INTELLECTUAL PROPERTY LAW

AUGUST 18, 2011

Bata Industries v. CA [REG]
Abad Santos | 1982
Facts:
Bata shoes made by Gerbec and Hrdina of
Czechoslovakia
were
sold
in
the
Philippines prior to World War II. Some
shoes made by Bata Industries, Ltd., a
Canadian corporation, were perhaps also
sold in the Philippines until 1948.
However, the trademark BATA was never
registered in the Philippines by any foreign
entity
New Olympian Rubber Products Co., Inc.
sought before the Philippine Patent Office
the registration of the mark BATA for
casual rubber shoes. It alleged that it has
used the mark since July 1, 1970.
Registration was opposed by Bata
Industries, Ltd. which alleged that it owns
and has not abandoned the trademark
BATA.
Bata Industries had no license to
do business in the Philippines;
not presently selling footwear
under the trademark BATA in the
Philippines; and
has no licensing agreement with
any local entity or firm to sell its
products in the Philippines.
PPO: dismissed the opposition and
ordered the registration of the trademark
BATA in favor of the domestic corporation.
Decision was appealed to the CA.
CA: Reversed, but after two motions for
reconsideration, affirmed the Director of
Patents.
Issue: WON the opposition of petitioner
should have prospered.
Ruling: NO.
Any slight goodwill generated by the
Czechoslovakian
product
during
the
Commonwealth years was completely

abandoned and lost in the more than 35

years that have passed since the
liberation of Manila from the Japanese
troops.
Petitioner was:
never a user of the trademark
BATA either before or after the
war;
is not the successor-in-interest of
Gerbec and Hrdina who were not
its representatives or agents, and
could not have passed any rights
to the petitioner;
there was no privity of interest
between
the
Czechoslovakian
owner and the Canadian petitioner
and that the Czechoslovakian
trademark has been abandoned in
Czechoslovakia.
More than substantial evidence supports
the findings and conclusions of the
Director of Patents. The petitioner has no
Philippine goodwill that would be damaged
by the registration of the mark in the
respondents favor.

Mirpuri vs. Court of Appeals, supra

Ang Tibay vs. Teodoro, supra

Chua Che vs. Philippines Patent Office

[JING]
January 30, 1965 | Paredes
FACTS:
On 30 October 1958, Chua Che filed a
petition for the registration in his favor of
the trade name "X-7" which he used since
June 10, 1957 for granulated soap.
Respondent
Sy
Tuo
opposed
the
application on the ground that he has prior
use of the trademark "X-7" since July 31,
1952 for toilet articles such as perfume,
lipstick and nail polish. He also claims that
he has spent a big amount in expanding
his business for the manufacture of toilet
soap and crystal laundry soap with his
already popular "X-7" brand.

In his Answer, petitioner said that

although "X-7" is registered in the name of
oppositor, said trademark is not being
used on soap, but purely toilet articles.
Director of Patents: The products of the
parties, while specifically different, are
products intended for use in the home and
usually have common purchasers. The
average purchasers are likely to associate
X-7 laundry soap with X-7 perfume, lipstick
and nail polish or to think that the
products
have
common
origin
or
sponsorship.
ISSUE:
WON petitioner is barred from using X-7
on granulated soap, a mark already
registered for use on toilet articles,
notwithstanding the absence of prior use
of the mark on granulated soap YES.
HELD:
The circumstance of non-actual use of the
mark on granulated soap by Sy Tuo, does
not detract from the fact that he has
already a right to such a trademark and
should, therefore, be protected. The
observation of the Director of Patents to
the effect that "the average purchasers
are likely to associate X-7 laundry soap
with X-7 perfume, lipstick and nail polish
or to think that the products have
common origin or sponsorship," is indeed
well taken.
It does not matter that the product upon
which the trademark X-7 will be used
(laundry soap) is different from those of Sy
Tuo's. While it is no longer necessary to
establish that the goods of the parties
possess the same descriptive properties,
as previously required under the Trade
Mark Act of 1905, registration of a
trademark should be refused in cases
where there is a likelihood of confusion,
mistake, or deception, even though the
goods fall into different categories. The
products of Sy Tuo are common household
items nowadays, in the same manner as
laundry soap. The likelihood of purchasers
to associate those products to a common
origin is not far-fetched. Both from the
standpoint of priority of use and for the
protection of the buying public and, of

course, Sy Tuo's rights to the trademark

"X-7", it becomes manifest that the
registration of said trademark in favor of
Chua Che should be denied.

Sta. Ana vs. Maliwat [GAY]

August 31, 1968; Reyes, J.B.L.
Facts:
On 21 June 1962, Florentino Maliwat filed
with the Patent Office an application for
registration of the trademark FLORMANN
(for shirts, pants, jackets and shoes for
ladies, men and children), claiming first
use in commerce of the said mark on 15
January 1962, which was later amended to
6 July 1955.
On 18 September 1962, Jose P. Sta. Ana
filed an application for the registration of
the
tradename
FLORMEN
SHOE
MANUFACTURERS
(for
ladies
and
childrens shoes), claiming 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.
After trial, Sta. Anas
application was denied.
Sta. Ana appealed to the SC, alleging that
the Director of Patents erred in not finding
that Maliwat failed to establish by clear
and convincing evidence his date of use.
He also alleged that the Director of
Patents
should
have
allowed
the
concurrent use of tradename FLORMEN
SHOE
MANUFACTURERS
and
the
trademark FLORMANN provided it is not
used on shoes.
Issues:
1. Who has first use? MALIWAT (for
FLORMANN)
2. WON the use of the trademark
FLORMANN could be confined to
tailoring and haberdashery only and
not on shoes - NO
Held:

1. The findings of the Director that

Maliwat was the prior adopter and user
of the mark cannot be contradicted,
since his findings were based on facts
stipulated in the course of the trial in
the interference proceedings. During
the proceedings, the following was
stipulated:

trademark is entitled is not limited to

guarding his goods or business from
actual
market
competition
with
identical or similar products of the
parties.
It extends to all cases in
which the use by a junior appropriator
of a trademark 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.
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. 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 (Aunt
Jemima Mills Co. vs. Rigney & Co), or
cosmetics and toilet goods from ladies'
wearing apparel and costume jewelry
(Lady Esther Ltd. vs. Lady Esther
Corset Shoppe).

(Sta. Ana) is engaged solely in the

manufacture of shoes under the firm
name
FLORMEN
SHOE
MANUFACTURERS since April 1959...
That Mr. Florentino Maliwat has been
engaged in the manufacture and sale
of menswear 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...
Since that stipulation of fact has not
been shown to have been made
through palpable mistake, it is vain for
the petitioner to allege that the
evidence for the respondent is false,
fabricated,
inconsistent,
indefinite,
contradictory, unclear, unconvincing,
and unsubstantial.
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 (Anchor Trading
Co., Inc. vs. The Director of Patents, et
al.). In the case at bar, the proof of
date of first use (1953), earlier than
that alleged in respondent Maliwat's
application (1962), can be no less than
clear and convincing because the fact
was stipulated and no proof was
needed.
2. Modern law recognizes that the
protection to which the owner of a

Also, under RA 166, Sec 4 (d) 1, it is not

required
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.

Philippine Refining Co., Inc. v. Ng Sam

[CEL]
(July 30, 1982; Escolin J.)

Sec. 4 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;

Facts: Petitioner was the first to use and

register the trademark CAMIA in 1922
and 1949, respectively, on its products
which covers vegetable and animal fats,
particularly lard, butter and cooking oil, all
classified under Class 47 (Fods and
Ingredients of Food).
On November 1960, respondent filed an
application for registration of the identical
trademark CAMIA for his ham product,
which likewise falls under Class 47.
Petitioner opposed citing Sec 4(d) of the
Trademark Law2.
The Director of Patents rendered a
decision allowing registration of the
trademark CAMIA in favor of Ng Sam.
Issue:
WON
the
product
of
respondent, which is ham, and those
of petitioner consisting of lard,
butter, cooking oil and soap are so
related that he use of the same
trademark CAMIA on said goods
would likely result in confusion as to
their source or origin. [NO]
Ratio: The business of the parties are
non-competitive and their products so
unrelated that the use of identical
trademarks are not likely to give rise to
confusion, much less cause damage to
petitioner.
I. The right to trademark is a limited one,
in the sense that others may use the same
mark on unrelated goods.
II. Under Sec 4(d) of the Trademark Law,
registration of trademark which so
resembles another already registered or in
use should be denied where to allow such
registration
could
likely
result
to
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.
2

Sec4(d) provides as unregisterable a mark which

consists of or comprises a mark or tradename which
so resembles a mark or tradename previously used
in the Phiippines by another and not abandoned, as
to be likely, when applied to or used in connection
with the gods, business services of the applicant, to
cause confusion or mistake or to deceive purchasers.

III. 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.
IV. If a mark is so commonplace that it
cannot be readily distinguished from
others, then it is apparent that it cannot
identify a particular business; and he who
first adopted it cannot be injured by any
subsequent appropriation or imitation by
others, and the public will not be
deceived.
CAMIA: descriptive of a whole
genus of garden plants with
fragrant white flowers
Camia, 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.
Camia as a trademark is far from
being distinctive. By itself, it does
not identify petitioner as the
manufacturer or producer of the
goods upon which said pmark is
used (unlike Rolex, Kodak, Kotex)
Records show that the term
CAMIA has been registered as a
trademark not only by petitioner
but by 2 other concerns (one
engaged in Thread and Yarn and
the other engaged in Textiles,
Embroideries laces, etc.)
V. While ham and some of the products of
petitioner are classified under Class 47,
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
Director of Patents took into
account several factors such as
probable purchaser attitude and

habits, marketing activities, retail

outlets
and
commercial
impression.
It was found that the products of
petitioner and respondent does not
move in the same manner through
the same channels of trade
The goods are so unrelated that
consumers would not in any
probability mistake one as the
source or origin of the product of
the other.

VI. Sec 16 of Trademark Act, in referring to

merchandise of substantially descriptive
properties, embraces competitive and
noncompetitive 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 defendant.
The goods of the petitioner are
basically derived from vegetable
and animal fats, while the product
of respondent is processed from
pigs legs. A consumer would not
reasonably assume that petitioner
has so diversified its business as to
include the product of respondent.
Judgment: Affirmed.

Esso Standard Eastern, Inc. v. CA

[LIV]
August 31, 1982 Teehankee, J.
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 Corp. 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.
Barely had respondent as such successor
started manufacturing cigarettes with the
trademark
ESSO,
when
petitioner
commenced a case for trademark
infringement in the Court of First Instance
of Manila.
CFI in favor of petitioner
CA reversed
Issue: WON there
infringement [NO]

was

trademark

Ratio:
The law defines infringement as the use
without consent of the trademark owner of
any "reproduction, counterfeit, copy or
colorable limitation of any registered mark
or tradename 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 tradename and apply such
reproduction,
counterfeit,
copy
or
colorable limitation to labels, signs, prints,
packages,
wrappers,
receptacles
or
advertisements intended to be used upon
or in connection with such goods, business
or services."
Implicit in this definition is the
concept that the goods must be so
related that there is a likelihood
either of confusion of goods or
business. But likelihood of confusion is a
relative concept; to be determined only
according
to
the
particular,
and
sometimes peculiar, circumstances of
each case.
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.
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 may also be
related because they serve the same
purpose or are sold in grocery stores.
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.
As applied:
The goods are so foreign to each other as
to make it unlikely that purchasers would
think that petitioner is the manufacturer of
respondent's goods.
Petitioner uses the trademark ESSO
and holds certificate of registration
of the trademark for petroleum
products,
including
aviation
gasoline, grease, cigarette lighter
fluid and other various products
such
as
plastics,
chemicals,
synthetics,
gasoline
solvents,
kerosene,
automotive
and
industrial
fuel,
bunker
fuel,
lubricating oil, fertilizers, gas,
alcohol, insecticides and the ESSO
Gasul" burner, while respondent's
business
is
solely
for
the
manufacture and sale of the
unrelated product of cigarettes.

The public knows too well that

petitioner
deals
solely
with
petroleum products that there is no
possibility that cigarettes with
ESSO brand will be associated with
whatever good name petitioner's
ESSO
trademark
may
have
generated.
The products of each party move
along and are disposed through
different channels of distribution.
The (petitioner's) products are
distributed
principally
through
gasoline service and lubrication
stations, automotive shops and
hardware stores. On the other
hand, the (respondent's) cigarettes
are sold in sari-sari stores, grocery
stores, and other small distributor
outlets. (Respondent's) cigarettes
are even peddled in the streets
while (petitioner's) 'gasul' burners
are not.
A comparison of the labels of the
samples of the goods submitted by
the parties shows a great many
differences on the trademarks
used.

Disposition: Petition dismissed.

Hickock Manufacturing
[MEL]
1982; Teehankee, J.

Co.

vs.

CA

Facts:
Hickock Manufacturing registered the
trademark HICKOCK for its leather
wallets, key cases, money folds made
of
leather,
belts,
mens
briefs,
neckties, handkerchiefs and mens
socks.
Santos Lim Bun Liong registered the
same trademark for its Marikina shoes.
Hickock Manufacturing filed a petition
to cancel Santos registration on the
ground of its earlier registration.
The Director of Patents granted the
trademark
cancellation.
The
CA
reversed.
Issue: WON the cancellation of the
trademark registration was proper

(NO, because the goods are noncompeting)

Ratio:
It
is
established
doctrine
that
emphasis should be on the similarity
of the products involved and not on
the arbitrary classification or general
description of their properties or
characteristics and that 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.
While the law does not require that the
competing trademarks be identical, the
two marks must be considered in their
entirety, as they appear in the respective
labels, in relation to the goods to which
they are attached.

There must be not only resemblance

between the trademark
of the
plaintiff and of the defendant, but
also similarity of the goods to which
the two trademarks are respectively
attached.
As applied:
Taking into account the facts of record that
Hickock
Manufacturing,
a
foreign
corporation registered the trademark for
its diverse articles of mens wear such as
wallets, belts and mens briefs which are
all manufactured here in the Philippines by
a licensee but are so labeled as to give the
misimpression that the said goods are of
foreign (stateside) manufacture and that
Santos secured its trademark registration
exclusively for shoes (which neither
Hickock
nor
the
licensee
ever
manufactured or traded in) which are
clearly labeled in block letters as Made in
Marikina, Rizal, Philippines, no error can
be attributed to the CA in upholding
Santos
registration
of
the
same
trademark for his unrelated and noncompeting product of Marikina shoes.
Judgment: Affirmed

Faberge vs. IAC [TRACE]

Faberge registered its symbol BRUT

for after-shave lotion, shaving
cream, deodorant, talcum powder
and toilet soap. It also applied for
the registration of the trademark
BRUT 33 and DEVICE for antiperspirant, personal deodorant, cream
shave, after shave/shower lotion, hair
spray and shampoo.
Pending its application for BRUT 33
and DEVICE, Co Beng Kay applied for
the
registration
of
BRUTE
trademark for briefs. The Director of
Patents approved the registration
Faberge opposed saying that the
similarity of the marks would cause
irreparable injury to its business
reputation
Defenses of Co Beng Kay:
o Briefs and cosmetics do not
belong to the same class nor do
they have the same descriptive
properties such that the use of a
trademark on ones goods does
not prevent the adoption and use
of the same trademark by others
on unrelated articles of a different
nature (Hicock Manufacturing v.
CA)
Counter-argument of Faberge
o Cited JBL Reyes in Sta. Ana v.
Maliwat: dissimilarity of goods will
not preclude relief if the junior
users goods are not remote from
any other product which the first
user would be likely to make or
sell.
o JBL Reyes cited as basis what is
now sec. 4(d) of RA 166 which
states that the law in point does
not require that articles of
manufacture of the previous user
and later 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
Sec. 4(d) of RA 166 conflicts with
sec.20 of the same law which
states:
o A certificate of registration of a
mark or tradename shall be prima

face evidence of the validity of the

registration,
the
registrants
ownership
of
the
mark
or
tradename, and of the registrants
exclusive right to use the same in
connection
with
the
goods,
business or services specified in
the certificate, subject t any
conditions and limitations stated
therein
This means that the mantle of
protection of the law extends only
to the goods used by the first user
as specified in its certificate of
registration

Issue: Will the previous trademark of

Faberge on unrelated goods bar Co Beng
Kays registration of Brute for briefs?
(NO)
Ratio:
Section 20 is controlling over sec. 4(d).
The rule is that the clause which comes
later shall be given paramount importance
over an anterior proviso upon the
presumption that it expresses the latest
and dominant purpose.
This means that Co Beng Kay can
appropriate its symbol for briefs because
as remarked in Sterling v. Farbenfabriken
Bayer:
Really, if the certificate of registration
were deemed as including goods not
specified therein, then a situation may
arise whereby an applicant may be
tempted to register a trademark on any
and all goods which his mind may
conceive even if he had never intended to
use the trademark for the said goods. We
believe that such omnibus registration is
not contemplated by Trademark Law.
Withal,
judging
from
the
physical
attributes of petitioners and respondents
products, there can be do doubt that
confusion or likelihood of deception to the
average purchaser is unlikely since the
goods are non-competing and unrelated.
A purchaser out to buy BRUTE brief would
definitely not be mistaken or misled into
buying BRUT after-shave or deodorant.

Canon Kabushiki Kaisha

[CIELA]
GONZAGA-REYES, J. (2000)

vs.

CA

FACTS:
On
January
15,
1985,
private
respondent NSR Rubber Corporation
(private
respondent)
filed
an
application for registration of the mark
CANON for sandals in the BPTTT.
A Verified Notice of Opposition was
filed by petitioner, a foreign
corporation duly organized and
existing under the laws of Japan.
The evidence presented by petitioner
consisted
of
its
certificates
of
registration for the mark CANON in
various countries covering goods
belonging to class 2 (paints, chemical
products, toner, and dye stuff).
Petitioner also submitted in evidence
its Philippine Trademark Registration,
showing its ownership over the
trademark CANON also under class 2.
The
BPTTT
issued
its
decision
dismissing the opposition of petitioner
and giving due course to private
respondent's
application
for
the
registration of the trademark CANON.
The CA affirmed the decision of BPTTT.
ISSUE: WON private respondent may use
the mark CANON for its sandals (class 25)
despite registration of said mark by
petitioner for class 2 goods (YES)
Ordinarily, the ownership of a trademark
or tradename is a property right that the
owner is entitled to protect as mandated
by the Trademark Law. However, when a
trademark is used by a party for a
product in which the other party does
not deal, the use of the same
trademark on the latter's product
cannot be validly objected to.
a) The certificates of registration for the
trademark CANON in other countries
and in the Philippines as presented by
petitioner, clearly showed that said
certificates of registration cover goods
belonging to class 2 (paints, chemical
products, toner, dyestuff). On this
basis, the BPTTT correctly ruled that
private respondent can use the

trademark CANON for its

classified as class 25 (sandals).

goods

b) Petitioner failed to attach evidence

that would convince this Court that
petitioner has also embarked in the
production of footwear products.
Faberge Inc. vs. IAC: The certificate of
registration confers upon the trademark
owner the exclusive right to use its own
symbol only to those goods specified in
the certificate, subject to the conditions
and limitations stated therein.
Thus, the exclusive right of petitioner
in this case to use the trademark
CANON is limited to the products
covered
by
its
certificate
of
registration.
c) The products involved are so unrelated
that the public will not be misled that
there is the slightest nexus between
petitioner and the goods of private
respondent.
In cases of confusion of business or origin,
the question that usually arises is whether
the respective goods or services of the
senior user and the junior user are so
related as to likely cause confusion of
business or origin, and thereby render the
trademark or tradenames confusingly
similar. 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 may also be related because they
serve the same purpose or are sold in
grocery stores.
Undoubtedly,
the
paints,
chemical
products, toner and dyestuff of petitioner
that carry the trademark CANON are
unrelated to sandals, the product of
private respondent. The two classes of
products in this case flow through
different trade channels. The products of
petitioner are sold through special
chemical stores or distributors while the
products of private respondent are sold in

grocery stores, sari-sari

department stores.

stores

and

ISSUE: WON petitioner may properly

invoke the protective mantle of the Paris
Convention (NO)
Petitioner asserts that it has the exclusive
right to the mark CANON because it forms
part of its corporate name or tradename,
protected by Article 83 of the Paris
Convention. Petitioner questions the
applicability of the guidelines4 embodied
in the Memorandum of then Minister of
Trade and Industry Roberto Ongpin which
according to petitioner implements Article
6bis5 of the Paris Convention, the provision
referring to the protection of trademarks,
not tradenames. Petitioner believes that
the appropriate memorandum to consider
is that issued by the then Minister of Trade
and Industry, Luis Villafuerte, directing the
Director of patents to:
3

"A tradename shall be protected in all the countries

of the Union without the obligation of filing or
registration, whether or not it forms part of a
trademark."
4

"a) the mark must be internationally 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
class of goods;
d) the person claiming must be the owner of the
mark."
5

(1)The countries of the Union undertake, either

administratively if their legislation so permits, or at
the request of an interested party, to refuse or to
cancel the registration and to prohibit the use of a
trademark
which
constitutes
a reproduction,
imitation or translation, liable to create confusion, of
a mark considered by the competent authority of the
country of registration or use to be well-known in
that country as being already the mark of a person
entitled to the benefits of the present Convention
and used for identical or similar goods. These
provisions shall also apply when the essential part of
the mark constitutes a reproduction of any such wellknown mark or an imitation liable to create confusion
therewith.
(2) A period of at least five years from the date of
registration shall be allowed for seeking the
cancellation of such a mark. The countries of the
Union may provide for a period within which the
prohibition of use must be sought.
(3) No time limit shall be fixed for seeking the
cancellation or the prohibition of the use of marks or
used in bad faith."

"reject all pending applications for

Philippine registration of signature
and
other
world
famous
trademarks by applicants other
than the original owners or users."
The term "trademark" is defined by RA
166, the Trademark Law, as including "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 them for those manufactured,
sold or dealt in by others."
Tradename is defined by the same law as
including "individual names and surnames,
firm names, tradenames, devices or words
used by manufacturers, industrialists,
merchants, agriculturists, and others to
identify their business, vocations, or
occupations; the names or titles lawfully
adopted and used by natural or juridical
persons, unions, and any manufacturing,
industrial, commercial, agricultural or
other organizations engaged in trade or
commerce."
Simply put, a trade name refers to
the business and its goodwill; a
trademark refers to the goods.
The Paris Convention, of which both the
Philippines and Japan, the country of
petitioner, are signatories, 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.
We agree with public respondents that the
controlling doctrine with respect to the
applicability of Article 8 of the Paris
Convention is that established in Kabushi
Kaisha Isetan vs. IAC:
The Paris Convention 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.

DISPOSITION: Petition for review

certiorari is DENIED for lack of merit.

on

246 Corp. vs. Daway [REG]

Ynares-Santiago | 2003
Facts:
Respondents Montres Rolex S.A. and Rolex
Centre Phil., Limited, owners/proprietors of
Rolex and Crown Device, filed against
petitioner 246 Corporation a suit for
trademark infringement and damages
before the RTC-QC. They alleged that
sometime in July 1996, petitioner adopted
and, since then, has been using without
authority the mark "Rolex" in its business
name "Rolex Music Lounge" as well as in
its newspaper advertisements as "Rolex
Music Lounge, KTV, Disco & Party Club."
246 Corp.: no cause of action because no
trademark
infringement
exist;
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.
Petitioner filed a motion for preliminary
hearing on its affirmative defenses with
motion to dismiss. The same was denied.
Upon certiorari, the CA dismissed.
Issue: WON a junior user of a well-known
mark on goods or services which are not
similar to the goods or services specified
in the certificate of registration of the wellknown mark is precluded from using the
same on the entirely unrelated goods or
services.
Ruling: YES.
Under the old Trademark Law, where the
goods for which the identical marks are
used are unrelated, there can be no
likelihood of confusion and there is
therefore no infringement in the use by
the junior user of the registered mark on
the entirely different goods. This ruling,
however, has been to some extent,

modified by Section 123.1(f)

Intellectual Property Code.6

of

the

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:
1)
The
mark
internationally
Philippines7

is
well-known
and
in
the

Sec. 123. Registrability. 123.1. A mark cannot be

registered if it:
(f) Is identical with, or confusingly similar to, or
constitutes a translation of a mark considered wellknown 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;
7

In determining whether a mark is well known, the

following criteria or any combination thereof may be
taken into account: (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

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.
3) The interests of the owner of
the well-known mark are likely
to be damaged.
Section 123.1(f) is clearly in point because
the Music Lounge of petitioner is entirely
unrelated
to
respondents
business
involving watches, clocks, bracelets, etc.
However, the Court cannot yet resolve the
merits
of
the
present
controversy
considering that the requisites for the
application of Section 123.1(f), clearly
require determination facts of which need
to be resolved at the trial court.

Societe Des Produits Nestle, S.A. vs.

Court of Appeals [JING]
April 4, 2001 | Ynares-Santiago
FACTS:
On 18 January 1984, private respondent
CFC Corporation filed an application
before the Bureau of Patents, Trademarks
and Technology Transfer (BPTTT) for the
registration of the trademark "FLAVOR
MASTER" for instant coffee.
Petitioner Societe Des Produits Nestle,
S.A., a Swiss company registered under
Swiss laws and domiciled in Switzerland
opposed claiming that the trademark of
private
respondents
product
is
"confusingly similar to its trademarks for
coffee and coffee extracts, to wit: MASTER
ROAST and MASTER BLEND." Likewise,
Nestle Philippines, Inc., a Philippine
corporation and a licensee of Societe Des
Produits Nestle S.A., opposed claiming that
the use, if any, by CFC of the trademark
FLAVOR MASTER and its registration would
likely cause confusion in the trade; or
deceive purchasers and would falsely
well-known mark.

suggest to the purchasing public a

connection in the business of Nestle, as
the dominant word present in the three (3)
trademarks is "MASTER"; or that the goods
of CFC might be mistaken as having
originated from the latter.
CFC argued that its trademark, FLAVOR
MASTER, is not confusingly similar with
the formers trademarks, MASTER ROAST
and MASTER BLEND, alleging that, "except
for the word MASTER (which cannot be
exclusively appropriated by any person for
being a descriptive or generic name), the
other words that are used respectively
with said word in the three trademarks are
very different from each other in
meaning, spelling, pronunciation, and
sound". CFC further argued that its
trademark, FLAVOR MASTER, "is clearly
very different from any of Nestles alleged
trademarks MASTER ROAST and MASTER
BLEND, especially when the marks are
viewed in their entirety, by considering
their
pictorial
representations,
color
schemes and the letters of their respective
labels."
BPTTT: Denied CFCs application applying
the test of dominancy. The word MASTER
is the dominant feature of opposers mark.
Because
of
opposers
advertising
schemes, the mind of the buying public
had come to learn to associate the word
MASTER with the opposers goods.
Court of Appeals: The test to be applied
should be the totality or holistic test since
what is of paramount consideration is the
ordinary purchaser who is, in general,
undiscerningly rash in buying the more
common and less expensive household
products like coffee, and is therefore less
inclined to closely examine specific details
of similarities and dissimilarities between
competing
products.
The
overall
appearance of the contending marks, the
physical discrepancies between appellant
CFCs and appellees respective logos are
so ostensible that the casual purchaser
cannot likely mistake one for the other.
ISSUE:
WON the trademark FLAVOR MASTER is a
colorable imitation of the trademarks

MASTER ROAST and MASTER BLEND

YES, applying the Dominancy Test.
HELD:
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, as
to cause him to purchase the one
supposing
it
to
be
the
other. In
determining if colorable imitation exists,
jurisprudence has developed two kinds of
tests - the Dominancy Test and the Holistic
Test. The test of dominancy focuses on the
similarity of the prevalent features of the
competing trademarks which might cause
confusion or deception and thus constitute
infringement. On the other side of the
spectrum, the holistic test mandates that
the entirety of the marks in question must
be considered in determining confusing
similarity.
IN THIS CASE, the dominancy test should
be applied to determine whether there is a
confusing
similarity
between
CFCs
FLAVOR MASTER and Nestles MASTER
ROAST
and
MASTER
BLEND.
The
determination of whether two trademarks
are indeed confusingly similar must be
taken from the viewpoint of the ordinary
purchasers
who
are,
in
general,
undiscerningly rash in buying the more
common and less expensive household
products like coffee, and are therefore less
inclined to closely examine specific details
of similarities and dissimilarities between
competing products.
The
products
bearing
the
trademarks
in
question
are
"inexpensive
and
common"
household items bought off the
shelf by "undiscerningly rash"
purchasers. As such, the ordinary
purchaser would not have the time
nor the inclination to make a keen
and perceptive examination of the
physical
discrepancies
in
the
trademarks of the products in order
to exercise his choice. Thus, it
would be less likely for the ordinary
purchaser to notice that CFCs
trademark FLAVOR MASTER carries

the colors orange and mocha while

that of Nestles uses red and
brown.
The application of the totality or
holistic test is improper since the
ordinary purchaser would not be
inclined to notice the specific
features,
similarities
or
dissimilarities, considering that the
product is an inexpensive and
common
household
item.
Moreover, the totality or holistic
test is contrary to the elementary
postulate of the law on trademarks
and
unfair
competition
that
confusing similarity is to be
determined on the basis of visual,
aural, connotative comparisons and
overall impressions engendered by
the marks in controversy as they
are encountered in the realities of
the marketplace. The totality or
holistic test only relies on visual
comparison
between
two
trademarks
whereas
the
dominancy test relies not only on
the visual but also on the aural and
connotative
comparisons
and
overall impressions between the
two trademarks.

IN ADDITION, the word "MASTER" is

neither a generic nor a descriptive term.
As such, said term cannot be invalidated
as a trademark and, therefore, may be
legally protected. Rather, the term
"MASTER" is a suggestive term brought
about by the advertising scheme of Nestle
by promoting its products as "coffee
perfection worthy of masters like Robert
Jaworski and Ric Puno Jr.
Suggestive terms are those which, in
the phraseology of one court, require
"imagination, thought and perception
to reach a conclusion as to the
nature of the goods." Such terms,
"which subtly connote something
about the product," are eligible for
protection
in
the
absence
of
secondary
meaning.
While
suggestive marks are capable of
shedding "some light" upon certain
characteristics of the goods or
services
in
dispute,
they
nevertheless involve "an element of

incongruity," "figurativeness," or "

imaginative effort on the part of the
observer."
The term "MASTER", therefore, has
acquired a certain connotation to mean
the coffee products MASTER ROAST and
MASTER BLEND produced by Nestle. As
such, the use by CFC of the term
"MASTER" in the trademark for its coffee
product FLAVOR MASTER is likely to cause
confusion or mistake or even to deceive
the ordinary purchasers.

Levi Strauss vs Clinton

[GAY]
September 20, 2005; Tinga, J

Apparelle

Facts:
LS & Co is the owner by prior adoption
and use since 1986 of the internationally
famous Dockers and Design trademark
for pants, shirts, blouses, skirts, shorts,
sweatshirts and jackets. The Dockers and
Design trademark was first used in the
Philippines in or about May 1988, by LSPI.
LS & Co. and LSPI further alleged that
they discovered the presence in the local
market of jeans under the brand name
Paddocks using a device which is
substantially, if not exactly, similar to the
Dockers and Design trademark, without
their consent. They filed a complaint for
trademark infringement, injunction and
damages
against
Clinton
Apparelle,
together with an alternative defendant
Olympian Garments, Inc.
The trial court scheduled a hearing for
the issuance of TRO.
Neither Clinton
Apparelle
nor
Olympian
Garment
appeared. Clinton Apparelle claimed that
it was not notified of such hearing. Only
Olympian Garments allegedly had been
issued with summons.
The hearing
continued and the trial court granted the
TRO. After a few days, the trial court also
issued another order granting the writ of
preliminary injunction.
The evidence
considered by the trial court in granting
injunctive relief were as follows:

(1) a certified true copy of the

certificate of trademark registration
for Dockers and Design;
(2) a pair of DOCKERS pants bearing
the
Dockers
and
Design
trademark;
(3) a pair of Paddocks pants bearing
respondents assailed logo;
(4) the Trends MBL Survey Report
purportedly proving that there was
confusing similarity between two
marks;
(5) the affidavit of one Bernabe Alajar
which recounted petitioners prior
adoption, use and registration of
the
Dockers
and
Design
trademark; and
(6) the affidavit of one Mercedes Abad
of Trends MBL, Inc. which detailed
the methodology and procedure
used in their survey and the results
thereof.
Clinton Apparelle thereafter filed a
Motion to Dismiss and a Motion for
Reconsideration. Both were denied by the
trial court.
The Court of Appeals ruled that the TRO
was improperly issued. It also held that
the issuance of the writ of preliminary
injunction was questionable. It noted that
petitioners failed to sufficiently establish
its material and substantial right to have
the writ issued. Also, it considered that
the injury petitioners have suffered or are
currently suffering may be compensated
in terms of monetary consideration, if
after trial, a final judgment shall be
rendered in their favor.
Issues:
1. WON the issuance of the writ of
preliminary injunction by the trial court
was proper NO
2. WON the petitioner is entitled to
protection from trademark dilution - NO
Held:
1. The petitioners are not entitled to a
writ of preliminary injunction.
An injunction is resorted to only when
there is a pressing necessity to avoid

injurious consequences, which cannot be

remedied
under
any
standard
compensation. The resolution of an
application for a writ of preliminary
injunction rests upon the existence of an
emergency or of a special recourse before
the main case can be heard in due course
of proceedings. Also, there must be a
clear and positive right especially calling
for
judicial
protection
must
be
shown. There must be a patent showing
by the complaint that there exists a right
to be protected and that the acts against
which the writ is to be directed are
violative of said right.
While the matter of the issuance of a
writ of preliminary injunction is addressed
to the sound discretion of the trial
court, this discretion must be exercised
based upon the grounds and in the
manner provided by law. The exercise of
discretion by the trial court in injunctive
matters is generally not interfered with
save in cases of manifest abuse. In the
present case, there was scant justification
for the issuance of the writ of preliminary
injunction.
Given the single registration of the
trademark Dockers and Design and
considering that respondent only uses the
assailed device but a different word mark 8,
the right to prevent the latter from using
the challenged Paddocks device is far
from clear. It is not evident whether the
single registration of the trademark
Dockers and Design confers on the
owner the right to prevent the use of a
fraction thereof in the course of trade. It is
also unclear whether the use without the
8

Petitioners registered trademark consists of two

elements: (1) the word mark Dockers and (2) the
wing-shaped design or logo. Notably, there is only
one registration for both features of the trademark
giving the impression that the two should be
considered as a single unit. Clinton Apparelles
trademark, on the other hand, uses the Paddocks
word mark on top of a logo which according to
petitioners is a slavish imitation of the Dockers
design. The two trademarks apparently differ in their
word marks (Dockers and Paddocks), but again
according to petitioners, they employ similar or
identical logos. It could thus be said that respondent
only appropriates petitioners logo and not the
word mark Dockers; it uses only a portion of the
registered trademark and not the whole.

owners consent of a portion of a

trademark registered in its entirety
constitutes
material
or
substantial
invasion of the owners right. It is likewise
not settled whether the wing-shaped logo,
as opposed to the word mark, is the
dominant or central feature of petitioners
trademarkthe feature that prevails or is
retained in the minds of the publican
imitation of which creates the likelihood of
deceiving the public and constitutes
trademark infringement. In sum, there are
vital matters which have yet and may only
be established through a full-blown trial.
Petitioners also failed to show proof
that there is material and substantial
invasion of their right to warrant the
issuance of an injunctive writ. Neither
were petitioners able to show any urgent
and permanent necessity for the writ to
prevent serious damage. The damages
the petitioners had suffered or continue to
suffer may be compensated in terms of
monetary consideration.
The issued injunctive writ, if allowed,
would dispose of the case on the merits as
it would effectively enjoin the use of the
Paddocks device without proof that
there is basis for such action. The
prevailing rule is that courts should avoid
issuing a writ of preliminary injunction that
would in effect dispose of the main case
without trial.
2. Trademark dilution is the lessening
of the capacity of a famous mark to
identify and distinguish goods or services,
regardless of the presence or absence of:
(1) competition between the owner of the
famous mark and other parties; or (2)
likelihood of confusion, mistake or
deception. Subject to the principles of
equity, the owner of a famous mark is
entitled to an injunction against another
persons commercial use in commerce of a
mark or trade name, if such use begins
after the mark has become famous and
causes dilution of the distinctive quality of
the mark. This is intended to protect
famous marks from subsequent uses that
blur distinctiveness of the mark or tarnish
or disparage it.

To be eligible for protection from

dilution, there has to be a finding that:
(1) the trademark sought to be protected
is famous and distinctive;
(2) the use by respondent of Paddocks
and Design began after the petitioners
mark became famous; and
(3) such subsequent use defames
petitioners mark.
In the case at bar, petitioners have yet
to establish whether Dockers and Design
has acquired a strong degree of
distinctiveness and whether the other two
elements are present for their cause to fall
within the ambit of the invoked protection.
The Trends MBL Survey Report which
petitioners presented in a bid to establish
that there was confusing similarity
between two marks is not sufficient proof
of any dilution that the trial court must
enjoin.
NOTE: The SC held, however, that the
CA overstepped its authority when it
declared that the alleged similarity as to
the two logos is hardly confusing to the
public. The only issue brought before the
Court of Appeals involved the grave abuse
of discretion allegedly committed by the
trial court in granting the TRO and the writ
of preliminary injunction. The appellate
court in making such a statement went
beyond that issue and touched on the
merits of the infringement case, which
remains to be decided by the trial court.

Yu v. Court of Appeals [CEL]

(Melo J., January 21, 1993)
Facts:
Petitioner
is
the
exclusive
distributor of the House of Mayfair
wallcovering products in the Philippines
since 1987.
Respondent is petitioners former dealer of
the same goods. Respondent, however,
imported the same goods via the FNF
Trading
which
eventually
sold
the
merchandise in the domestic market. It is
alleged by the petitioner that private
respondents misled Mayfair into believing

that the goods ordered by FNF Trading

were intended for shipment to Nigeria
although they were actually shipped to
and sold in the Philippines. Petitioner
claims that his exclusive distributorship
agreement was infringed by the private
respondent.
The lower court and the CA denied the writ
of preliminary injunction filed by petitioner
holding that the private respondent was a
complete stranger vis--vis the covenant
between petitioner and Mayfair.
Issue: WON the preliminary injunction
prayed for by petitioner should be
granted. [YES]
Ratio:
Injunction is the appropriate remedy
to prevent a wrongful interference
with contracts by strangers to such
contracts where the legal remedy is
insufficient and the resulting injury
irreparable.
The liability of private respondent, if any,
does not emanate from the four corners of
the contract but its accountability is an
independent act generative of civil
liability. Hence, the Court held that the
exclusive sales contract which links
petitioner and the House is Mayfair is
solely the concern of the privies thereto
and cannot extend to private respondent
is beside the point.9
The right to perform an exclusive
distributorship agreement and to reap the
profits resulting from such performance
are proprietary rights which a party may
protect. Otherwise, it may be rendered
illusory by the expedient act of utilizing or
interposing a person to obtain goods from
supplier to defeat the very purpose for
which the exclusive distributorship was
conceptualized, at the expense of the sole
authorized distributor.
9

This case just involves preliminary injunction.

The court does not wish to pronounce on the validity
of the main suit for injunction. It held that they were
simply rectifying certain misperceptions entertained
by the CA as regards the feasibility of requesting a
preliminary injunction to enjoin a stranger to an
agreement.

The allegation that FNF Trading misled

House of Mayfair that the goods were to
be shipped to Nigeria but were instead
sold and to the Philippines is akin to the
scenario of a third person who induces a
party to renege on or violate his
undertaking under a contract, thereby
entitling the other contracting party to
relief therefrom (Art 1314 NCC). The
breach caused by private respondent was
even aggravated when it did not cease to
distribute and sell the subject products
despite of the SCs restraining order.
Also, the CA erred when it refused to grant
relief simply because of its observation
that petitioner can be fully compensated
for the damage. A contrario, the injury is
irreparable where it is continuous and
repeated since from its constant and
frequent
recurrence,
no
fair
and
reasonable redress can be had therefor by
petitioner insofar as his goodwill and
business
reputation
as
sole
distributor is concerned.
Judgment:
granted.

REVERSED.

Petition

Leviton Industries vs. Salvador [LIV]

June 19, 1982 Escolin, J.
Leviton Manufacturing Co., Inc. filed a
complaint for unfair competition against
petitioners Leviton Industries, Nena de la
Cruz Lim, Domingo Go and Lim Kiat before
the CFI-Rizal.
The plaintiff is a foreign corporation
organized and existing under the
laws of the State of New York
Defendant Leviton Industries is a
partnership organized and existing
under the laws of the Philippines;
while defendants Nena de la Cruz
Lim, Domingo Go and Lim Kiat are
the
partners,
with
defendant
Domingo Go acting as General
Manager of defendant Leviton
Industries;
The complaint alleges that plaintiff,
founded in 1906 by Isidor Leviton, is the
largest manufacturer of electrical wiring
devices in the United States under the

trademark
Leviton,
which
various
electrical wiring devices bearing the
trademark Leviton and trade name Leviton
Manufacturing Co., Inc. had been exported
to the Philippines since 1954; that
defendants began manufacturing and
selling electrical ballast, fuse and oval
buzzer under the trademark Leviton and
trade name Leviton Industries Co.; that
Domingo Go had registered with the
Philippine Patent Office the trademarks
Leviton Label and Leviton with respect to
ballast and fuse which registration was
contrary to paragraphs (d) and (e) of
Section 4 of RA 166, as amended; that
defendants not only used the trademark
Leviton but likewise copied the design
used by plaintiff in distinguishing its
trademark
Plaintiff prayed for damages and also
sought the issuance of a writ of injunction
to prohibit defendants from using the
trade name Leviton Industries, Co. and the
trademark Leviton.
Defendants
moved
to dismiss
the
complaint for failure to state a cause of
action, drawing attention to the plaintiff's
failure to allege therein its capacity to sue
under Section 21-A of Republic Act No.
166, as amended.
plaintiff
is
not
actually
manufacturing,
selling
and/or
distributing ballasts generally used
in flourescent lighting;
plaintiff
has
no
registered
trademark or trade name in the
Philippine Patent Office of any of its
products; and
plaintiff has no license to do
business in the Philippines under
and by virtue of the provision of Act
No. 1459, better known as the
Philippine Corporation Law
Plaintiff admitted to the foregoing but
argues that it has filed with an application
of its trade mark on April 16, 1971.
RTC denied MTD
Issue: WON the plaintiff has capacity to
sue [NO]

Ratio:
Section 21-A of Republic Act No. 166, as
amended, provides:
Sec. 21-A. Any foreign corporation or
juristic person to which a mark or
tradename has been registered or
assigned under this Act may bring an
action hereunder for infringement, for
unfair competition, or false designation of
origin and false description, whether or
not it has been licensed to do business in
the Philippines under Act numbered
Fourteen Hundred and Fifty-Nine, as
amended, otherwise known as the
Corporation Law, at the time it brings the
complaint; Provided, That the country of
which the said foreign corporation or
juristic person is a citizen, or in which it is
domiciled, by treaty, convention or law,
grants a similar privilege to corporate or
juristic persons of the Philippines. (As
amended by R.A. No. 638)
Its literal tenor indicates as a
condition
sine
qua
non
the
registration of the trade mark of the
suing foreign corporation with the
Philippine Patent Office or, in the
least, that it be an asignee of such
registered
trademark.
The
said
section further requires that the
country, of which the plaintiff foreign
corporation or juristic person is a
citizen or domicilliary, grants to
Filipino
corporations
or
juristic
entities
the
same
reciprocal
treatment,
either
thru
treaty,
convention or law.
All
that
is
alleged
in
private
respondent's complaint is that it is a
foreign
corporation.
Such
bare
averment not only fails to comply
with the requirements imposed by
the aforesaid Section 21-A but
violates as well the directive of
Section 4, Rule 8 of the Rules of Court
that "facts showing the capacity of a
party to sue or be sued or the
authority of a party to sue or be sued
in a representative capacity or the
legal existence of an organized

association of persons that is made a

party, must be averred "
These are matters peculiarly within the
knowledge of appellants alone, and it
would be unfair to impose upon appellees
the burden of asserting and proving the
contrary.
Disposition: Petition granted.

Puma vs. IAC [MEL]

1988; Gutierrez, Jr., J.
Facts:
Puma
Sportschuhfabriken
Rudolf
Dassler,
a
foreign
corporation
organized under the laws of the
Federal Republic of Germany and the
manufacturer and producer of PUMA
PRODUCTS, filed a complaint for
trademark infringement against MilOro Manufacturing before the RTC.
o Prior to the filing of this civil suit,
three Inter Partes cases were
pending before the Phil. Patent
Office in which Puma and Mil-Oro
both seek the cancellation of the
trademark of the other.
Mil-Oro filed a motion to dismiss on the
grounds of litis pendencia and that
Puma has no legal capacity to sue.
The RTC denied the motion to dismiss.
The CA reversed. It ruled that the
requisites of lis pendens as a ground
for the motion to dismiss have been
met. It also held that Puma had no
legal capacity to sue because it failed
to allege reciprocity in its complaint,
citing Leviton Industries v. Salvador.
Puma
maintains
that
it
has
substantially
complied
with
the
requirements of Sec. 21-A of RA 166. Its
complaint specifically alleged:
o that it is not doing business in the
Philippines and is suing under RA
166;
o that Sec. 21-A thereof provides that
the country of which the said
corporation or juristic person is a
citizen, or in which it is domiciled,
by treaty, convention or law, grants
similar privilege to corporate or

juristic persons of the Philippines

but does not mandatorily require
that such reciprocity between the
Federal Republic of Germany and
the Philippines be pleaded;
that such reciprocity arrangement
is embodied in and supplied by the
Paris Convention to which both the
Philippines and Federal Republic of
Germany are signatories and that
since the Paris Convention is a
treaty which forms part of the law
of the land, our courts our bound to
take judicial notice of such treaty,
and, consequently, this fact need
not be averred in the complaint.

Issues:
(1) WON Puma has no legal capacity
to sue for its failure to allege
reciprocity (NO)
(2) WON the doctrine of lis pendens is
applicable (NO)
Ratio:
In the leading case of La Chemise Lacoste,
S.A v. Fernandez, we ruled: But even
assuming the truth of the private
respondents allegation that the petitioner
failed to allege material facts in its petition
relative to capacity to sue, the petitioner
may still maintain the present suit against
respondent Hemadas. As early as 1927,
this Court was, and 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.
Quoting the Paris Convention, this Court
further said: By the same token, the
petitioner should be given the same
treatment in the Philippines as we make
available to our citizens. We are obligated
to assure to nationals of countries of the
Union an effective protection against
unfair competition in the same way that
they are obligated to similarly protect
Filipino citizens and firms. xxxx It creates a
legally binding obligation on the parties
founded on the generally accepted
principle of international law of pacta sunt
servanda.

(2) For lis pendens to be a valid

ground for the dismissal of a case,
the other case pending between the
same parties and having the same
cause must be a court action.
In this case, the pending Inter Partes cases
before the Phil. Patent Office is not a court
action but an administrative case.

La Chemise
[TRACE]

Lacoste

v.

Fernandez

Hemandas and Co, a domestic firm,

registered in its own name in the
Supplemental Register the trademark
chemise lacoste and crocodile device.
Later, it applied for the registration of
the same mark with the principal
register.
o The patent office said that since
the mark was already registered in
the supplemental register, it had
no recourse but to accept the
application. It warned, however,
that a petition for cancellation of
the trademark certificate in the
supplemental
register
was
pending.
In
the
meantime,
however,
Hemandas
was
presumed owner of the mark until
registration
was
declared
cancelled
Later, La Chemise applied for the
registration
of
the
trademark
Crocodile Device and Lacoste. The
former was approved; the latter was
opposed
Meanwhile, La Chemise filed with the
NBI a letter-complaint alleging acts of
unfair competition by Hemandas. The
NBI conducted an investigation and
applied for search warrants. The judge
issued the search warrants. Later,
however, the judge changed its mind,
saying there was no probable cause.
La Chemise now brings forth this
petition for certiorari alleging judge
committed grave abuse of discretion
As a defense, Hemandas argues that
La Chemise has no capacity to sue
before Philippine Courts

Hemandas argues that La Chemise

is doing business in the Philippines
but is unlicensed; hence, cannot
sue in Phil. Courts

Issue: WON La Chemise can sue before

Philippine courts (YES)
Ratio:
A foreign corporation not doing
business in the Philippines needs no
license to sue before Philippine
courts for infringement of trademark
and unfair competition. This is because
the foreign company is not seeking to
enforce any legal right arising from a
business which it has transacted in the
Philippines. The sole purpose of the action
is to protect its reputation, corporate
name and goodwill, when such have
established themselves.
o La Chemise is a foreign corporation not
doing business in the Philippines. Its
marketing is done by its exclusive
distributor,
Rustan
Commercial
Corporation, which is a separate entity
and not a mere agent of La Chemise.
Moreover, it is important to note that the
nature of the case which led to this
petition is criminal. If prosecution follows
after the completion of the preliminary
investigation, the information shall be in
the name of the People of the Phils. and
no longer La Chemise. Its capacity to sue
would become then irrelevant.
Moreover, in upholding the right of La
Chemise to maintain this present suit for
unfair competition or infringement of
trademarks of a foreign corporation, we
are merely 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.
The
Paris
Convention
has
an
extraterritorial application. It is a compact
between member countries to accord in
their own countries to citizens of other
contracting states trademark and other
rights comparable to those accorded their
own citizens by their domestic law.

The underlying principle is that foreign

nationals should be given the same
treatment in each of the member
countries as that country makes available
to its own citizens. The convention is not
premised on the idea that trademark law
of each member nation shall be given
extra-territorial application, but on exactly
the converse principle that each nations
law shall have only territorial application.
Thus, La Chemise should be given the
same treatment in the Philippines as we
make available to our own citizens. We are
obligated to assure nationals of countries
of the union an effective protection
against unfair competition in the same
way that we are obligated to do so with
respect to Filipino citizens and firms.

Romero vs. Maiden Form Brassiere

Co. Inc. [CIELA]
BARRERA, J. (1964)
FACTS:
On February 12, 1957, respondent
company, a foreign corporation, filed
with respondent Director of Patents an
application for registration (pursuant to
RA 166) 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 US 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; that said trademark "is on
the date of this application,
actually used by respondent
company on the following goods,
classified according to the official
classification of goods (Rule 82) Brassieres, Class 40"; and that
said trademark is applied or
affixed by respondent to the goods
by placing thereon a woven label
on which the trademark is shown.
On October 17, 1957, respondent
Director issued to respondent company
a
certificate
of
registration
of
trademark "Adagio". On February 26,

1958, petitioner filed with respondent

Director a petition for cancellation of
said trademark, on the grounds:
that it is a common descriptive
name of an article or substance on
which the patent has expired; that
its registration was obtained
fraudulently or contrary to Sec.4,
Chapter II of RA 166; and that the
application for its registration was
not filed in accordance with
Sec.37, Chapter XI of the same
Act; that said trademark has not
become distinctive of respondent
company's goods or business; that
it has been used by respondent
company to classify the brassieres
manufactured by it, in the same
manner as petitioner uses the
same; that said trademark has
been used by petitioner for almost
6 years; that it has become a
common descriptive name.
ISSUE: WON the trademark "Adagio" has
become a common descriptive name of a
particular style of brassiere and is,
therefore, unregistrable (NO)
a) The
evidence
shows
that
the
trademark "Adagio" is a musical term,
which means slowly or in an easy
manner, and was used as a trademark
by the owners thereof (the Rosenthals
of Maiden Form Co., New York) because
they are musically inclined.
Being a musical term, it is used in an
arbitrary (fanciful) sense as a trademark
for
brassieres
manufactured
by
respondent company. It also appears that
respondent
company
has,
likewise,
adopted other musical terms such as
"Etude," "Chansonette," "Prelude," "Overture,", and "Concerto" to identify, as a
trademark, the different styles or types of
its brassieres. As respondent Director
pointed out, "the fact that said mark is
used also to designate a particular style of
brassiere, does not affect its registrability
as a trademark"
b) It is not true that respondent company
did not object to the use of said

trademark by petitioner and other local

brassiere manufacturers.
The records show that respondent
company's agent warned the Valleson
Department Store to desist from the sale
of the "Adagio" Royal Form brassieres
manufactured by petitioner, and even
placed an advertisement in the local
newspapers warning the public against
unlawful use of said trademark.
c) Respondent company's long and
continuous use of the trademark
"Adagio" has not rendered it merely
descriptive of the product.
In Winthrop Chemical Co. v. Blackman, it
was held that widespread dissemination
does not justify the defendants in the use
of the trademark.
d) The sentence (Maidenform bras are
packaged for your quick shopping
convenience.
For
other
popular
Maidenform styles, write for free style
booklet to: Maiden Form Brassiere Co.,
Inc 200 Madison Avenue, New York 16,
N.Y.") printed on the package, standing
alone, does not conclusively indicate
that the trademark "Adagio" is merely
a style of brassiere.

"SEC. 2. What are registrable

Trademarks, ... own by persons,
corporations,
partnerships
or
associations domiciled ... in any
foreign country may be registered
in accordance with the provisions
of this Act: Provided, That said
trademarks,
trade-names,
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: ..."
Sec.37 of RA 166 can be availed of only
where the Philippines is a party to an
international convention or treaty relating
to trademarks, in which the trade-mark
sought to be registered need not be used
in the Philippines.
ISSUE: WON the registration of the
trademark was fraudulent or contrary
Sec.4 of RA 166 (NO)

ISSUE: WON the Director erred in

registering the trademark in question,
despite appellee's non-compliance with
Sec.37, paragraphs 1 and 4 (a) of RA 166
(NO)

There is no evidence to show that the

registration of the trademark "Adagio" was
obtained fraudulently by appellee. The
evidence record shows, on the other hand,
that the trademark "Adagio" was first
used exclusively in the Philippines by
appellee in the year 1932. There being no
evidence of use of the mark by others
before 1932, or that appellee abandoned
use thereof, the registration of the mark
was made in accordance with the
Trademark Law. Granting that appellant
used the mark when appellee stopped
using it during the period of time that the
Government imposed restrictions on
importation of respondent's brassiere
bearing the trademark, such temporary
non-use did not affect the rights of
appellee because it was occasioned by
government restrictions and was not
permanent, intentional, and voluntary.

Sec.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. Respondent's application was
filed under the provisions of Section 2 of
RA 166 as amended by Section 1 of RA
865 which reads as follows:

To work an abandonment, the

disuse must be permanent and not
ephemeral; it must be intentional
and voluntary, and not involuntary
or even compulsory. There must be
a thorough-going discontinuance of
any trade-mark use of the mark in
question.

Brassieres are usually of different types or

styles, and appellee has used different
trademarks for every type as shown by its
labels. The mere fact that appellee uses
"Adagio" for one type or style, does not
affect the validity of such word as a
trademark.

The use of the trademark by other

manufacturers did not indicate an
intention on the part of appellee to
abandon it.
'To establish the defense of
abandonment, it is necessary to
show not only acts indicating a
practical abandonment, but an
actual intention to abandon. Nonuse because of legal restrictions is
not evidence of an intent to
abandon.
DISPOSITION: The Director of Patents did
not err in dismissing the present petition
for
cancellation
of
the
registered
trademark of appellee-company, and the
decision appealed from is affirmed.

Philippine Nut Industry vs. Standard

Brands, Inc. [REG]
Muoz-Palma | 1975
Facts:
Philippine Nut, a domestic corporation,
obtained from the Patent Office in 1961 a
Certificate of Registration covering the
trademark
"PHILIPPINE
PLANTERS
CORDIAL PEANUTS," the label used on its
product of salted peanuts.
In 1962, Standard Brands, a foreign
corporation, filed with the Director of
Patents a case 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
is the owner of the trademark "PLANTERS
COCKTAIL PEANUTS" covered by a
Certificate of Registration issued in 1958.
Standard Brands alleged in its petition that
Philippine Nut's trademark "PHILIPPINE
PLANTERS CORDIAL PEANUTS" closely
resembles and is confusingly similar to its
trademark
"PLANTERS
COCKTAIL
PEANUTS" used also on salted peanuts,
and that the registration of the former is
likely to deceive the buying public and
cause damage to it.

Standard Brands trademark was first used

in commerce in the Philippines in
December,
1938.
Philippine
Nut's
trademark
"PHILIPPINE
PLANTERS
CORDIAL PEANUTS" was first used in the
Philippines on December 20, 1958.
Phil. Nut: its registered label is not
confusingly similar to that of Standard
Brands as the latter alleges.
Director of Patents: ordered the
cancellation of Philippine Nut's Certificate
of Registration. Held that in the labels
using the two trademarks in question, the
dominant part is the word "Planters",
displayed "in a very similar manner" so
much so that "as to appearance and
general impression" there is "a very
confusing similarity," and concluded that
Philippine Nut "was not entitled to register
the mark at the time of its filing the
application for registration" as Standard
Brands
will
be
damaged
by
the
registration of the same.
Issue: WON the trademark "PHILIPPINE
PLANTERS CORDIAL PEANUTS" used by
Philippine Nut on its label for salted
peanuts is confusingly similar to the
trademark
"PLANTERS
COCKTAIL
PEANUTS" used by Standard Brands on its
product
so
as
to
constitute
an
infringement of the latter's trademark
rights and justify its cancellation.
Ruling: YES.
There is infringement of trademark when
the use of the mark involved would be
likely to cause confusion or mistake in the
mind of the public or to deceive
purchasers as to the origin or source of
the commodity; that 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, then
infringement takes pIace; that duplication
or imitation is not necessary, a similarity

in
the
dominant
features
trademarks would be sufficient.

of

the

Petitioner:
PLANTERS
cannot
be
considered as the dominant feature of the
trademarks in question because it is a
mere descriptive term, an ordinary word.
SC: While it is true that PLANTERS is an
ordinary word, nevertheless it is used in
the labels not to describe the nature of the
product, but to project the source or origin
of the salted peanuts contained in the
cans. 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 word PLANTERS is the dominant,
striking mark of the labels in question.
While there are other words used such as
"Cordial" in petitioner's can and "Cocktail"
in Standard Brands', which are also
prominently displayed, but these words
are mere adjectives describing the type of
peanuts in the labeled containers and are
not sufficient to warn the unwary
customer that the two products come form
distinct sources. As a whole it is the word
PLANTERS which draws the attention of
the buyer and leads him to conclude that
the salted peanuts contained in the two
cans originate from one and the same
manufacturer. (housemaid example !)
Petitioner: Director of Patents should not
have based his decision simply on the use
of the term PLANTERS, and that what he
should have resolved is whether there is a
confusing similarity in the trademarks of
the parties.
SC: Petitioner also used in its label the
same coloring scheme of gold, blue, and
white, and basically the same lay-out of
words such as "salted peanuts" and
"vacuum packed" with similar type and
size of lettering as appearing in Standard
Brands' own trademark, all of which result
in a confusing similarity between the two
labels. The striking similarity between the
two labels is quite evident not only in the
common use of PLANTERS but also in the

other words employed. As a matter of fact,

the capital letter "C" of petitioner's
"Cordial" is alike to the capital "C" of
Standard's "Cocktail", with both words
ending with an "1".
The alleged differences in the label but are
insignificant in the sense that they are not
sufficient to call the attention of the
ordinary buyer that the labeled cans come
from distinct and separate sources.
The merchandize or goods being sold by
the parties herein are very ordinary
commodities purchased by the average
person and many times by the ignorant
and unlettered (!) and these are the
persons who will not as a rule examine the
printed small letterings on the container
but will simply be guided by the presence
of the striking mark PLANTERS on the
label. Differences there will always be, but
whatever differences exist, these pale into
insignificance in the face of an evident
similarity in the dominant feature and
overall appearance of the labels of the
parties.
Also, the applicability of the doctrine of
secondary meaning to the case is
appropriate because there is oral and
documentary evidence showing that the
word PLANTERS has been used by and
closely associated with Standard Brands
for its canned salted peanuts since 1938
in this country.

Anchor Trading Co., Inc. vs. Director

of Patents [JING]
May 30, 1956 | Bautista Angelo
FACTS:
Respondent
failed
to
register
opposition to petitioners petition
registration in due time.

his
for

ISSUE:
WON respondent is stopped from asking
for the cancellation of the certificate of
registration issued to petitioner NO.
HELD:
The only consequence resulting from a
late filing of an opposition to any

application for registration of a trademark

is the oppositors relinquishment of the
privilege given to him by laws to object to
such registration, but such cannot prevent
him from asking later for its cancellation
when in his opinion there are good
grounds justifying it.

its verified opposition. The Director of

Patents denied both the motion and the
petition for relief. It maintains that the
verified opposition cannot be considered
as having been filed on time, for the
reason that it was misfiled in the record of
another opposition case through the
negligence of its own counsel.

Clorox Company vs. Director

Patents [GAY]
August 10, 1967; Angeles, J

Issue: WON the Director of Patents erred

in dismissing the opposition - YES

of

Facts:
On April 7, 1959, respondent Go Siu Gian
filed with the Patent Office an application
for
registration
of
the
trademark
"OLDROX," for his goods (whitening agent
for bleaching) in trade and commerce in
the country.
He alleged that such
trademark, shown on printed labels affixed
to the goods, or to the containers thereof,
has been used by him since February 1,
1959. The application was allowed and
published in the issue of the Official
Gazette dated April 25, 1960, which was
released for circulation on August 22,
1960.
On September 21 of the same year, or
within 30 days from the date of its
publication in the Official Gazette, an
unverified opposition to the application
was filed by the law firm Lichauco, Picazo
and Agcaoili in behalf of the Clorox
Company.
The Director of Patents dismissed the
opposition on the ground that the Clorox
Company failed to file the required verified
notice of opposition within the period
allowed by law. Petitioners counsel filed a
motion with the Patent Office alleging that
it has filed a verified notice of opposition
on time (November 16, 1960), although it
also admitted that the covering letter of
said verified opposition was given another
case number.
Petitioner prayed for relief from the order
dismissing
its
opposition,
alleging
circumstances constituting mistake or
excusable negligence of its counsel and
his employee which led to the misfiling of

Held:
The verified petition in question was filed
on time, although it was submitted under
an erroneous covering letter. A covering
letter is not part of the pleading. What is
important is the fact that the pleading
reached the official designated by law to
receive it within the prescribed time,
regardless of the mistake in the
indorsement or covering letter which is
not a necessary element of filing. It is the
duty of the clerk of court to receive and
file the necessary papers of a case in their
corresponding files. It is gross negligence
on the part of a clerk of court to receive
and file pleadings in the record of a case
by relying upon a letter of submittal or
covering letter without bothering to
examine whether or not the pleading or
document submitted corresponds to the
enclosure mentioned in the letter.
The respondents argue that the petition
for relief filed by petitioner before the
order dismissing the opposition became
final was premature and may not be
legally considered for purposes of setting
aside said order. The Court held that the
petition for relief filed by the petitioner in
this case, having been filed before the
finality of the order dismissing its
opposition, could have been treated as a
motion for reconsideration. When, as in
this case, the allegation of the pleading
clearly show circumstances constituting
mistake and excusable negligence which
are
grounds
for
a
motion
for
reconsideration of the order in question, a
dismissal of the motion and a denial of the
relief sought upon the flimsy excuse that
the same was filed as a petition for relief,
will amount to an abuse of that discretion.

Respondent also argues that the petitioner

is not totally deprived of its right to
question the registration of the trademark
in question because it may still pursue a
cancellation proceeding under Sections 17
to 19 of Republic Act No. 166, and Rules
191 to 197 of the Rules of Practice in
Trademark Cases. The opposition to a
registration
and
the
petition
for
cancellation are alternative proceedings
which a party may avail of according to his
purposes,
needs,
and
predicaments
(Anchor Trading Company vs. Director of
Patents, 1956), and herein petitioner has
the right to choose which remedy it deems
best for the protection of its rights.

WOLVERINNE WORLDWIDE, INC. V. CA

(CEL)

Shangri-La v. CA [LIV]
June 21, 2001 Ynares-Santiago, J.
On June 21, 1988, 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 latters
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.
DGC filed an opposition to the application.
On April 15, 1991, DGC instituted with the
RTC a complaint for infringement and

damages with prayer for injunction against

the Shangri-La Group.
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.
RTC denied
CA affirmed
Hence, the petition for certiorari before
the SC docketed as G.R. No. 111580.
In the meantime, the BPTTT denied DGCs
Urgent Motion to Suspend Proceedings
and Motion for Reconsideration. The Court
of Appeals affirmed.
Issue:
WON 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 [YES]
Ratio:
I.
Section 151.2 of Republic Act No. 8293,
otherwise known as the Intellectual
Property Code, provides, as follows
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 to wit
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)
Rationale: Certificate of Registration No.
31904, upon which the infringement case
is based, remains valid and subsisting for
as long as it has not been cancelled by the
Bureau or by an infringement court. As
such, Developers Groups Certificate of
Registration in the principal register
continues as 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.
II.
Furthermore, the issue raised before the
BPTTT is quite different from that raised in
the trial court. The issue raised before the
BPTTT was whether the mark registered by
Developers
Group
is
subject
to
cancellation, as the Shangri-La Group
claims prior ownership of the disputed
mark. On the other hand, the issue raised
before the trial court was whether the
Shangri-La Group infringed upon the rights
of
Developers
Group
within
the
contemplation of Section 22 of Republic
Act 166.
III.
However, while the instant Petitions have
been pending with this Court, the
infringement court rendered a Decision
docketed as Civil Case No. Q-91-8476 in

favor of DGC. The said Decision is now on

appeal with respondent Court of Appeals.
Following both law and the jurisprudence
enunciated in Conrad and Company, Inc.
v. Court of Appeals, 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. However, the Regional
Trial Court, in granting redress in
favor of Developers Group, went
further and upheld the validity and
preference of the latters registration
over that of the Shangri-La Group.
There can be no denying that the
infringement court may validly pass upon
the right of registration. Section 161 of
Republic Act No. 8293 provides to wit
SEC. 161. Authority to Determine Right to
Registration In any action involving a
registered mark the court may
determine the right to registration,
order
the
cancellation
of
the
registration, in whole or in part, and
otherwise rectify the register with
respect to the registration of any
party to the action in the exercise of
this.
Judgement and orders shall be
certified by the court to the Director, who
shall make appropriate entry upon the
records of the Bureau, and shall be
controlled thereby. (Sec. 25, R.A. No.
166a). (Emphasis provided)
Therefore, the cancellation case filed with
the Bureau hence becomes moot. To allow
the
Bureau
to
proceed
with
the
cancellation case would lead to a possible
result contradictory to that which the RTC
has rendered, albeit the same is still on
appeal.
We are not unmindful of the fact that in
G.R. No. 114802, the only issue submitted
for resolution is the correctness of the
Court of Appeals decision sustaining the

BPTTTs denial of the motion to suspend

the proceedings before it. Yet, to provide
a judicious resolution of the issues at
hand, we find it apropos to order the
suspension of the proceedings before the
Bureau pending final determination of the
infringement case, where the issue of the
validity of the registration of the subject
trademark and logo in the name of
Developers Group was passed upon.
Disposition: G. R. 11580 dismissed; BLA
to suspend to suspend further proceedings
in Inter Partes Case No. 3145, to await the
final outcome of the appeal in Civil Case
No. Q-91-8476.

Superior Commercial Enterprises vs.

Kunnan Enterprises Ltd. [MEL]
2010; Brion, J.
Facts:
Superior
filed
a
complaint
for
Trademark Infringement and Unfair
Competition against Kunnan
and
Sports Concept with the RTC.
o It claimed ownership of the
trademarks KENNEX and PRO
KENNEX, used for sportswear and
sporting goods and equipment,
based on its prior use and
numerous valid registrations.
Kunnan,
a
foreign
corporation
organized under the laws of Taiwan,
disputed Superiors claim of ownership
and maintained that Superior, as a
mere distributor from 1982 to 1991,
fraudulently registered the trademarks
in its name.
o Upon the termination of its
distributorship
agreement
with
Superior, Kunnan appointed Sports
Concept as its new distributor.
o Subsequently, Kunnan also caused
the publication of a Notice and
Warning in the Manila Bulletin
stating that:
It is the owner of the
trademarks;
It terminated its distributorship
agreement with Superior; and
It appointed Sports Concept as
its exclusive distributor.

This notice prompted Superior to

file the complaint for Infringement
and Unfair Competition.
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 (now the IPO)
Consolidated Petitions for Cancellation
involving the KENNEX and PRO
KENNEX
trademarks
(Registration
Cancellation Case).
The RTC found Kunnan and Sports
Concept liable for Infringement and
Unfair Competition and ordered them
to pay Superior damages.

Intervening Developments: The IPO and

CA Rulings in the Registration Cancellation
Case
During the appeal to the CA, Kunnan
filed a Manifestation and Motion
praying that the decision of the Bureau
of Legal Affairs (BLA) Director and the
decision of the IPO Director General in
the Registration Cancellation Case be
made of record and be given weight by
the CA in resolving the Infringement
and Unfair Competition Case.
o The
BLA
Director
cancelled
Superiors
registration
of
the
trademarks. It found that Superior,
as a distributor, did not acquire any
proprietary
interest
in
the
principals (Kunnans) trademarks.
o The IPO Director General denied
Superiors appeal.
The CA reversed the RTC. It dismissed
Superiors complaint for Infringement
and Unfair Competition on the ground
that Superior was a mere distributor
and had no right to register the
trademarks since the right to register a
trademark is based on ownership.
Superior questioned the IPO Director
Generals ruling in the Registration
Cancellation Case before the CA. The
CA dismissed Superiors petition. The
CA decision was declared final and
executory.
Hence,
Superiors
registration of the trademarks now
stands effectively cancelled.

This decision was rendered after the

CA decision in the Infringement and
Unfair Competition case.

Issues:
(1) WON there was infringement (NO)
(2) WON there was unfair competition
(NO)
Ratio:
(1) No infringement because Superior
does not own the trademarks.
To establish trademark infringement,
the following elements must be
proven:
1. The validity of plaintiffs mark;
2. The plaintiffs ownership of the
mark; and
3. The use of the mark or its
colorable imitation by the alleged
infringer results in likelihood of
confusion.
The second element the plaintiffs
ownership of the trademark was what
the Registration Cancellation Case decided
with finality. The doctrine of res judicata
by conclusiveness of judgment bars
Superiors case for infringement.
The CA decided that the registration of the
KENNEX and PRO KENNEX trademarks
should be cancelled because Superior was
a mere distributor and was not the owner
of, and could not in the first place have
validly registered these trademark. Thus,
as of the finality of the CA decision, these
trademark registrations were effectively
cancelled and Superior was no longer the
registrant of the trademarks.
Sec. 22 of RA 166 states that only a
registrant of a trademark can file a case
for infringement. Corollary to this, Sec. 19
provides that any right conferred upon the
registrant under the provisions of RA 166
terminates when the judgment or order of
cancellation has become final. Thus, the
cancellation of registration of a trademark
has the effect of depriving the registrant
of protection from infringement from the
moment the judgment or order of
cancellation has become final.

In this case, by operation of law,

specifically Sec. 19 of RA 166, the
trademark
infringement
aspect
of
Superiors case has been rendered moot
and academic in view of the finality of the
decision in the Registration Cancellation
Case. In infringement, title to the
trademark is indispensable to a valid
cause of action and such title is shown by
its certificate of registration. With its
certificates of registration effectively
cancelled with finality, Superiors case for
infringement lost its legal basis and no
longer presented a valid cause of action.
(2) No unfair competition because
Kunnan never attempted to pass off
the goods it sold as those of Superior.
Unfair competition is 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.
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.
In this 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. Also, there is no evidence of bad
faith or fraud imputable to Kunnan in using
the trademarks. Specifically, Superior
failed to adduce any evidence to show
that Kunnan intended to deceive the
public as to the identity of the goods sold
or of the manufacturer of the goods sold.

There can be infringement without

unfair competition such as when the
infringer discloses on the labels
containing
the
mark
that
he
manufactures
the
goods,
thus
preventing the public from being
deceived that the goods originate
from the trademark owner.
In this case, no issue of confusion arises
because the same manufactured products
are sold; only the ownership of the
trademarks is at issue. Also, Kunnans
Notice and Warning 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.

In-N-Out Burger vs. Sehwani [TRACE]

Facts:
IN-N-OUT is an American burger chain,
not doing business in the Philippines. It
sought to register its trademark "INN-OUT" and "IN-N-OUT Burger & Arrow
Design with the Bureau of Trademarks
It found out, however, that the
trademark for IN N OUT had already
been obtained by Sehwani, Inc. Thus, it
filed an administrative complaint
against Sehwani for unfair competition
and
cancellation
of
trademark
registration.
o IN-N-OUT
alleged
that
its
trademark has been registered all
over
the
world
and
is
internationally well-known. The
use by Sehwani of a confusingly
similar or identical trademark in a
restaurant business would mislead
purchasers of petitioners goods
The IPO Director of Legal Affairs
ruled in favor of IN-N-OUT. It said
that the IPO had already previously
declared the mark IN-N-OUT as an
internationally well known brand;
hence, petitioner could use it in the
Philippines to the exclusion of others.
However,
it
also
ruled
that
Sehwani was not guilty of unfair
competition, there being no bad faith

on its part. The director then ordered

the
cancellation
of
Sehwanis
certificate of registration.
Sehwani filed an MR, but being filed
out of time, it was denied. IN-N-OUT
filed a partial MR but it likewise
denied. IN-N-OUT then appealed
such decision before the IPO
Director General.
The IPO Director General found
the appeal meritorious. It found
Sehwani guilty of unfair competition
and ordered the payment of damages.
Aggrieved, Sehwani filed before
the CA a petition for review under
rule 43 of the Rules of Court
The CA reversed the decision of
the Director General. It resolved the
appeal on jurisdictional issues not
raised by the parties. It ruled:
o IPO Director for Legal Affairs
and the IPO Director General
had no jurisdiction over the
administrative
proceedings
below to rule on issue of unfair
competition, because Section
163
of
the
Intellectual
Property
Code
specifically
confers
jurisdiction
over
particular provisions in the law
on trademarks on regular
courts
o Section 163 states: Jurisdiction of
Court.All actions under Sections
150, 155, 164, and 166 to 169
shall be brought before the proper
courts with appropriate jurisdiction
under existing laws.
o The provisions referred to in
Section 163 are: Section 150 on
License Contracts; Section 155 on
Remedies on Infringement; Section
164 on Notice of Filing Suit Given
to the Director; Section 166 on
Goods Bearing Infringing Marks or
Trade Names; Section 167 on
Collective Marks; Section 168 on
Unfair
Competition,
Rights,
Regulation and Remedies; and
Section 169 on False Designations
of Origin, False Description or
Representation.

Issue: WON the IPO has jurisdiction

over administrative complaints for

intellectual property rights violations
(YES)

petitioners intellectual property rights,

falls within the jurisdiction of the IPO
Director of Legal Affairs.

Ratio:
Section 10 of the Intellectual Property
Code specifically identifies the functions of
the Bureau of Legal Affairs, thus:

The Intellectual Property Code also

expressly
recognizes
the
appellate
jurisdiction of the IPO Director General
over the decisions of the IPO Director of
Legal Affairs, to wit:

Section 10. The Bureau of Legal Affairs.

The Bureau of Legal Affairs shall have the
following functions:
10.1 Hear and decide opposition to the
application for registration of marks;
cancellation of trademarks; subject to
the provisions of Section 64, cancellation
of patents and utility models, and
industrial designs; and petitions for
compulsory licensing of patents;
10.2 (a) Exercise original jurisdiction
in
administrative
complaints
for
violations
of
laws
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, futher, That availment of
the provisional remedies may be
granted in accordance with the Rules
of Court. The Director of Legal Affairs
shall have the power to hold and punish
for contempt all those who disregard
orders or writs issued in the course of the
proceedings. (b) After formal investigation,
the Director for Legal Affairs may impose
one (1) or more of the following
administrative penalties:
(i) (vi) The cancellation of any permit,
license, authority, or registration
which may have been granted by the
Office, or the suspension of the validity
thereof for such period of time as the
Director of Legal Affairs may deem
reasonable which shall not exceed one (1)
year;
(viii) The assessment of damages;
Unquestionably, petitioners complaint
which seeks the cancellation of the
disputed trademark in the name of
Sehwani and damages for violation of

Section 7. The Director General and

Deputies Director General. 7.1 Fuctions.
The Director General shall exercise the
following powers and functions:
xxxx
b) Exercise exclusive appellate jurisdiction
over all decisions rendered by the Director
of Legal Affairs, the Director of Patents,
the Director of Trademarks, and the
Director of Documentation, Information
and Technology Transfer Bureau. The
decisions of the Director General in the
exercise of his appellate jurisdiction in
respect of the decisions of the Director of
Patents, and the Director of Trademarks
shall be appealable to the Court of
Appeals in accordance with the Rules of
Court; and those in respect of the
decisions
of
the
Director
of
Documentation,
Information
and
Technology Transfer Bureau shall be
appealable to the Secretary of Trade and
Industry;
Hence, the CA erroneously reasoned that
Section 10(a) of the Intellectual Property
Code, conferring upon the BLA-IPO
jurisdiction over administrative complaints
for violations of intellectual property
rights, is a general provision, over which
the specific provision of Section 163 of the
same Code, found under Part III thereof
particularly governing trademarks, service
marks, and tradenames, must prevail.
Proceeding therefrom, the Court of
Appeals incorrectly concluded that all
actions involving trademarks, including
charges of unfair competition, are under
the exclusive jurisdiction of civil courts.
Such interpretation is not supported by
the provisions of the Intellectual Property
Code. While Section 163 thereof vests
in civil courts jurisdiction over cases
of unfair competition, nothing in the

said section states that the regular

courts have sole jurisdiction over
unfair competition cases, to the
exclusion of administrative bodies. On
the contrary, Sections 160 and 170, which
are also found under Part III of the
Intellectual Property Code, recognize the
concurrent jurisdiction of civil courts and
the IPO over unfair competition cases.
These two provisions read:

and defraud a competitor. The confusing

similarity may or may not result from
similarity in the marks, but may result
from other external factors in the
packaging or presentation of the goods.
The intent to deceive and defraud may be
inferred from the similarity of the
appearance of the goods as offered for
sale to the public. Actual fraudulent intent
need not be shown.

Section 160. Right of Foreign Corporation

to Sue in Trademark or Service Mark
Enforcement Action.Any foreign national
or juridical person who meets the
requirements of Section 3 of this Act and
does not engage in business in the
Philippines
may
bring
a
civil
or
administrative action hereunder for
opposition, cancellation, infringement,
unfair competition, or false designation of
origin and false description, whether or
not it is licensed to do business in the
Philippines under existing laws.
xxxx

It appeared that Sehwan registered the

trademark IN N OUT, but it was using
petitioners trademark IN-N-OUT in its
business. Moreover, the inside of the O in
its trademark is shaped like a star. In
practice, however, Sehwani doesnt print
its trademark that way, allegedly because
of the difficulty of printing such design.

Section 170. Penalties.Independent of the

civil and administrative sanctions
imposed by law, a criminal penalty of
imprisonment from two (2) years to five
(5) years and a fine ranging from Fifty
thousand pesos (P50,000) to Two hundred
thousand pesos (P200,000), shall be
imposed on any person who is found guilty
of committing any of the acts mentioned
in
Section
155,
Section168,
and
Subsection169.1.
Based on the foregoing discussion,
the IPO Director of Legal Affairs had
jurisdiction to decide the petitioners
administrative
case
against
respondents and the IPO Director
General had exclusive jurisdiction
over the appeal of the judgment of
the IPO Director of Legal Affairs.
Others:
Issue: WON Sehwani was engaged in
unfair competition (YES)
The essential elements of an action for
unfair competition are (1) confusing
similarity in the general appearance of the
goods and (2) intent to deceive the public

Sehwani has also been using [etitioners

registered mark Double-Double for use on
hamburger products. In fact, the burger
wrappers and the French fries receptacles
that Sehwani uses bear not its own
trademark but that of petitioners do not
bear the mark registered by the
[respondent], but the [petitioners] IN-NOUT Burgers name and trademark IN-NOUT with Arrow design.
Sehwani gives its products the general
appearance that would likely influence
purchasers to believe that these products
are those of the petitioner. The intention
to deceive may be inferred from the
similarity of the goods as packed and
offered for sale.
Sehwani also uses petitioners signage.
Also, despite respondents claims that
they had been using the mark since 1982,
they only started constructing their
restaurant sometime in 2000, after
petitioner had already demanded that
they desist from claiming ownership of the
mark "IN-N-OUT."
Damages awarded pursuant to Section
168.4 of the Intellectual Property Code,
which provides that the remedies under
Sections
156,
157
and
161
for
infringement shall apply mutatis mutandis
to unfair competition.

Sehwani has also been using It was also

shown that it has been using another
trademark of petitioners, Double-Double,
for its hamburger products.
Also, started constructing the restaurant
only after the [petitioner] demanded that
the latter desist from claiming ownership
of the mark IN-N-OUT and voluntarily
cancel their trademark registration.