS
Family Bank, a Thrift Bank."8Petitioner likewise applied with the Department of Trade and Industry (DTI) and
Bangko Sentral ng Pilpinas (BSP) for authority to use "GSIS Family Bank, a Thrift Bank" as its business name. The DTI
and the BSP approved the applications. Thus, petitioner operates under the corporate name "GSIS Family Bank – a
Thrift Bank," pursuant to the DTI Certificate of Registration No. 741375 and the Monetary Board Circular approval.

Respondent BPI Family Bank was a product of the merger between the Family Bank and Trust Company (FBTC) and
the Bank of the Philippine Islands (BPI). On June 27, 1969, the Gotianum family registered with the SEC the
corporate name "Family First Savings Bank," which was amended to "Family Savings Bank," and then later to
"Family Bank and Trust Company." Since its incorporation, the bank has been commonly known as "Family Bank."
In 1985, Family Bank merged with BPI, and the latter acquired all the rights, privileges, properties, and interests of
Family Bank, including the right to use names, such as "Family First Savings Bank," "Family Bank," and "Family Bank
and Trust Company." BPI Family Savings Bank was registered with the SEC as a wholly-owned subsidiary of BPI. BPI
Family Savings Bank then registered with the Bureau of Domestic Trade the trade or business name "BPI Family
Bank," and acquired a reputation and goodwill under the name.

Eventually, it reached respondent’s attention that petitioner is using or attempting to use the name "Family Bank."
Thus, on March 8, 2002, respondent petitioned the SEC Company Registration and Monitoring Department (SEC
CRMD) to disallow or prevent the registration of the name "GSIS Family Bank" or any other corporate name with
the words "Family Bank" in it. Respondent claimed exclusive ownership to the name "Family Bank," having
acquired the name since its purchase and merger with Family Bank and Trust Company way back 1985.
Respondent also alleged that through the years, it has been known as "BPI Family Bank" or simply "Family Bank"
both locally and internationally. As such, it has acquired a reputation and goodwill under the name, not only with
clients here and abroad, but also with correspondent and competitor banks, and the public in general.

The SEC CRMD declared that upon the merger of FBTC with the BPI in 1985, the latter acquired the right to the use
of the name of the absorbed corporation. Thus, BPI Family Bank has a prior right to the use of the name. SEC EN
Banc upheld the ruling.

The Court of Appeals ruled that the approvals by the BSP and by the DTI of petitioner’s application to use the name
"GSIS Family Bank" do not constitute authority for its lawful and valid use. It said that the SEC has absolute
jurisdiction, supervision and control over all corporations. CA held that respondent was entitled to the exclusive
use of the corporate name because of its prior adoption of the name "Family Bank" since 1969

ISSUE:

Whether respondent was entitled to the exclusive use of the corporate name (YES)

RULING:

Section 18. Corporate name. – No corporate name may be allowed by the Securities and Exchange Commission if
the proposed name is identical or deceptively or confusingly similar to that of any existing corporation or to any
other name already protected by law or is patently deceptive, confusing or contrary to existing laws. When a
change in the corporate name is approved, the Commission shall issue an amended certificate of incorporation
under the amended name.

In Philips Export B.V. v. Court of Appeals, this Court ruled that to fall within the prohibition of the law on the right
to the exclusive use of a corporate name, two requisites must be proven, namely: (1) that the complainant
corporation acquired a prior right over the use of such corporate name; and (2) the proposed name is either (a)
identical or

(b) deceptive or confusingly similar to that of any existing corporation or to any other name already protected by
law; or (c) patently deceptive, confusing or contrary to existing law.

These two requisites are present in this case.

On the first requisite of a prior right, Industrial Refractories Corporation of the Philippines v. Court of Appeals (IRCP
case) is instructive. In that case, Refractories Corporation of the Philippines (RCP) filed before the SEC a petition to
compel Industrial Refractories Corporation of the Philippines (IRCP) to change its corporate name on the ground
that its corporate name is confusingly similar with that of RCP’s such that the public may be confused into believing
that they are one and the same corporation. The SEC and the Court of Appeals found for petitioner, and ordered
IRCP to delete or drop from its corporate name the word "Refractories." Upon appeal of IRCP, this Court upheld
the decision of the CA.

Applying the priority of adoption rule to determine prior right, this Court said that RCP has acquired the right to
use the word "Refractories" as part of its corporate name, being its prior registrant. In arriving at this conclusion,
the Court considered that RCP was incorporated on October 13, 1976 and since then continuously used the
corporate name "Refractories Corp. of the Philippines." Meanwhile, IRCP only started using its corporate name
"Industrial Refractories Corp. of the Philippines" when it amended its Articles of Incorporation on August 23, 1985.

In this case, respondent was incorporated in 1969 as Family Savings Bank and in 1985 as BPI Family Bank.
Petitioner, on the other hand, was incorporated as GSIS Family – Thrift Bank only in 2002, or at least seventeen
(17) years after respondent started using its name. Following the precedent in the IRCP case, we rule that
respondent has the prior right over the use of the corporate name.

The second requisite in the Philips Export case likewise obtains on two points: the proposed name is (a) identical or
(b) deceptive or confusingly similar to that of any existing corporation or to any other name already protected by
law. On the first point (a), the words "Family Bank" present in both petitioner and respondent's corporate name
satisfy the requirement that there be identical names in the existing corporate name and the proposed one.

Respondent cannot justify its claim under Section 3 of the Revised Guidelines in the Approval of Corporate and
Partnership Names, to wit:

3. The name shall not be identical, misleading or confusingly similar to one already registered by another
corporation or partnership with the Commission or a sole proprietorship registered with the Department of Trade
and Industry. If the proposed name is similar to the name of a registered firm, the proposed name must contain at
least one distinctive word different from the name of the company already registered. Section 3 states that if there
be identical, misleading or confusingly similar name to one already registered by another corporation or
partnership with the SEC, the proposed name must contain at least one distinctive word different from the name
of the company already registered. To show contrast with respondent's corporate name, petitioner used the words
"GSIS" and "thrift." But these are not sufficiently distinct words that differentiate petitioner's corporate name from
respondent's. While "GSIS" is merely an acronym of the proper name by which petitioner is identified, the word
"thrift" is simply a classification of the type of bank that petitioner is. Even if the classification of the bank as
"thrift" is appended to petitioner's proposed corporate name, it will not make the said corporate name distinct
from respondent's because the latter is likewise engaged in the banking business.

This Court used the same analysis in Ang mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus, H.S.K. sa Bansang Pilipinas,
Inc. v. Iglesia ng Dios Kay Cristo Jesus, Haligi at Suhay ng Katotohanan. In that case, Iglesia ng Dios Kay Cristo Jesus
filed a case before the SEC to compel Ang mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus to change its corporate
name, and to prevent it from using the same or similar name on the ground that the same causes confusion among
their members as well as the public. Ang mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus claimed that it complied
with SEC Memorandum Circular No. 14-2000 by adding not only two, but eight words to their registered name, to
wit: "Ang Mga Kaanib" and "Sa Bansang Pilipinas, Inc.," which effectively distinguished it from Iglesia ng Dios Kay
Cristo Jesus. This Court rejected the argument, thus: The additional words "Ang Mga Kaanib" and "Sa Bansang
Pilipinas, Inc." in petitioner's name are, as correctly observed by the SEC, merely descriptive of and also referring to
the members, or kaanib, of respondent who are likewise residing in the Philippines. These words can hardly serve
as an effective differentiating medium necessary to avoid confusion or difficulty in distinguishing petitioner from
respondent. This is especially so, since both petitioner and respondent corporations are using the same acronym –
H.S.K.; not to mention the fact that both are espousing religious beliefs and operating in the same place. Xxx41

On the second point (b), there is a deceptive and confusing similarity between petitioner's proposed name and
respondent's corporate name, as found by the SEC. In determining the existence of confusing similarity in
corporate names, the test is whether the similarity is such as to mislead a person using ordinary care and
discrimination. And even without such proof of actual confusion between the two corporate names, it suffices that
confusion is probable or likely to occur. Petitioner's corporate name is "GSIS Family Bank—A Thrift Bank" and
respondent's corporate name is "BPI Family Bank." The only words that distinguish the two are "BPI," "GSIS," and
"Thrift." The first two words are merely the acronyms of the proper names by which the two corporations identify
themselves; and the third word simply describes the classification of the bank. The overriding consideration in
determining whether a person, using ordinary care and discrimination, might be misled is the circumstance that
both petitioner and respondent are engaged in the same business of banking. "The likelihood of confusion is
accentuated in cases where the goods or business of one corporation are the same or substantially the same to
that of another corporation."

Respondent alleged that upon seeing a Comsavings Bank branch with the signage "GSIS Family Bank" displayed at
its premises, some of the respondent’s officers and their clients began asking questions. These include whether
GSIS has acquired Family Bank; whether there is a joint arrangement between GSIS and Family Bank; whether
there is a joint arrangement between BPI and GSIS regarding Family Bank; whether Comsavings Bank has acquired
Family Bank; and whether there is there an arrangement among Comsavings Bank, GSIS, BPI, and Family Bank
regarding BPI Family Bank and GSIS Family Bank.46 The SEC made a finding that "[i]t is not a remote possibility that
the public may entertain the idea that a relationship or arrangement indeed exists between BPI and GSIS due to
the use of the term ‘Family Bank’ in their corporate names."
Findings of fact of quasi-judicial agencies, like the SEC, are generally accorded respect and even finality by this
Court, if supported by substantial evidence, in recognition of their expertise on the specific matters under their
consideration, more so if the same has been upheld by the appellate court, as in this case.

Petitioner cannot argue that the word "family" is a generic or descriptive name, which cannot be appropriated
exclusively by respondent. "Family," as used in respondent's corporate name, is not generic. Generic marks are
commonly used as the name or description of a kind of goods, such as "Lite" for beer or "Chocolate Fudge" for
chocolate soda drink. Descriptive marks, on the other hand, convey the characteristics, function, qualities or
ingredients of a product to one who has never seen it or does not know it exists, such as "Arthriticare" for arthritis
medication.

Under the facts of this case, the word "family" cannot be separated from the word "bank."In asserting their claims
before the SEC up to the Court of Appeals, both petitioner and respondent refer to the phrase "Family Bank" in
their submissions. This coined phrase, neither being generic nor descriptive, is merely suggestive and may properly
be regarded as arbitrary. Arbitrary marks are "words or phrases used as a mark that appear to be random in the
context of its use. They are generally considered to be easily remembered because of their arbitrariness. They are
original and unexpected in relation to the products they endorse, thus, becoming themselves distinctive."
Suggestive marks, on the other hand, "are marks which merely suggest some quality or ingredient of goods. xxx
The strength of the suggestive marks lies on how the public perceives the word in relation to the product or
service."

In Ang v. Teodoro, this Court ruled that the words "Ang Tibay" is not a descriptive term within the meaning of the
Trademark Law but rather a fanciful or coined phrase. In so ruling, this Court considered the etymology and
meaning of the Tagalog words, "Ang Tibay" to determine whether they relate to the quality or description of the
merchandise to which respondent therein applied them as trademark.

The word "family" is defined as "a group consisting of parents and children living together in a household" or "a
group of people related to one another by blood or marriage." Bank, on the other hand, is defined as "a financial
establishment that invests money deposited by customers, pays it out when requested, makes loans at interest,
and exchanges currency." By definition, there can be no expected relation between the word "family" and the
banking business of respondent. Rather, the words suggest that respondent’s bank is where family savings should
be deposited. More, as in the Ang case, the phrase "family bank" cannot be used to define an object. Petitioner’s
argument that the opinion of the BSP and the certificate of registration granted to it by the DTI constitute authority
for it to use "GSIS Family Bank" as corporate name is also untenable.

The enforcement of the protection accorded by Section 18 of the Corporation Code to corporate names is lodged
exclusively in the SEC. The jurisdiction of the SEC is not merely confined to the adjudicative functions provided in
Section 5 of the SEC Reorganization Act, as amended. By express mandate, the SEC has absolute jurisdiction,
supervision and control over all corporations. It is the SEC’s duty to prevent confusion in the use of corporate
names not only for the protection of the corporations involved, but more so for the protection of the public. It has
authority to de-register at all times, and under all circumstances corporate names which in its estimation are likely
to generate confusion.

The SEC correctly applied Section 18 of the Corporation Code, and Section 15 of SEC Memorandum Circular No. 14-
2000, pertinent portions of which provide: In implementing Section 18 of the Corporation Code of the Philippines
(BP 69), the following revised guidelines in the approval of corporate and partnership names are hereby adopted
for the information and guidance of all concerned: xxx 15.

Registrant corporations or partnership shall submit a letter undertaking to change their corporate or partnership
name in case another person or firm has acquired a prior right to the use of the said firm name or the same is
deceptively or confusingly similar to one already registered unless this undertaking is already included as one of
the provisions of the articles of incorporation or partnership of the registrant.

The SEC, after finding merit in respondent's claims, can compel petitioner to abide by its commitment "to change
its corporate name in the event that another person, firm or entity has acquired a prior right to use of said name or
one similar to it." Clearly, the only determination relevant to this case is that one made by the SEC in the exercise
of its express mandate under the law.

The BSP opinion invoked by petitioner even acknowledges that "the issue on whether a proposed name is identical
or deceptively similar to that of any of existing corporation is matter within the official jurisdiction and competence
of the SEC." Judicial notice may also be taken of the action of the IPO in approving respondent’s registration of the
trademark "BPI Family Bank" and its logo on October 17, 2008.

The certificate of registration of a mark shall be prima facie evidence of the validity of the registration, the
registrant’s ownership of the mark, and of the registrant’s exclusive right to use the same in connection with the
goods or services and those that are related thereto specified in the certificate.

Reference: Dean’s Circle 2019-UST Faculty of Civil Law Case Digests https://irp-
cdn.multiscreensite.com/7dcde495/files/uploaded/Corporation%20and%20Securities
%20Law_vvEHJQMQStO3TTiZ3WlG.pdf

SAMSON VS. DAWAY

GRs 160054-55, 21 July 2004

FACTS: Two informations for unfair competition under Section 168.3 (a), in relation to Section 170, of the
Intellectual Property Code (Republic Act No. 8293), similarly worded save for the dates and places of commission,
were filed against petitioner Manolo P. Samson, the registered owner of ITTI Shoes.

Samson allegedly distributed, sold and/or offered for sale CATERPILLAR products such as footwear, garments,
clothing, bags, accessories and paraphernalia which are closely identical to and/or colorable imitations of the
authentic Caterpillar products and likewise using trademarks, symbols and/or designs as would cause confusion,
mistake or deception on the part of the buying public to the damage and prejudice of CATERPILLAR, INC., the prior
adopter, user and owner of the following internationally: “CATERPILLAR,” “CAT,” “CATERPILLAR & DESIGN,” “CAT
AND DESIGN,” “WALKING MACHINES” and “TRACK-TYPE TRACTOR & DESIGN.”
Samson filed a motion to suspend arraignment and other proceedings in view of the existence of an alleged
prejudicial question involved in a civil case for unfair competition pending with the same branch of the RTC; and
also in view of the pendency of a petition for review filed with the Secretary of Justice assailing the Chief State
Prosecutor’s resolution finding probable cause to charge petitioner-accused with unfair competition. The RTC
denied the motion to suspend arraignment and other proceedings.

Later, Samson filed a twin motion to quash the informations and motion for reconsideration of the order denying
motion to suspend challenging the jurisdiction of the trial court over the offense charged. He contended that since
under Section 170 of R.A. No. 8293, the penalty of imprisonment for unfair competition does not exceed six years,
the offense is cognizable by the Municipal Trial Courts and not by the Regional Trial Court, per R.A. No. 7691. The
trial court denied Samson’s twin motions as well as his motion for reconsideration.

ISSUE: Which court has jurisdiction over criminal and civil cases for violation of intellectual property rights?

HELD: All actions (civil or criminal) for unfair competition, should be filed with the RTC. Section 163 of R.A. No.
8293, states that “all actions under Sections 150, 155, 164 and 166 to 169 shall be brought before the proper
courts with appropriate jurisdiction under existing laws.

The existing law referred to in the foregoing provision is Section 27 of R.A. No. 166 (The Trademark Law) which
provides that jurisdiction over cases for infringement registered marks, unfair competition, false designation of
origin and false description or representation, is lodged with the Court of First Instance (now Regional Trial Court).

The settled rule in statutory construction is that in case of conflict between a general law and a special law, the
latter must prevail. Jurisdiction conferred by a special law to Regional Trial Courts must prevail over that granted
by a general law to Municipal Trial Courts.

In the case at bar, R.A. No. 8293 and R.A. No. 166 are special laws conferring jurisdiction over violations of
intellectual property rights to the Regional Trial Court. They should therefore prevail over R.A. No. 7691, which is a
general law.

WILLIAM C. YAO, SR., LUISA C. YAO, RICHARD C. YAO, WILLIAM C. YAO JR., and ROGER C. YAO,  Petitioners, v. THE
PEOPLE OF THE PHILIPPINES, PETRON CORPORATION and PILIPINAS SHELL PETROLEUM CORP., and its Principal,
SHELL INT L PETROLEUM CO. LTD., Respondents.

Facts:

Petitioners are incorporators and officers of MASAGANA GAS CORPORATION (MASAGANA), an entity engaged in
the refilling, sale and distribution of LPG products.

Private respondents Petron Corporation (Petron) and Pilipinas Shell Petroleum Corporation (Pilipinas Shell) are two
of the largest bulk suppliers and producers of LPG in the Philippines. Their LPG products are sold under the marks
"GASUL" and "SHELLANE," respectively. The said companies are sole entities authorized to allow refillers and
distributors to refill, use, sell, and distribute LPG containers, products and its trademarks.

On 3 April 2003, National Bureau of Investigation (NBI) agent Ritche N. Oblanca (Oblanca) filed two applications for
search warrant with the RTC, Branch 17, Cavite City, against petitioners and other occupants of the MASAGANA
compound located at Governor's Drive, Barangay Lapidario, Trece Martires, Cavite City, for alleged violation of
Section 155, in relation to Section 170 of Republic Act No. 8293, otherwise known as "The Intellectual Property
Code of the Philippines."8 The two applications for search warrant uniformly alleged that per information, belief,
and personal verification of Oblanca, the petitioners are actually producing, selling, offering for sale and/or
distributing LPG products using steel cylinders owned by, and bearing the tradenames, trademarks, and devices of
Petron and Pilipinas Shell, without authority and in violation of the rights of the said entities.

Issue:

WON Petitioners are liable for Trademark Infringement

Ruling:

Yes. Section 155 of Republic Act No. 8293 identifies the acts constituting trademark infringement, thus:

SEC. 155. Remedies; Infringement. - Any person who shall, without the consent of the owner of the registered
mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the
same container or a dominant feature thereof in connection with the sale, offering for sale, distribution,
advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods
or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive;
or

155.2. 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, shall be liable in a civil action for infringement by the registrant for
the remedies hereinafter set forth: Provided, That the infringement takes place at the moment any of the acts
stated in Subsection 155.1 or this subsection are committed regardless of whether there is actual sale of goods or
services using the infringing material.

As can be gleaned in Section 155.1, mere unauthorized use of a container bearing a registered trademark in
connection with the sale, distribution or advertising of goods or services which is likely to cause confusion, mistake
or deception among the buyers/consumers can be considered as trademark infringement.

In the case at bar, testimonial, documentary and object evidence revealed the fact that petitioners, through
MASAGANA, have been using the LPG cylinders bearing the marks GASUL and SHELLANE without permission from
Petron and Pilipinas Shell, a probable cause for trademark infringement.

William C. Yao, et al. V. The People of the Philippines, et al.

G.R. No. 168306 June 19, 2007

FACTS: Petitioners are incorporators and officers of MASAGANA GAS CORPORATION (MASAGANA), an entity
engaged in the refilling, sale and distribution of LPG products, while Private respondents Petron and Pilipinas Shell
are two of the largest bulk suppliers and producers of LPG in the Philippines. Their LPG products are sold under the
marks "GASUL" and "SHELLANE," respectively. They are authorized to allow refillers and distributors to refill, use,
sell and distribute their respective LPG containers and products. NBI agent Oblanca filed applications for search
warrant against petitioners and other occupants of MASAGANA compound, on the ground that petitioners are
actually producing, selling, offering for sale and/or distributing LPG products using steel cylinders owned by, and
bearing the tradenames, trademarks, and devices of Petron and Pilipinas Shell, without authority and in violation
of the rights of the said entities. Presiding Judge of RTC Cavite found probable cause, hence, commanded the
immediate search and seizure of the items. Petitioners filed with the RTC a Motion to quash Search Warrants
alleging that the items are being used in the conduct of the lawful business of respondents and the same are not
being used in refilling Shellane and Gasul LPGs. RTC denied the said petitioner’s Motion, and was affirmed by CA.
Hence, this petition.

ISSUE: Whether or not Petitioners are liable for Trademark Infringement.

DECISION: YES. Section 155 of Republic Act No. 8293 identifies the acts constituting trademark infringement. As
can be gleaned in Section 155.1, mere unauthorized use of a container bearing a registered trademark in
connection with the sale, distribution or advertising of goods or services which is likely to cause confusion, mistake
or deception among the buyers/consumers can be considered as trademark infringement.

In Oblanca’s sworn affidavits, he stated that before conducting an investigation on the alleged illegal activities of
MASAGANA, he reviewed the certificates of trademark registrations issued by the Philippine Intellectual Property
Office in favor of Petron and Pilipinas Shell; that he confirmed from Petron and Pilipinas Shell that MASAGANA is
not authorized to sell, use, refill or distribute GASUL and SHELLANE LPG cylinder containers; that he and Alajar
monitored the activities of MASAGANA in its refilling plant station located within its compound at Governor’s
Drive, Barangay Lapidario, Trece Martires, Cavite City; that, using different names, they conducted two test-buys
therein where they purchased LPG cylinders bearing the trademarks GASUL and SHELLANE; that the said GASUL
and SHELLANE LPG cylinders were refilled in their presence by the MASAGANA employees; that while they were
inside the MASAGANA compound, he noticed stock piles of multi-branded cylinders including GASUL and
SHELLANE LPG cylinders; and that they observed delivery trucks loaded with GASUL and SHELLANE LPG cylinders
coming in and out of the MASAGANA compound and making deliveries to various retail outlets.
B35 Sehwani Incorporated v. In-N-Out Burger Inc.

FACTS:

Respondent IN-N-OUT Burger, Inc., a foreign corporation (California, USA), and not doing business in the
Philippines, filed before the Bureau of Legal Affairs of the IPO, an administrative complaint against petitioners
Sehwani, Inc. and Benita’s Frites, Inc. for violation of intellectual property rights, attorney’s fees and damages with
prayer for the issuance of a restraining order or writ of preliminary injunction.

Respondent, alleges that it is the owner of the tradename “IN-N-OUT” and trademarks “IN-N-OUT,” “IN-N-OUT
Burger & Arrow Design” and “IN-N-OUT Burger Logo” which are used in its business since 1948 up to the present.
These tradename and trademarks were registered in the United States as well as in other parts of the world.
Petitioner Sehwani allegedly had obtained a trademark registration for the mark “IN N OUT” (with the inside letter
O formed like a star) without its authority.

In their answer with counterclaim, petitioners alleged that respondent lack the legal capacity to sue because it was
not doing business in the Philippines and that it has no cause of action because its mark is not registered or used in
the Philippines. Petitioner Sehwani, Inc. also claimed that as the registered owner of the "IN-N-OUT" mark, it
enjoys the presumption that the same was validly acquired and that it has the exclusive right to use the mark.
Moreover, petitioners argued that other than the bare allegation of fraud in the registration of the mark,
respondent failed to show the existence of any of the grounds for cancellation thereof under Section 151 of
Republic Act (R.A.) No. 8293, otherwise known as The Intellectual Property Code of the Philippines.

The Bureau ruled in favor of In-N-Out and cancelled the registration of Shwani.

ISSUES:
1. WON Respondent has the legal capacity to sue for the protection of its trademarks albeit it is not doing business
in the Philippines

2. WON a ground exists for the cancellation of the Petitioners’ registration

HELD:

1. Yes. Section 160 RA No. 8293 provides for the right of foreign corporations to sue in trademark or service mark
enforcement action, provided that it meets the requirements under Section 3 thereof, which are a) Any
convention, treaty or agreement relation to intellectual property right or the repression of unfair competition
wherein Philippines is also a party; and b) An extension therein of reciprocal rights.

Moreover, Article 6 of The Paris Convention, which governs the protection of well-known trademarks, is a self-
executing provision and does not require legislative enactment to give it effect in the member country. The
essential requirement therein is that the trademark must be well-known in the country where protection is sought.
In this case, Director Beltran-Abelardo found that In-n-out Burger and Arrow Design is an internationally well
known mark as evidenced by its trademark registrations around the world and its comprehensive advertisements
therein.

2. Yes. Section 151(b) of RA 8293 provides that a petition to cancel a registration of a mark may be filed with the
Bureau of Legal Affairs by any person who believes that he is or will be damaged by the registration of a mark at
any time, if the registered mark becomes the generic name for the goods or services, or a portion thereof, for
which it is registered, or has been abandoned, or its registration was fraudulently or contrary to the provisions of
this Act, or if the registered mark is being used by or with the permission of, the registrant so as to misrepresent
the source of goods or services on or in connection with which the mark is used. The evidence showed that not
only did the petitioners use the IN-N-OUT Burger trademark for the name of their restaurant, but they also used
identical or confusingly similar mark for their hamburger wrappers and French-fries receptacles, thereby effectively
misrepresenting the source of the goods and services.

B36: TY vs. De Jemil

GR No. 182147, DECEMBER 15, 2010

FACTS: Petitioners are stockholders of Omni Gas Corporation ("Omni"). They are being suspected of engaging in
illegal trading of petroleum products and underfilling of branded LPG cylinders in violation of B.P. 33, as amended
by P.D. 1865. NBI Agents Marvin De Jemil and Edgardo Kawada conducted surveillance operations on Omni. On 15
April 2004, the NBI Agents carried out a test-buy. Using eight branded LPG cylinders from Shell, Petron and Total,
they went to Omni for refilling. Omni refilled the cylinders. The NBI agents paid more than P1500. LPG Inspector
Noel Navio found that the LPG cylinders were without LPG valve seals and one of the cylinders was actually
underfilled.

On 28 April 2004, Agent De Jemil obtained a search warrant from Pasig RTC branch 167. The NBI seized several
items from Omni's premises. Subsequently, Agent De Jemil filed his Complaint-Affidavit before the DOJ. The
Assistant City Prosecutor of Pasig found probable cause for violation of BP 33. This was later approved by Chief
State Prosecutor Jovencito Zuno.

Petitioners appealed the decision to the Secretary of Justice, who later reversed the decision of the Office of the
Chief State Prosecutor and viewed first, that the underfilling of one of the eight LPG cylinders was an isolated
incident and cannot give rise to a conclusion of underfilling, as the phenomenon may have been caused by human
error, oversight or technical error; second, on the alleged violation of refilling branded LPG cylinders sans written
authority, it found no sufficient basis to hold petitioners responsible for violation of Sec. 2 (c) of BP 33 , there was
no proof that the branded LPG cylinders seized from Omni belong to another company or firm, holding that the
simple fact that the LPG cylinders with markings or stamps of other petroleum producers cannot by itself prove
ownership by said firms or companies as the consumers who take them to Omni fully owned them having
purchased or acquired them beforehand.

NBI Agent De Jemil moved for reconsideration. However, it was denied. He thus filed a petition for certiorari under
Rule 65 with the Court of Appeals.

The Court of Appeals affirmed the decision of Secretary of Justice. It later reversed itself and reinstated the
Resolution of the Chief State Prosecutor. Citing Sec. 1 (1) and (3) of BP 33, as amended, which provide for the
presumption of underfilling, the CA held that the actual underfilling of an LPG cylinder falls under the prohibition of
the law which does not require for the underfilling to be substantial and deliberate and strong probable violation
of "refilling of another company’s or firm’s cylinders without such company’s or firm’s written authorization"

ISSUE: Whether or not petitioners can be held liable involving criminal infringement of property rights under Sec.
155 of RA 8293?

HELD: Yes. The court held under Sec. 155.159 of RA 8293 can be gleaned that "mere unauthorized use of a
container bearing a registered trademark in connection with the sale, distribution or advertising of goods or
services which is likely  to cause confusion, mistake or deception among the buyers/consumers can be considered
as trademark infringement”. The court affirmed the presence of infringement involving the unauthorized sale
of Gasul and Shellane LPG cylinders and the unauthorized refilling of the same duly attested to and witnessed by
NBI agents who conducted the surveillance and test-buys. What the law manifestly prohibits is the refilling of a
branded LPG cylinder by a refiller who has no written authority from the brand owner. A refiller cannot and ought
not to refill branded LPG cylinders if it has no written authority from the brand owner. In line with DOE Circular No.
2000-05-007brand owners are deemed owners of their duly embossed, stamped and marked LPG cylinders even if
these are possessed by customers or consumers. The Court recognizes this right pursuant to our laws, the
Intellectual Property Code.

Evidently, this pernicious practice of tampering or changing the appearance of a branded LPG cylinder to look like
another brand violates the brand owners’ property rights as  infringement  under Sec. 155.1 of RA 8293.

THE EAST PACIFIC MERCHANDISING CORPORATION vs. THE DIRECTOR OF PATENTS and LUIS P. PELLICER

G.R. No. L-14377, December 29, 1960 

FACTS: Marcelo T. Pua filed with the Office of the Director of Commerce an application for the registration under
Act 666 of the composite trademark consisting of the word "Verbena" and representation of a Spanish lady, with
specific evident set of designs. Respondent Luis P. Pellicer filed an opposition to the application on the following
grounds: (a) that the picture of a lady is common in trade and the name "Verbena" is the generic name of a flower
and, therefore, neither may be exclusively appropriated or registered by the applicant. 
The Director of Patents favored the Pellicer, alleging that the term "Verbena" is "generically descriptive or
misdescriptive of the products, namely lotion, face powder, hair pomade and brillantine, while the representation
of a Spanish lady is not only deceptively misdescriptive of the source or origin, but also common in trade," and,
resulting to the denial of East Pacific’s registration. 

ISSUE: Whether or not the term “Verbena” is registerable.

HELD: The term "Verbena" is descriptive of a whole genus of garden plants with fragrant flowers used in
connection with cosmetic products. Regardless of other connotations of the word, the use of the term cannot be
denied to other traders using such extract or oils in their own products. It follows that the Director of Patents
correctly held the term to be non-registerable in the sense that petitioner company would be entitled to
appropriate its use to the exclusion of others legitimately entitled, such as oppositor Pellicer.

In a leading case, Caswell vs. Davis, 17 Am. Rep. 233, 241, 242, the court, on a similar issue, said: 

There is no principle more firmly settled in the law of trademarks, than that words or phrases which have been in
common use and which indicate the character, kind, quality and composition of the thing, may not be
appropriated by any one to his exclusive use. In the exclusive use of them the law will not protect. . . . 

The claim that the petitioner is entitled to registration because the term "Verbena" has already acquired a
secondary significance is without merit. The provisions of law (Rep. Act No. 166, sec. 4) require that the trademark
applied for must have "become distinctive of the applicant's goods", and that a prima facie proof of this fact exists
when the applicant has been in the "substantially exclusive and continuous use thereof as a mark or tradename,
for five years next preceding the date of the filing of the application for its registration".

B38

UNIVERSAL RUBBER PRODUCTS, INC., petitioner, vs.

HON. COURT OF APPEALS, CONVERSE RUBBER CORPORARION, EDWARDSON MANUFACTURING CO., INC. AND
HON. PEDRO C. NAVARRO, respondents.

FACTS:

Two respondent corporations sued the petitioner for unfair competition. Respondent Judge issued a
subpoena duces tecum on February 13, 1968, directing the treasurer of the present petitioner to bring with him to
the lower court "all sales invoices, sales books and ledgers wherein are recorded the sales of Plymouth Star Player
rubber shoes from the time the corporation started manufacturing and selling said shoes up to the present.

Petitioner submits a contrary opinion and insists that the question of liability of petitioner should be
determined first before discovery by means of a subpoena duces tecum is allowed: that respondent Converse is a
foreign corporation not licensed to do business in the Philippines and that Edwardson is merely its licensee that
respondent Converse has no goodwill to speak of and that it has no registrable right over its own names

Petitioner filed a motion that the subpoena duces tecum be quashed on the grounds that: (1) the said
subpoena is both Unreasonable and oppressive as the books and documents caned for are numerous and
voluminous; (2) there is no good cause shown for the issuance thereof; and (3) the books and documents are not
relevant to the case pending below. Judge issued the first controverted order on May 6, 1968, denying the motion
to quash the subpoena duces tecum.

Petitioner filed a motion to reconsider its order denying the motion to quash the subpoena duces tecum. ,
respondent Judge. issued the second controverted order on June 28, 1968, denying the motion for
reconsideration, hence, he appealed to the CA but denied the same for lack of merit

ISSUE:

WON the issuance of the "subpoena duces tecum" is proper in a suit for unfair competition.

RULING: YES

. In a suit for unfair competition, it is only through the issuance of the questioned "subpoena duces tecum " that
the complaining party is afforded his full rights of redress, thus we must uphold the order of the court  a
quo denying the motion. of the petitioner to quash the "subpoena duces tecum" 

The argument that the petitioner should first be found guilty unfair competition before an accounting for
purposes of ascertaining the amount of damages recoverable can proceed, stands without merit.. The complaint
for unfair competition is basically a suit for "injunction and damages"

As We said earlier, the establishment of the petitioner burned down together with all the records sought to be
produced by the questioned "subpoena duces tecum," hence this case has become moot and academic.

In order to entitle a party to the issuance of a "subpoena duces tecum ", it must appear, by clear and
unequivocal proof, that the book or document sought to be produced contains evidence relevant and material
to the issue before the court, and that the precise book, paper or document containing such evidence has been
so designated or described that it may be identified. 

A "subpoena duces tecum once issued by the court may be quashed upon motion if the issuance thereof is
unreasonable and oppressive or the relevancy of the books, documents or things does not appear, or if the
persons in whose behalf the subpoena is issued fails to advance the reasonable cost of production thereof.

As a general rule, on obtaining an injunction for infringement of a trademark, complainant is entitled to an

accounting and recovery of defendant's profits on the goods sold under that mark, as incident to, and a part of,
his property right, and this rule applies in cases of unfair competition

In the instant case, in determining whether the books subject to the subpoena duces tecum are relevant and
reasonable in relation to the complaint of private respondent for unfair competition We have to examine Republic
Act No. 166,' CHAPTER V.—Rights and Remedies, Sec 23

In recovering the loss suffered by the aggrieved party due to unfair competition," Sec. 23 of R.A. 166 grants the
complainant three options within which to ascertain the amount of damages recoverable, either (1) the reasonable
profit which the complaining party would have made, had the defendant not infringed his said rights; or (2) the
profit which the defendant actually made out of the infringement; or (3) the court may award as damages a
reasonable percentage based upon the amount of gross sales of the defendant of the value of the services in
connection with which the mark or tradename was issued in the infringement of the rights of the complaining
party.

the case of Converse Rubber Corporation vs. Jacinto Rubber & Plastic Co., Inc., 11 where We explained:

The disability of a foreign corporation from suing in the Philippines is limited to suits to enforce
any legal of contract rights arising from, or growing out, of any business which it has transacted
in the Philippine Islands ... On the other hand, where the purpose of the suit is "to protect its
reputation, its corporate name, its goodwill, whenever that reputation, corporate name or
goodwill have, through the natural development of its trade, established themselves", an
unlicensed foreign corporation may sue in the Philippines. So interpreted by the Supreme
Court, it is clear that Section 29 of the Corporation Law does not disqualify plaintiff-appellee
Converse Rubber, which does not have a branch office in any part of the Philippines and is not
"doing business" in the Philippines, from filing and prosecuting this action for unfair
competition.

La Estrella Distillery Inc., petitioner

vs.

The Director of Patents, Cheng Chiong, and Foo U. Ching and Co., respondents

Facts:

- La Estrella Distillery, Inc. (hereinafter referred to as La Estrella) and Cheng Chiong & Foo U. Ching
Company (Cheng Chiong for short) are both holders of Supplemental Registration label trademarks.
- Before the Patent Office, proceedings for the cancellation of La Estrella's label by trademark registration
No. SR-13 were instituted by Cheng Chiong under Section 19-A of Republic Act No. 166. After answer by La
Estrella and after trial on the merits, the Director of Patents found that the two label trademarks are
distinctly differently in appearance and possess different identifying marks which make each satisfy the
statutory requirement for registration — the requirement of being capable of distinguishing the particular
goods upon which each is used. The Director accordingly held that no damage to Cheng Chiong could
possibly result from La Estrella's registration and use of its own label trademark and dismissed the petition
for its cancellation.
- Despite this favorable decision, La Estrella moved for its reconsideration praying for the elimination of
"the findings made therein that the label trademarks of the petitioner and respondents are distinctly
different" and "that in lieu thereof a pronouncement be made to the effect that said label trademarks are
similar." The reason given for this motion for reconsideration is that the matter of similarly or dissimilarity
has not been raised in issue and that in fact the parties have impliedly admitted that the labels are similar.
- Its motion for reconsideration having been denied, La Estrella has taken the present appeal and here
urges the same contention that the Director of Patents has committed error in making a pronouncement
in his decision that the two labels in question are not similar, contrary to the pleadings and evidence
presented by the parties.

Ruling:
- This appeal is without merit. While appellant attacks the grounds upon which the decision of the Director
of Patents is based, it does not question the dispositive part thereof because it is favorable to it. Appellant
claims that the matter of dissimilarity of the two labels has never been put in issue. This is not true. The
whole theory upon which this case was presented, tried and decided in the Patent Office was predicated
mainly on this question.
- The pleadings of the parties disclose their respective contentions. The petition for cancellation alleges,
among others: (1) That La Estrella's label "is not and cannot be a trademark as defined by law" because it
is a "common label affixed to rice wine, Chinese wine and similar goods and also to other kinds of goods."
(2) That "it is also used by petitioner (Cheng Chiong) and other manufacturers of same or similar
products." (3) That therefore petitioners (Cheng Chiong) deem themselves "prejudiced and/or injured
damage by said registration."
- The answer of La Estrella avers: (1) That its trademark "meets all the necessary elements of a valid
trademark" in that it is "so disposed as to attract attention, impress the memory, and advertises more
effectually the origin of the article to which it is attached." (2) That it has been long and continuously used
by it "for no other purpose than to further distinguish the products of said respondent (La Estrella) from
those of its competitors." (3) "That the trademark in question is the original and exclusive creation of
respondent" (La Estrella).
- During the trial, Cheng Chiong, in support of their claim that La Estrella's label trademark is "publici juris"
and therefore incapable of distinguish La Estrella's goods, presented over a dozen labels of different
merchants including his own. To counteract this, La Estrella exhibited its own label in color and other
evidence to prove that its trademark sufficiently identifies and differentiates its merchandise from those
of its competitors.
- The record disclose similar testimonies of witnesses and statements of counsel of both parties sustaining
respectively their opposing stands.
- In disposing of and denying the motion for reconsideration of appellant La Estrella, the Director of Patents
correctly ruled:

It is alleged in said motion that the Director of Patents erred (1) in finding that the label trade-mark of the
petitioner and of the respondent-registrant are not similar, and (2) in making pronouncement on why
they are not similar.

Under Sec. 19-A Rep. Act 166, as amended, a label, used as a trademark, may be registered on the
Supplemental Register provided (1) it is not a mark prescribed or prohibited under paragraph (a), (b), (c)
and (d) of Sec. 4 of the same acts; (2) it is capable of distinguishing the goods upon it is used; (3) it had
been used by the applicants for registration for one year next preceding the filing of the application.

Under the same Sec. 19-A, a person may petition for the cancellation of the registration on the
Supplementary Register was not label, used as a trademark, provided (1) the registrant was not entitled to
register the mark at the time he filed his application for its registration; and (2) provided the register of
the registered mark.

Under the same Sec. 19-A, among the facts that they may be established to show that the registrant was
not entitled to the registration of the mark sought to be cancelled are (1) the mark was prescribed under
paragraph (a), (b), (c) and (d), of Sec. 4 of the Rep. Act 166, as amended; (2) the mark was and is not
capable of distinguishing the registrant's goods; (3) the registrants had never used the mark or had not
actually used the mark for one year next preceding the filing of his application for registration; and (4) the
registrants had abandoned his mark after registration. But although the petitioner for cancellation may
succeed in establishing one or all of the above four facts, his petition for cancellation will nevertheless be
dismissed, under the same Sec. 19-A unless he is able clearly to establish that he will damaged by the
continuance on the register of the mark he seeks to cancel.
 Of the two grounds alleged by the petitioner for cancellation (loser in this case, for canceling the
respondent's mark, the one pertinent to the instant motion of the respondent (winner in this case) for
reconsideration, is the following that respondent's label trademark was and is common to the trade,
being used not only by the respondent, but by the petitioner and by the New Occidental Distillery as well.
If this allegation be true, then the respondent's trademark is not only incapable of distinguishing
respondent's goods, but its continuance on the register will damage the petitioner for cancellation.

To determine whether respondent's label trademark was incapable of distinguishing respondent's goods
and whether its continuance on the register would damage the petitioner for cancellation, it was
necessary for this tribunal to examine the label trademark of the respondent, the petitioner, and the New
Occidental Distillery and to make a finding thereon. The finding was that the label trademark were
different; that therefore, respondent's goods, the petitioner for cancellation would not be damaged by
the continuance on the registers of the respondent's label trademark, and petitioner's petition for
cancellation should be dismissed.

B41 Sterling Products International Inc. v. Farbenfabriken Bayer Aktiengsellschaft, GR L-19906, 30 April 1969, En
Banc, Sanchez [J]

Facts: The Bayer Cross in circle “trademark was registered in Germany in 1904 to Farbenfabriken vorm.

Friedr. Bayer (FFB), successor to the original Friedr. Bauyer et. Comp., and predecessor to Farbenfabriken Bayer
aktiengessel craft (FB2). The “Bayer, and “Bayer Cross in circle” trademarks were acquired by Sterling Drug Inc.
when it acquired FFB’s subsidiary Bayer Co. of New York as a result of the sequestration of its assets by the US
Alien Property Custodian during World War I. Bayer products have been known in Philippines by the close of the
19th century. Sterling Drugs, Inc., however, owns the trademarks “Bayer” in relation to medicine. FBA attempted
to register its chemical products with the “Bayer Cross in circle” trademarks. Sterling Products International and
FBA seek to exclude each other from use of the trademarks in the Philippines. The trial court sustained SPI’s right
to use the Bayer trademark for medicines and directed FBA to add distinctive word(s) in their mark to indicate their
products come from Germany.” Both appealed.

Issue: What is the principle of actual use in trademark law?

Ruling: A rule widely accepted and firmly entrenched because it has come down through the years is that actual
use in commerce or business is a prerequisite to the acquisition of the right of ownership over a trademark. This
rule is spelled out in our. Trademark Law thus:

SEC. 2-A. Ownership of trade-marks, trademark names and service-mark; how acquired. — Anyone who
lawfully produces or deals in merchandise of any kind or who engages in any lawful business, or who
renders any lawful service in commerce, by actual use thereof in manufacture or trade, in business, and in
the service rendered, may appropriate to his, exclusive use a trademark, a trade-name, or a service-mark
not so appropriated by another, to distinguish his merchandise, business, or service from the
merchandise, business or service of others. The ownership or possession of a trademark, trade-name,
service mark, heretofore or hereafter appropriated, as in this section provided, shall be recognized and
protected in the same manner and to the same extent as are other property rights known to the law.

In this case, plaintiff cannot now say that the present worth of its BAYER trademarks it owes solely to its own
efforts; it is not insulated from the charge that as it marketed its medicines it did so with an eye to the goodwill as
to quality that defendants' predecessor had established.
Plaintiff is not the first user thereof in the Philippines. The trademarks do not necessarily link plaintiff with the
public, but defendants ask the Court to delist plaintiff's BAYER trademarks for medicine from the Principal Register,
claiming right thereto for said use. Said trademarks had been registered since 1939 by plaintiff's predecessor, The
Bayer Co., Inc. Defendants' claim is stale; it suffers from the defect of non-use. It was not plaintiff's predecessor but
defendant's namely Farbenfabriken or Bayer Germany that first introduced the medical products into the
Philippine market and household with the Bayer mark half a century ago. Plaintiff may hold on to its BAYER
trademarks for medicines. And defendants may continue using the same trademarks for insecticides and other
chemicals, not medicines.

B42 Asia Brewery Inc. v. Court of Appeals

GR 103543, 5 July 1993

Facts:

San Miguel Corporation filed a complaint against Asia Brewery Inc., for infringement of trademark and unfair
competition on account of Asia Brewery Inc. “BEER PALE PILSEN” or “BEER NA BEER” product which has been
competing with San Miguel’s “SAN MIGUEL PALE PILSEN” for a share of the local beer market. A decision was
rendered by the trial Court, dismissing San Miguel’s complaint because Asia Brewery Inc., has not committed
trademark infringement or unfair competition against San Miguel Corporation. San Miguel Corporation appealed
to the Court of Appeals which reversed decision of the trial court in which Asia Brewery Incorporated found guilty
of infringement of trademark and unfair competition. Hence a petition 

Issue:

1. Whether the words “pale pilsen” may be exclusively appropriated and used by San Miguel Corporations

2. Whether there is confusing similarity between the two trademarks.

Held:

1. No, The fact that the words “pale pilsen” are part of Asia Brewery Inc., trademark does not constitute an
infringement of San Miguel Corporation’s trademark: SAN MIGUEL PALE PILSEN, for "pale pilsen" are
generic words descriptive of the color ("pale"), of a type of beer ("pilsen"), which is a light bohemian beer
with a strong hops flavor that originated in the City of Pilsen in Czechoslovakia and became famous in the
Middle Ages.

The words “pale pilsen” may not be appropriated by SMC for its exclusive use even if they are part of its
registered trademark: “San miguel Pale Pilsen”. No one may appropriate generic or descriptive words.
They belong to the public domain.

2. No, There is hardly any dispute that the dominant feature of San Miguel Corporation trademark is the
name of the product: “San Miguel Pale Pilsen”, written in white Gothic letters with elaborate serifs at the
beginning and end of the letters "S" and "M" on an amber background across the upper portion of the
rectangular design. On the other hand, the dominant feature of Asia Brewery Inc., trademark is the name:
“Beer Pale Pilsen”, with the word "Beer" written in large amber letters, larger than any of the letters
found in the San Miguel Corporation label.

The trial court perceptively observed that the word "Beer" does not appear in San Miguel Corporation
trademark, just as the words "San Miguel" do not appear in Asia Brewery trademark. Hence, there is
 absolutely no similarity in the dominant features of both trademarks. Neither in sound, spelling or
appearance can Beer Pale Pilsen be said to be confusingly similar to San Miguel Pale Pilsen. No one who
purchases Beer Pale Pilsen can possibly be deceived that it is San Miguel Pilsen. No evidence was
presented by San Miguel be proven otherwise.

BRISTOL MYERS CO. vs DIRECTOR OF PATENT

Facts: Bristol Myers Co., a corporation of the State of Delaware, U.S.A., filed on January 6, 1959 an opposition to
the application. Said oppositor is the owner in the Philippines of the trademark "BUFFERIN" under Certificate of
Registration No. 4578 issued by the Philippine Patent Office on March 3, 1954. Its trademark is also registered in
the United States under Certificate of Registration No. 566190 issued on November 4, 1952. It was first used in the
Philippines on May 13, 1953. The product covered by "BUFFERIN" also belongs to Class 6, Medicines and
Pharmaceutical Preparations. Designated as "Antacid analgesic", it is intended for relief in cases of "simple
headaches, neuralgia, colds, menstrual pain and minor muscular aches."

The thrust of oppositor's contention was that the registration of the applicant's trademark "BIOFERIN would
violate its rights and interests in its registered trademark "BUFFERIN" as well as mislead and confuse the public as
to the source and origin of the goods covered by the respective marks, in view of the allegedly practically the same
spelling, pronunciation and letter-type design of the two trademarks covering goods of the same class.

Parties filed a joint petition stipulating as to the facts and submitting the case upon the issue of whether or not,
considering all the factors involved, in both trademarks — as the parties would discuss in their memoranda,—
there will be such confusing similarity between the two trademarks as will be likely to deceive the purchasing
public.

The Director of Patents rendered a decision granting the petition for registration and dismissing the opposition, on
the ground that, all factors considered the trademarks in question are not confusingly similar, so that the damage
feared by the oppositor will not result.

Hence, this petition.

Issue: W/N trademarks "BIOFERIN" and "BUFFERIN", as presented to the public in their respective labels,
confusingly similar.

Held: No, the trademarks are not confusingly similar.

In determining whether two trademarks are confusingly similar, the test is not simply to take their words and
compare the spelling and pronunciation of said words. Rather, it is to consider the two marks in their entirety, as
they appear in the respective labels, in relation to the goods to which they are attached.

Applying this test to the trademarks involved in this case, it is at once evident that the Director of Patents did not
err in finding no confusing similarity. For though the words "BIOFERIN" and "BUFFERIN" have the same suffix and
similar sounding prefixes, they appear in their respective labels with strikingly different backgrounds and
surroundings, as to color , size and design.

Accordingly, taken as they will appear to a prospective customer, the trademark in question are not apt to
confuse. Furthermore, the product of the applicant is expressly stated as dispensable only upon doctor's
prescription, while that of oppositor does not require the same. The chances of being confused into purchasing
one for the other are therefore all the more rendered negligible. Although oppositor avers that some drugstores
sell "BIOFERIN" without asking for a doctor's prescription, the same if true would be an irregularity not
attributable to the applicant, who has already clearly stated the requirement of a doctor's prescription upon the
face of the label of its product.
B48
Lyceum of the Philippines v. CA
G.R. No. 101897, March 5, 1993

Facts:
Petitioner is an educational institution duly registered with the Securities and Exchange Commission (SEC).
When it first registered with the SEC on 21 September 1950, it used the corporate name Lyceum of the Philippines,
Inc. and has used that name ever since.

On 24 February 1984, petitioner instituted proceedings before the SEC to compel the private respondents,
which are also educational institutions, to delete the word "Lyceum" from their corporate names and permanently
to enjoin them from using "Lyceum" as part of their respective names.Some of the private respondents actively
participated in the proceedings before the SEC, the dates of their original SEC registration being set out below
opposite their respective names:
Western Pangasinan Lyceum — 27 October 1950
Lyceum of Cabagan — 31 October 1962
Lyceum of Lallo, Inc. — 26 March 1972
Lyceum of Aparri — 28 March 1972
Lyceum of Tuao, Inc. — 28 March 1972
Lyceum of Camalaniugan — 28 March 1972

Petitioner had sometime before commenced in the SEC a proceeding against the Lyceum of Baguio, Inc. to
require it to change its corporate name and to adopt another name not "similarto or identical" with that of
petitioner. The SEC held that the corporate name of petitioner and that of the Lyceum of Baguio, Inc. were
substantially identical because of the presence of a "dominant" word, i.e., "Lyceum," the name of the geographical
location of the campus being the only word which distinguished one from the other corporate name. The SEC also
noted that petitioner had registered as a corporation ahead of the Lyceum of Baguio, Inc. in point of time, and
ordered the latter to change its name to another name "not similar or identical [with]" the names of previously
registered entities.
Petitioner then wrote all the educational institutions it could find using the word "Lyceum" as part of their
corporate name, and advised them to discontinue such use of "Lyceum." SEC ruled in favor of petitioner, but the
same was reversed on appeal to the SEC en banc, CA affirmed.

Issues:

(1) Whether or not the word ‘Lyceum’ has acquired a secondary meaning in favor of petitioner.

(2) Whether or not petitioner is infringed by respondent institutions’ corporate names.

Held:
(1) No. Under the doctrine of secondary meaning, a word or phrase originally incapable of exclusive
appropriation with reference to an article in the market, because geographical or otherwise descriptive
might nevertheless have been used so long and so exclusively by one producer with reference to this
 article that, in that trade and to that group of the purchasing public, the word or phrase has come to
mean that the article was his produce. The Court believe the appellant failed to satisfy the
aforementioned requisites. While the appellant may have proved that it had been using the word
‘Lyceum’ for a long period of time, this fact alone did not amount to mean that the said word had
acquired secondary meaning in its favor because the appellant failed to prove that it had been using the
same word all by itself to the exclusion of others. More so, there was no evidence presented to prove that
confusion will surely arise if the same word were to be used by other educational institutions.

(2) No. We do not consider that the corporate names of private respondent institutions are “identical with, or
deceptively or confusingly similar” to that of the petitioner institution. True enough, the corporate names
of private respondent entities all carry the word “Lyceum” but confusion and deception are effectively
precluded by the appending of geographic names to the word “Lyceum.” Thus, we do not believe that the
“Lyceum of Aparri” can be mistaken by the general public for the Lyceum of the Philippines, or that the
“Lyceum of Camalaniugan” would be confused with the Lyceum of the Philippines.  We conclude and so
hold that petitioner institution is not entitled to a legally enforceable exclusive right to use the word
“Lyceum” in its corporate name and that other institutions may use “Lyceum” as part of their corporate
names.
[ GR No. L-29123, Mar 29, 1972 ]

SY CHNG v. GAW LIU

Facts:

The case arose from a petition filed by Sy Chng to cancel a certificate of registration No. 10637, of a trademark,
LION and TIGER issued by the Philippines Patent Office on December 12, 1963 in favor of respondent Gaw Liu.  The
application was filed on February 20 of that year, the use of such trademark on his product consisting of dyestuffs
allegedly dating back to 1956.  Petitioner Sy Chng did seek such a cancellation on the allegation that he had
previously used such a trademark since 1952 on aniline basic colors or goods similar to those manufactured or sold
by respondent whom he accused of fraudulently appropriating and registering the same with full knowledge that
he was not the owner.  There was a denial by respondent. 

"Petitioner's principal witness is Sy Chang, his assistant manager, who testified that he has been connected with
Venus Commercial since 1949 up to the present.  His firm allegedly is engaged in the manufacture of dyestuff,
crayone, stationery, and school supplies, and in the sale of dyestuff the trademark LION and TIGER label has been
adopted since 1952.  The witness identified a LION-TIGER label being used by Petitioner.  It was designed for Venus
Commercial in 1952 by Mr. Gaudencio Eugenio, a free lance artist who confirmed this fact by testifying that around
June, 1952, upon request of Sy Chang, he designed a label for dyestuff, the LION & TIGER label, for which he was
duly compensated.  The design was in turn first printed by Majestic Press owned by the other witness, Antonio T.
Cheng, who affirmed that he knew Venus Commercial because of a printing job in 1952 pertaining to the 10,000
pieces of LION-TIGER label. 

As for the defense of respondent, this is how the decision summarized matters:  "The Respondent also presented
himself and one witness, Pua Chong Beng.  The latter's testimony, however, was stricken from the record, upon
motion of the Petitioner's counsel because said witness failed to submit himself to further cross-examination, and
it was ruled during the hearing that his failure to further appear would result in the striking off of his testimony.  
Gaw Liu himself next took the witness stand and testified that he was engaged in chemical manufacturing since the
Japanese occupation, with offices at Magdalena St., Manila.  Thereafter, in 1947, he used and adopted the brand
TIGER for his dyestuff and later, he allegedly adopted LION & TIGER, made some sales, as shown by an invoice
dated December 10, 1951 issued to Pue Chong Beng of Zamboanga. 
ISSUE:

WON THERE IS A VIOLATION IN TRADEMARK

RULING:

Appellant would impress on the Court that he did present the proof required by law to invest him with exclusive,
continuous adoption and use of the trademark contrary to the finding of the Director of Patents, who moreover
should have not relied on the weak and inconsistent testimony of the witnesses for petitioner and should not have
admitted certain proofs regarding the actual and positive use of the trademark in question by the appellee.  
Appellant is oblivious of the controlling principle of law set forth in Chua Che vs. Philippines Patent Office. As
worded in the opinion of Justice Paredes:  "At the very outset, we would like to state that in cases of the nature of
the one at bar, only questions of law should be raised, and the only exception to this rule, meaning that findings of
facts may be reviewed, is when such findings are not supported by substantial evidence  (Sec. 2, Rule 44, Revised
Rules).  The finding of the Director of Patents Office to the effect that opposer-appellee Sy Tuo had priority of use
and adoption of the trademark 'X-7', is for all intents and purposes, one of fact.   This being the case, such finding
becomes conclusive to this Court.  Even on this sole issue alone, the petition for review must fall." To the same
effect is this excerpt from the later case of Lim Kiah vs. Kaynee Company:  "It is well-settled that we are precluded
from making such an inquiry as the finding of facts of the Director of Patents in the absence of any showing that
there was a grave abuse of discretion is binding on us.  As set forth by Justice Makalintal in Chung Te vs. Ng Kian
Giab:  'The rule is that the findings of fact by the Director of Patents are conclusive on the Supreme Court provided
they are supported by substantial evidence.

B50 246 Corporation v. Judge Daway, GR 157216, 20 November 2003

Case Digest by; Tejada, Mac Arthur V.

FACTS:

 This is is a petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure assailing the
November 28, 2002 Decision 1 of the Court of Appeals in CA-G.R. SP No. 64660 which dismissed the
petition for certiorari filed by petitioner, as well as the Resolution 2 dated February 13, 2003 denying its
motion for reconsideration.chanrob1es virtua1 1aw 1ibrary

 In 1996, Respondent 246 Corp (herein Petitioner) operated in Quezon City a KTV Bar using the trade name
“Rolex Music Lounge" and its newspaper advertisement “Rolex Music Lounge, KTV, Disco & Party Club”;

 On November 26, 1998, Petitioners Montres Rolex S.A. and Rolex Centre Phil., Limited (herein
Respondents), owners/proprietors of Rolex and Crown Device, filed against Respondent 246 Corporation
(herein Petitioner) the instant suit for trademark infringement and damages with prayer for the issuance
of a restraining order or writ of preliminary injunction before the Regional Trial Court of Quezon City:

Argument/Complaint of Petitioner Rolex Phils:

 for using the mark "Rolex" in its business name "Rolex Music Lounge" and in its newspaper
advertisement is liable for trademark infringement;

Argument of Respondent 246 Corp.:

  In its answer raising special affirmative defences, respondents have no cause of action because
no trademark infringement exist;

 that no confusion would arise from the use by petitioner of the mark "Rolex" considering that its
entertainment business is totally unrelated to the items catered by respondents such as watches,
clocks, bracelets and parts thereof;

 On July 21, 2000, Respondent 246 Corp. (herein Petitioner) filed a motion for preliminary hearing on its
affirmative defenses. Subsequently, on motion of petitioner, the trial court issued a subpoena ad
testificandum requiring Atty. Alonzo Ancheta to appear at the preliminary hearing. Petitioner Rolex Phils
(herein Respondents), in the meantime, filed a Comment and Opposition to the motion for preliminary
hearing and a motion to quash the subpoena ad testificandum.

 In an Order dated October 27, 2000, the trial court quashed the subpoena ad testificandum and denied
petitioner’s motion for preliminary hearing on affirmative defenses with motion to dismiss.

 With the denial of the motion for reconsideration on March 16, 2001, petitioner filed a petition
for certiorari with the Court of Appeals contending that the trial court gravely abused its discretion in
issuing the October 27, 2000 and March 16, 2001 orders.

 On November 28, 2002, the Court of Appeals dismissed the petition. The motion for reconsideration filed
by petitioner was denied.

ISSUE:

1) WON THE COURT OF APPEALS COMMITTED A GRAVE ABUSE OF DISCRETION IN DISMISSING THE PETITION
FOR CERTIORARI AGAINST RESPONDENT JUDGE DAWAY

2) WON RESPONDENT JUDGE DAWAY WAS CORRECT (IN DENYING THE MOTION FOR PRELIMINARY HEARING
WITH MOTION TO DISMISS FILED BY PETITIONER 246 CORP REGARDING THE TRADEMARK INFRINGEMENT
CASE FILED AGAINST IT BY ROLEX PHILS.)

3) WON 246 CORP IS LIABLE FOR TRADEMARK INFRINGEMENT

SC HELD:

The petition for review on certiorari filed by petitioner is DENIED. The November 28, 2002 Decision and the
February 13, 2003 Resolution of the Court of Appeals in CA-G.R. SP No. 64660 which dismissed the petition
for certiorari filed by petitioner are AFFIRMED, based on the following:

On Issue No. 1:

In the case at bar, the Court of Appeals did not err in finding that no abuse of discretion could be ascribed to the
trial court’s denial of petitioner’s motion for preliminary hearing on its affirmative defenses with motion to dismiss.
The issue of whether or not a trademark infringement exists, is a question of fact that could best be determined by
the trial court.

Grave abuse of discretion implies such capricious and whimsical exercise of judgment as equivalent to lack of
jurisdiction, or, in other words, where the power is exercised in an arbitrary or despotic manner by reason of
passion or personal hostility, and it must be so patent and gross as to amount to an evasion of positive duty or to a
virtual refusal to perform the duty enjoined or to act at all in contemplation of law. None of these was committed
by the trial court; hence, the Court of Appeals correctly dismissed the petition.

On Issue No. 2:

Yes, the trial court correctly denied petitioner’s motion for preliminary hearing on its affirmative defenses with
motion to dismiss when it decided on the merits of the Petitioner 246 Corp. Motion and Respondent Rolex’s
Comment and Opposition; it is presumed that all matters within an issue raised in a case were passed upon by the
court. In the absence of evidence to the contrary, the presumption is that the court a quo discharged its task
properly;

The issue of whether or not a trademark infringement exists, is a question of fact that could best be determined by
the trial court.

On Issue No. 3:

The argument of Petitioner 246 Corp that its product/service (KTV Bar) is unrelated to the product of Rolex Centre
Phils (watches, clocks and bracelet) is covered under Section 123.1 (f) of RA 8293, which provides:

Sec. 123. Registrability. — 123.1. A mark cannot be registered if it:chanrob1es virtual 1aw library

x          x          x

(f) Is identical with, or confusingly similar to, or constitutes a translation of a mark considered well-known
in accordance with the preceding paragraph, which is registered in the Philippines with respect to goods or
services which are not similar to those with respect to which registration is applied for: Provided, That use
of the mark in relation to those goods or services would indicate a connection between those goods or
services, and the owner of the registered mark: Provided, further, That the interest of the owner of the
registered mark are likely to be damaged by such use; (Emphasis supplied)

A junior user of a well-known mark on goods or services which are not similar to the goods or services, and
are therefore unrelated, to those specified in the certificate of registration of the well-known mark is
precluded from using the same on the entirely unrelated goods or services, subject to the following
requisites, to wit:chanrob1es virtual 1aw library

1. The mark is well-known internationally and in the Philippines. Under Rule 102 of the Rules and
Regulations on Trademarks; Service Marks, Trade Names and Marked or Stamped Containers, 17 in
determining whether a mark is well known, the following criteria or any combination thereof may be
taken into account:chanrob1es virtual 1aw library

(a) the duration, extent and geographical area of any use of the mark, in particular, the duration, extent
and geographical area of any promotion of the mark, including advertising or publicity and presentation,
at fairs or exhibitions, of the goods and/or services to which the mark applies;

(b) the market share in the Philippines and in other countries, of the goods and/or services to which the
mark applies;

(c) the degree of the inherent or acquired distinction of the mark;

 (d) the quality-image or reputation acquired by the mark;

(e) the extent to which the mark has been registered in the world;

(f) the exclusivity of the registration attained by the mark in the world;

(g) the extent to which the mark has been used in the world;

(h) the exclusivity of use attained by the mark in the world;

(i) the commercial value attributed to the mark in the world;

(j) the record of successful protection of the rights in the mark;

(k) the outcome of litigations dealing with the issue of whether the mark is a well-known mark; and

(l) the presence of absence of identical or similar marks validly registered for or used on identical or similar
goods or services and owned by persons other than the person claiming that his mark is a well-known
mark.

2. The use of the well-known mark on the entirely unrelated goods or services would indicate a connection
between such unrelated goods or services and those goods or services specified in the certificate of
registration in the well known mark. This requirement refers to the likelihood of confusion of origin or
business or some business connection or relationship between the registrant and the user of the mark.

3. The interests of the owner of the well-known mark are likely to be damaged. For instance, if the
registrant will be precluded from expanding its business to those unrelated good, or services, or if the
interests of the registrant of the well-known mark will be damaged because of the inferior quality of the
good or services of the user. 18

However, the Court cannot yet resolve the merits of the present controversy considering that the requisites for
the application of Section 123.1(f), which constitute the kernel issue at bar, clearly require determination facts
of which need to be resolved at the trial court. The existence or absence of these requisites should be addressed
in a full blown hearing and not on a mere preliminary hearing. The respondent must be given ample opportunity
to prove its claim, and the petitioner to debunk the same.

GREAT WHITE SHARK ENTERPRISES, INC., petitioner, vs. DANILO M. CARALDE, JR., respondent.

FACTS:
On July 31, 2002, Caralde filed before the Bureau of Legal Affairs (BLA), IPO a trademark application seeking to
register the mark “SHARK & LOGO” for his manufactured goods under Class 25, such as slippers, shoes and sandals.
The same was opposed by Great White Shark, a foreign corporation domiciled in Florida, USA, claiming to be the
owner of the mark consisting of a representation of a shark in color, known as “GREG NORMAN LOGO” (associated
with apparel worn and promoted by Australian golfer Greg Norman). It contended that being a world famous mark
which is pending registration before the BLA since February 19, 2002, the confusing similarity between the two (2)
marks is likely to deceive or confuse the purchasing public into believing that Caralde’s goods are produced by or
originated from it, or are under its sponsorship, to its damage and prejudice.

Caralde explained that the subject marks are distinctively different from one another and easily distinguishable.
When compared, the only similarity in the marks is in the word “shark” alone, differing in other factors such as
appearance, style, shape, size, format, color, ideas counted by marks, and even in the goods carried by the parties.

During the pendency of the proceedings, Great White Shark’s trademark application was granted and it was issued
Certificate of Registration for clothing, headgear and footwear, including socks, shoes and its components.

The BLA Director rejected Caralde’s application stating that the two competing marks are at least strikingly similar
to each other, hence, the likelihood of confusion of goods is likely to occur. The IPO Director General affirmed said
decision.

However, Court of Appeals reversed and set aside said decision and directed IPO to grant Caralde’s application
stating that no confusing similarity between the subject marks notwithstanding that both contained the shape of a
shark as their dominant feature since Caralde’s mark is more fancitful and colorful, and contains several elements
which are easily distinguishable from that of the Great White Shark and considering the price disparity, there is no
likelihood of confusion as they travel in different channels of trade.

ISSUE:

Whether the CA erred in reversing the previous resolutions of the BLA and IPO.

HELD:

NO. The CA committed no reversible error.

A trademark device is susceptible to registration if it is crafted fancifully or arbitrarily and is capable of identifying
and distinguishing the goods of one manufacturer or seller from those of another. Apart from its commercial
utility, the benchmark of trademark registrability is distinctiveness.13 Thus, a generic figure, as that of a shark in
this case, if employed and designed in a distinctive manner, can be a registrable trademark device, subject to the
provisions of the IP Code.

Section 123.1(d) of the Intellectual Property Code provides that a mark cannot be registered if it is identical with a
registered mark belonging to a different proprietor with an earlier filing or priority date, with respect to the same
or closely related goods or services, or has a near resemblance to such mark as to likely deceive or cause
confusion.
In determining similarity and likelihood of confusion, case law has developed the Dominancy Test and the Holistic
or Totality Test.

The Dominancy Test focuses on the similarity of the dominant features of the competing trademarks that might
cause confusion, mistake, and deception in the mind of the ordinary purchaser, and gives more consideration to
the aural and visual impressions created by the marks on the buyers of goods, giving little weight to factors like
prices, quality, sales outlets, and market segments.

The Holistic or Totality Test considers the entirety of the marks as applied to the products, including the labels and
packaging, and focuses not only on the predominant words but also on the other features appearing on both labels
to determine whether one is confusingly similar to the other as to mislead the ordinary purchaser. The “ordinary
purchaser” refers to one “accustomed to buy, and therefore to some extent familiar with, the goods in question.”

In this case, the Court finds no confusing similarity between the subject marks. While both marks use the shape of
a shark, there are distinct visual and aural differences between them. In Great White Shark’s “GREG NORMAN
LOGO,” there is an outline of a shark formed with the use of green, yellow, blue and red  lines/strokes. While the
shark in Caralde’s “SHARK & LOGO” is illustrated in letters outlined in the form of a shark with the letter “S”
forming the head, the letter “H” forming the fins, the letters “A” and “R” forming the body, and the letter “K”
forming the tail. Its mark includes several more elements such as the word “SHARK” in a different font underneath
the shark outline, layers of waves, and a tree on the right side, and liberally used the color blue with some parts in
red, yellow, green and white. The whole design is enclosed in an elliptical shape with two linings.

The visual dissimilarities between the two (2) marks are evident and significant, negating the possibility or
confusion in the minds of the ordinary purchaser, especially considering the distinct aural difference between the
marks.

Great White Shark’s “GREG NORMAN LOGO” Caralde’s “SHARK & LOGO”
GREAT WHITE SHARK ENTERPRISES, INC., petitioner, vs. DANILO M. CARALDE, JR., respondent.

FACTS:

On July 31, 2002, Caralde filed before the Bureau of Legal Affairs (BLA), IPO a trademark application seeking to
register the mark “SHARK & LOGO” for his manufactured goods under Class 25, such as slippers, shoes and sandals.
The same was opposed by Great White Shark, a foreign corporation domiciled in Florida, USA, claiming to be the
owner of the mark consisting of a representation of a shark in color, known as “GREG NORMAN LOGO” (associated
with apparel worn and promoted by Australian golfer Greg Norman). It contended that being a world famous mark
which is pending registration before the BLA since February 19, 2002, the confusing similarity between the two (2)
marks is likely to deceive or confuse the purchasing public into believing that Caralde’s goods are produced by or
originated from it, or are under its sponsorship, to its damage and prejudice.

Caralde explained that the subject marks are distinctively different from one another and easily distinguishable.
When compared, the only similarity in the marks is in the word “shark” alone, differing in other factors such as
appearance, style, shape, size, format, color, ideas counted by marks, and even in the goods carried by the parties.

During the pendency of the proceedings, Great White Shark’s trademark application was granted and it was issued
Certificate of Registration for clothing, headgear and footwear, including socks, shoes and its components.

The BLA Director rejected Caralde’s application stating that the two competing marks are at least strikingly similar
to each other, hence, the likelihood of confusion of goods is likely to occur. The IPO Director General affirmed said
decision.

However, Court of Appeals reversed and set aside said decision and directed IPO to grant Caralde’s application
stating that no confusing similarity between the subject marks notwithstanding that both contained the shape of a
shark as their dominant feature since Caralde’s mark is more fancitful and colorful, and contains several elements
which are easily distinguishable from that of the Great White Shark and considering the price disparity, there is no
likelihood of confusion as they travel in different channels of trade.

ISSUE:

Whether the CA erred in reversing the previous resolutions of the BLA and IPO.

HELD:

NO. The CA committed no reversible error.

A trademark device is susceptible to registration if it is crafted fancifully or arbitrarily and is capable of identifying
and distinguishing the goods of one manufacturer or seller from those of another. Apart from its commercial
utility, the benchmark of trademark registrability is distinctiveness.13 Thus, a generic figure, as that of a shark in
this case, if employed and designed in a distinctive manner, can be a registrable trademark device, subject to the
provisions of the IP Code.

Section 123.1(d) of the Intellectual Property Code provides that a mark cannot be registered if it is identical with a
registered mark belonging to a different proprietor with an earlier filing or priority date, with respect to the same
or closely related goods or services, or has a near resemblance to such mark as to likely deceive or cause
confusion.

In determining similarity and likelihood of confusion, case law has developed the Dominancy Test and the Holistic
or Totality Test.

The Dominancy Test focuses on the similarity of the dominant features of the competing trademarks that might
cause confusion, mistake, and deception in the mind of the ordinary purchaser, and gives more consideration to
the aural and visual impressions created by the marks on the buyers of goods, giving little weight to factors like
prices, quality, sales outlets, and market segments.

The Holistic or Totality Test considers the entirety of the marks as applied to the products, including the labels and
packaging, and focuses not only on the predominant words but also on the other features appearing on both labels
to determine whether one is confusingly similar to the other as to mislead the ordinary purchaser. The “ordinary
purchaser” refers to one “accustomed to buy, and therefore to some extent familiar with, the goods in question.”

In this case, the Court finds no confusing similarity between the subject marks. While both marks use the shape of
a shark, there are distinct visual and aural differences between them. In Great White Shark’s “GREG NORMAN
LOGO,” there is an outline of a shark formed with the use of green, yellow, blue and red  lines/strokes. While the
shark in Caralde’s “SHARK & LOGO” is illustrated in letters outlined in the form of a shark with the letter “S”
forming the head, the letter “H” forming the fins, the letters “A” and “R” forming the body, and the letter “K”
forming the tail. Its mark includes several more elements such as the word “SHARK” in a different font underneath
the shark outline, layers of waves, and a tree on the right side, and liberally used the color blue with some parts in
red, yellow, green and white. The whole design is enclosed in an elliptical shape with two linings.

The visual dissimilarities between the two (2) marks are evident and significant, negating the possibility or
confusion in the minds of the ordinary purchaser, especially considering the distinct aural difference between the
marks.

Great White Shark’s “GREG NORMAN LOGO” Caralde’s “SHARK & LOGO”
PHILIPPINE REFINING CO., INC., petitioner, vs. NG SAM and THE DIRECTOR OF PATENTS, respondents.

FACTS: The trademark "CAMIA" was first used ill the Philippines by petitioner on its products in 1922. In 1949,
petitioner caused the registration of said trademark with the Philippine Patent Office under certificates of
registration Nos. 1352-S and 1353-S, both issued on May 3, 1949. Certificate of Registration No. 1352-S covers
vegetable and animal fats, particularly lard, butter and cooking oil, all classified under Class 47 (Foods and
Ingredients of Food) of the Rules of Practice of the Patent Office, while certificate of registration No. 1353-S applies
to abrasive detergents, polishing materials and soap of all kinds (Class 4).

Respondent Ng Sam, a citizen residing in Iloilo City, filed an application with the Philippine Patent office for
registration of the Identical trademark "CAMIA" for his product, ham, which likewise falls under Class 47. Alleged
date of first use of the trademark by respondent was on February 10, 1959.

After due publication of the application, petitioner filed an opposition, in accordance with Section 8 of Republic Act
No. 166, otherwise known as the Trademark Law, as amended. Basis of petitioner's opposition was Section 4(d) of
said law, which provides as unregistrable:

a mark which consists of or comprises a mark or tradename which so resembles a mark or tradename registered in
the Philippines or a mark or tradename previously used in the Philippines by another and not abandoned, as to be
likely, when applied to or used in connection with the goods, business services of the applicant, to cause confusion
or mistake or to deceive purchasers. The parties submitted the case for decision without presenting any evidence:
thereafter the Director of patents rendered a decision allowing registration of the trademark "CAMIA" in favor of
Ng Sam.
Petitioner moved for a reconsideration, but the same was denied.

Hence this petition.

ISSUE: Whether or not the product of respondent, Ng Sam, which is ham, and those of petitioner consisting of lard,
butter, cooking oil and soap are so related that the use of the same trademark "CAMIA" on said goods would likely
result in confusion as to their source or origin.

RULING: NO.

"the mere fact that one person has adopted and used a trademark on his goods does not prevent the adoption and
use of the same trademark by others on articles of a different description."

Such restricted right over a trademark is likewise reflected in our Trademark law. Under Section 4(d) of the law,
registration of a trademark which so resembles another already registered or in use should be denied, where to
allow such registration could likely result in confusion, mistake or deception to the consumers. Conversely, where
no confusion is likely to arise, as in this case, registration of a similar or even Identical mark may be allowed.

The term "CAMIA" is descriptive of a whole genus of garden plants with fragrant white flowers. Some people call
the "CAMIA" the "white ginger plant" because of its tuberous roots, while children refer to it as the butterfly flower
because of its shape. Being a generic and common term, its appropriation as a trademark, albeit in a fanciful
manner in that it bears no relation to the product it Identifies, is valid. However, the degree of exclusiveness
accorded to each user is closely restricted.

A trademark is designed to Identify the user. But it should be so distinctive and sufficiently original as to enable
those who come into contact with it to recognize instantly the Identity of the user. " It must be affirmative and
definite, significant and distinctive, capable to indicate origin."

The trademark "CAMIA" is used by petitioner on a wide range of products: lard, butter, cooking oil, abrasive
detergents, polishing materials and soap of all kinds. Respondent desires to use the same on his product, ham.
While ham and some of the products of petitioner are classified under Class 47 (Foods and Ingredients of Food),
this alone cannot serve as the decisive factor in the resolution of whether or not they are related goods. Emphasis
should be on the similarity of the products involved and not on the arbitrary classification or general description of
their properties or characteristics.

The goods of petitioners are basically derived from vegetable oil and animal fats, while the product of respondent
is processed from pig's legs. A consumer would not reasonably assume that, petitioner has so diversified its
business as to include the product of respondent. While confusion of goods can only be evident, where the
litigants are actually in competition, confusion of business may arise between non-competitive interests as well.
This is true whether or not the trademarks are registered. Sec. 16 of the Trademark Act, in referring to
'merchandise of substantially the same descriptive properties, embraces competitive and non-competitive
trademark infringement but it is not so extensive as to be applicable to cases where the public would not
reasonably expect the plaintiff to make or sell the same class of goods as those made or sold by the defendant.

In fine, We hold that the businesss of the parties are non-competitive and their products so unrelated that the use
of Identical trademarks is not likely to give rise to confusion, much less cause damage to petitioner.

WHEREFORE, the instant petition is hereby dismissed and the decision of the Director of Patents in Inter Partes
Case No. 231 affirmed in toto. Costs against petitioner.

SKECHERS, U.S.A., INC. vs. INTER PACIFIC INDUSTRIAL TRADING CORP.

G. R. No. 164321               March 23, 2011

FACTS:

Petitioner filed an application for the issuance of search warrants against an outlet and warehouse operated by
respondents for infringement of trademark under Section 155, in relation to Section 170 of Republic Act No. 8293,
IP Code of the Philippines.  In the course of its business, petitioner has registered the trademark "SKECHERS" and
the trademark "S" (within an oval design) with the IPO. Two search warrants were issued and more than 6,000
pairs of shoes bearing the “S” logo were seized. Respondents moved to quash the warrants arguing that there was
no confusing similarity between petitioner’s "Skechers" rubber shoes and its "Strong" rubber shoes. RTC granted
the motion and quashed the search warrants. Petitioner filed a petition for certiorari with the CA which affirmed
the decision of the RTC. Thus, petitioner filed the present petition with the SC assailing that the CA committed
grave abuse of discretion when it considered matters of defense in a criminal trial for trademark infringement in
passing upon the validity of the search warrant when it should have limited itself to a determination of whether
the trial court committed grave abuse of discretion in quashing the warrants. And that it committed grave abuse of
discretion in finding that respondents are not guilty of trademark infringement in the case where the sole triable
issue is the existence of probable cause to issue a search warrant. Subsequently, petitioner-intervenor filed a
Petition-in-Intervention with the Court claiming to be the sole licensed distributor of Skechers products here in the
Philippines, but the same was dismissed. Both petitioner and petitioner-intervenor filed separate motions for
reconsideration.

ISSUE: Whether or not respondent is guilty of trademark infringement.

HELD: Yes. The essential element of infringement under R.A. No. 8293 is that the infringing mark is likely to cause
confusion. In determining similarity and likelihood of confusion, two tests have been developed: (1)the Dominancy
Test which focuses on the similarity of the prevalent or dominant features of the competing trademarks that might
cause confusion, mistake, and deception in the mind of the purchasing public. Duplication or imitation is not
necessary; neither is it required that the mark sought to be registered suggests an effort to imitate. Given more
consideration are the aural and visual impressions created by the marks on the buyers of goods, giving little weight
to factors like prices, quality, sales outlets, and market segments. (2) the Holistic or Totality Test which
necessitates a consideration of the entirety of the marks as applied to the products, including the labels and
packaging, in determining confusing similarity. The discerning eye of the observer must focus not only on the
predominant words, but also on the other features appearing on both labels so that the observer may draw
conclusion on whether one is confusingly similar to the other.
There are two types of confusion: (1) confusion of goods (product confusion), where the ordinarily prudent
purchaser would be induced to purchase one product in the belief that he was purchasing the other; and (2)
confusion of business (source or origin confusion), where, although the goods of the parties are different, the
product, the mark of which registration is applied for by one party, is such as might reasonably be assumed to
originate with the registrant of an earlier product, and the public would then be deceived either into that belief or
into the belief that there is some connection between the two parties, though inexistent.

In the case at bar, the Court applied the Dominancy Test and found that the use of the stylized "S" by respondent
in its Strong rubber shoes infringes on the mark already registered by petitioner with the IPO. While it is
undisputed that petitioner’s stylized "S" is within an oval design, to this Court’s mind, the dominant feature of the
trademark is the stylized "S," as it is precisely the stylized "S" which catches the eye of the purchaser. Thus, even if
respondent did not use an oval design, the mere fact that it used the same stylized "S", the same being the
dominant feature of petitioner’s trademark, already constitutes infringement under the Dominancy Test.

The protection of trademarks as intellectual property is intended not only to preserve the goodwill and reputation
of the business established on the goods bearing the mark through actual use over a period of time, but also to
safeguard the public as consumers against confusion on these goods. While respondent’s shoes contain some
dissimilarities with petitioner’s shoes, this Court cannot close its eye to the fact that for all intents and purpose,
respondent had deliberately attempted to copy petitioner’s mark and overall design and features of the shoes. Let
it be remembered, that defendants in cases of infringement do not normally copy but only make colorable
changes. 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 courts.

B54

CATERPILLAR, INC., Petitioner vs. MANOLO P. SAMSON, Respondent G.R. No. 205972, FIRST DIVISION,
November 9, 2016, BERSAMIN, J.

FACTS: Caterpillar is a foreign corporation engaged in the manufacture and distribution of footwear, clothing and
related items, among others. Its products are known for six core trademarks, namely, "CATERPILLAR", "CAT"
"CATERPILLAR & DESIGN" "CAT AND DESIGN", "WALKING MACHINES" and "TRACK-TYPE TRACTOR & DESIGN (Core
Marks), all of which are alleged as internationally known. On the other hand, Samson, doing business under the
names and styles of Itti Shoes Corporation, Kolm's Manufacturing Corporation and Caterpillar Boutique and
General Merchandise, is the proprietor of various retail outlets in the Philippines selling footwear, bags, clothing,
and related items under the trademark "CATERPILLAR", registered in 1997 under Trademark Registration No.
64705 issued by the Intellectual Property Office (IPO). On July 26, 2000, the Regional Trial Court (RTC), Branch 56,
in Makati City issued Search Warrants for unfair competition, to search the establishments owned, controlled and
operated by Samson. The implementation of the search warrants on July 27, 2000 led to the seizure of various
products bearing Caterpillar's Core Marks. Caterpillar filed against Samson several criminal complaints for unfair
competition in the Department of Justice (DOJ). Additionally, on July 31, 2000, Caterpillar commenced a civil action
against Samson and his business entities, with the IPO as a nominal party10 - for Unfair Competition, Damages and
Cancellation of Trademark with Application for Temporary Restraining Order (TRO) and/or Writ of Preliminary
Injunction with the RTC in Quezon City. The DOJ, issued a joint resolution recommending that Samson be criminally
charged with unfair competition under Section 168.3 (a), in relation to Section 123.l(e), Section 131.1 and Section
170, all of Republic Act No. 8293, or the Intellectual Property Code of the Philippines (IP Code). Caterpillar filed 26
criminal complaints for unfair competition on January 31, 2001 against Samson and/or the occupants of his affiliate
entities before the DOJ. Accordingly, six criminal complaints were filed in the RTC, Branch 256, in Muntinlupa City.
Samson filed a motion to suspend arraignment on the ground of prejudicial question.

ISSUE: Whether an action for the cancellation of trademark is a prejudicial question to a criminal action for unfair
competition. (NO)

RULING: No. Appeal is meritorious. The action of the petitioner can be tried as a separated civil action and not
subject to suspension due to Prejudicial Question. The civil case filed by Caterpillar in the RTC in Quezon City, was
for unfair competition, damages and cancellation of trademark, while Criminal Cases were the criminal prosecution
of Samson for unfair competition. A common element of all such cases for unfair competition – civil and criminal –
was fraud. Under Article 33 of the Civil Code, a civil action entirely separate and distinct from the criminal action
may be brought by the injured party in cases of fraud, and such civil action shall proceed independently of the
criminal prosecution. Secondly, a civil action for damages and cancellation of trademark cannot be considered a
prejudicial question by which to suspend the proceedings in the criminal cases for unfair competition. A prejudicial
question is that which arises in a civil case the resolution of which is a logical antecedent of the issues to be
determined in the criminal case. It must appear not only that the civil case involves facts upon which the criminal
action is based, but also that the resolution of the issues raised in the civil action will necessarily be determinative
of the criminal case.

Societes Des Produits Nestlé, S.A. v. Court of Appeals

G.R. 112012 || April 4, 2001

PETITIONER: Societes Des Produits Nestlé, S.A. and Nestlé Philippines

RESPONDENTS: Court of Appeals and CFC Corporation

Doctrine: A trademark has been generally defined as “any word, name, symbol or device adopted and used by a
manufacturer or merchant to identify his goods and distinguish them from those manufactured and sold by others.

FACTS:

1. CFC Corporation filed with the Bureau of Patents, Trademarks and Technology Transfer (BPTTT) an application
for the registration of the trademark FLAVOR MASTER for instant coffee. This was granted and subsequently
published in the Official Gazette of the BPTTT.
2. Petitioner filed a notice of opposition claiming that the respondent’s trademark is confusingly similar to its
trademarks for coffee and coffee extracts, namely MASTER ROAST and MASTER BLEND; alleging that its
registration is likely to cause confusion in the trade as well as deceive purchasers as the dominant word present
in the trademarks of Nestlé is MASTER.

3. Naturally, CFC argued otherwise, i.e., there is no confusion between the companies’ trademarks, the word
MATER cannot be exclusively appropriated by any person for being a descriptive or generic name , and the
trademarks are very different from one another.

4. BPTTT denied the respondent’s registration but the appellate court assailed such decision, holding that the
physical discrepancies between appellant and appellee’s respective logos are so ostensible that the casual
purchaser cannot likely mistake one for the other.

ISSUE:

Whether the trademark FLAVOR MASTER is a colorable trademarks of MASTER ROAST and MASTER BLEND.

RATIO:

1. Colorable imitation denotes such a close or ingenious imitation as to be calculated to deceive an ordinary
purchaser giving such attention as a purchaser usually gives, as to cause him to purchase the one supposing it to
be the other.

2. As no set of rules can be deduced in cases of infringement or trademark, the Court ruled that the likelihood of
confusion is a relative concept; thus, each case must be decided on their merits.

3. A manufacturer’s trademark should be entitled to protection. And in order to do so, jurisprudence has
developed two kinds of tests:

a. Dominancy Test – Focuses on the similarity of the prevalent features of the competing trademarks
which might cause confusion or deception and thus constitute infringement.

b. Holistic Test – Mandates that the entirety of the marks in question must be considered in
determining confusing similarity.

4. In finding for the petitioner, the dominancy test should be the one applied in this case (in lieu of CA agreeing
with the application of the holistic test), because should ordinary purchases be “undiscerningly rash” in buying
such common and inexpensive household products as instant coffee, then they will be less inclined to closely
examine specific details of similarities and dissimilarities.

5. In rejecting the application of the totality test, the Court also held that it is contrary to elementary postulate of
law on trademarks and unfair competition that confusingly similar is to be determined on the basis of visual, aural,
connotative comparisons which only rely on the visual comparison between two trademarks.

6. With regard to the word MASTER, it is neither a generic nor descriptive term, as it can be validated as a
trademark and may be legally protected. As in this case, Nestlé’s use of the word MASTER is a suggestive term
brought about by their advertising scheme, subtly connoting something about the product, are eligible for
protection in the absence of secondary meaning.

DISPOSITIVE PORTION: WHEREFORE, in view of the foregoing, the decision of the Court of Appeals in  CA-G.R. SP
No. 24101 is REVERSED and SET ASIDE and the decision of the Bureau of Patents, Trademarks and Technology
Transfer in Inter Partes Cases Nos. 3200 and 3202 is REINSTATED.
SO ORDERED.

Pagasa Industrial vs. CA

GR L-54158, 31 AUGUST 1984; En Banc, Aquino (J)

Facts: Yoshida Kogyo Kabushiki Kaisha was issued a certificate of Registration in 1961 for the trademark YKK for
slide fastener and zippers. The trademark is claimed to have been used since 1950. Notwithstanding the prior
registration, a certificate of registration was issued to Pagasa Industrial for the same trademark for zippers in 1966.
In 1975, Yoshida asked the Director of Patents to cancel the registration of Pagasa, which it did. Pagasa appealed.
The appellate court affirmed the cancellation. Pagasa appealed to the Supreme Court.

Issue: Whether Pagasa is entitled to the trademark YKK.

Held: No. Pagasa has not shown any semblance of justification for usurping the trademark YKK. In fact, Pagasa
knew prior to 1968 that Yoshida was the registered owner and user of the YKK trademark, which is an acronym of
its corporate name. The registration of Pagasa was admittedly a mistake. Pag-asa’s application should have been
denied outright. Further, Pag-asa’s knowledge of the trademark’s prior use precludes the application of the
equitable principle of laches, estoppel and acquiescence. He who comes into equity must come with clean hands.

Facts: Paula Recaro, hereafter referred to as plaintiff, alleged that she is doing business under the registered
name and style of "BIG FIVE PRODUCTS"; that she is the assignee and owner of the trademark "BIG FIVE 5", which
is duly registered with the Philippines Patent Office as per Registry No. 3281 dated April 29, 1952; that since May
22, 1952, she had been using and affixing said trade-mark on the printed labels (a facsimile of which is appended to
the complaint) of her products, namely in vegetable lard repacked for sale on retail, with which she is identified in
the mind of the public; that defendant Nestor Embisan, doing business under the name and style "Nel-Coff
Products", is, likewise, engaged in the repacking of vegetable lard on which he uses printed labels bearing the
trademark "Big Three" (a facsimile of which is, likewise, appended to the complaint) which is not registered with
said Patent Office and is but a reproduction, a counterfeit copy or colorable imitation of plaintiff's aforementioned
registered trade-mark, to such an extent as is likely to cause confusion or mistake or to deceive purchasers or
others as to the source or origin of such repacked products, in gross and unauthorized infringement of plaintiff's
certificate of registration; that, by giving the wrapping of his products the general appearance of the goods sold by
plaintiff, the defendant has influenced purchasers to believe that his goods are those of the plaintiff and has
deceived the public and defrauded the plaintiff of her legitimate trade and is, therefore, engaged in unfair
competition; that, despite notice given to him, the defendant has refused and continued to refuse to cease and
desist from his aforementioned infringement of patent and unfair competition.

Issue: Whether or not defendant is guilty of infringement

Ruling: We find no merit in the appeal. The affidavit and other documents, attached to plaintiff's petition for
summary judgment show that the trade-mark "BIG FIVE 5" was duly registered with the Philippines Patent Office
since April 29, 1952, for use in packing or wrapping of Class 47, vegetable lard; that by virtue of an instrument,
dated June 1, 1954, Sy Lin, the original owner of said trade-mark, had sold, assigned and transferred his right, title
and interest thereto and to the registration thereof, together with the goodwill of the business in connection
therewith, to plaintiff herein; and that said deed of sale, assignment and transfer in favor of plaintiff had been duly
annotated and registered with the Philippines Patent Office, and acknowledged by the same. Upon the other hand,
defendant has admitted that he is engaged in the repacking of vegetable lard and that he has been using thereon
"for sometime" printed labels bearing the trade-mark "Nel's Big 3 Lard". What is more, defendant does not claim
that the latter is registered. Lastly, a comparison thereof with plaintiffs label readily shows such of a resemblance
in the general features of both as is likely on deceive the ordinary purchaser, exercising ordinary are, and induce
him to believe that the goods bearing such labels are products of one and the same enterprise, particularly plaintiff
herein, she having been, evidently, in the business of repacking vegetable lard before defendant herein. Hence,
there is no genuine issue about the fact that the use of the trade-mark "Nel's Big 3" on vegetable lard repacked by
the defendant constitutes an infringement upon plaintiff's registered trade-mark "Big Five 5", which is similarly
used on repacked vegetable lard.

B58 FORIETRANS MANUFACTURING CORP v. DAVIDOFF ET. CIE SA & JAPAN TOBACCO INC.

GR 197482 | 6 March 2017 | Jardaleza

Facts: Davidoff Et. Cie Sa (Davidoff) and Japan Tobacco, Inc (JTI) [collectively, respondents] are non-resident foreign
corporation organized and existing under the laws of Switzerland and Japan, respectively. They are represented in
the Philippines by law firm SyCip Salazar Henandez and Gatmaitan (SyCip law firm). Respondents also retained
Business Profile, Inc. (BPI) as their private investigator in the Philippines.

Meanwhile, petitioner Forietrans Manufacturing Corp (FMC) is a domestic corporation with principal address at
lots 5 and 7, Angeles Industrial Park, special economic zone, brgy. Calibutbut, Bacoor, Pampanga.

BPI reported to respondents that “there were counterfeit or product imitations of Davidoff and JTI products or
products which are deceivingly similar and were stored in FMC’s warehouse. Sycip then, sought assistance from
the CIDG in securing search warrants to search the said warehouse. Upon investigation the CIDG confirmed the
reports of BPI. With the seized items as evidence, three separate complaint-affidavits were filed before the office
of the provincial prosecutor of San Fernando, Pampanga charging FMC and its employees with violation of republic
act no 8293.

Calaquin (FMC) denies the charges stating that FMC is, and eco-zone export enterprise registered with the
Philippine economic Zone Authority (PEZA) and duly authorized to import and export tobacco.

In the Joint Resolution dated September 12, 2005, second assistant Provincial Prosecutor Otto B. Macabulos
dismissed the criminal complaints. Macabulos found the affidavit of Jimmy Trocio, the informant/witness
presented by PSI De Mesa in his application for search warrants, clearly insufficient to show probable cause to
search FMC’s premises.
Respondents thereafter filed a Petition for review before then Secretary of Justice Raul M. Gonzalez. In his
resolution dated February 10, 2006, secretary Gonzalez affirmed the ruling of prosecutor macabulos. Respondents
moved for reconsideration. This, however, was denied with finality by secretary Gonzalez in his resolution dated
March 27, 2006. Respondents elevated the case to the CA via A petition for Certiorari.

CA then reversed the resolutions of secretary Gonzalez. It adjudged that secretary Gonzalez acted with grave
abuse of discretion in affirming Prosecutor Macabulos’ finding that no probable cause exists against FMC. The
petitioners filed a partial motion for reconsideration, but was denied by the CA. hence, they filed a petition to the
Supreme Court. Where the SC denies the petition for lack of merit and the decision dated March 31, 2011 and
resolution dated July 5, 2011 of the Court of Appeals were Affirmed. The Provincial Prosecutor of Pampanga was
then Directed to file information against petitioners for violations of Infringement and False Designation of origin.

Issue/s: Was the CA correct that grave abuse of discretion was committed by Secretary Gonzalez leading to the
reversal of his decision?

Ruling: Probable cause, for the purpose of filing a criminal action, is defined as such facts are sufficient to engender
a well-founded belief that a crime has been committed and that respondent is probably guilty thereof. Only prima
facie evidence is required or that which is, on its face, good and sufficient to establish a given fact, or the group or
chain of facts constituting the party’s claim or defense; and which, if not rebutted or contradicted, will remain
sufficient. Thus, probable cause with and only of itself is not sufficient as a basis to dismiss a case where evidences
was presented and can be better resolved in the course of the trial.

PHILIPPINE NUT INDUSTRY, INC. vs. STANDARD BRANDS INCORPORATED and TIBURCIO S. EVALLE FACTS: Philippine
Nut Industry Inc., a domestic corporation, obtained from the Patent Office on August 10, 1961, a certificate
covering the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS," the label used on its product of salted
peanuts. On May 14, 1962, Standard Brands, a foreign corporation, filed a case with the Director of Patent, asking
for the cancellation of Philippine Nut's certificate of registration on the ground that "the registrant was not entitled
to register the mark at the time of its application for registration thereof" for the reason that it (Standard Brands)
is the owner of the trademark "PLANTERS COCKTAIL PEANUTS" covered by Certificate of Registration No. SR-172,
issued by the Patent Office on July 28, 1958. Thereafter, the Philippine Nut filed its answer invoking the special
defense that its registered label is not confusingly similar to that of Standard Brands as the latter alleges.
Respondent Director of Patents gave due course to Standard Brand's petition, ordering the cancellation of
Philippine Nut's Certificate of Registration. Upon denial of the motion for reconsideration, the Philippine Nut
petitioned for a review, seeking the reversal of the Director of Patents’ decision. ISSUE: Whether or not the
trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" used by Philippine Nut on its label for salted peanuts with
the same coloring scheme and the same lay-out of words, confusingly similar to the trademark "PLANTERS
COCKTAIL PEANUTS" used by Standard Brands on its product. HELD: Yes. As to appearance and general impression
of the two trademarks, the Supreme Court said it found a very confusing similarity. The word PLANTERS printed
across the upper portion of the label in bold letters easily attracts and catches the eye of the ordinary consumer
and it is that word and none other that sticks in his mind when he thinks of salted peanuts. The Supreme Court also
held that although it is true that no producer or manufacturer may have a monopoly of any color scheme or form
of words in a label, but when a competitor adopts a distinctive or dominant mark or feature of another's
trademark and with it makes use of the same color ensemble, employs similar words written in a style, type and
size of lettering almost identical with those found in the other trademark, the intent to pass to the public his
product as that of the other is quite obvious. It deceives the public. Hence, the decision of respondent Director of
Patents was affirmed.

B60- American Wire & Cable Company v. Director of Patents, GR L-26557, 18 February 1970

FACTS:

Petitioner American Wire and Cable Company (American) is the owner of the registered trademark DURAFLEX and
Device for electric wires. On June 1962, private respondent/applicant Central Banahaw (Central) sought to register
the label DYNAFLEX for electric wires.

Petitioner opposed on the ground that Central’s use of the trademark DYNAFLEX would confuse purchasers looking
for DURAFLEX. The mark sought to be registered allegedly having practically the same spelling, pronunciation and
sound, and covering the same good, but had not been in use continuously, unlike DURAFLEX which was in use
since 1958.

Director of Patents held that DYNAFLEX was not similar to DURAFLEX, since the logo design was dissimilar, the
DURAFLEX logo being in all caps while DYNAFLEX was in miniscule, and thus gave Central’s application to
trademark DYNAFLEX due course.

ISSUE: Whether or not the two trademarks are confusingly similar.

HELD: YES.

Earlier rulings of the Court seem to indicate its reliance on the dominancy test or the assessment of the essential
or dominant features in the competing labels to determine whether they are confusingly similar.

The similarity between the competing trademarks, DURAFLEX and DYNAFLEX, is apparent. Not only are the initial
letters and the last half of the appellations identical, but the difference exists only in two out of the eight literal
elements of the designations. Coupled with the fact that both marks cover insulated flexible wires under class 20;
that both products are contained in boxes of the same material, color, shape and size; that the dominant elements
of the front designs are a red circle and a diagonal zigzag commonly related to a spark or flash of electricity; that
the back of both boxes show similar circles of broken lines with arrows at the center pointing outward, with the
identical legend “Cut Out Ring” “Draw From Inside Circle”, no difficulty is experienced in reaching the conclusion
that there is a deceptive similarity that would lead the purchaser to confuse one product with the other.

B61 Tanduay Distillers Inc. v. Ginebra San Miguel Inc., GR 164324, 14 August 2009, First Division, Carpio [J]

FACTS: Tanduay developed a new gin product distinguished by its sweet smell, smooth taste, and affordable price.
The brand name eventually chosen for the gin product was Ginebra Kapitan with the representation of a
revolutionary Kapitan on horseback as the dominant feature of its label. Tanduay points out that the label design
of Ginebra Kapital in terms of color scheme, size and arrangement of text, and other label features were precisely
selected to distinguish it from the leading gin brand in the Philippine market, Ginebra San Miguel. Tanduay filed a
trademark application for Ginebra Kapitan with the Intellectual Property Office (IPO). After which, Tanduay began
selling Ginebra Kapitan in the Luzon areas including Metro Manila. Eventually, Tanduay received a letter from San
Miguel informing the former to immediately cease and desist from using the mark Ginebra. San Miguel filed a
complaint for trademark infringement, unfair competition and damages, with applications for the issuance of a
TRO and a writ of preliminary injunction against Tanduay before the RTC of Mandaluyong.

The trial court issued a TRO prohibiting Tanduay from manufacturing, selling and advertising Ginebra Kapitan.
Tanduay filed a petition for certiorari with the CA and an Urgent Motion to Defer Injunction Hearing before the
trial court. Despite the motion filed by San Miguel, the trial court conducted hearings for Tanduay to show cause
why no writ of preliminary injunction should be issued. The trial court granted San Miguel’s application for
issuance of a writ of preliminary injunction. Tanduay filed a supplemental petition in the CA assailing the injunction
order.

The CA issued a TRO enjoining the trial court from implementing the injunction order and further proceeding with
the case. Finally, the CA rendered a decision dismissing Tanduay’s petition for certiorari and supplemental petition.
Its motion for reconsideration was likewise denied.

ISSUE(s) (1) Whether the word "Ginebra" is a generic mark that is incapable of appropriation by gin
manufacturers?

2) Whether San Miguel is entitled to a finding that the mark is deemed to have acquired a secondary meaning.?

RULING: (1) The Court rule citing Asia Brewery, Inc. v. Court of Appeals,53 the Court ruled that "pale pilsen" are
generic words, "pale" being the actual name of the color and "pilsen" being the type of beer, a light bohemian beer
with a strong hops flavor that originated in Pilsen City in Czechoslovakia and became famous in the Middle Ages,
and hence incapable of appropriation by any beer manufacturer. Moreover, Section 123.1(h) of the IP Code states
that a mark cannot be registered if it "consists exclusively of signs that are generic for the goods or services that
they seek to identify.

In this case, a cloud of doubt exists over San Miguel’s exclusive right relating to the word "Ginebra." San Miguel’s
claim to the exclusive use of the word "Ginebra" is clearly still in dispute because of Tanduay’s claim that it has, as
others have, also registered the word "Ginebra" for its gin products.

(2) Assuming that Ginebra is a generic word which is proscribed to be registered as a trademark under Section
123.1(h) of Republic Act No. 8293 or the Intellectual Property Code (IP Code), it can still be appropriated and
registered as a trademark under Section 123.1(j) in relation to Section 123.2 of the IP Code, considering that
Ginebra is also a mark which designates the kind of goods produced by San Miguel. San Miguel alleges that
although Ginebra, the Spanish word for gin, may be a term originally incapable of exclusive appropriation,
jurisprudence dictates that the mark has become distinctive of San Miguels products due to its substantially
exclusive and continuous use as the dominant feature of San Miguels trademarks since 1834. Hence, San Miguel is
entitled to a finding that the mark is deemed to have acquired a secondary meaning.

Bata Industries, Ltd. vs. the Honorable Court of Appeals; Tiburcio S. Evalle, Director of Patents, New Olympian
Rubber Products Co., Inc.

G.R. No. L-53672; May 31, 1982

Facts:

Evidence received by the Philippine Patent Office (PPO) showed that Bata shoes made by Gerbec and Hrdina of
Czechoslovakia were sold in the Philippines prior to the World war II. Some shoes made by Bata of Canada were
perhaps also sold in the Philippines until 1948. However, the trademark BATA was never registered in the
Philippines by any foreign entity. Under the circumstances, it was concluded that, “oppose has, to all intents and
purposes, technically abandoned its trademark BATA in the Philippines.” The PPO found that respondent New
Olympian Rubber Products Co., Inc. has overwhelmingly and convincingly established its right to the trademark
BATA and consequently, its use and registration in its favor. Respondent spent a considerable amount of money
and effort in popularizing the trademark BATA for shoes in the Philippines through the advertising media since it
was lawfully used in commerce on July 1, 1970. It is the respondent’s expense that created the enormous goodwill
of the trademark BATA in the Philippines and not the opposer as claimed in its opposition to the registration of the
BATA mark by the respondent. Additionally on evidence of record, respondent has 3 copyright registrations for the
word BATA in the Philippines.

The PPO dismissed the opposition and ordered the registration of the trademark BATA in favor of the domestic
corporation. Appeal from the decision of the PPO was made to the CA by Bata industries, ltd. The PPO decision was
reversed. MR filed by New Olympian reconsideration affirmed the PPO decision.

Issue/s: Does the petitioner Bata industries, Ltd. have the right to protect its goodwill alleged to be threatened
with the registration of the mark?

Held: No. Bata industries has no Philippine goodwill that would be damaged by the registration of the mark. Any
slight goodwill generated by the Czechoslovakian product during the Commonwealth years was completely
abandoned and lost in more than 35 years that have passed since the liberation of Manila from the Japanese
troops.

New Olympian has reproduced excerpts from the testimonies of Bata industries’ witnesses to prove that the latter
was never a user of the trademark BATA either before or after the war; that the appellant is not the successor-in-
interest of Gerbec and Hrdina who were not representatives or agents, and could not have passed any rights to the
appellant; that there was no privity of interest between the Czechoslovakian owner and the Canadian appellant
and; that the Czechoslovakian trademark has been abandoned in Czechoslovakia.
B63

G.R. No. L-24802            October 14, 1968

LIM KIAH, petitioner, vs. THE KAYNEE COMPANY and THE DIRECTOR OF PATENTS, respondents.

FACTS:

The dispute in this controversy centered around the right to use the trademark KAYNEE. Petitioner Lim
Kiah, on April 5, 1957, filed an application with the Philippines Patent Office to register such a trademark allegedly
being used by him on undershirts, polo shirts, T-shirts, pants, sporting wear and handkerchiefs, asserting further
that the date of its first use went back to January 7, 1957.

The application was oppossed by the Kaynee Company, one of the respondents here, a South Carolina
corporation and had used the same in the Philippines as far back as 1951, on goods similar to those being sold by
the applicant

Respondent Kaynee Company adduced proof to the effect that late in 1949 or early 1950, the Aguinaldo's
Department Store sold therein knitted shirts as well as polo shirts, cotton sports shirts, swimming trunks and
cotton pajamas coming form it and so identified that KAYNEE products were advertised in the Philippines
advertisement was confirmed by one official of a public relations and management firm and another from an
advertising agency.

The applicant testified on his own behalf asserting that as of 1957 he had started using such trademark on
his products, the word in Chinese, according to him, being equivalent to fast in English or mabilis in Tagalog.

The Director of Patents concluded that from the facts of record and the exhibits presented, the opposition
by the Kaynee Company was without merit. It does not appear of record that Opposser had a direct hand in the
introduction of the goods bearing its trademark into this country. There is no distributorship agreement between
The Kaynee Company and Aguinaldo's, or for that matter, amy local outlet. Neither has there been shown a license
or dealership agreement, an assignment, or any other document to prove that the Opposer had authorized
Aguinaldo's to market the KAYNEE goods locally. If ever the word KAYNEEE has been known to exist in this country,
it is because of Aguinaldo's trade activities and not those of the Opposer. As the prior use should exist on the part
of the oppositor and as in this case it had not done so, there being no showing either that it authorized the
Aguinaldo's Department Store to use its trademark, its opposition was dismissed.

Under Rule 34 of the Revised Rules of Practice in Trademark Cases, only the owner of the trdemark may
apply for its registration. It has been proven by the evidence for the Opposer that the trademark KAYNEE had been
advertised in newspapers as early as the year 1953 ... through Aguinaldo's advertising activities. Under Section 4(d)
of Republic Act No. 166, a trademark shall not be registrable if it consists of or comprises a mark or tradename
previously used in the Philippines by another and not abandoned.

Petitioner Lim Kiah assigned three alleged errors, namely, that he had presented evidence "clearly and
fully establishing his ownership" of the trademark, that no evidence existed to support the ruling that the
Aguinaldo's Department Store had been using such a trademark, and that the construction fastened on Section
4(d) of Republic Act No. 166 by respondent Director of Patents ignored other relevant sections.

ISSUE:

WON when the Director of Patents ignored other relevant provision which could have called for a different
conclusion when he relied on the explicit and literal language of the appropriate section,  to the effect that a
trademark shall not be registrable if it "consists of or comprises mark or trade-name ... previously used in the
Philippines by another and not abandoned,"

RULING:

No, as early as 1913, in Lizarraga Hermanos v. Yap Tico, it was stressed that our first and fundamental
duty is to apply the law. Construction and interprretation come only "after it has been demonstrated that
application is impossible and inadequate without them." Such a principle has since then commended itself for
acceptance and has been invariably followed, especially so in not a few of our recent decisions.

It is apparent, therefore, why, as above noted, the appeal is doomed to failure. The decision of the Director of
Patents is not only sound in law but also commendable for its consonance with the appropriate ethical standard
which by no means should be excluded from the business world as an alien, if not a hostile, force. While in the
fierce, competive jungle which at times constitutes the arena of commercial transactions, shrewdness and
ingenuity are at a premium, the law is by no means called upon to yield invariably its nod of approval to schemes
frowned upon by the concept of fairness. Here, petitioner engaged in manufacturing and selling the same kind of
products would rely on a trademark, which undeniably was previously registered abroad and which theretofore
had been used and advertised extensively by one of the leading department stores in the Philippines.

Considering that such a trademark had long stood for similar products which undoubtedly were well-known and
patronized locally. It did not improve his standing at all. As a matter of fact, without his so intending it, the
legitimate suspicion did arise that such a plea while perhaps a tribute to his ingenuity hardly seemed to betray
fidelity to fact.

Lim Hoa v. Director of Patents

G.R. L-8072 October 31, 1956

FACTS: Lim Hoa filed an application for registration of a trademark showing two midget roosters in an attitude of
combat with the word “Bantam” printed above them for a food seasoning product. Agricom Development Co., Inc.,
opposed the application on the ground, that the trademark sought to be registered was confusingly similar to its
register mark, consisting of a pictorial representation of a hen with the words “Hen Brand” and “Marca Manok”,
which mark or brand was also used on a food seasoning product, before the use of the trademark by the applicant.

ISSUE: Whether or not there is an infringement of trademark.

HELD: YES. The court ruled that the trademarks are similar to each other which would likely create confusion to the
ordinary buyer. Although the hen and the rooster are of different sexes, they still belong to the same specie which
is the “manok”. To the ordinary buyer, it may not look any different. The similarity may compel a person to buy
one product thinking that it is the other. Moreover, with all the animals in the land, ocean and air, the court could
not phantom why the plaintiff chose two roosters facing each other knowing that a similar trademark is used by
another establishment producing the same product.
B65 Asari Yoko Co. Ltd. v. Kee Boc, GR L-14086, 20 January 1961, En Banc, Labrador [J]

Facts:

On August 27, 1953, Kee Boc, a Chinese citizen, filed a petition for the registration of the trade mark "RACE" and
design to be used in shirts and undershirts manufactured by him. He claims to have first used the trade mark in
commerce on May 17, 1952, basing the design on a movie picture (t.s.n., 690) he had seen with Domingo
Cabatingan, his employee, who corroborated to this fact (tsn, 674). On the other hand, petitioner Asari Yoko Co.,
Ltd., a Japanese Corp. interposed that it is the owner of owner of the trade mark because the same is registered in
Japan and in the Philippines, registration in the latter having been made in August, 1929, under the provisions of
Act No. 666 and is valid for 30 years; that the trade mark has been in continuous use in commerce in, and trade
with, the Philippines since its registration until the early part of 1942, and then again after the liberation of the
Philippines up to the present: that the trade mark was never abandoned by the registrant and that it will be
damaged by the registration of the same. After due hearing, the Director of Patents dismissed the opposition of
Asari Yoko Co., Ltd, and adjudged applicant Kee Boc as the owner of the trademark. Hence this petition for review.

Issue:

Whether or not Asari Yoko was the rightful owner of the “Race Brand” trademark.

Ruling:

Yes. There is no question that the trade mark "RACE BRAND" applied for is exactly the same as the trade mark
"RACE BRAND" registered in Tokyo, Japan on June 11, 1937 by Kojiro Asari. Not only is the trade mark sought to be
registered the actual trade mark, for Japanese shirts and undershirts, belonging to Kojiro Asari, but the very names
printed on the boxes containing shirts and undershirts sold by petitioner "Race Brand Gentlemen's Underwear" are
exactly identical to those appearing in the boxes used by applicant for the underwear he manufactures The original
facsimile of the trade mark shows clearly two thin sheets of white paper pasted thereon. When these pasted
sheets of white paper were removed, it was found that the said papers covered the following words, (1)
“Registered Trade Mark” in big capital letters, and, (2) “Made in Occupied Japan” in small capital letters. These
Findings are conclusive evidence that trade mark applied for is the very trade mark on manufactured goods made
in Japan and imported into the trade mark since 1949 should entitle the owner of the trade mark to the right to
use the same to the exclusion of others.

Modern trade and commerce demands that depredations on legitimate trade marks of non-nationals should not
be tolerated. No evidence was found whether the trademark was registered by a Japanese in the Philippines
before the war to warrant its confiscation under the Trading with enemy Act. Prior to the trade agreement
between Occupied Japan and the Philippines in 1951, the entry of goods from Japan into the Philippines was legal
because Japan was occupied by the United States and the Philippines had commercial relations with the United
States.

The lawful entry into the Philippines of goods bearing a trademark registered in Japan entitles the owner of the
trademark to the right to use the same to the exclusion of others. As commercial relations with Japan had existed
and continued, and that the goods bearing the trademark entered the Philippines legally, the owner of the
trademark is entitled to the right to use the same to the exclusion of the others. Existence of formal commercial
agreement between the countries is unnecessary for the recognition trademarks as such is inconsistent with the
freedom of trade recognized in modern times.
B66 ARCE SONS v. SELECTA
FACTS:
1. Selecta Biscuit Company, Inc. (SBCI) filed with the Philippine Patent Office a petition for registration of the word
“SELECTA” as trademark to be use in its bakery products, alleging that it is an actual use thereof for not less than 2
months before said date and that “no other persons, partnership, corporation, or association has the right to use
said trademark in the Philippines, either in the identical form or in any such near resemblance thereto, as might be
calculated to deceive”
2. Its petition was referred to an examiner for study, who found that the trademark sought to be registered
resembles the word “SELECTA” used by the ARCE SONS AND CO (ARCE), in its milk and ice products so that its use
by SBCI will cause confusion as to the origin of their respective goods
a. Consequently, the examiner recommended that the application be refused
b. However, upon reconsideration, the Patent Office ordered the publication of the application for purposes of
opposition
3. ARCE filed its opposition thereto on several grounds:
a. That the mark “SELECTA” had been continuously used by ARCE in the manufacture and sale of its
products, including cakes, bakery products, milk and ice cream, from the time of its organization and even prior
thereto by its predecessor-in-interest, Ramon Arce
b. That the mark has already become identified with name of ARCE and its business
c. That Arce warned SBCI not to use said mark because it was already being used by the former, but that the
latter ignored said warning;
d. That SBCI is using the word “SELECTA” as a trademark as bakery products in unfair competition with the
products of ARCE thus resulting in confusion in trade;
e. That the mark to which the application of SBCI refers has striking resemblance, both in appearance and
meaning, to ARCE’s mark as to be mistaken therefor by the public
f. That a complaint has been filed by ARCE against SBCI for unfair competition in CFI Manila asking for
damages and for the issuance of a writ of injunction against SBCI, enjoining the latter for continuing with the use of
said mark
4. CFI Manila rendered decision in the unfair competition case perpetually enjoining SBCI from using the name
“SELECTA” as a trademark on the goods manufactured and/or sold by it and ordering it to pay ARCE by way of
damages all the profits it may have realized by the use of said name, plus the sum of P5,000 as attorney’s fee and
costs of suit.
a. From this decision, SBCI brought the matter on appeal to the CA
5. However, despite the decision by the CFI, the Director of Patents rendered decision dismissing ARCE’s
opposition and stating that the registration of the trademark “SELECTA” in favor of applicant SBCI will not cause
confusion or mistake nor will deceive the purchasers as to cause damage to ARCE
a. Hence, ARCE interpose the present petition for review
6. The case for ARCE:
a. Ramon Arce, predecessor-in-interest, started a milk business using the name “SELECTA” as a trade name
as well as a trademark. He begun selling and distributing his products to different residences, restaurants and
offices, in bottles on the caps of which were inscribed the words ‘SELECTA FRESH MILK’
b. As his business prospered, he thought of expanding and, in fact, he expanded his business by establishing
a store. While there, he began to cater, in addition, sandwiches and other food products. As his catering and ice
cream business prospered in a big way, he placed a signboard in his establishment with the name ‘SELECTA’
inscribed thereon
c. Even after the war broke out, Ramon Arce continued with his business. Continuing to use the name
‘SELECTA’ Arce added bakery products to his line of business
d. Business being already well-established, Arce decided to retire, so that his children can go on with the
business. For this purpose, he transferred and leased to them all his rights, interest and participations in the
business, including the use of the name ‘SELECTA’
7. The case for SBCI:
a. The name ‘SELECTA’ was chosen by the organizers of SBCI who are Chinese citizens as a translation of the
Chinese word ‘Ching Suan’ which means ‘mapili’ in Tagalog, and ‘selected’ in English
b. Inquiries were also made with the Patent Office of ‘SELECTA’; after an official of the Patent referred to
 index cards information was furnished to the effect that SBCI could register the name ‘SELECTA’ with the Bureau of
Patents
c. Accordingly, the corresponding petition for registration of trademark was filed
d. SBCI actually operated its business factory, while the petition for registration of trademark
‘SELECTA’ was filed with the PPO, because they were informed that the mark had to be used first before registered
e. It is significant to note that Eulalio Arce, managing partner, resided and resides near SBCI’s factory, only
150 m away; in fact, Arce used to pass in front of the factory of SBCI while still under construction and up to the
present time. Neither Eulalio Arce nor any other person in representation of ARCE complained to SBCI about the
use of the name ‘Selecta Biscuit’ until of the present complaint
8. At the outset one cannot but note that in the two cases appealed before us which involve the same parties and
the same issues of fact and law, the Court a quo and the Director of Patents have rendered contradictory
decisions.
a. While the former is of the opinion that the word 'SELECTA' has been used by the petitioner, or its predecessor-in
interest, as a trademark in the sale and distribution of its dairy and bakery products as early as 1933 to the extent
that it has acquired a proprietary connotation so that to allow respondent to use it now as a trademark in its
business would be an usurpation of petitioner's goodwill and an infringement of its property right, the Director of
Patents entertained a contrary opinion.
b. He believes that the word as used by the petitioner functions only to point to the place of business or
location of its restaurant while the same word as used by respondent points to the origin of the products its
manufactures and sells and he predicates this distinction upon the fact that while the goods of petitioner are only
served within its restaurant or sold only on special orders in the City of Manila, respondent's goods are readymade
and are for sale throughout the length and breadth of the country.
c. He is of the opinion that the use of said trademark by SBCI has not resulted in confusion in trade contrary
to the finding of the court a quo. Which of this opinions is correct is the issue now for determination.

ISSUE/s:
WoN the Dir. Of Patents erred in mling in favor of SBCI - YES. The word SELECTA may be ordinary and common, but
it has gained a secondafry meaning as to be exclusively associated with its products and business. Thus, the use of
“SELECTA” by others would cause confusion

RULING: In view of the foregoing, we hold that the Director of Patents committed an error in dismissing the
opposition of petitioner and in holding that the registration of the trademark 'SELECTA' in favor of respondent will
not cause damage to petitioner, and consequently, we hereby reverse his decision.
Consistently with this finding, we hereby affirm the decision of the court a quo rendered in G.R. No. L17981. No
costs.

RATIO:
1. It appears that Ramon Arce, predecessor-in-interest of ARCE, started his milk business as early as 1933. He
sold his milk products in bottles covered with caps on which the words 'SELECTA FRESH MILK' were inscribed.
2. Expanding his business, he established a store at Lepanto Street, City of Manila, where he sold, in addition
to his products, ice cream, sandwiches and other food products, placing right in front of his establishment a
signboard with the name 'SELECTA' inscribed thereon. Special containers made of tin cans with the word 'SELECTA'
written on their covers were used for his products. Bottle with the same word embossed on their sides were used
for his milk products. The sandwiches he sold and distributed were wrapped in carton boxes with covers bearing
the same name. He used several cars and tracks for delivery purposes on the sides of which were written the same
word. As new products were produced for sale, the same were placed incontainers with the same name written on
their covers.
3. After the war, he added to his business such items as cakes, bread, cookies, pastries, and assorted bakery
products. Then his business was acquired by petitioner, a co-partnership organized by his sons, the purposes of
which are "to conduct a first class restaurant business; to engage in the manufacture and sale of ice cream, milk,
cakes and other products; and to carry on such other legitimate business as may produce profit."
4. The foregoing unmistakably show that petitioner, through its predecessor-in- interest, had made use of
the word "SELECTA" not only as a tradename indicative of the location of the restaurant where it manufactures
and sells its products, but as trademark is used. This is not only in accordance with its general acceptation but with
our law on the matter. "
a. TRADEMARK
i. Distinctive mark of authenticity through which the merchandise of a particular producer or
manufacturer may be distinguished from that of others, and its sole function is to designate distinctively the
origin of the products to which it is attached
ii. Includes any word, name, symbol, emblem, sign or device or any combination thereof adopted and
used by a manufacturer or merchant to identify his goods and distinguish from them those manufactured, sold
or dealt in by others
5. Verily, the word 'SELECTA' has been chosen by ARCE and has been inscribed on all its products to serve
not only as a sign or symbol that may indicate that they are manufactured and sold by it but as a mark of
authenticity that may distinguish them from the products manufactured and sold by other merchants or
businessmen.
a. The Director of Patents, therefore, erred in holding that petitioner made use of that word merely as a
tradename and not as a trademark within the meaning of the law
6. The word 'SELECTA', it is true, may be an ordinary or common word in the sense that may be used or
employed by any one in promoting his business or enterprise, but once adopted or coined in connection with
one's business as an emblem, sign or device to characterize its products, or as a badge of authenticity, it may
acquire a secondary meaning as to be exclusively associated with its products and business
a. In this sense, its use by another may lead to confusion in trade and cause damage to its business. And this is the
situation of petitioner when it used the word 'SELECTA' as a trademark. In this sense, the law gives its protection
and guarantees it’s used to the exclusion of all others
a. The term 'SELECTA' may be placed at par with the words "Ang Tibay" which this Court has considered not
merely as a descriptive term within the meaning of the Trademark Law but as a fanciful or coined phrase, or a
trademark.
b. In that case, this Court found that respondent has constantly used the term "Ang Tibay" , both as a
trademark and a tradename, in the manufacture and sale of slippers, shoes and indoor baseballs for 22 years
before petitioner registered it as a tradename for pants and shirts so that it has performed during that period the
function of a trademark to point distinctively, or by its own meaning or by association, to the origin or ownership
of the wares to which it applies.
c. Even if 'Ang Tibay', therefore, were not capable of exclusive appropriation as a trademark, the
application of the doctrine of secondary meaning could nevertheless be fully sustained because, in any event, by
respondent's long and exclusive appropriation with reference to an article on the market, because
geographically or otherwise descriptive, might nevertheless have been used so long and exclusively by one
producer with reference to his article that, in that trade and to that branch of the purchasing public, the word or
phrase has come to mean that article was his product."
7. The suggestion that the name 'SELECTA' was chosen by the organizers of respondent merely as a
translation from a Chinese word "Ching Suan" meaning "mapili" in the dialect is betrayed by the very manner of its
selection, for if the only purpose is to make an English translation of that word and not to compete with the
business of petitioner, why chose the word 'SELECTA', a Spanish word, and not "Selected", the English equivalent
thereof, as was done by other well-known enterprises? In the words of petitioner's counsel, "Why with all the
words in the English dictionary and all the words in the Spanish dictionary and all the phrases that could be coined,
should defendant appellant (respondent) choose 'SELECTA' if its purpose was not and is not to fool the people and
to damage ARCE?
8. Certainly, this cannot be allowed, and it becomes the duty of the court to protect the legitimate owners of
said tradenames and trademarks, for under the law, the same constitute one kind of property right entitled to the
necessary legal protection.
B67
Romero v. Maiden Form Brassiere Co Inc.
GR L-18289
31 March 1964

Facts:
 Maiden Form Brassiere Co Inc., a foreign corporation, filed with the Director of Patents an application for
registration of the trademark 'Adagio" for the brassieres manufactured by it. In its application, respondent
company alleged that said trademark was first used by it in the United States on October 26, 1937, and in the
Philippines on August 31, 1946, that it had been continuously used by it in trade in, or with the Philippines for over
10 years. The Patent Director approved the application and was published in the Official Gazette.

Andres Romero filed for the cancellation of the patent on the basis that: (1) it is a common descriptive
name of an article or substance on which the patent has expired, (2) said trademark has not become distinctive of
respondent company's goods or business and (3) it is not registered in accordance with the requirements of
Section 37 [a], Chapter XI of Republic Act No. 166.

Issue:

W/N "Adagio" has become a common descriptive name of a particular style of brassiere and is, therefore,
unregistrable?

Ruling:

No. Romero’s claim is without basis in fact. The trademark "Adagio" is a musical term, which means slowly
or in an easy manner, and when applied to brassieres is used in an arbitrary (fanciful) sense, not being a common
descriptive name of a particular style of brassieres, and is therefore registrable

A company's long and continuous use of a trademark does not by itself render it more descriptive of the
product. Temporary non-use of a trademark occasioned by government restrictions, not being permanent,
intentional and voluntary, does not affect the right to a trademark.

Section 37 is not the provision invoked by respondent because the Philippines is not as yet a party to any
international convention or treaty relating to trademarks. Section 37 of Republic Act No. 166 can be availed of only
where the Philippines is a party to an international convention or treaty relating to trademarks, in which case the
trademark sought to be registered need not be in use in the Philippines

G.R. No. L-19441             June 30, 1964

SHELL COMPANY OF THE PHILIPPINES, LTD., petitioner, 

vs.
INSULAR PETROLEUM REFINING CO., LTD., and COURT OF APPEALS, respondents.

Petitioner, Shell Co. of the Phil., Ltd. (Shell for short), is a corporation engaged in the sale of petroleum products,
including lubricating oil.

Defendant Insular Petroleum Refining Co., Ltd. (Insular for short), is a registered limited partnership, whose
principal business is collecting used lubricating oil which, thru a scientific process, is refined and marketed to the
public at a price much lower than that of new lubricating oil.

In one transaction, however, which was consummated with Conrado Uichangco a dealer of petitioner's gasoline
and lubricating oil, the low-grade oil that was sold to said operator was contained in a drum with the petitioner's
mark or brand "Shell" still stenciled without having been erased.
This single transaction between plaintiff and defendant was effected, according to Conrado Uichangco an operator
of a Shell service station at the corner of San Andres and Tuason Privado Streets, Manila, and who has been losing
during the first eight and ten months of operation of his station, although he had money to back up his losses,
when a certain F. Pecson Lozano, in agent of the defendant, repaired at his station and "tried to convince him that
Insoil is a good oil". Lozano tried to show Uichangco chemical analysis of Insoil which he claimed was very close to
the analysis of Shell oil; and told him that he could sell this kind of oil (Insoil) to me at a much cheaper price so that
Uichangco could make a bigger margin of profits.

The incident between petitioner's operator and respondent's agent, brought about the presentation with the
Manila CFI, a case for damages on the allegation of unfair competition and a Criminal Case against Donald Mead,
Manager, Pedro Kayanan and F. Tecson Lozano. In the criminal case, the accused therein were acquitted, the Court
having found that the element of deceit was absent.

In the civil case, petitioner herein invoked two causes of action:

(1) that respondent in selling its low-grade oil in Shell containers, without erasing the marks or brands labeled or
stencilled thereon, intended to mislead the buying public to the prejudice of petitioner and the general public; and

(2) defendant had attempted to persuade Shell dealers to purchase its low-grade oil and to pass the same to the
public as Shell oil, by reason of which petitioner bad suffered damages in the form of decrease in sales, estimated
at least P10,000.00.

The trial court ruled in favor of Shell. However, it was reversed by CA. Hence, this petition.

ISSUE:

Whether the defendant is guilty of unfair competition.

RULING:

NO.

R.A 166 provides that “Any person who shall employ deception or any other means contrary to good faith by which
he shall pass off the goods manufactured by him or in which he deals, ... for those of the one having established
such goodwill, or who shall commit any act calculated to produce said result, shall be guilty of unfair competition,
and shall be subject to an action therefor.”

In this case, the single transaction at bar will not render defendant's act an unfair competition, much in the same
way that the appearance of one swallow does not make a season, summer.
It was found by the Court of Appeals that in all transactions of the low-grade Insoil, except the present one, all the
marks and brands on the containers used were erased or obliterated. The drum in question did not reach the
buying public. It was merely a shell dealer or an operator of a Shell Station who purchased the drum not to be
resold to the public, but to be sold to the petitioner company, with a view of obtaining evidence against someone
who might have been committing unfair business practices, for the dealer had found that his income was
dwindling in his gasoline station.

There is evidence showing that the use of the defendant of the drum or container with the Shell brand stenciled
thereon was with the knowledge and consent of Uichangco. There is also the categorical testimony of Uichangco
that defendant's agent did not make any representation that said agent was selling any oil other than Insoil motor
oil. The sales invoice states that Insoil Oil was sold. True, that a drum with the brand Shell remaining unerased was
used by the defendant. But, Uichangco was apprised beforehand that a Shell drum would be used, and in fact the
instruction of Crespo to Uichangco could mean — to buy Insoil oil contained in a Shell drum. The buyer could not
have been deceived or confused that he was not buying Insoil Oil. There is reason to believe that the transaction
was consummated in pursuance of a plan of Mr. Crespo to obtain evidence for the filing of a case. The oil was
never sold to the public because the plaintiff never intended or contemplated doing so.

CONFORMABLY WITH ALL THE FOREGOING, the Court finds that the decision of the Court of Appeals appealed
from, is in accordance with the fact, the law and jurisprudence on the matter. The same is affirmed, with costs
against petitioner, in both instances.

B69 Operators Inc., v Director of Patents

Facts: Petitioner, a domestic corporation, applied to the Philippine Patent Office for registration of AMBISCO as a
trademark for its locally manufactured candy products. It has been using said trademark since May 1956 by virtue
of two contracts with the American Biscuit Company, also a domestic corporation. The National Biscuit Company
opposed the application, having previously registered NABISCO as trademark for its own bakery goods, such as
biscuits, crackers, cakes and wafers. The oppositor, a corporation organized in the United States, has had the said
trademark registered in the Philippines since 1930, and renewed the registration in 1948 under the latest
trademark law. In his decision of September 20, 1960 the Director of Patents defined the issues in this case to be:
(1) whether or not the two trademarks aforesaid are so similar to each other as to cause confusion, mistake or
deception of purchasers; and (2) whether or not the applicant had a right in the first place to apply for registration
of AMBISCO as a trademark at all. And reaching an affirmative conclusion on the first issue, the Director denied the
application without considering it necessary to resolve the second. Petitioner moved to reconsider, and upon
denial of the motion brought up the case to this Court for review.

Issue: Whether or not AMBISCO as a trademark constitutes infringement.

Held: Yes, we find no cogent reason to disagree with the Director of Patents that "considering the similarities in
appearance and sound between the marks AMBISCO and NABISCO, the nature and similarity of the products of the
parties together with the fact that opposer's NABISCO has been used in commerce in the Philippines for more than
fifty five (55) years before AMBISCO was adopted by applicant, confusion of purchasers is likely. In the case of Co
Tiong vs. Director of Patents, 95 Phil. 1, this Court said: If the competing trademark contains the main or essential
or dominant features of another, and confusion and deception is likely to result, infringement takes place.
Duplication or imitation is not necessary; nor is it necessary that the infringing label should suggest an effort to
imitate.The ordinary customer does not Scrutinize the details of the label; he forgets or overlooks these, but
retains a general impression, or a central figure, or a dominant characteristic. "The question of infringement is to
be determined by the test of dominancy. The dissimilarity in size, form and color of the label and the place where
applied are not conclusive. If the competing label contains the trademark of another, and confusion or deception is
likely to result, infringement takes place, regardless of the fact that the accessories are dissimilar. Duplication or
exact imitation is not necessary; nor is it necessary that the infringing label should suggest an effort to imitate.

B70
Hickok Manufacturing Co. Inc. v. Court of Appeals
G.R. No. L-44707, August 31, 1982

Facts:

Petitioner is a foreign corporation and all its products are manufactures by Quality House Inc. The latter pays
royalty to the petitioner. Hickok registered the trademark 'Hickok' earlier and used it in the sale of leather wallets,
key cases, money folds, belts, men’s underwear, neckties, hankies, and men's socks. While Sam Bun Liong used the
same trademark in the sale of Marikina shoes. Both products have different channels of trade. The Patent Office
did not grant the registration, but the Court of Appeals reversed the decision.

Issue: Is there infringement in this case?

Held:

None. Emphasis should be on the similarity of the products involves and not on the arbitrary classification or the
general description of their properties or characteristics. Also, the mere fact that one person has adopted and used
a trademark on his goods does not prevent the adoption and use of the same by others on unrelated articles of
different kind.

There is a different design and coloring of the trademark itself. The 'Hickok' trademark is in red with white
background in the middle of 2 branches of laurel (in light gold) while the one used by Sam Bun Liong is the word
'Hickok ' in white with gold background between 2 branches of laurel in red with the word 'shoes' also in red
placed below the word 'Hickok'.

Fruit of the Loom v. CA (G.R. No. L-32747)

Facts:
Petitioner Fruit of the Loom, an American corporation, is the registrant of the trademark ‘Fruit of the Loom’
covering goods such as underwear and other textile fabrics. Respondent General Garments on the other hand, is a
domestic corporation and a registrant of the trademark ‘Fruit for Eve’ covering garments similar to petitioner.
Alleging respondent’s mark and hang tag is confusingly similar with its own, petitioner filed a complaint for
trademark infringement and unfair competition. The trial court found for petitioner. CA reversed the judgment.

Issue:

Whether or not respondent’s mark and hang tag is confusingly similar with that of petitioner.

Ruling: NO.

WE agree with the respondent court that by mere pronouncing the two marks, it could hardly be said that it will
provoke a confusion as to mistake one for the other. Standing by itself, FRUIT OF THE LOOM is wholly different
from FRUIT FOR EVE. WE do not agree with petitioner that the dominant feature of both trademarks is the word
FRUIT for even in the printing of the trademark in both hang tags, the word FRUIT is not at all made dominant over
the other words. As to the design and coloring scheme of the hang tags, the shape of petitioner’s hang tag is round
with a base that looks like a paper rolled a few inches in both ends; while that of private respondent is plain
rectangle without any base. The designs differ. Petitioner’s trademark is written in almost semi-circle while that of
private respondent is written in straight line in bigger letters than petitioner’s. Private respondent’s tag has only an
apple in its center but that of petitioner has also clusters of grapes that surround the apple in the center. The
colors of the hang tag are also very distinct from each other. WE hold that the trademarks FRUIT OF THE LOOM
and FRUIT FOR EVE do not resemble each other as to confuse or deceive an ordinary purchaser. WE hold that the
trademarks FRUIT OF THE LOOM and FRUIT FOR EVE do not resemble each other as to confuse or deceive an
ordinary purchaser.

B72 Armco Steel Corporation (of the Philippines) v. SEC , GR L-54580, 29 December 1987

FACTS: On July 1, 1965 ARMCO Steel Corporation, a corporation organized in Ohio, USA called ARMCO-OHIO,
obtained from the PPO a Certificate of Registration for its trademark consisting of the word "ARMCO" and a
triangular device for "ferrous metals and ferrous metal castings and forgings." On April 14, 1971, the petitioner
filed an "Affidavit of Use" for said trademark, which was subsequently accepted. ARMCO-Ohio later purchased 40%
capital stock of Marsteel Alloy Company, Inc., thus its name was changed to ARMCO-Marsteel Alloy Corporation on
March 28, 1973. Both corporations are engaged in the manufacture of steel products.

ARMCO Steel Corporation, incorporated in the Philippines on April 25, 1973, hereinafter called ARMCO-Philippines.
Its articles of incorporation provide as among its purposes: "to contract, fabricate ... manufacture ... regarding
pipelines, steel frames.”

ARMCO-Ohio and ARMCO-Marsteel then filed a petition in the SEC to compel ARMCO-Philippines to change its
corporate name on the ground that it is very similar, if not exactly the same as the name of one of the petitioners.
On February 14, 1975, SEC granted the petition and ordered ARMCO Steel Corporation to take out 'ARMCO' and
substitute another word in lieu thereof in its corporate name by amending the articles of incorporation within 30
days from date of receipt of a copy of the Order. After which, 3 copies of the amended articles of incorporation,
duly certified by a majority of the board of directors and countersigned by the president and secretary of the
corporation, shall be submitted to this Commission, together with the corresponding filing fees, as required by
law. 

On March 22, 1976, respondent amended its articles of incorporation and changed its name to "ARMCO
structures, Inc." which was filed with and approved by the SEC. On Jan. 6, 1977, the SEC issued an order requiring
respondent to comply with the SEC order of Feb. 14, 1975 within 10 days from notice thereof. Respondent filed a
manifestation and motion, informing SEC that it had already changed its corporate name with SEC approval to
ARMCO Structures, Inc. in substantial compliance with the said order. Petitioners then filed a comment to said
manifestation alleging that the change of name of said respondent was not done in good faith and is not in
accordance with the SEC order of Feb. 14, 1975.

In another order on January 17, 1979, the SEC reiterated that its February 14, 1975 order is clear on what it
requires or demand from respondent. The order enjoins the removal or deletion of the word 'ARMCO' from
respondent's corporate name, which was not so complied with. The respondent did not make the proper
disclosure of the circumstances when it amended its articles of incorporation and submitted the same for the
approval of the SEC. Thus, the Commission, cannot give its imprimatur to the new corporate name because there
was no compliance at all. An appeal was interposed by the respondent to the SEC  en banc. The Commission en
banc in an order of December 14, 1979 dismissed the appeal for lack of merit. 

ISSUE: WON respondent’s name ARMCO Steel Corporation is similar, if not Identical with that of petitioners
ARMCO Steel Corporation (of Ohio, USA.) and ARMCO-Marsteel Alloy Corporation, as to create uncertainty and
confusion in the minds of the public.

RULING: Yes. ARMCO Steel-Philippines, has not only an Identical name but also a similar line of business, as shown
above, as that of ARMCO Steel- Ohio. People who are buying and using products bearing the trademark "Armco"
might be led to believe that such products are manufactured by the respondent, when in fact, they might actually
be produced by the petitioners. Thus, the goodwill that should grow and inure to the benefit of petitioners could
be impaired and prejudiced by the continued use of the same term by the respondent.

It is indisputable that ARMCO-STEEL-OHIO, having patented the term 'Armco' as part of its trademark on its steel
products, is entitled to protection in the use thereof in the Philippines. The term "Armco" is now being used on the
products being manufactured and sold in this country by Armco-Marsteel by virtue of its tie-up with ARMCO-
STEEL-OHIO. Clearly, the two companies have the right to the exclusive use and enjoyment of said term. Obviously,
the petition for review is designed to further delay if not simply evade compliance with the said final and executory
SEC order. An order or resolution granting execution of the final judgment cannot be appealed, otherwise there
will be no end to the litigation. The petition is DISMISSED for lack of merit.

B73 Philips Export BV v. Court of Appeals, GR 96161, 21 February 1992,

Facts: Petitioners filed a letter complaint with the Securities & Exchange Commission (SEC) asking for the
cancellation of the word "PHILIPS" from Private Respondent's corporate name in view of the prior registration with
the Bureau of Patents of the trademark "PHILIPS" and the logo "PHILIPS SHIELD EMBLEM" in the name of
Petitioner, PEBV, and the previous registration of Petitioners Philips Electrical and Philips Industrial with the SEC.

As a result of Private Respondent's refusal to amend its Articles of Incorporation, Petitioners filed with the SEC, on
6 February 1985, a Petition (SEC Case No. 2743) praying for the issuance of a Writ of Preliminary Injunction,
alleging, among others, that Private Respondent's use of the word PHILIPS amounts to an infringement and clear
violation of Petitioners' exclusive right to use the same considering that both parties engage in the same business.

Petition for lack of merit. In so ruling, the latter declared that inasmuch as the SEC found no sufficient ground for
the granting of injunctive relief on the basis of the testimonial and documentary evidence presented, it cannot
order the removal or cancellation of the word "PHILIPS" 

Issue: Whether or not the petitioner have the exclusive right to its use which must be free from any infringement
by similarity.

Held: Yes. What is lost sight of, however, is that PHILIPS is a trademark or trade name which was registered as far
back as 1922. Petitioners, therefore, have the exclusive right to its use which must be free from any infringement
by similarity. A corporation has an exclusive right to the use of its name, which may be protected by injunction
upon a principle similar to that upon which persons are protected in the use of trademarks and tradenames 

As a general rule, parties organizing a corporation must choose a name at their peril; and the use of a name similar
to one adopted by another corporation, whether a business or a nonbusiness or non-profit organization if
misleading and likely to injure it in the exercise in its corporate functions, regardless of intent, may be prevented
by the corporation having the prior right, by a suit for injunction against the new corporation to prevent the use of
the name

Our own Corporation Code, in its Section 18, expressly provides that:

No corporate name may be allowed by the Securities and Exchange Commission if the proposed name is  identical
or deceptively or confusingly similar to that of any existing corporation or to any other name already protected by
law or is patently deceptive, confusing or contrary to existing law. Where a change in a corporate name is
approved, the commission shall issue an amended certificate of incorporation under the amended name.
(Emphasis supplied)

The statutory prohibition cannot be any clearer. To come within its scope, two requisites must be proven, namely:
(1) that the complainant corporation acquired a prior right over the use of such corporate name; and(2) the
proposed name is either:(a) identical; or(b) deceptively or confusingly similar to that of any existing corporation or
to any other name already protected by law; or(c) patently deceptive, confusing or contrary to existing law.

PHILIP MORRIS, INC., BENSON & HEDGES (CANADA), INC., AND FABRIQUES OF TABAC REUNIES, S.A., vs. THE
COURT OF APPEALS AND FORTUNE TOBACCO CORPORATION
G.R. No. 91332. July 16, 1993

FACTS: Philip Morris, Inc. and two other petitioners are ascribing whimsical exercise of the faculty conferred upon
magistrates by Section 6, Rule 58 of the Revised Rules of Court when respondent Court of Appeals lifted the writ of
preliminary injunction it earlier had issued against Fortune Tobacco Corporation, from manufacturing and selling
“MARK” cigarettes in the local market. Banking on the thesis that petitioners’ respective symbols “MARK VII”,
‘MARK TEN”, and “MARK”, also for cigarettes, must be protected against unauthorized appropriation.

All petitioners are not doing business in the Philippines but are suing on an isolated transaction, They Invoked
provisions of the Paris Convention for the Protection of Industrial and Intellectual Property. As corporate nationals
of member-countries of the Paris Union, they can sue before Philippine courts for infringement of trademarks, or
for unfair competition, without need of obtaining registration or a license to do business in the Philippines, and
without necessity of actually doing business in the Philippines.

Philip Morris and its subsidiaries filed the complaint for infringement and damages against Fortune Tobacco before
the Pasig Regional Trial Court (RTC) for manufacturing and selling cigarettes bearing the trademark “Mark” which is
identical and confusingly similar to Philip Morris trademarks. The said act was dismissed. Hence, this petition at
bar.

ISSUE: Whether or not the petitioner may sue and be afforded protection under the Philippines laws.

RULING: Petitioners may have the capacity to sue for infringement irrespective of lack of business activity in the
Philippines on account of Section 21-A of the Trademark Law but the question of whether they have an exclusive
right over their symbol as to justify issuance of the controversial writ will depend on actual use of their trademarks
in the Philippines in line with Sections 2 and 2-A of the same law. It is thus incongruous for petitioners to claim that
when a foreign corporation not licensed to do business in the Philippines files a complaint for infringement, the
entity need not be actually using its trademark in commerce in the Philippines. Such a foreign corporation may
have the personality to file a suit for infringement but it may not necessarily be entitled to protection due to
absence of actual use of the emblem in the local market.

More telling are the allegations of petitioners in their complaint as well as in the very petition filed with this Court
indicating that they are not doing business in the Philippines, for these frank representations are inconsistent and
incongruent with any pretense of a right which can breached. Indeed, to be entitled to an injunctive writ,
petitioner must show that there exists a right to be protected and that the facts against which injunction is
directed are violative of said right. On the economic repercussion of this case, we are extremely bothered by the
thought of having to participate in throwing into the streets Filipino workers engaged in the manufacture and sale
of private respondent’s “MARK” cigarettes who might be retrenched and forced to join the ranks of the many
unemployed and unproductive as a result of the issuance of a simple writ of preliminary injunction and this, during
the pendency of the case before the trial court, not to mention the diminution of tax revenues represented to be
close to a quarter million pesos annually. On the other hand, if the status quo is maintained, there will be no
damage that would be suffered by petitioners inasmuch as they are not doing business in the Philippines. In view
of the explicit representation of petitioners in the complaint that they are not engaged in business in the
Philippines, it inevitably follows that no conceivable damage can be suffered by them not to mention the foremost
consideration heretofore discussed on the absence of their “right” to be protected.
Godines v. Court of Appeals
G.R. No. 97343, September 13, 1993

FACTS:

This case involves a patent issued by the Philippine Patent Office to one Magdalena S. Villaruz which
covers a utility model for a hand tractor or power tiller. The above mentioned patent was acquired by SV-Agro
Industries Enterprises, Inc., herein private respondent, from Magdalena Villaruz, its chairman and president, by
virtue of a Deed of Assignment executed by the latter in its favor. In accordance with the patent, private
respondent manufactured and sold the patented power tillers with the patent imprinted on them. In 1979, SV-
Agro Industries suffered a decline of more than 50% in sales in its Molave, Zamboanga del Sur branch. Upon
investigation, it discovered that power tillers similar to those patented by private respondent were being
manufactured and sold by petitioner herein. Consequently, private respondent notified Pascual Godines about the
existing patent and demanded that the latter stop selling and manufacturing similar power tillers. Upon
petitioner's failure to comply with the demand, SV-Agro Industries filed before the Regional Trial Court a complaint
for infringement of patent and unfair competition.

After trial, the court held Pascual Godines liable for infringement of patent and unfair competition.

The decision was affirmed by the appellate court.

Petitioner maintains the defenses which he raised before the trial and appellate courts, to wit: that he was not
engaged in the manufacture and sale of the power tillers as he made them only upon the special order of his
customers who gave their own specifications; hence, he could not be liable for infringement of patent and unfair
competition; and that those made by him were different from those being manufactured and sold by private
respondent.

ISSUE:

Whether or not petitioner's product infringe upon the patent of private respondent.

RULING:

Yes. The question of whether petitioner was manufacturing and selling power tillers is a question of fact better
addressed to the lower courts. The fact that petitioner herein manufactured and sold power tillers without
patentee's authority has been established by the courts despite petitioner's claims to the contrary.

Tests have been established to determine infringement. These are (a) literal infringement; and (b) the doctrine of
equivalents. In using literal infringement as a test, ". . . resort must be had, in the first instance, to the words of the
claim. If accused matter clearly falls within the claim, infringement is made out and that is the end of it."  To
determine whether the particular item falls within the literal meaning of the patent claims, the Court must
juxtapose the claims of the patent and the accused product within the overall context of the claims and
specifications, to determine whether there is exact identity of all material elements.

Samples of the defendant's Goating power tiller have been produced and inspected by the court and compared
with that of the turtle power tiller of the plaintiff. In appearance and form, both the Goating power tillers of the
defendant and the turtle power tiller of the plaintiff are virtually the same. Viewed from any perspective or angle,
the power tiller of the defendant is identical and similar to that of the turtle power tiller of plaintiff in form,
configuration, design and appearance. The parts or components thereof are virtually the same.

In operation, the floating power tiller of the defendant operates also in similar manner as the turtle power tiller of
plaintiff. This was admitted by the defendant himself in court that they are operating on the same principles.

Moreover, it also observed that petitioner also called his power tiller as a floating power tiller. The patent issued by
the Patent Office referred to a "farm implement but more particularly to a turtle hand tractor having a vacuumatic
housing float on which the engine drive is held in place, the operating handle, the harrow housing with its
operating handle and the paddy wheel protective covering." It appears from the foregoing observation of the trial
court that these claims of the patent and the features of the patented utility model were copied by petitioner. We
are compelled to arrive at no other conclusion but that there was infringement.

Recognizing that the logical fallback position of one in the place of defendant is to aver that his product is different
from the patented one, courts have adopted the doctrine of equivalents which recognizes that minor modifications
in a patented invention are sufficient to put the item beyond the scope of literal infringement. Thus, according to
this doctrine, "(a)n infringement also occurs when a device appropriates a prior invention by incorporating its
innovative concept and, albeit with some modification and change, performs substantially the same function in
substantially the same way to achieve substantially the same result." The reason for the doctrine of equivalents is
that to permit the imitation of a patented invention which does not copy any literal detail would be to convert the
protection of the patent grant into a hollow and useless thing. Such imitation would leave room for — indeed
encourage — the unscrupulous copyist to make unimportant and insubstantial changes and substitutions in the
patent which, though adding nothing, would be enough to take the copied matter outside the claim, and hence
outside the reach of the law. A careful examination between the two power tillers will show that they will operate
on the same fundamental principles.
B76: Distilleria Washington Inc. v. Court of Appeals, GR 120961, 17 October 1996 DOCTRINE: Trademark refers to a
word, name, symbol. Emblem, sign or device or any combination thereof adopted and used by a merchant to
identify and distinguish from others, his goods of commerce. It is basically an intellectual creation that is
susceptible to ownership and consistently therewith, gives rise to its own elements of jus posidendi, jus utendi, jus
fruendi, jus disponendi, and jus abutendi, along with the applicable jus lex, comprising that ownership. The
incorporeal right, however, is distinct from the property in the material object subject to it. Thus, the transfer or
assignment of the intellectual property will not necessarily constitute a conveyance of the thing it covers, nor
would a conveyance of the latter imply the transfer or assignment of the intellectual right. FACTS: 1. The initiatory
suit for manual delivery with damages herein was instituted by La Tondena (LTDI) against Distillery Washington
(Washington) under a claim of ownership. Such action sought to seize from Washington 18,157 empty bottles
bearing blown- in marks of La Tondena and Ginebra San Miguel because, allegedly, Washington uses it for its own
Gin Sevem products without the consent of LTDI. The court in the said action issued a replevin to seize said bottles.
2. After hearing, the trial court ordered LTDI to return the bottles seized from Washington and in the event of
failure to return said bottles, LTDI is ordered to indemnify the defendant in the amount of P18,157.00 on the
ground that a purchaser of liquor pays only a single price for the liquor and the bottle and is not required to return
the bottle at any time. In view of the foregoing, LTDI appealed the decision to the Court of Appeals. CA reversed
and ordered the retention of the subject bottles in favor of LTDI on the ground that the marks of ownership of LTDI
stamped or blown-in to the bottles are sufficient notice to the public that the bottles are LTDI property. Thus,
Washington assailed the reversal of the trial court’s decision. Washington is of the position that R.A. 623 should
not apply to gin since it is not among those mentioned in the law and that, in any case, ownership of the bottles
was already transferred to it upon the sale of the gin and containers at a single price. Thus, he is now the lawful
owner of the said bottles. ISSUE: 1. Whether or not LTDI is now the lawful owner of the empty bottles upon sale of
the gin. 2. Whether or not RA 623 affords intellectual property protection to liquors. RULING: 1. In its decision, the
Supreme Court saw no cogent reason to depsrt from the rule already laid down in the previous case of Cagayan
Valley Enterprises v. Court of Appeals. In the said case, it ruled that RA 623 affords protection to a qualified
manufacturer who successfully registered with the Philippine Patent Office its duly stamped or marked bottled,
etc. The mere use of the registered bottles without the written consent of the manufacturer is prohibited, the only
exceptions being when they are used as containers for sisi, bagoong and patis and similar native products. RA 623
only required that bottles, in order to be eligible for registration, must be stamped or marked with the names of
the manufacturers or the names of their principals or products, or other marks of ownership. No drawings of labels
are required but, instead, two photographs of the container, duly signed by the applicant, showing clearly and
legibly the names and other marks of ownership sought to be registered and a bottle showing the name or other
mark of ownership, irremovably stamped or marked shall be submitted. 2. However, the court noted that the issue
in this case is not only one for violation of RA 623, but instead, it is one for replevin where the claimant must be
able to show convincingly that he is either the owner or clearly entitled to the possession of the object sought to
be recovered. Replevin focuses on possession. Evidently, RA 623 does not disallow the sale or transfer of
ownership of the marked bottles or containers. In fact, the contrary is implicit in the law. The buyer takes the item,
he is neither required to return the bottle nor required to make a deposit to assure its return to the seller. He
could return the bottle and get a refund but it cannot be gainsaid that ownership of the containers does pass on to
the consumer albeit subject to the statutory limitation on the use of registered containers and to the trademark
right of the registrant. The court sees no other logical purpose for Washington’s insistence to keep the bottles,
except for the unauthorized use thereof. The practical and feasible alternative herein is to merely require the
payment of just compensation to Washington for the bottles seized from it by LTDI.

ALFRED HAHN, petitioner,

Vs.

COURT OF APPEALS AND BAYERSCHE MOTOREN WERKE AKTIENGSELLCHAFT (BMW), respondents.

G.R. No. 113074, January 22, 1997

Facts:

Petitioner Alfred Hahn is a Filipino citizen doing business under the name and style "Hahn-Manila." On the other
hand, private respondent Bayerische Motoren Werke Aktiengesellschaft (BMW) is a nonresident foreign
corporation existing under the laws of the former Federal Republic of Germany, with principal office at Munich,
Germany.

On March 7, 1967, petitioner executed in favor of private respondent a "Deed of Assignment with Special Power of
Attorney”. Per the agreement, the parties "continue[d] business relations as has been usual in the past without a
formal contract." But on February 16, 1993, in a meeting with a BMW representative and the president of
Columbia Motors Corporation (CMC), Jose Alvarez, petitioner was informed that BMW was arranging to grant the
exclusive dealership of BMW cars and products to CMC, which had expressed interest in acquiring the same. On
February 24, 1993, petitioner received confirmation of the information from BMW which, in a letter, expressed
dissatisfaction with various aspects of petitioner's business, mentioning among other things, decline in sales,
deteriorating services, and inadequate showroom and warehouse facilities, and petitioner's alleged failure to
comply with the standards for an exclusive BMW dealer.2 Nonetheless, BMW expressed willingness to continue
business relations with the petitioner on the basis of a "standard BMW importer" contract, otherwise, it said, if this
was not acceptable to petitioner, BMW would have no alternative but to terminate petitioner's exclusive
dealership effective June 30, 1993.

Petitioner protested, claiming that the termination of his exclusive dealership would be a breach of the Deed of
Assignment. Hahn insisted that as long as the assignment of its trademark and device subsisted, he remained
BMW's exclusive dealer in the Philippines because the assignment was made in consideration of the exclusive
dealership. In the same letter petitioner explained that the decline in sales was due to lower prices offered for
BMW cars in the United States and the fact that few customers returned for repairs and servicing because of the
durability of BMW parts and the efficiency of petitioner's service.

Because of Hahn's insistence on the former business relation, BMW withdrew on March 26, 1993 its offer of a
"standard importer contract" and terminated the exclusive dealer relationship effective June 30, 1993.  At a
conference of BMW Regional Importers held on April 26, 1993 in Singapore, Hahn was surprised to find Alvarez
among those invited from the Asian region. On April 29, 1993, BMW proposed that Hahn and CMC jointly import
and distribute BMW cars and parts.

Hahn found the proposal unacceptable. On May 14, 1993, he filed a complaint for specific performance and
damages against BMW to compel it to continue the exclusive dealership. Later he filed an amended complaint to
include an application for temporary restraining order and for writs of preliminary, mandatory and prohibitory
injunction to enjoin BMW from terminating his exclusive dealership.

On June 30, 1993, the trial court issued an order granting the writ of preliminary injunction upon the filing of a
bond of P100,000.00. On July 13, 1993, following the posting of the required bond, a writ of preliminary injunction
was issued.
On July 1, 1993, BMW moved to dismiss the case, contending that the trial court did not acquire jurisdiction over it
through the service of summons on the Department of Trade and Industry, because it (BMW) was a foreign
corporation and it was not doing business in the Philippines. It contended that the execution of the Deed of
Assignment was an isolated transaction; that Hahn was not its agent because the latter undertook to assemble and
sell BMW cars and products without the participation of BMW and sold other products; and that Hahn was an
indentor or middleman transacting business in his own name and for his own account.

Petitioner Alfred Hahn opposed the motion. He argued that BMW was doing business in the Philippines through
him as its agent, as shown by the fact that BMW invoices and order forms were used to document his transactions;
that he gave warranties as exclusive BMW dealer; that BMW officials periodically inspected standards of service
rendered by him; and that he was described in service booklets and international publications of BMW as a "BMW
Importer" or "BMW Trading Company" in the Philippines.

The trial court deferred resolution of the motion to dismiss until after trial on the merits for the reason that the
grounds advanced by BMW in its motion did not seem to be indubitable. Without seeking reconsideration of the
aforementioned order, BMW filed a petition for certiorari with the Court of Appeals. BMW asked for the
immediate issuance of a temporary restraining order and, after hearing, for a writ of preliminary injunction, to
enjoin the trial court from proceeding further in Civil Case No. Q-93-15933. Private respondent pointed out that,
unless the trial court's order was set aside, it would be forced to submit to the jurisdiction of the court by filing its
answer or to accept judgment in default, when the very question was whether the court had jurisdiction over it.

The Court of Appeals enjoined the trial court from hearing petitioner's complaint. It ruled that BMW was not doing
business in the country and, therefore, jurisdiction over it could not be acquired through service of summons on
the DTI pursuant to Rule 14, §14. 'The court upheld private respondent's contention that Hahn acted in his own
name and for his own account and independently of BMW, based on Alfred Hahn's allegations that he had invested
his own money and resources in establishing BMW's goodwill in the Philippines and on BMW's claim that Hahn
sold products other than those of BMW. It held that petitioner was a mere indentor or broker and not an agent
through whom private respondent BMW transacted business in the Philippines. Consequently, the Court of
Appeals dismissed petitioner's complaint against BMW.

Issue: Whether or not BMW is doing business in the Philippines.

Ruling: Yes.

Nothing in the allegations of the amended complaint shows support to the appellate court's finding that Hahn
solicited orders alone and for his own account and without "interference from, let alone direction of, BMW." To
the contrary, Hahn claimed he took orders for BMW cars and transmitted them to BMW. Upon receipt of the
orders, BMW fixed the downpayment and pricing charges, notified Hahn of the scheduled production month for
the orders, and reconfirmed the orders by signing and returning to Hahn the acceptance sheets. Payment was
made by the buyer directly to BMW. Title to cars purchased passed directly to the buyer and Hahn never paid for
the purchase price of BMW cars sold in the Philippines. Hahn was credited with a commission equal to 14% of the
purchase price upon the invoicing of a vehicle order by BMW. Upon confirmation in writing that the vehicles had
been registered in the Philippines and serviced by him, Hahn received an additional 3% of the full purchase price.
Hahn performed after-sale services, including warranty services, for which he received reimbursement from BMW.
All orders were on invoices and forms of BMW.
These allegations were substantially admitted by BMW which, in its petition for certiorari before the Court of
Appeals, stated:

9.4. As soon as the vehicles are fully manufactured and full payment of the purchase prices are made, the
vehicles are shipped to the Philippines. (The payments may be made by the purchasers or third-persons or
even by Hahn.) The bills of lading are made up in the name of the purchasers, but Hahn-Manila is therein
indicated as the person to be notified.

9.5. It is Hahn who picks up the vehicles from the Philippine ports, for purposes of conducting pre-delivery
inspections. Thereafter, he delivers the vehicles to the purchasers.

9.6. As soon as BMW invoices the vehicle ordered, Hahn is credited with a commission of fourteen
percent (14%) of the full purchase price thereof, and as soon as he confirms in writing that the vehicles
have been registered in the Philippines and have been serviced by him, he will receive an additional three
percent (3%) of the full purchase prices as commission.

Contrary to the appellate court's conclusion, this arrangement shows an agency. An agent receives a commission
upon the successful conclusion of a sale. On the other hand, a broker earns his pay merely by bringing the buyer
and the seller together, even if no sale is eventually made.

As to the service centers and showrooms which he said he had put up at his own expense, Hahn said that he had to
follow BMW specifications as exclusive dealer of BMW in the Philippines. According to Hahn, BMW periodically
inspected the service centers to see to it that BMW standards were maintained. Indeed, it would seem from
BMW's letter to Hahn that it was for Hahn's alleged failure to maintain BMW standards that BMW was terminating
Hahn's dealership.

The fact that Hahn invested his own money to put up these service centers and showrooms does not necessarily
prove that he is not an agent of BMW. For as already noted, there are facts in the record which suggest that BMW
exercised control over Hahn's activities as a dealer and made regular inspections of Hahn's premises to enforce
compliance with BMW standards and specifications. For example, in its letter to Hahn dated February 23, 1996,
BMW stated:

In the last years we have pointed out to you in several discussions and letters that we have to tackle the
Philippine market more professionally and that we are through your present activities not adequately
prepared to cope with the forthcoming challenges.

In effect, BMW was holding Hahn accountable to it under the 1967 Agreement.

This case fits into the mold of Communications Materials, Inc. v. Court of Appeals, in which the foreign corporation
entered into a "Representative Agreement" and a "Licensing Agreement" with a domestic corporation, by virtue of
which the latter was appointed "exclusive representative" in the Philippines for a stipulated commission. Pursuant
to these contracts, the domestic corporation sold products exported by the foreign corporation and put up a
service center for the products sold locally. This Court held that these acts constituted doing business in the
Philippines. The arrangement showed that the foreign corporation's purpose was to penetrate the Philippine
market and establish its presence in the Philippines.

B78 Cagayan Valley Enterprises Inc. v. Court of Appeals,

GR 78413, 8 November 1989

Digested by: Tejada, Mac Arthur V.

FACTS:

This petition for review on certiorari seeks the nullification of the decision of the Court of Appeals of December 5,
1986 in CA-G.R. CV No. 06685 which reversed the decision of the trial court, and its resolution dated May 5, 1987
denying petitioner’s motion for reconsideration.

 In 1953, La Tondeña, Inc. (hereafter, LTI for short) registered with the Philippine Patent Office pursuant to
Republic Act No. 623 1 the 350 c.c. white flint bottles it has been using for its gin popularly known as
"Ginebra San Miguel." This registration was subsequently renewed on December 4, 1974.

 November 10, 1981, LTI filed Case for injunction and damages CFI of Isabela against Cagayan Valley
Enterprises, Inc. (Cagayan, for brevity) for using the 350 c.c., bottles with the mark "La Tondeña, Inc." and
"Ginebra San Miguel" by filling with Cagayan’s liquor product bearing the label "Sonny Boy" for
commercial sale and distribution;

Major Arguments of Respondent Cagayan:

1) LTI has no cause of action due to its failure to comply with Section 21 of Republic Act No. 166 which
requires the giving of notice that its aforesaid marks are registered by displaying and printing the words
"Registered in the Phil. Patent Office" or "Reg. Phil. Pat. Off.," hence no suit, civil or criminal, can be filed
against Cagayan;

2) contended that the bottles they are using are not the registered bottles of LTI since the former was using
the bottles marked with "La Tondeña, Inc." and "Ginebra San Miguel" but without the words "property of"
indicated in said bottles as stated in the sworn statement attached to the certificate of registration of LTI
for said bottles;

3) LTI is not entitled to any protection under Republic Act No. 623, as amended by Republic Act No. 5700,
because its products, consisting of hard liquor, are not among those contemplated therein. What is
protected under said law are beverages like Coca-cola, Royal Tru-Orange, Lem-O-Lime and similar
beverages the bottles whereof bear the words "Reg. Phil. Pat. Off.;"

RTC DECISION:
the trial court rendered judgment in favor of Cagayan, ruling that the complaint does not state a cause of action
and it awarded damages in favor of Cagayan;

CA DECISION:

On December 5, 1986 rendered a decision in favor of said appellant:

"WHEREFORE, the decision appealed from is hereby SET ASIDE and judgment is rendered permanently enjoining
the defendant, its officers and agents from using the 350 c.c. white flint bottles with the marks of ownership ‘La
Tondeña, Inc.’ and ‘Ginebra San Miguel’, blown-in or stamped on said bottles as containers for defendant’s
products.

"The writ of preliminary injunction issued by the trial court is therefore made permanent.

"Defendant is ordered to pay the amounts of:(1) P15,000.00 as nominal or temperate damages; (2) P50,000.00 as
exemplary damages; (3) P10,000.00 as attorney’s fees; and (4) Costs of suit." 8

ISSUE:

WON THE COURT OF APPEALS IS CORRECT IN REVERSING THE FINDINGS OF THE LOWER COURT (RULING
IN FAVOR OF RESPONDENT CAGAYAN NOT LIABLE UNDER SECTIONS 1, 2 AND 3 OF RA 623, AS AMENDED
BY RA 5700)

SC HELD:

Yes, the decision of the Court of Appeals is AFFIRMED; The petition of the Respondent Cagayan is DENIED for being
untenable as follows:

On the arguments of Respondent Cagayan:

1) The failure of LTI to make said marking “Registered in the Philippines Patent Office’ or ‘Reg. Phil. Pat. Off.’
will not bar civil action against petitioner Cagayan. The aforesaid requirement is not a condition sine qua
non for filing of a civil action against the infringer for other reliefs to which the plaintiff may be entitled.
The failure to give notice of registration will not deprive the aggrieved party of a cause of action against
the infringer but, at the most, such failure may bar recovery of damages but only under the provisions of
Republic Act No. 166;

2) Republic Act No. 623 which governs the registration of marked bottles and containers merely requires
that the bottles, in order to be eligible for registration, must be stamped or marked with the names of the
manufacturers or the names of their principals or products, or other marks of ownership. The omitted
words "property of" are not of such vital indispensability such that the omission thereof will remove the
bottles from the protection of the law. The owner of a trade-mark or trade-name, and in this case the
marked containers, does not abandon it by making minor modifications in the mark or name itself. 13
With much more reason will this be true where what is involved is the mere omission of the words
"property of" since even without said words the ownership of the bottles is easily identifiable. The words
"La Tondeña. Inc." and "Ginebra San Miguel" stamped on the bottles, even without the words "property
of," are sufficient notice to the public that those bottles so marked are owned by LTI;

3) The claim of petitioner that hard liquor is not included under the term "other lawful beverages" as
provided in Section 1 of Republic Act No. 623, as amended by Republic Act No. 5700, is without merit. The
title of the law itself, which reads "An Act to Regulate the Use of Duly Stamped or Marked Bottles, Boxes,
Casks, Kegs, Barrels and Other Similar Containers" clearly shows the legislative intent to give protection to
all marked bottles and containers of all lawful beverages regardless of the nature of their contents. The
 words "other lawful beverages" is used in its general sense, referring to all beverages not prohibited by
law. Beverage is defined as a liquor or liquid for drinking. Hard liquor, although regulated, is not
prohibited by law, hence it is within the purview and coverage of Republic Act No, 623, as amended;

ROWLAND KIM SANTOS, petitioner, vs. PRYCE GASES, INC., respondent.

FACTS:

Respondent Pryce Gases, Inc. is a domestic corporation engaged in the manufacture of oxygen, acetylene and
other industrial gases as well as in the distribution of LPG products in the Visayas and Mindanao regions. Its branch
in Iloilo City has been selling LPG products directly or through various dealers to hospitals, restaurants and other
business establishments. The LPG products are contained in 11-kg, 22-kg or 50-kg steel cylinders that are
exclusively manufactured for respondent’s use. The LPG cylinders are also embossed with the Pryce marking and
logo.2

In the beginning of the year 2002, respondent noticed the decline in the return of its LPG cylinders for refilling. Respondent’s employees suspected that the LPG cylinders had

Respondent Pryce Gases, Inc. is a domestic corporation engaged in the manufacture of oxygen, acetylene and
other industrial gases as well as in the distribution of LPG products in the Visayas and Mindanao regions. Its branch
in Iloilo City has been selling LPG products directly or through various dealers to hospitals, restaurants and other
business establishments. The LPG products are contained in 11-kg, 22-kg or 50-kg steel cylinders that are
exclusively manufactured for respondent’s use. The LPG cylinders are also embossed with the Pryce marking and
logo.2

In the beginning of the year 2002, respondent noticed the decline in the return of its LPG cylinders for refilling. Respondent’s employees suspected that the LPG cylinders had

Pryce Gases, Inc. is a domestic corporation engaged in the manufacture of oxygen, acetylene and other industrial
gases as well as in the distribution of LPG products and has been selling the same directly or through various
dealers to hospitals, restaurants and other business establishments. The LPG products are contained in steel
cylinders embossed with the Pryce marking and logo which are exclusively manufactured for its use.
It noticed that sometime in the beginning of 2002, the decline in the return of said cylinders for refilling and
suspected that they were removed from the market circulation and refilled by its competitors, one of whom was
Sun Gas, Inc. Its sales manager sought the assistance of the CIDG to recover said cylinders. CIDG operatives
conducted surveillance and were able to enter on the warehouse of Sun Gas in Timawa Avenue, Molo, Iloilo, and
took photographs of the said cylinders. By virtue of this surveillance, they applied for the issuance of a search
warrant before RTC Iloilo and the same was granted. CIDG operatives were able to recover the Pryce LPG Tank
cylinders which are: 544 empty 11-kg; 2 filled 11-kg with seal; 7 filled 11-kg without seal; 44 empty 22-kg; 10 empty
50-kg; and 1 filled 6-kg without seal. CIDG filed a criminal complaint with the Office of the City Prosecutor against
Santos for violation of R.A. No. 623, as amended.

Rowland Kim Santos, manager of Sun Gas, filed a motion to quash said search warrant on the grounds of lack of
probable cause, deception and fraud employed in obtaining evidence in support of the application. The RTC
granted said motion and made a turnaround, stating that the probable cause as found by it at the time of the
application for search warrant fell short of the requisite probable cause necessary to sustain the validity of the
search warrant.

Pryce Gases appealed to the Court of Appeals contending RTC’s grave abuse of discretion. CA ruled in favor of
Pryce Gases setting aside the order of the RTC and ordering the return of the seized items to Pryce Gases. Santos’s
motion for reconsideration was denied. Hence, this petition.

Respondent Pryce Gases, Inc. is a domestic corporation engaged in the manufacture of oxygen, acetylene and
other industrial gases as well as in the distribution of LPG products in the Visayas and Mindanao regions. Its branch
in Iloilo City has been selling LPG products directly or through various dealers to hospitals, restaurants and other
business establishments. The LPG products are contained in 11-kg, 22-kg or 50-kg steel cylinders that are
exclusively manufactured for respondent’s use. The LPG cylinders are also embossed with the Pryce marking and
logo.2

In the beginning of the year 2002, respondent noticed the decline in the return of its LPG cylinders for refilling. Respondent’s employees suspected that the LPG cylinders had

ISSUE:

Who has proper custody of the seized items?

HELD:

The resolution of the issue as to who has legal custody of the seized items depends upon the determination of the
existence of probable cause in the issuance of the search warrant.

Probable cause for a search warrant is defined as such facts and circumstances which would lead a reasonably
discrete and prudent man to believe that an offense has been committed and that the objects sought in
connection with the offense are in the place sought to be searched. 23 A finding of probable cause needs only to rest on evidence showing that, more
likely than not, a crime has been committed and that it was committed by the accused. Probable cause demands more than bare suspicion; it requires less than evidence which would justify

conviction.24 The existence depends to a large degree upon the finding or opinion of the judge conducting the examination. However, the findings of the judge should not
Probable cause for a search warrant is defined as such facts and circumstances which would lead a reasonably
discrete and prudent man to believe that an offense has been committed and that the objects sought in
connection with the offense are in the place sought to be searched. A finding of probable cause needs only to rest
on evidence showing that, more likely than not, a crime has been committed and that it was committed by the
accused. Probable cause demands more than bare suspicion; it requires less than evidence which would justify
conviction. The existence depends to a large degree upon the finding or opinion of the judge conducting the
examination. However, the findings of the judge should not disregard the facts before him nor run counter to the
clear dictates of reason.

In this case, the application for a search warrant was based on the alleged violation by Santos of certain provisions
of R.A. No. 623, as amended by R.A. No. 5700. The amended provisions of R.A. No. 623 state:

“Sec. 2. It shall be unlawful for any person, without the written consent of the manufacturer, bottler, or
seller, who has successfully registered the marks of ownership in accordance with the provisions of the
next preceding section, to fill such bottles, boxes, kegs, barrels, steel cylinders, tanks, flasks, accumulators,
or other similar containers so marked or stamped, for the purpose of sale, or to sell, dispose of, buy or
traffic in, or wantonly destroy the same, whether filled or not to use the same for drinking vessels or
glasses or drain pipes, foundation pipes, for any other purpose than that registered by the manufacturer,
bottler or seller. Any violation of this section shall be punished by a fine of not more than one thousand
pesos or imprisonment of not more than one year or both.

Sec. 3. The use by any person other than the registered manufacturer, bottler or seller, without written
permission of the latter of any such bottler, cask, barrel, keg, box, steel cylinders, tanks, flasks,
accumulators, or other similar containers, or the possession thereof without written permission of the
manufacturer, by any junk dealer or dealer in casks, barrels, kegs, boxes, steel cylinders, tanks, flasks,
accumulators, or other similar containers, the same being duly marked or stamped and registered as
herein provided, shall give rise to a prima facie presumption that such use or possession is unlawful.”

Section 3 of R.A. No. 623, as amended, clearly creates a prima facie presumption of the unlawful use of gas
cylinders based on two separate acts, namely, the unauthorized use of the cylinder by a person other than the
registered manufacturer and the possession thereof by a dealer. RTC’s conclusion that the mere possession by
petitioner of the seized gas cylinders was not punishable under Section 2 of R.A. No. 623, as amended, is not
correct. It failed to consider that Santos was not only in possession of the gas cylinders but was also distributing
the same. The failure of the CIDG operatives to confiscate articles and materials used in tampering with the Pryce
marking and logo did not negate the existence of probable cause. The fact of possession and distribution of the gas
cylinders and the claim by Pryce Gases that it did not authorize Santos to distribute the same was a sufficient
indication that Santos is probably guilty of the illegal use of the gas cylinders punishable under Section 2 of R.A. No.
623, as amended.

The seized items should remain in the custody of the trial court which issued the search warrant pending the
institution of criminal action against Santos.