INTELLECTUAL PROPERTY LAW
 JURIS DOCTOR 3 CASE DIGESTS “LEE” is primarily a surname. Private respondent cannot,
1. Emerald Garment Manufacturing Corp. vs CA
Facts:
HD Lee Co., a foreign corporation, seeks the cancellation
of a patent in favor of Emerald Garment Manufacturing
(domiciled in the Phil) for the trademark “Stylistic Mr.
Lee,” which according to HD Lee Co. closely resembled
its own trademark “Lee” and thus would cause confusion,
mistake and deception to the purchasing public. The
Director of Patents granted the cancellation on the ground
that petitioner’s trademark was confusingly similar to
private respondent’s mark because “it is the word ‘Lee’
which draws the attention of the buyer and leads him to
conclude that the goods originated from the same
manufacturer. It is undeniably the dominant feature of the
mark. The CA affirmed.
Issue: WON the trademark “Stylistic Mr. Lee” tends to
mislead or confuse the public and constitutes an
infringement of the trademark “Lee.”
Held: Negative for lack of adequate proof of actual use of
its trademark in the Philippines prior to Emeralds use of its
own mark and for failure to establish confusing similarity
between said trademarks, HD Lee Co’s action for
infringement must necessarily fail. (SC used Holistic Test,
CA- Dominancy Test)
Ratio:
Emerald’s “Stylistic Mr. Lee” is not confusingly similar to
private respondent’s “LEE” trademark. Colorable imitation
DOES NOT APPLY because:
Petitioner’s trademark is the whole “STYLISTIC MR. LEE.”
Although on its label the word “LEE” is prominent, the
trademark should be considered as a whole and not
piecemeal. The dissimilarities between the two marks
become conspicuous, noticeable and substantial enough
to matter especially in the light of the following variables
that must be factored in, among others:
Expensive and valuable items are normally bought only after
deliberate, comparative and analytical investigation; and
The average Filipino consumer generally buys his jeans by
brand.
therefore, acquire exclusive ownership over and singular use of
said term.
After a meticulous study of the records, the SC observes that
the Director of Patents and the Court of Appeals relied mainly
on the registration certificates as proof of use by HD Lee Co of
the trademark “LEE” which are not sufficient.
***********************
Colorable imitation defined: "such a close or ingenious
imitation as to be calculated to deceive ordinary
purchasers, or such resemblance of the infringing mark to
the original as to deceive an ordinary purchaser giving
such attention as a purchaser usually gives, and to cause
him to purchase the one supposing it to be the other.
2. Ecole De Cuisine Manille (Cordon Bleu of the Philippines),
Inc., vs. Renaud Cointreau & Cie and Le Cordon Bleu Int'l.,
B.V.
Facts:
Cointreau, a partnership registered under the laws of France,
filed for a trademark application for the mark "LE CORDON
BLEU & DEVICE" pursuant to Section 37 of Republic Act No. 166.
Petitioner Ecole filed an opposition to the subject application,
averring that it is the owner of the mark "LE CORDON BLEU,
ECOLE DE CUISINE MANILLE," which it has been using since
1948 in cooking and other culinary activities, including in its
restaurant business; and it has earned immense and invaluable
goodwill such that Cointreau’s use of the subject mark will
actually create confusion, mistake, and deception to the buying
public as to the origin and sponsorship of the goods, and cause
great and irreparable injury and damage to Ecole’s business
reputation and goodwill as a senior user of the same.
The Bureau of Legal Affairs (BLA) sustained Ecole’s opposition
to the subject mark, necessarily resulting in the rejection of
Cointreau’s application. While noting the certificates of
registration obtained from other countries and other pertinent
materials showing the use of the subject mark outside the
Philippines, the BLA did not find such evidence sufficient to
establish Cointreau’s claim of prior use of the same in the
Philippines. It emphasized that the adoption and use of
trademark must be in commerce in the Philippines and not
abroad. Cointreau has not established any proprietary right
entitled to protection in the Philippine jurisdiction because the
law on trademarks rests upon the doctrine of nationality or
territoriality.
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The IPO Director General reversed and set aside the BLA’s
decision.. The CA affirmed and declared Cointreau as the true
and actual owner of the subject mark with a right to register
the same in the Philippines under Section 37 of R.A. No. 166,
having registered such mark in its country of origin on
November 25, 1986
Issue:
Whether the CA was correct in upholding the IPO Director
General’s ruling that Cointreau is the true and lawful owner of
the subject mark and thus, entitled to have the same registered
under its name.
Held:
Yes, the CA was correct. At the time Ecole started using the
subject mark, the same was already being used by Cointreau,
albeit abroad, of which Ecole’s directress was fully aware, being
an alumna of the latter’s culinary school in Paris, France. Hence,
Ecole cannot claim any tinge of ownership whatsoever over the
subject mark as Cointreau is the true and lawful owner thereof.
As such, the IPO Director General and the CA were correct in
declaring Cointreau as the true and lawful owner of the subject
mark and as such, is entitled to have the same registered under
its name.
In any case, the present law on trademarks, Republic Act No.
8293, otherwise known as the Intellectual Property Code of the
Philippines, as amended, has already dispensed with the
requirement of prior actual use at the time of registration. Thus,
there is more reason to allow the registration of the subject
mark under the name of Cointreau as its true and lawful owner.
3. Mirpuri vs CA
Facts:
Lolita Escobar applied with the Bureau of Patents for the
registration of the trademark “Barbizon”, alleging that she had
been manufacturing and selling these products since 1970.
private respondent Barbizon Corp opposed the application in
IPC No. 686. The Bureau granted the application and
a certificate of registration was issued for the trademark
“Barbizon”. Escobar later assigned all her rights and interest
over the trademark to petitioner Mirpuri. In 1979,
Escobar failed to file with the Bureau the Affidavit of Use of the
trademark. Due to his failure, the Bureau cancelled the
certificate of registration. Escobar reapplied and Mirpuri also
applied and this application was also opposed by private
respondent in IPC No. 2049, claiming that it adopted said
trademark in 1933 and has been using it. It obtained a
certificate from the US Patent Office in 1934. Then in 1991, DTI
cancelled petitioner’s registration and declared private
respondent the owner and prior user of the business name
“Barbizon International”.
Issue:
Whether or not the treaty (Paris Convention) affords protection
to a foreign corporation against a Philippine applicant for the
registration of a similar trademark.
Held:
The Court held in the affirmative. RA 8293 defines trademark as
any visible sign capable of distinguishing goods. The Paris
Convention is a multilateral treaty that seeks to
protect industrial property consisting of patents, utility
models, industrial designs, trademarks, service marks, trade
names and indications of source or appellations of origin, and
at the same time aims to repress unfair competition. In short,
foreign nationals are to be given the same treatment in each of
the member countries as that country makes available to its
own citizens. Nationals of the various member nations are thus
assured of a certain minimum of international protection of
their industrial property.
4. Fredco Manufacturing Corporation vs President and
Fellows of Harvard College (Harvard University)
Facts:
On August 10 2005, Petitioner Fredco Manufacturing
Corporation (Fredco), a corporation organized and existing
under the laws of the Philippines, filed a Petition for
Cancellation of Registration No. 56561 before the Bureau of
Legal Affairs of the Intellectual Property Office (IPO) against
respondents President and Fellows of Harvard College (Harvard
University).
Fredco alleged that Registration No. 56561 was issued to
Harvard University on 25 November 1993 for the mark
“Harvard Veritas Shield Symbol” for decals, tote bags, serving
trays, sweatshirts, t-shirts, hats and flying discs under Classes
16, 18, 21, 25 and 28 of the Nice International Classification of
Goods and Services. Fredco alleged that the mark “Harvard” for
t-shirts, polo shirts, sandos, briefs, jackets and slacks was first
used in the Philippines on 2 January 1982 by New York
Garments Manufacturing & Export Co., Inc. (New York
Garments), a domestic corporation and Fredco’s predecessor-
in-interest. A Certificate of Registration was issued to New York
Garments on 12 December 1988, with a 20-year term subject to
renewal at the end of the term.
Fredco alleged that at the time of issuance of Registration No.
56561 to Harvard University, New York Garments had already
registered the mark “Harvard” for goods under Class 25.
Despute New York Garments inadvertently failing to file an
affidavit of use/non-use on the fifth anniversary of the
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registration, the right to the mark “Harvard” remained with its
predecessor New York Garments and now with Fredco.
Harvard University, on the other hand, alleged that it is the
lawful owner of the name and mark “Harvard” in numerous
countries worldwide, including the Philippines. It contends that
the name and mark “Harvard” was adopted in 1639 as the
name of Harvard College of Cambridge, Massachusetts, U.S.A.
The name and mark “Harvard” was allegedly used in commerce
as early as 1872. Harvard University is over 350 years old and is
one of the most famous brands in the world.
Harvard University alleged that in March 2002, it discovered,
through its international trademark watch program, Fredco’s
website which advertises and promotes the brand name
“Harvard Jeans USA.” It then filed an administrative complaint
against Fredco before the IPO for trademark infringement
and/or unfair competition with damages.
Harvard University alleged that its valid and existing certificates
of trademark registration in the Philippines. The trademark for
“Harvard Veritas Shield Design” was issued on November 25,
1993 among others.
IPO cancelled Harvard University’s registration of the mark
“Harvard” under Class 25. The Office of the Director General,
IPO reversed the decision of the Bureau of Legal Affairs, IPO.
The Court of Appeals affirmed the decision of the Office of the
Director General of the IPO hence, this petition.
Issue:
Whether or not Fredco’s date of actual use of the trademark in
the Philippines entitles it to a better right to register the marks.
Held:
No.
Under Section 2 of Republic Act No. 166,14 as amended (R.A.
No. 166), before a trademark can be registered, it must have
been actually used in commerce for not less than two months
in the Philippines prior to the filing of an application for its
registration. However, Harvard University’s registration of the
name “Harvard” is based on home registration which is allowed
under Section 37 of R.A. No. 166.
Where the trademark sought to be registered has already been
registered in a foreign country that is a member of the Paris
Convention, the requirement of proof of use in the commerce
in the Philippines for the said period is not necessary.
Under Section 239.2 of Republic Act No. 8293 (R.A. No.
8293),18 “[m]arks registered under Republic Act No. 166 shall
remain in force but shall be deemed to have been granted
under this Act. Since the mark “Harvard Veritas Shield Symbol”
is now deemed granted under R.A. No. 8293, any alleged defect
arising from the absence of actual prior use in the Philippines
has been cured by Section 239.2.19. In addition, Fredco’s
registration was already cancelled on 30 July 1998 when it
failed to file the required affidavit of use/non-use for the fifth
anniversary of the mark’s registration. Hence, at the time of
Fredco’s filing of the Petition for Cancellation before the
Bureau of Legal Affairs of the IPO on 2005, Fredco was no
longer the registrant or presumptive owner of the mark
“Harvard.”
Fredco’s registration of the mark “Harvard” and its
identification of origin as “Cambridge, Massachusetts” falsely
suggest that Fredco or its goods are connected with Harvard
University. Section 4(a) of R.A. No. 166 prohibits the
registration of a mark “which may disparage or falsely suggest a
connection with persons, living or dead, institutions, beliefs.
Indisputably, Fredco does not have any affiliation or connection
with Harvard University, or even with Cambridge,
Massachusetts.
Fredco claims that it used these words “to evoke a ‘lifestyle’ or
suggest a ‘desirable aura’ of petitioner’s clothing lines.”
Fredco’s belated justification merely confirms that it sought to
connect or associate its products with Harvard University, riding
on the prestige and popularity of Harvard University, and thus
appropriating part of Harvard University’s goodwill without the
latter’s consent.
The Philippines and the United States of America are both
signatories to the Paris Convention for the Protection of
Industrial Property (Paris Convention). Thus, under Philippine
law, a trade name of a national of a State that is a party to the
Paris Convention, whether or not the trade name forms part of
a trademark, is protected “without the obligation of filing or
registration.”
No entity in the Philippines can claim, expressly or impliedly
through the use of the name and mark “Harvard,” that its
products or services are authorized, approved, or licensed by,
or sourced from, Harvard University without the latter’s
consent.
Minister of Trade Secretary Luis Villafuerte issued a
Memorandum directing the Director of Patents to reject,
pursuant to the Paris Convention, all pending applications for
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Philippine registration of signature and other world-famous
trademarks by applicants other than their original owners.
Minister of Trade and Industry Roberto Ongpin directed the
Director of Patents to implement measures necessary to
comply with the Philippines’ obligations under the Paris
Convention.
To be protected under the two directives of the Ministry of
Trade, an internationally well-known mark need not be
registered or used in the Philippines. All that is required is that
the mark is well-known internationally and in the Philippines
for identical or similar goods, whether or not the mark is
registered or used in the Philippines.
Section 123.1(e) of R.A. No. 8293 now categorically states that
“a mark which is considered by the competent authority of the
Philippines to be well-known internationally and in the
Philippines, whether or not it is registered here,” cannot be
registered by another in the Philippines. Section 123.1(e) does
not require that the well-known mark be used in commerce in
the Philippines but only that it be well-known in the Philippines.
Records also show that the first use of the name HARVARD was
in 1638 for educational services, policy courses of instructions
and training at the university level. It has a Charter. Its first
commercial use of the name or mark HARVARD for Class 25 was
on 31 December 1953. The name HARVARD was the name of a
person, John Harvard, whose deeds were considered to be a
cornerstone of the university.
“Harvard” is a well-known name and mark not only in the
United States but also internationally, including the Philippines.
The mark “Harvard” is rated as one of the most famous marks
in the world. It has been registered in at least 50 countries. It
has been used and promoted extensively in numerous
publications worldwide. It has established a considerable
goodwill worldwide since the founding of Harvard University
more than 350 years ago.
5. Shangri-La v. Developers Group of Companies, Inc.
Facts:
On 18 October 1982, Developers Group of Companies, Inc.
(DGCI) filed with the Bureau of Patents, Trademarks, and
Technology Transfer (BPTTT) for registration covering the
“Shangri-La” mark and “S” logo. On 31 May 1983, BPTTT issued
in favor of DGCI, Registration No. 31904.
DGCI has used the “S” logo since then but as far back as 1962,
the Kuok Group of Companies has adopted the name Shangri-
La in all Shangri-La hotels and hotel-related establishments
worldwide (SLIHM)
In February 1975, William Lee, a Singaporean design artist
commissioned to design the logo of Shangri-La hotels, launched
the stylized “S” logo
SLIHM has used the name “Shangri-La” and the “S” logo since
then. Shangri-La Hotel and Resort, Inc. was incorporated in the
RP beginning 1987 when the Kuok Group put up two hotels in
Mandaluyong and Makati.
SLIHM filed with the BPTTT a petition, praying for the
cancellation of the Registration No. 31904 and for the
registration of the mark and logo in their own name. DGCI filed
a complaint for Infringement and Damages with the RTC of
Quezon City against SLIHM because they have been using the
mark and the logo for the last eight years
SLIHM pointed to the Paris Convention for the Protection of
Industrial Property and further claimed that they have used the
mark and logo since 1975
On 8 March 1996, RTC ruled in favor of DGCI. Therefrom, SLIHM
went on appeal to the CA, but the affirmed the lower court’s
decision with the modification of deleting the award of
attorney’s fees. SLIHM moved a motion for reconsideration, but
was also denied.
Issue:
What constitutes trademark ownership?
Held:
Petition is granted and the assailed decision and resolution of
the CA is set aside. SC ruled in favor of SLIHM
RA No. 166 (law in force at the time of DGCI’s application)
The root of ownership of a trademark is actual use in
commerce
Section 2 of RA No. 166 requires that before a trademark can
be registered, it must have been actually used in commerce and
service for not less than two months in the Philippines prior to
the filing of an application for its registration
Moreover, registration does not confer upon the registrant an
absolute right to the registered mark. The certificate of
registration is merely a prima facie proof that the registrant is
the owner of the registered mark or trade name
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Evidence of prior and continuous use of the mark or trade
name by another can overcome the presumptive ownership of
the registrant and may very well entitle the former to be
declared owner in an appropriate case.
In other words, registration is not a mode of acquiring
ownership.The actual use in commerce or business is a pre-
requisite to the acquisition of the right of ownership
In his testimony, Ramon Synhunliong, stated that the alleged
jeepney signboard artist commissioned to create the mark and
logo submitted his design only in December 1982. That was
two-and-a-half months after the filing of the respondent’s
trademark application. Ramon Synhunliong has been a guest at
SLIHM’s hotel before causing the registration of the trademark,
which gave rise to the allegation that he must have copied the
idea there
Section 2 of RA No. 166 provides for what is registerable,
containing the clause “actually in use in commerce in services
not less than two months in the Philippines”. But Section 2-A
sets out how ownership is acquired. Under Section 2-A it states:
The actual use in commerce is the test of ownership
The mark must not have been so appropriated by another.
Whether or not the actual use of the trademark is in the
Philippines, DGCI did not fulfill the requirements of ownership
under Section 2-A
6. McDonald's Corporation v. L.C. Big Mak Burger, Inc.
Facts:
Mcdo registered its Big Mac with the Philippine IPO, which was
granted as far back as 18 July 1985. From 1982 to 1990, Mcdo
spent P10.5 million in advertisement for Big Mac hamburger
sandwiches, and displayed the Big Mac mark on paraphernalia
and other items.
L.C. Big Mak Burger is a domestic corporation which operates
fast-food outlets and snack vans in Metro Manila and nearby
provinces. Their menu includes hamburger sandwiches and
other food items.
L.C. Big Mak tried to register the “Big Mak” mark with the then
PBPTT (now IPO), which was opposed by McDo. McDo also
wrote L.C. Big Mak and its owners to desist. Receiving no
response, McDo filed a case for trademark infringement and
unfair competition.
Issue:
Whether there is trademark infringement or unfair competition.
Held:
Yes, there is trademark infringement and unfair competition.
The evidence presented shows that the plastic wrappings and
plastic bags used by L.C. Big Mak for their hamburger
sandwiches bore the words “Big Mak.” The other descriptive
words “burger” and “100% pure beef” were set in smaller type,
along with the locations of branches. Respondents’ cash
invoices simply refer to their hamburger sandwiches as “Big
Mak.”[29] It is respondents’ snack vans that carry the words
“L.C. Big Mak Burger, Inc.”
To establish trademark infringement, the following elements
must be shown: (1) the validity of plaintiff’s mark; (2) the
plaintiff’s ownership of the mark; and (3) the use of the mark
or its colorable imitation by the alleged infringer results in
“likelihood of confusion.” Of these, it is the element of
likelihood of confusion that is the gravamen of trademark
infringement
Validity of the Mark: The “Big Mac” mark, which should be
treated in its entirety and not dissected word for word, is
neither generic nor descriptive. Generic marks are commonly
used as the name or description of a kind of goods, such as
“Lite” for beer or “Chocolate Fudge” for chocolate soda
drink.Descriptive marks, on the other hand, convey the
characteristics, functions, qualities or ingredients of a product
to one who has never seen it or does not know it exists, such as
“Arthriticare” for arthritis medication. On the contrary, “Big
Mac” falls under the class of fanciful or arbitrary marks as it
bears no logical relation to the actual characteristics of the
product it represents. As such, it is highly distinctive and thus
valid.
Confusion: While there is confusion of goods when the
products are competing, confusion of business exists when
the products are non-competing but related enough to
produce confusion of affiliation. The registered trademark
owner may use his mark on the same or similar products,
in different segments of
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7. McDonalds Corporation vs. MacJoy Fast-food
Corporation
Facts:
MacJoy is a fast food restaurant engages in selling fried chicken,
chicken barbeque, burgers, fries, spaghetti, palabok, tacos,
sandwiches, halo-halo and steaks. Since 1987 Macjoy Devices
had been operating in Cebu.
In 1991, MacJoy filed its application for trademark before the
IPO.
McDonald’s opposed the application as it alleged that MacJoy
closely resembles McDonald’s corporate logo such that when
used on identical or related goods, the trademark applied for
would confuse or deceive purchasers into believing that the
goods originate from the same source or origin and that the use
and adoption in bad faith of the “MacJoy and Device” mark
would falsely tend to suggest a connection or affiliation with
McDonald’s restaurant services and food products, thus,
constituting a fraud upon the general public and further cause
the dilution of the distinctiveness of McDonald’s registered and
internationally recognized McDonald’S marks to its prejudice
and irreparable damage.
The IPO ruled in favor of McDonald’s.
MacJoy appealed before the Court of Appeals and the latter
ruled in favor of MacJoy using the commonly used holistic test
in ruling over the case which looks upon the visual comparisons
between the two trademarks.
The Court of Appeals ruled that other than the letters “M” and
“C” in the words MacJoy and McDonald’s, there are no real
similarities between the two trademarks. “MacJoy” is written
in round script while “McDonald’s” is written in thin gothic.
“MacJoy” is accompanied by a picture of a (cartoonish) chicken
while “McDonald’s” is accompanied by the arches “M”. The
color schemes between the two are also different. “MacJoy” is
in deep pink while “McDonald’s” is in gold color. Hence, this
petition
Issue:
Whether or not Macjoy had committed infringement upon the
trademark of MacDonalds.
Held:
Yes. The Supreme Court ruled that the proper test to be used is
the dominancy test. It not only looks at the visual
comparisons between two trademarks but also the aural
impressions created by the marks in the public mind as well as
connotative comparisons, giving little weight to factors like
prices, quality, sales outlets and market segments.
According to the SC “McDonald’s” and “MacJoy” marks are
confusingly similar with each other such that an ordinary
purchaser can conclude an association or relation between the
marks.
First, both marks use the corporate “M” design logo and the
prefixes “Mc” and/or “Mac” as dominant features. The first
letter “M” in both marks puts emphasis on the prefixes “Mc”
and/or “Mac” by the similar way in which they are depicted i.e.
in an arch-like, capitalized and stylized manner.
Second, it is the prefix “Mc,” an abbreviation of “Mac,” which
visually and aurally catches the attention of the consuming
public. Verily, the word “MACJOY” attracts attention the same
way as did “McDonalds,” “MacFries,” “McSpaghetti,” “McDo,”
“Big Mac” and the rest of the MCDONALD’S marks which all use
the prefixes Mc and/or Mac. Besides and most importantly,
both trademarks are used in the sale of fast-food products.
Finally, the owner of MacJoy provided little explanation why in
all the available names for a restaurant he chose the prefix
“Mac” to be the dominant feature of the trademark.
The prefix “Mac” and “Macjoy” has no relation or similarity
whatsoever to the name Scarlett Yu Carcel, which is the name
of the niece of MacJoy’s president whom he said was the basis
of the trademark MacJoy.
By reason of the MacJoy’s implausible and insufficient
explanation as to how and why out of the many choices of
words it could have used for its trade-name and/or trademark,
it chose the word “Macjoy,” the only logical conclusion
deducible therefrom is that the MacJoy would want to ride high
on the established reputation and goodwill of the McDonald’s
marks, which, as applied to its restaurant business and food
products, is undoubtedly beyond question.
8. Asia Brewery, Inc. vs. The Hon. Court of Appeals and San
Miguel Corporation
Facts:
San Miguel Corporation (SMC) filed a complaint against Asia
Brewery Inc. (ABI) for infringement of trademark and unfair
competition on account of the latter's BEER PALE PILSEN or
BEER NA BEER product which has been competing with SMC's
SAN MIGUEL PALE PILSEN for a share of the local beer market.
The trial court dismissed SMC's complaint because ABI "has not
committed trademark infringement or unfair competition
against" SMC
On appeal by SMC, the Court of Appeals reversed the decision
rendered by the trial court, finding the defendant Asia Brewery
Incorporated GUILTY of infringement of trademark and unfair
competition. ABI then filed a petition for certiorari.
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Issue:
Are the words PALE PILSEN as part of ABI’s trademark
constitute infringement of SMC’s trademark?
Held:
No. The Supreme Court said it does not constitute an
infringement as the words PALE PILSEN, which are part of ABI’s
trademark, are generic words descriptive of the color (“pale“),
of a type of beer (“pilsen”), which is a light bohemian beer with
a strong hops flavor that originated in the City of Pilsen,
Czechislovakia and became famous in the Middle Ages.
The Supreme Court further said that the words "pale pilsen"
may not be appropriated by SMC for its exclusive use even if
they are part of its registered trademark. No one may
appropriate generic or descriptive words. They belong to the
public domain.
Petitioner ABI has neither infringed SMC's trademark nor
committed unfair competition with the latter's SAN MIGUEL
PALE PILSEN product.
9. Prosource International, Inc. vs. Horphag Research
Management SA
Facts:
Respondent Horphag Research Management SA is a
corporation duly organized and existing under the laws of
Switzerland and the owner of trademark PYCNOGENOL, a food
supplement sold and distributed by Zuellig Pharma Corporation.
Respondent later discovered that petitioner Prosource
International, Inc. was also distributing a similar food
supplement using the mark PCO-GENOLS since 1996. This
prompted respondent to demand that petitioner cease and
desist from using the aforesaid mark.
Without notifying respondent, petitioner discontinued the use
of, and withdrew from the market, the products under the
name PCO-GENOLS as of June 19, 2000. It, likewise, changed its
mark from PCO-GENOLS to PCO-PLUS.
On August 22, 2000, respondent filed a Complaint for
Infringement of Trademark with Prayer for Preliminary
Injunction against petitioner, praying that the latter cease and
desist from using the brand PCO-GENOLS for being confusingly
similar with respondent’s trademark PYCNOGENOL. It, likewise,
prayed for actual and nominal damages, as well as attorney’s
fees.
In its Answer, petitioner contended that respondent could not
file the infringement case considering that the latter is not the
registered owner of the trademark PYCNOGENOL, but one
Horphag Research Limited. It, likewise, claimed that the two
marks were not confusingly similar. Finally, it denied liability,
since it discontinued the use of the mark prior to the institution
of the infringement case. Petitioner thus prayed for the
dismissal of the complaint. By way of counterclaim, petitioner
prayed that respondent be directed to pay exemplary damages
and attorney’s fees.
On January 16, 2006, the RTC decided in favor of respondent. It
observed that PYCNOGENOL and PCO-GENOLS have the same
suffix "GENOL" which appears to be merely descriptive and
thus open for trademark registration by combining it with other
words. The trial court, likewise, concluded that the marks,
when read, sound similar, and thus confusingly similar
especially since they both refer to food supplements. The court
added that petitioner’s liability was not negated by its act of
pulling out of the market the products bearing the questioned
mark since the fact remains that from 1996 until June 2000,
petitioner had infringed respondent’s product by using the
trademark PCO-GENOLS. As respondent manifested that it was
no longer interested in recovering actual damages, petitioner
was made to answer only for attorney’s fees amounting to
P50,000.00. For lack of sufficient factual and legal basis, the
court dismissed petitioner’s counterclaim. Petitioner’s motion
for reconsideration was likewise denied.
On appeal to the CA, petitioner failed to obtain a favorable
decision. The appellate court explained that under the
Dominancy or the Holistic Test, PCO-GENOLS is deceptively
similar to PYCNOGENOL. It also found just and equitable the
award of attorney’s fees especially since respondent was
compelled to litigate.
Issues:
Whether or not Prosource committed trademark
infringement?
Should the answer be on the affirmative, whether
Horphag is entitled to the award of Attorney’s Fee?
Held:
Yes, Prosource committed trademark infringement.
Yes, SC sustained the award of attorney’s fees in favor of
respondent.
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10. Del Monte vs. Sunshine Sauce
(Infringement of Trademark and Unfair Competition)
Facts:
Petitioner Del Monte Corporation is a foreign company
organized under the laws of the United States and not engaged
in business in the Philippines. Both the Philippines and the
United States are signatories to the Convention of Paris of
September 27, 1965, which grants to the nationals of the
parties rights and advantages which their own nationals enjoy
for the repression of acts of infringement and unfair
competition.
Petitioner Philippine Packing Corporation (Philpack) is a
domestic corporation duly organized under the laws of the
Philippines. Del Monte granted Philpack the right to
manufacture, distribute and sell in the Philippines various
agricultural products, including catsup, under the Del Monte
trademark and logo. Del Monte authorized Philpack to register
with the Philippine Patent Office the Del Monte catsup bottle
configuration, for which it was granted Certificate of Trademark
Registration No. SR-913 by the Philippine Patent Office under
the Supplemental Register. Del Monte also obtained two
registration certificates for its trademark "DEL MONTE" and its
logo. Respondent Sunshine Sauce Manufacturing Industries was
issued a Certificate of Registration by the Bureau of Domestic
Trade to engage in the manufacture, packing, distribution and
sale of various kinds of sauce, identified by the logo Sunshine
Fruit Catsup. The product itself was contained in various kinds
of bottles, including the Del Monte bottle, which the private
respondent bought from the junk shops for recycling.
Having received reports that the private respondent was using
its exclusively designed bottles and a logo confusingly similar to
Del Monte's, Philpack and Del Monte filed a complaint against
the private respondent for infringement of trademark and
unfair competition.
Sunshine alleged that its logo was substantially different from
the Del Monte logo and would not confuse the buying public to
the detriment of the petitioners.
Issue: Whether or not there was infringement of trademark
and unfair competition.
Held:
YES. Section 22 of R.A. No. 166, otherwise known as the
Trademark Law, provides:
Any person who shall use, without the consent of the registrant,
any reproduction, counterfeit, copy or colorable imitation 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...
Sec. 29 of the same law states as follows:
Any person who shall employ deception or any other means
contrary to good faith by which he shall pass off the goods
manufactured by him or in which he deals, or his business, or
services for those of the one having established such goodwill...
To arrive at a proper resolution of this case, it is important to
bear in mind the following distinctions between infringement
of trademark and unfair competition.
(1) Infringement of trademark is the unauthorized use of a
trademark, whereas unfair competition is the passing off of
one's goods as those of another.
(2) In infringement of trademark fraudulent intent is
unnecessary whereas in unfair competition fraudulent intent is
essential.
(3) In infringement of trademark the prior registration of the
trademark is a prerequisite to the action, whereas in unfair
competition registration is not necessary.
In determining whether two trademarks are confusingly similar,
the two marks in their entirety as they appear in the respective
labels must be considered in relation to the goods to which
they are attached; the discerning eye of the observer must
focus not only on the predorninant words but also on the other
features appearing on both labels.
The ordinary buyer does not usually make such scrutiny nor
does he usually have the time to do so. The question is NOT
whether the two articles are distinguishable by their label when
set side by side but whether the general confusion made by the
article upon the eye of the casual purchaser who is
unsuspicious and off his guard, is such as to likely result in his
confounding it with the original.The court therefore should be
guided by its first impression because the imitator will always
try to create enough differences to confuse the Court but
enough similarity to confuse the public. Here, although there
are particular differences, such are only manifest when you
conduct a thorough comparison.
We also note that the respondent court failed to take into
consideration several factors which should have affected its
8
conclusion, to wit: age, training and education of the usual
purchaser, the nature and cost of the article, whether the
article is bought for immediate consumption and also the
conditions under which it is usually purchased. It has been aptly
observed that the ultimate ratio in cases of grave doubt is the
rule that any doubt should be resolved against the newcomer
inasmuch as the field from which he can select a desirable
trademark to indicate the origin of his product is obviously a
large one. As Sunshine's label is an infringement of the Del
Monte's trademark, law and equity call for the cancellation of
the private respondent's registration and withdrawal of all its
products bearing the questioned label from the market. With
regard to the use of Del Monte's bottle, the same constitutes
unfair competition; hence, the respondent should be
permanently enjoined from the use of such bottles.
11. Fruit of the Loom vs. CA
Facts:
Petitioner is a corporation duly organized and existing under
the laws of the State of Rhode Island, USA. It is the registrant
of the trademark Fruit of the Loom in the Philippine Patent
Office and was issued two Certificates of Registration, one of
which was in 1957 and the other in 1958.
Private respondent, a domestic corporation, is the registrant of
the trademark Fruit for Eve in the Philippine Patent Office. Both
are involved in the merchandise of garments.
Petitioner filed a complaint for infringement of trademark and
unfair competition against private respondent, alleging that:
The latter’s trademark is confusingly similar to the
former’s, both trademarks being used in women’s panties and
other textile products
That the hang tags used by private respondent is a
colorable imitation of those of the petitioner
Petitioner respondent alleged that there was no confusing
similarity between the trademarks. At the pre-trial, the
following admissions were made:
That the registered trademark Fruit for Eve bears the
notice “Reg. Phil. Pat. Off.” While that of Fruit of the Loom does
not
That at the time of its registration, the plaintiff filed
no opposition thereto.
Respondent filed an answer invoking the special
defense that its registered trademark is not confusingly similar
to that of petitioner as the latter alleged. Likewise, private
respondent stated that the trademark FRUIT FOR EVE is being
used on ladies' panties and pajamas only whereas petitioner's
trademark is used even on men's underwear and pajamas. The
lower court rendered a decision in favor of the petitioner,
permanently enjoining private respondent from using the
trademark Fruit for Eve.
Both parties appealed to the Court of Appeals wherein the
petitioner questioned the lower court’s failure to award
damages in its favor and private respondent sought the reversal
of the lower court’s decision. The Court of Appeals rendered a
decision reversing the lower court’s decision and dismissing the
petitioner’s complaint. The petitioner’s motion for
reconsideration was denied.
Issue:
Whether or not there was infringement of trademark
Held:
In cases involving infringement of trademark brought before
this Court, it has been consistently held that 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. The discerning eye of the observer must focus not
only on the predominant words but also on the other features
appearing in both labels in order that he may draw his
conclusion where one is confusingly similar to the other. The
similarities of the competing trademarks in this case are
completely lost in the substantial differences in the design and
general appearance of their respective hangs tags. We have
examined the two trademarks as they appear in the hang tags
submitted by the parties and we are impressed more by the
dissimilarities than by the similarities appearing therein. We
hold that the trademarks Fruit of the Loom and Fruit for Eve do
not resemble each other as to confuse or deceive an ordinary
purchaser. The ordinary purchaser must be thought of as
having, and credited with, at least a modicum of intelligence to
be able to see the obvious differences between the two
trademarks in question.
9
12. Sehwani, Incorporated and/or Benita’s Frites, Inc. vs In-
N-Out Burger Inc
Facts:
This case arose because of the application of Respondent In-N-
Out Burger (INOB) with the Intellectual Property Office for the
registration of its trademark, the “IN-N-OUT Burger & Arrow
Design” and servicemark “IN-N-OUT” on June 2, 1997.
In the course of its application, INOB discovered that Petitioner
Sehwani, Inc. had obtained a trademark for “IN N OUT” on
December 17, 1993 without its authority. INOB subsequently
demanded that Sehwani desist from claiming ownership of
such mark and to voluntarily cancel its trademark registered
under the Intellectual Property Office (IPO). Sehwani refused to
accede to the demand of INOB and even entered into a
Licensing Agreement granting its co-petitioner Benita’s Frites,
Inc license to use for a period of five years the trademark in
issue.
This act of Sehwani then prompted INOB to file a complaint for
violation of intellectual property rights.
In its answer, Sehwani alleged that INOB lack the legal capacity
to sue because it was not doing business in the Philippines and
that it has no cause of action because its mark is not registered
or used in the Philippines. Also, Sehwani claimed that as owner
of the “IN-N-OUT” mark, it enjoys the presumption that the
same was validly acquired and that it has the exclusive right to
use the mark. Finally, Sehwani argued that other than the bare
allegation of fraud in the registration of the mark, respondent
failed to show the existence of any of the grounds for
cancellation thereof under Sec 151 of RA 8293.
The Bureau Director rendered a decision ruling that INOB has
legal capacity to sue and that it is the owner of the
internationally well-known trademarks but held that Sehwani is
not guilty of unfair competition.
Both parties appealed such decision of the Bureau Director but
said motions for reconsideration were subsequently denied by
the latter.
On separate dates, the parties appealed to the Office of the
Director General. The appeal of Sehwani was dismissed for
having been filed out of time. Aggrieved, Sehwani filed a
petition before the Court of Appeals which was dismissed for
lack of merit and the CA held that the requirements of the right
to appeal must be strictly complied with.
Meanwhile, the Director General rendered a decision in favour
of INOB in the latter’s appeal questioning the decision of the
Bureau Director when it ruled that Sehwani was not guilty of
unfair competition
Issues:
1. WON the Director General erred in dismissing the
appeal of Sehwani for having been filed out of time
2. WON INOB has legal capacity to sue
3. WON the complaint by INOB is barred by laches
Held:
The petition has no merit.
1st issue
The Court has invariably ruled that perfection of an appeal
within the statutory or reglementary period is not only
mandatory but also jurisdictional. The failure to file an appeal
on time renders the questioned decision final and executory,
and deprives the appellate court of jurisdiction to alter the
judgment or final order. The Court held the counsel of Sehwani
accountable for its claim that a mistake was made in counting
the period to appeal.
2nd issue:
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.
INOB anchors its causes of action under the Paris Convention,
wherein both the United States and the Philippines are
signatories. The Supreme Court held that the IPO is the
competent authority that is recognized under the Paris
Convention to determine whether a trademark is “well known”
in the country where protection is sought. Thus, the SC upheld
the ruling of the IPO. The SC further held that the fact that
INOB’s marks are neither registered nor used in the Philippines
is of no moment because under the Paris Convention, a well-
known mark should be protected in a country even if the mark
is neither registered nor used in that country. Sehwani’s claim
that no ground exists for the cancellation of their registration
lacks merit. This is because under Section 151 (b) of RA 8293, a
petition to cancel a registration of a mark may be filed by any
person who believes that he is damaged by the registration of a
10
mark if the registered mark is being used by the registrant so as
to misrepresent the source of goods or services on or in
connection with which the mark is used.
The evidence on record shows that not only did the petitioners
use the IN-N-OUT Burger trademark for the name of their
restaurant, but they also used identical or confusingly similar
mark for their hamburger wrappers and French-fries
receptacles, thereby effectively misrepresenting the source of
the goods and services
3 issue
rd
A petition to cancel the registration of a mark which is
registered contrary to the provisions thereof, or which is used
to misrepresent the source of goods or services, may be filed at
any time. Moreover, laches may not prevail against a specific
provision of law since equity is applied in the absence and not
against statutory law or rules of procedure. Petition is DENIED.
13. In-N-Out Burger, Inc. vs. Sehwani Inc., et. al
Facts:
Petitioner IN-N-OUT BURGER, INC., is a business entity
incorporated under the laws of California. It is a signatory to
the Convention of Paris on Protection of Industrial Property and
the TRIPS Agreement. It is engaged mainly in the restaurant
business, but it has never engaged in business in the Philippines.
Respondents Sehwani, Incorporated and Benita Frites, Inc. are
corporations organized in the Philippines. Sometime in 1991,
Sehwani filed with the BPTTT an application for the registration
of the mark "IN N OUT (the inside of the letter "O" formed like
a star). Its application was approved and a certificate of
registration was issued in its name on 1993. In 2000, Sehwani,
Incorporated and Benita Frites, Inc. entered into a Licensing
Agreement, wherein the former entitled the latter to use its
registered mark, "IN N OUT."
Sometime in 1997, In-N-Out Burger filed trademark and service
mark applications with the Bureau of Trademarks for the "IN-N-
OUT" and "IN-N-OUT Burger & Arrow Design. In 2000, In-N-Out
Burger found out that Sehwani, Incorporated had already
obtained Trademark Registration for the mark "IN N OUT (the
inside of the letter "O" formed like a star)." Also in 2000, In-N-
Out Burger sent a demand letter directing Sehwani, Inc. to
cease and desist from claiming ownership of the mark "IN-N-
OUT" and to voluntarily cancel its trademark registration.
Sehwani Inc. did not accede to In-N-Out Burger’s demand but it
expressed its willingness to surrender its registration for a
consideration.
In 2001 In-N-Out Burger filed before the Bureau of Legal Affairs
an administrative complaint against the Sehwani, Inc. and
Benita Frites, Inc. for unfair competition and cancellation of
trademark registration.
Issues:
(1) Whether or not the Intellectual Property Office (an
administrative body) have jurisdiction of cases
involving provisions of the IPC (e.g. unfair
competition).1
(2) Whether or not there was unfair competition.
Held:
FIRST ISSUE: Yes, the IPO (an administrative body) has
jurisdiction in cases involving provisions of the IPC (e.g. unfair
competition) due to the following reasons:
(1) Section 10 of the Intellectual Property Code
specifically identifies the functions of the Bureau of
Legal Affairs, thus:
Section 10. The Bureau of Legal Affairs.“The Bureau of Legal
Affairs shall have the following functions:
 1 IPO – Director of Legal Affairs decision
 In-N-Out Burger has legal capacity to sue in the
Philippines because the latter is a signatory of the
Convention of Paris on Protection of Industrial
Property.
 IN-N-OUT Burger, Inc. – right to use its
tradename and mark to the exclusion of the
others
 Respondents’ use of the petitioner’s mark was
made in good faith and therefore they are not
guilty of unfair competition.
 IPO – Director General’s Decision
 Respondents are guilty of unfair competition.
 The following are ordered to be paid to In-N-Out
Burger, inc.
- Damages in the amount of PHP 212, 574.28
- Exemplary damages in the amount of PHP
500,000
- Attorney’s fees and expenses of litigation in
the amount of PHP 500,000
 CA Decision
 Regular courts, and not the BLA-IPO, have sole
jurisdiction to hear and decide cases involving
provisions of the IPC.
11
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. Xxx
Xxx
(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;
Xxx
(viii) The assessment of damages;
Unquestionably, petitioner's complaint, which seeks the
cancellation of the disputed mark in the name of respondent
Sehwani, Incorporated, and damages for violation of
petitioner's intellectual property rights, falls within the
jurisdiction of the IPO Director of Legal Affairs.
(2) 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.
(3) 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:
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.
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 petitioner's
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.
SECOND ISSUE: Yes. The evidence on record shows that
Sehwani Inc. and Benita Frites were not using their registered
trademark but that of In-n-Out Burger. Sehwani and Benita
Frites are also giving their products the general appearance
that would likely influence the purchasers to believe that their
products are that of In-N-Out Burger. The intention to deceive
may be inferred from the similarity of the goods as packed and
offered for sale, and, thus, an action will lie to restrain unfair
competition. The respondents’ frauduulent intention to deceive
purchasers is also apparent in their use of the In-N-Out Burger
in business signages.
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 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.
12
14. Lyceum of the Philippines, Inc.
vs. Court of Appeals, Lyceum of Aparri, Lyceum of
Cabagan, Lyceum of Camalaniugan, Inc., Lyceum of Lallo,
Inc., Lyceum of Tuao, Inc., Buhi Lyceum, Central Lyceum
of Catanduanes, Lyceum of Southern Philippines, Lyceum
of Eastern Mindanao, Inc. and Western Pangasinan
Lyceum, Inc.
Facts:
Petitioner is an educational institution duly registered with the
Securities and Exchange Commission ("SEC"). When it first
registered with the SEC on 21 September 1950, it used the
corporate name Lyceum of the Philippines, Inc. and has used
that name ever since.
On 24 February 1984, petitioner instituted proceedings before
the SEC to compel the private respondents, which are also
educational institutions, to delete the word "Lyceum" from
their corporate names and permanently to enjoin them from
using "Lyceum" as part of their respective names.
However, prior to the said proceedings before the SEC, the
petitioner had commenced sometime in 1977 a proceeding
against Lyceum of Baguio, Inc. requiring it to change its
corporate name and to adopt another name not “similar to or
identical” with that of the petitioner.
The SEC ruled in favor of the petitioner and ordered the Lyceum
of Baguio, Inc to change its name. The Lyceum of Baguio
assailed the Order of the SEC before the Supreme Court but the
Court denied the Petition of Review for lack of merit.
Armed with the Resolution of this Court in G.R. No. L-46595,
petitioner then wrote all the educational institutions it could
find using the word "Lyceum" as part of their corporate name,
and advised them to discontinue such use of "Lyceum."
Despite the petitioner’s notice to other educational institutions,
the latter did not comply with the petitioner’s request. This
prompted the petitioner before the SEC a case to enforce what
it claims as its proprietary right to the word “Lyceum”. The SEC
hearing officer rendered a decision in favor of the petitioner
relying upon the SEC ruling in the Lyceum of Baguio, Inc. case.
The respondents appealed on SEC En Banc which reversed the
decision of the hearing officer. Petitioner then went on appeal
to the CA.
Issue:
Whether or not the use by petitioner of "Lyceum" in its
corporate name has been for such length of time and with such
exclusivity as to have become associated or identified with the
petitioner institution in the mind of the general public.
Held:
No.
“Under the doctrine of secondary meaning, a word or phrase
originally incapable of exclusive appropriation with reference to
an article in the market, because geographical or otherwise
descriptive might nevertheless have been used so long and so
exclusively by one producer with reference to this article that,
in that trade and to that group of the purchasing public, the
word or phrase has come to mean that the article was his
produce.”
The same doctrine or principle cannot be
made to apply where the evidence did not prove that the
business has continued for so long a time that it has become of
consequence and acquired a good will of considerable value
such that its articles and produce have acquired a well-known
reputation, and confusion will result by the use of the disputed
name.
The appellant failed to satisfy the aforementioned requisites.
No evidence was ever presented in the hearing before the
Commission which sufficiently proved that the word 'Lyceum'
has indeed acquired secondary meaning in favor of the
appellant. Nevertheless, its exclusive use of the word (Lyceum)
was never established or proven.
While the appellant may have proved that it had been using the
word 'Lyceum' for a long period of time, this fact alone did not
amount to mean that the said word had acquired secondary
meaning in its favor because the appellant failed to prove that
it had been using the same word all by itself to the exclusion of
others. More so, there was no evidence presented to prove
that confusion will surely arise if the same word were to be
used by other educational institutions.
The Court concluded and held that petitioner institution is not
entitled to a legally enforceable exclusive right to use the word
"Lyceum" in its corporate name and that other institutions may
use "Lyceum" as part of their corporate names.
The Petition for Review is DENIED for lack of merit, and the
Decision of the Court of Appeals is hereby AFFIRMED.
15. Societe Des Produits Nestle, S. A. vs. Martin Dy, Jr.
Facts:
Petitioner, Nestlé, is a foreign corporation organized under the
laws of Switzerland and manufactures food products and
beverages. A Certificate of Registration was issued by the BPTTT,
which, as a result made Nestle own the “NAN” trademark for its
line of infant powdered milk (PRE-NAN, NAN-H.A., NAN-1, and
NAN-2). It was classified under Class-6, “diatetic preparations
for infant feeding”. Nestle sold its NAN products throughout
the Philippines and invested substantial amounts of resources
for its marketing.
13
Respondent, Martin Dy, Jr., owns 5M Enterprises which imports
Sunny Boy powdered milk from Australia, and repacks the milk
into plastic bags bearing the name “NANNY”, which is also
classified as Class-6 “full cream milk for adults”. Respondent
sells the milk in parts of Mindanao.
Petitioner requested respondent to refrain from using NANNY
and to stop infringing the NAN trademark. Respondent did not
act which forced Nestle to file in the RTC of Dumaguete, a
complaint against respondent. The case was transferred to the
RTC of Cebu.
The RTC held that respondent was guilty of infringement,
stating that the instant case cannot be proven with the use of
the “test of dominancy” because the deceptive tendency of the
unregistered trademark NANNY is not apparent from the
essential features of the registered trademark NAN.
The RTC invoked however the case of Esso Standard Eastern vs.
CA where the SC said that as to whether trademark
infringement exists depends upon 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, or from a common
source.
The trial court justified that goods may become related for
purposes of infringement when they belong to the same class,
or have same descriptive properties; when they possess the
same physical attributes or essential characteristics with
reference to their form, composition, texture or quality. They
also be related because they serve the same purpose or are
sold in grocery stores.
Considering that NANNY belongs to the same class as that of
NAN because both are food products, the unregistered trade
mark NANNY should be held an infringement to the registered
trademark NAN because the use of NANNY would imply that it
came from the manufacturer of NAN. Furthermore, since the
word “nanny” means a “child’s nurse,” there might result the
not so remote probability that NANNY may be confused with
infant formula NAN despite the apparent disparity between the
features of the two products.
The trial court’s decision is reversed by the CA. It ruled that the
application of the doctrine laid down by the Supreme Court in
the Esso Standard case aforementioned and the cases cited
therein is quite misplaced. The goods of the two contending
parties in that case bore similar marks or labels. While it is true
that both NAN and NANNY are milk products and that the word
“NAN” is contained in the word “NANNY,” there are more
glaring dissimilarities in the entirety of their trademarks as they
appear in their respective labels and also in relation to the
goods to which they are attached. It added that NAN infant
milk preparation is more expensive than NANNY instant full
cream milk. The cheaper price of NANNY would give, at the
very first instance, a considerable warning to the ordinary
purchaser on whether he is buying an infant milk or a full cream
milk for adults. A cursory examination of the packaging would
confirm the striking differences between the products in
question. Thus, this petition.
Issue:
W/N NANNY infringes upon Nestle’s trademark NAN
Held:
Petition is granted. Applying the dominancy test in the present
case, the Court finds that “NANNY” is confusingly similar to
“NAN.” “NAN” is the prevalent feature of Nestle’s line of infant
powdered milk products. It is written in bold letters and used
in all products. The line consists of PRE-NAN, NAN-H.A., NAN-1,
and NAN-2. Clearly, “NANNY” contains the prevalent feature
“NAN.” The first three letters of “NANNY” are exactly the same
as the letters of “NAN.” When “NAN” and “NANNY” are
pronounced, the aural effect is confusingly similar.
The Supreme Court agrees with the lower court that there are
differences between NAN and NANNY: (1) NAN is intended for
infants while NANNY is intended for children past their infancy
and for adults; and (2) NAN is more expensive than
NANNY. However, as the registered owner of the “NAN” mark,
Nestle should be free to use its mark on similar products, in
different segments of the market, and at different price levels.
In McDonald’sCorporation v. L.C. BigMak Burger, Inc., the Court
held that the scope of protection afforded to registered
trademark owners extends to market areas that are the normal
expansion of business: Even respondent’s use of the “Big Mak”
mark on non-hamburger food products cannot excuse their
infringement of petitioners’ registered mark, otherwise
registered marks will lose their protection under the law.
The registered trademark owner may use his mark on the same
or similar products, in different segments of the market, and at
different price levels depending on variations of the products
for specific segments of the market. The Court has recognized
that the registered trademark owner enjoys protection in
product and market areas that are the normal potential
expansion of his business.
14
16. Amigo Manufacturing Inc. vs Cluett Peabody Co.
Facts:
 Cluett Peabody Co. is an American brand that a=has
acquired full ownership of Great American Knitting
Mills, Inc., which is the founder of the GOLD TOE
Socks.
 Amigo Manufacturing Inc. is a Philippine company
making GOLD TOP and DEVICES socks.
 Both socks of these companies features a gold tip and
linenized design.
 Cluett Peabody assailed the following against Amigo
Manufacturing for cancellation of trademark:
 GOLD TOE, under Certificate of
Registration No. 6797 dated
September 22, 1958;
 DEVICE, representation of a sock
and magnifying glass on the toe of
a sock, under Certificate of
Registration No. 13465 dated
January 25, 1968;
 DEVICE, consisting of a ‘plurality
of gold colored lines arranged in
parallel relation within a I. Date of Actual Use of Trademark
triangular area of toe of the
stocking and spread from each
other by lines of contrasting color
of the major part of the stocking’
under Certificate of Registration
No. 13887 dated May 9, 1968;
and,
 LINENIZED, under Certificate of
Registration No. 15440 dated
April 13, 1970.
 Bureau of Patents ruled in favor of Cluett Peabody,
the decision pivots on two points: the application of
the rule of idem sonans and the existence of a
confusing similarity in appearance between two
trademarks.
CA ruled in favor of Cluett Peabody upon appeal of petitioner:
“As shown by the records, and as correctly held by the Director
of Patents, there is hardly any variance in the appearance of
the marks ‘GOLD TOP’ and ‘GOLD TOE’ since both show a
representation of a man’s foot wearing a sock, and the marks
are printed in identical lettering. Section 4(d) of R.A. No. 166
declares to be unregistrable, ‘a mark which consists o[r]
comprises a mark or trademark which so resembles a mark or
tradename registered in the Philippines of 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 the purchasers.
Petitioner’s mark is a combination of the different registered
marks owned by respondent.”
“The Philippines and the United States are parties to the Union
Convention for the Protection of Industrial Property adopted
in Paris on March 20, 1883, otherwise known as the Paris
Convention. Respondent is domiciled in the United States of
America and is the lawful owner of several trademark
registrations in the United States for the mark ‘GOLD TOE’.”
Issues:
(1) the date of actual use of the two trademarks;
(2) their confusing similarities, and
(3) the applicability of the Paris Convention.
Held:
Petitioner claims that it started the actual use of the trademark
“Gold Top and Device” in September 1956, while respondent
began using the trademark “Gold Toe” only on May 15, 1962. It
contends that the claim of respondent that it had been using
the “Gold Toe” trademark at an earlier date was not
substantiated. The latter’s witnesses supposedly contradicted
themselves as to the date of first actual use of their trademark,
coming up with different dates such as 1952, 1947 and 1938.
Respondent presented Bureau registrations indicating the dates
of first use in the Philippines of the trademark and the devices
as follows: a) March 16, 1954, Gold Toe; b) February 1, 1952,
the Representation of a Sock and a Magnifying Glass; c) January
30, 1932, the Gold Toe Representation; and d) February 28,
1952, “Linenized.”
The registration of the above marks in favor of respondent
constitutes prima facie evidence, which petitioner failed to
overturn satisfactorily.
15
Republic Act No. 166 provides:
“Sec. 20. Certificate of registration prima facie evidence of
validity. - A certificate of registration of a mark or trade-name
shall be prima facie evidence of the validity of the registration,
the registrant's ownership of the mark or trade-name, and of
the registrant's exclusive right to use the same in connection
with the goods, business or services specified in the certificate,
subject to any conditions and limitations stated therein.”
Applying the two tests, admittedly, there are some
minor differences between the two sets of marks. The
similarities, however, are of such degree, number and quality
that the overall impression given is that the two brands of socks
are deceptively the same, or at least very similar to each
another. Dominant features are:
- gold checkered lines against a predominantly black
background

“Section 5-A - An applicant for a trademark or trade name shall, - a representation of a sock with a magnifying glass
among others, state the date of first use. The fact that the
marks were indeed registered by respondent shows that it did - both products use the same type of lettering
use them on the date indicated in the Certificate of
- both also include a representation of a man’s foot
Registration.”
wearing a sock and the word “linenized” with arrows
Thus, even assuming that respondent started using it only on printed on the label.
May 15, 1962, we can make no finding that petitioner had
- the names of the brands are similar -- “Gold Top” and
started using it ahead of respondent.
“Gold Toe.”
II. Confusing Similarities
- petitioner and respondent are engaged in the same
Petitioner points out that the director of patents erred in its line of business.
application of the idem sonans rule, claiming that the two
III. Applicability of Paris Convention
trademarks “Gold Toe” and “Gold Top” do not sound alike and
are pronounced differently. It avers that since the words gold
Respondent is domiciled in the United States and is the
and toe are generic, respondent has no right to their exclusive
registered owner of the “Gold Toe” trademark. Hence, it is
use. The arguments of petitioner are incorrect. True, it would
entitled to the protection of the Convention. A foreign-based
not be guilty of infringement on the basis alone of the similarity
trademark owner, whose country of domicile is a party to an
in the sound of petitioner’s “Gold Top” with that of
international convention relating to protection of trademarks,
respondent’s “Gold Toe.” Admittedly, the pronunciations of the
is accorded protection against infringement or any unfair
two do not, by themselves, create confusion. The Bureau of
competition as provided in Section 37 of Republic Act 166, the
Patents, however, did not rely on the idem sonans test alone in
Trademark Law which was the law in force at the time this case
arriving at its conclusion.
was instituted.
The Bureau considered the drawings and the labels, the
WHEREFORE, the Petition is hereby DENIED and the assailed
appearance of the labels, the lettering, and the representation
Resolution AFFIRMED. Costs against petitioner.
of a man’s foot wearing a sock. Obviously, its conclusion is
based on the totality of the similarities between the parties’ SO ORDERED.
trademarks and not on their sounds alone.

DOMINANCY 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 constitutes infringement.

HOLISTIC TEST

The holistic test mandates that the entirety of the marks in

question must be considered in determining confusing
similarity.

16
17. Societe Des Produits Nestle, S.A. & Nestle Philippines, Inc.
vs.
CA and CFC Corporation
Facts:
CFC Corporation filed with the Bureau of Patents an application
for the registration of the trademark Flavor Master for instant
coffee.
Petitioner Nestle, S.A. and Nestle Philippines opposed the
application, alleging that CFC’s trademark Flavor Master is
confusingly similar to the former’s trademarks, Master Roast
and Master Blend. As the dominant word present in the three
trademarks is "Master,” the goods of CFC might be mistaken as
having originated from Nestle.
CFC argued that its trademark is not confusingly similar with
Nestle’s, since the other words that are used respectively with
“Master” in the three trademarks are very different from each
other – in meaning, spelling, pronunciation, and sound. Also,
CFC alleged that the packaging of its product is different from
Nestle.
BPTTT denied CFC’s application.
Applying the totality or holistic test, the CA reversed the BPTTT.
The general appearances in the respective logos and labels of
CFC and Nestle are so marked that the casual purchaser cannot
likely mistake one for the other.
Issue:
Whether the trademark FLAVOR MASTER is a colorable
imitation of the trademarks MASTER ROAST and MASTER
BLEND.
Held:
YES. 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.
The dominancy test is more suitable. 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.
The word MASTER is the dominant feature of Nestle’s mark.
“Master” is printed across the middle portion of the label in
bold letters almost twice the size of the printed word ROAST.
Further, the word MASTER has always been given emphasis in
the TV and radio commercials and other advertisements made
in promoting the product. In due time, because of these
advertising schemes the mind of the buying public had come to
learn to associate the word MASTER with the Nestle’s goods.
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. Generic
terms are those which constitute "the common descriptive
name of an article or substance," or comprise the "genus of
which the particular product is a species," or are "commonly
used as the name or description of a kind of goods," or "imply
reference to every member of a genus and the exclusion of
individuating characters," or "refer to the basic nature of the
wares or services provided rather than to the more
idiosyncratic characteristics of a particular product," and are
not legally protectable. On the other hand, a term is
descriptive and therefore invalid as a trademark if, as
understood in its normal and natural sense, it "conveys the
characteristics, functions, qualities or ingredients of a product
to one who has never seen it and does not know what it is," or
"if it forthwith conveys an immediate idea of the ingredients,
qualities or characteristics of the goods," or if it clearly denotes
what goods or services are provided in such a way that the
consumer does not have to exercise powers of perception or
imagination.
Rather, the term "Master" is a suggestive term brought about
by the advertising scheme of Nestle. Suggestive terms are those
which 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."
Due to Nestle’s advertising, 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.
17
18. Tanduay Distillers vs. Ginebra San Miguel
Facts:
Tanduay developed a new gin product named “Ginebra
Kapitan” in the year 2002. Distinguishing features:
 representation of
revolutionary Kapitan on horseback as the
dominant feature of its label
 the label design in terms of color scheme,
size and arrangement of text, and other
label features were precisely selected to
distinguish it from the leading gin brand in
the Philippine market, “Ginebra San
Miguel”
 it’s bottle uses a resealable twist cap to
distinguish it from “Ginebra San Miguel”
and other local gin products with bottles
which use the crown cap or tansan
Tanduay filed for a trademark application for “Ginebra
Kapitan” with the Intellectual Property Office (IPO) which the
latter granted. After securing the approval permit from the
Bureau of Internal Revenue (BIR) to manufacture and sell such
product, Tanduay began selling such in Northern and Southern
Luzon in 2003. On August 3, 2003, Tanduay received a letter
from San Miguel’s counsel informing them to cease and desist
from using the mark “Ginebra” and from committing acts that
violate their intellectual property rights. On August 5, 2003,
San Miguel filed a complaint for trademark infringement, unfair
competition and damages, with the applications for the
issuance of TRO and writ of preliminary injunction against
Tanduay before the Regional Trial Court of Mandaluyong. The
court granted the TRO on September 23, 2003 prohibiting
Tanduay from manufacturing, selling, and advertising “Ginebra
Kapitan”.
Regional Trial Court (TRO): Upon the presentation of evidences,
the following facts were established by the trial court:
 San Miguel has registered the trademark “Ginebra
San Miguel”;
 There is a close resemblance between “Ginebra San
Miguel” and “Ginebra Kapitan”;
 The close similarity between “Ginebra San Miguel
and “Ginebra Kapitan may give rise to confusion of
goods sins San Miguel and Tanduay are competitors in
the business of manufacturing liquor; and
 “Ginebra” which is a well-known trademark, was
adopted by Tanduay to benefit from the reputation and
advertisement of the originator of the mark “Ginebra
San Miguel,” and to convey to the public the impression
of some supposed connection between the
manufacturer of the gin product sold uner the name
“Ginebra San Miguel” and the new product “Ginebra
Kapitan”.
Based on the foregoing, the trial court concluded that San
Miguel had demonstrated a clear, positive, and existing right to
be protected by a TRO and proceeded with the hearing for the
a preliminary injunction. On October 3, 2003, Tanduay filed a
petition for certiorari with the CA. Despite Tanduay’s urgent
Motion to Defer Injunction Hearing, the trial court continued to
conduct the hearings. On October 17, 2003, the trial court
granted the application of San Miguel for the issuance of a writ
of preliminary injunction.
Regional Trial Court (Injunction) : For the grant of the
preliminary injunction, the trial court applied the Dominancy
test which has shown that the word “Ginebra” would create a
confusion to the consumers since the buying public would
inevitably conclude that both products are affiliated with San
Miguel due to such distinctive mark which is already identified
with San Miguel.
On October 22, 2003, Tanduay filed a supplemental
petition in the CA assailing the injunction order. On November
10, 2003, the CA issued a TRO enjoining the trial court from
implementing its injunction order and from further proceeding
with the case. The CA directed the parties to appear for hearing
on January 6, 2004 to determine the need for the issuance of a
writ of preliminary injunction.
Court of Appeals : To warrant to issuance of TRO, the fact
established by the submitted affidavits of the witnesses that the
registered trademark “Ginebra San Miguel” exists are enough
to make a finding that San Miguel has a clear and
unmistakable right to prevent irreparable injury because gin
drinkers confuse San Miguel to be the manufacturer of “Ginebra
Kapitan”. It upheld the trial court’s ruling in granting the
injunction based on the fact that San Miguel has sufficiently
established its right to prior use and registration of the mark
“Ginebra” as the dominant feature of its trademark.
On January 9, 2004, the CA dismissed Tanduay’s petition and
supplemental petition. Tanduay moved for reconsideration
which was denied. Aggrieved by the decision, Tanduay elevated
the case to the Supreme Court via petition for review on
certiorari.
Issue:
Whether or not San Miguel is entitled to the writ of
preliminary injunction granted by the trial court as
affirmed by the CA
18
Held:
NO. The Rules of Court under Rule 58 provides that a
preliminary injunction is a provisional remedy for the
protection of substantive rights and interests. Before an
injunctive writ is issued, it is essential that the following
requisites are present: the existence of a right to be protected
and (2) the acts against which the injunction is directed are
violative of the right. Hence, it must be first proven that the
movant has a clear and unmistakable right to be protected to
prevent serious damage.
In the case at bar, there is a need to determine first if San
Miguel has really the clear and unmistakable right to the
exclusive use of the mark “Ginebra”. The SC held that the two
trademarks were apparently different from each other when
taken as a whole. It was not evident whether San Miguel has
the right to prevent other business entities from using the word
“Ginebra.” It is not settled (1) whether “Ginebra” is indeed the
dominant feature of the trademarks, (2) whether it is a generic
word that as a matter of law cannot be appropriated, or (3)
whether it is merely a descriptive word that may be
appropriated based on the fact that it has acquired a secondary
meaning.
The issue that must be resolved by the trial court is
whether a word like “Ginebra” can acquire a secondary
meaning for gin products so as to prohibit the use of the word
“Ginebra” by other gin manufacturers or sellers. This boils
down to whether the word “Ginebra” is a generic mark that is
incapable of appropriation by gin manufacturers.
In the case of Asia Brewery, Inc. v. Court of Appeals, it
cited Section 123.1(h) of the IP Code states that a mark cannot
be registered if it “consists exclusively of signs that are generic
for the goods or services that they seek to identify.”
In this case, a cloud of doubt exists over San Miguel’s
exclusive right relating to the word “Ginebra.” San Miguel’s
claim to the exclusive use of the word “Ginebra” is clearly still
in dispute because of Tanduay’s claim that it has, as others
have, also registered the word “Ginebra” for its gin products.
This issue can be resolved only after a full-blown trial.
In Ong Ching Kian Chuan v. Court of Appeals, the SC held
that in the absence of proof of a legal right and the injury
sustained by the movant, the trial court’s order granting the
issuance of an injunctive writ will be set aside, for having been
issued with grave abuse of discretion.
The SC finds that San Miguel’s right to injunctive relief has
not been clearly and unmistakably demonstrated. The right to
the exclusive use of the word “Ginebra” has yet to be
determined in the main case. The trial court’s grant of the writ
of preliminary injunction in favor of San Miguel, despite the
lack of a clear and unmistakable right on its part, constitutes
grave abuse of discretion amounting to lack of jurisdiction.
Based on the affidavits and market survey report
submitted during the injunction hearings, San Miguel has failed
to prove the probability of irreparable injury which it will stand
to suffer if the sale of “Ginebra Kapitan” is not enjoined. San
Miguel has not presented proof of damages incapable of
pecuniary estimation. At most, San Miguel only claims that it
has invested hundreds of millions over a period of 170 years to
establish goodwill and reputation now being enjoyed by the
“Ginebra San Miguel” mark such that the full extent of the
damage cannot be measured with reasonable accuracy.
Without the submission of proof that the damage is irreparable
and incapable of pecuniary estimation, San Miguel’s claim
cannot be the basis for a valid writ of preliminary injunction.
DECISION:
The petition was granted setting aside the decision of the
CA. The SC declared the writ of preliminary injunction void and
directed the RTC of Mandaluyong to continue expeditiously
with the trial to resolve the merits of the case.
19. Great White Shark Enterprises, Inc. v. Danilo M. Caralde,
Jr.
Facts:
Caralde filed before the Bureau of Legal Affairs (BLA) of the IPO
a trademark application seeking to register the mark “SHARK &
LOGO” for his manufactured goods under Class 25, such as
slippers, shoes and sandals. Petitioner Great White Shark
Enterprises, Inc. opposed the application claiming to be the
owner of the mark consisting of a representation of a shark in
color known as “Greg Norman Logo.”
Great White Shark’s trademark application was granted and it
was issued Certificate ofRegistration for clothing, headgear and
footwear. The BLA rejected Caralde’s application, which was
later affirmed by the IPO Director General.On petition for
review however, the CA reversed and set aside the decision of
the IPO and directed it to grant Caralde’s application for
registration of the mark “SHARK & LOGO.”
19
Issue:
Whether or not Caralde be held liable for trademark
infringement.
Held:
Section 123.1(d) of the Intellectual Property Code provides that
a mark cannot be registeredif it is identical with a registered
mark belonging to a different proprietor with an earlier filing
orpriority date, with respect to the same or closely related
goods or services or has a nearresemblance to such mark as to
likely deceive or cause confusion.The Court finds no confusing
similarity between the subject marks.
20. Developers Group of Companies vs. CA
Facts:
June 21, 1988"Shangri-La Group"filed with the Bureau of
Patents, Trademarks and Technology Transfer (BPTTT) a
petition, docketed as Inter Partes Case No. 3145, praying for
the cancellation of the registration of the "Shangri-La" mark
and "S" device/logo issued to the Developers Group of
Companies, Inc., on the ground that the same was illegally and
fraudulently obtained and appropriated for the latter's
restaurant business
ON the same date, "Shangri-La Group"filed with the BPTTT its
own application for registration of the subject mark and logo.
The Developers Group filed an opposition to the application,
which was docketed as Inter Partes Case No. 3529.
April 15, 1991, the Developers Group instituted with the
Regional Trial Court of Quezon City, Branch 99, a complaint for
infringement and damages with prayer for injunction, docketed
as Civil Case No. Q-91-8476, against the Shangri-La Group.
On January 8, 1992, the Shangri-La Group moved for the
suspension of the proceedings in the infringement case on
account of the pendency of the administrative proceedings
before the BPTTT [denied RTC, denied CA, SC- G.R. No. 111580]
October 28, 1991, the Developers Group filed in Inter Partes
Case No. 3145 an Urgent Motion to Suspend Proceedings,
invoking the pendency of the infringement case it filed before
the Regional Trial Court of Quezon City.[denied RTC, denied CA,
SC- G.R. No. 114802]
On February 2, 1998, G.R. Nos. 111580 and 114802 were
ordered consolidated.
Issue:
Whether, despite the institution of an Inter Partes case for
cancellation of a mark with the BPTTT (now the Bureau of Legal
Affairs, Intellectual Property Office) by one party, the adverse
party can file a subsequent action for infringement with the
regular courts of justice in connection with the same registered
mark.
Held:
YES.
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)
- Hence, as applied in the case at bar, the earlier
institution of an Inter Partes case by the Shangri-La
Group for the cancellation of the "Shangri-La" mark
and "S" device/logo with the BPTTT cannot effectively
bar the subsequent filing of an infringement case by
registrant Developers Group.
20
 - Since the certificate still subsists, Developers Group
may thus file a corresponding infringement suit and
recover damages from any person who infringes upon
the former's rights.The issue raised before the BPTTT
is quite different from that raised in the trial court.
- The case of Conrad and Company, Inc. v. Court of
Appeals18 is in point. We held:
We cannot see any error in the above disquisition. It might be
mentioned that while an application for the
administrative cancellation of a registered trademark on any of
the grounds enumerated in Section 17 of Republic Act No. 166,
as amended, otherwise known as the Trade-Mark Law, falls
under the exclusive cognizance of BPTTT (Sec. 19, Trade-Mark
Law), an action, however, for infringement or unfair
competition, as well as the remedy of injunction and relief for
damages, is explicitly and unquestionably within the
competence and jurisdiction of ordinary courts.
RTC RULING:
- March 8, 1996, in Civil Case No. Q-91-8476 Uphold
the validity of the registration of the service mark
"Shangri-La" and "S-Logo" in the name of plaintiff;
and declare defendants' use of said mark and logo as
an infringement of plaintiff's right thereto.
COURT OF APPEALS RULING:
- 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) may continue independently from the
infringement case so as to determine whether a
registered mark may ultimately be cancelled.
- The Regional Trial Court, in granting redress in favor
of Developers Group, went further and upheld the
validity and preference of the latter's registration
over that of the Shangri-La Group.
- Upholding the validity of the registration of the
service mark "Shangri-La" and "S" logo in the name of
Developers Group, 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 Regional Trial Court has rendered,
albeit the same is still on appeal.
- WHEREFORE, in view of the foregoing, judgment is
hereby rendered dismissing G.R. No. 111580 for being
moot and academic, and ordering the Bureau of Legal
Affairs, Intellectual Property Office, 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.
21. Coffee Partners, Inc. v. San Francisco Coffee and Roastery
Facts:
The petitioner holds a business in maintaining coffee shops in
the Philippines. It is registered with the Securities and Exchange
Commission in January 2001. In its franchise agreement
with Coffee Partners Ltd, it carries the trademark “San
Francisco Coffee.” Respondent is engaged in the wholesale and
retail sale of coffee that was registered in SEC in May 1995
under a registered business name of “San Francisco Coffee &
Roastery, Inc.” It entered into a joint venture with
Boyd Coffee USA to study coffee carts in malls.
When respondent learned that petitioner will open
a coffee shop in Libis, Q.C. they sent a letter to the petitioner
demanding them to stop using the name “San Francisco Coffee”
as it causes confusion to the minds of the public. A complaint
was also filed by respondents before the Bureau of Legal Affairs
of the Intellectual Property Office for infringement and unfair
competition with claims for damages. Petitioners contend that
there are distinct differences in the appearance of their
trademark and that respondent abandoned the use of their
trademark when it joined venture with Boyd Coffee USA. The
Bureau of Legal Affairs of the IPO held that petitioner’s
trademark infringed on the respondent’s trade name as it
registered its business name first with the DTI in 1995 while
petitioner only registered its trademark in 2001.
Furthermore, it ruled that the respondent did not abandon the
use of its trade name upon its joint venture with
Boyd Coffee USA since in order for abandonment to exist it
must be permanent, intentional and voluntary. It also held that
petitioner’s use of the trademark "SAN FRANCISCO COFFEE"
21
will likely cause confusion because of the exact similarity in
sound, spelling, pronunciation, and commercial impression of
the words "SAN FRANCISCO" which is the dominant portion of
respondent’s trade name and petitioner’s trademark. Upon
appeal before the office of the Director General of the IPO, the
decision of its legal affairs was reversed declaring there was no
infringement. The Court of Appeals however set aside its
decision and reinstated the IPO legal affairs’ decision. Petitioner
contends that the respondent’s trade name is not registered
therefore a suit for infringement is not available.
Issue:
Whether or not the petitioner’s use of the trademark "SAN
FRANCISCO COFFEE" constitutes infringement of respondent’s
trade name "SAN FRANCISCO COFFEE & ROASTERY, INC.," even
if the trade name is not registered with the Intellectual
Property Office (IPO).
Ruling:
Registration of a trademark before the IPO is no longer a
requirement to file an action for infringement as provided in
Section 165.2 of RA 8293. All that is required is that the
trade name is previously used in trade or commerce in
the Philippines. There is no showing that respondent
abandoned the use of its trade name as it continues to embark
to conduct research on retailing coffee, import and
sell coffee machines as among the services for which the use of
the business name had been registered.
The court also laid down two tests to determine similarity and
likelihood of confusion. The dominancy test focuses
on similarity of the prevalent features of the trademarks that
could cause deception and confusion that constitutes
infringement. Exact duplication or imitation is not required. The
question is whether the use of the marks involved is likely to
cause confusion or mistake in the mind of the public or to
deceive consumers. The holistic test entails a consideration of
the entirety of the marks as applied to the products, including
the labels and packaging, in determining confusing
similarity. The discerning eye of the observer must focus not
only on the predominant words but also on the other features
appearing on both marks in order that the observer may draw
his conclusion whether one is confusingly similar to the
other. Applying either the dominancy test or the holistic test,
petitioner’s "SAN FRANCISCO COFFEE" trademark is a clear
infringement of respondent’s "SAN FRANCISCO COFFEE &
ROASTERY, INC." trade name. The descriptive words "SAN
FRANCISCO COFFEE" are precisely the dominant features of
respondent’s trade name. And because both are involved
in coffee business there is always the high chance that the
public will get confused of the source of the coffee sold by the
petitioner. Respondent has acquired an exclusive right to the
use of the trade name "SAN FRANCISCO COFFEE & ROASTERY,
INC." since the registration of business name with the DTI in
1995.
22. Republic Gas vs. Petron
Petitioner:
Regasco, an entity duly licensed to engage in, conduct and carry
on, the business of refilling, buying, selling, distributing
and marketing at wholesale and retail of Liquefied Petroleum
Gas ("LPG"). Petitioners filed the instant Petition for Review on
Certiorari after CA denied their MOR when CA reversed the
Resolution of Sec. of DOJ affirming the dismissal of the
complaint against the petitioners.
Respondents:
("Petron" for brevity) and Pilipinas Shell Petroleum Corporation
("Shell" for brevity) are two of the largest bulk suppliers and
producers of LPG in the Philippines. Petron is the registered
owner in the Philippines of the trademarks GASUL and GASUL
cylinders used for its LPG products. It is the sole entity in the
Philippines authorized to allow refillers and distributors to refill,
use, sell, and distribute GASUL LPG containers, products and its
trademarks. Pilipinas Shell, on the other hand, is the
authorized user in the Philippines of the trade name,
trademarks, symbols or designs of its principal, Shell
International Petroleum Company Limited, including the marks
SHELLANE and SHELL device in connection with the production,
sale and distribution of SHELLANE LPGs. It is the only
corporation in the Philippines authorized to allow refillers and
distributors to refill, use, sell and distribute SHELLANE LPG
containers and products. The surveillance revealed that
REGASCO LPG Refilling Plant in Malabon was engaged in the
refilling and sale of LPG cylinders bearing the registered marks
of the petitioners without authority from the latter.
Issue:
Whether probable cause exists to hold petitioners liable for the
crimes of trademark infringement and unfair competition as
defined and penalized under Sections 155and 168, in relation to
Section 170 of Republic Act (R.A.) No. 8293
22
Held:
Section 155. Remedies; Infringement. “ Any person who
shall, without the consent of the owner of the registered mark:
155.1 Use in commerce any reproduction, counterfeit, copy or
colorable imitation of a registered mark of the same container
or a dominant feature thereof in connection with the sale,
offering for sale, distribution, advertising of any goods or
services including other preparatory steps necessary to carry
out the sale of any goods or services on or in connection with
which such use is likely to cause confusion, or to cause mistake,
or to deceive; or
Here, petitioners have actually committed trademark
infringement when they refilled, without the respondents'
consent, the LPG containers bearing the registered marks of the
respondents. As noted by respondents, petitioners' acts will
inevitably confuse the consuming public, since they have no
way of knowing that the gas contained in the LPG tanks bearing
respondents' marks is in reality not the latter's LPG product
after the same had been illegally refilled. The public will then be
led to believe that petitioners are authorized refillers and
distributors of respondents' LPG products, considering that
they are accepting empty containers of respondents and
refilling them for resale.
In the present case, respondents pertinently observed that by
refilling and selling LPG cylinders bearing their registered marks,
petitioners are selling goods by giving them the general
appearance of goods of another manufacturer. The CA
correctly pointed out that there is a showing that the
consumers may be misled into believing that the LPGs
contained in the cylinders bearing the marks "GASUL" and
"SHELLANE" are those goods or products of the petitioners
when, in fact, they are not. Obviously, the mere use of those
LPG cylinders bearing the trademarks "GASUL" and "SHELLANE"
will give the LPGs sold by REGASCO the general appearance of
the products of the petitioners.
23. Victorio P. Diaz vs People of the Philippines and Levi
Strauss [Phils.], Inc.
Facts:
Levi Strauss Philippines, Inc. (Levi’s Philippines) is a licensee of
Levi’s. After receiving information that Diaz was selling
counterfeit LEVI’S 501 jeans in his tailoring shops in Almanza
and Talon, Las Piñas City, Levi’s Philippines hired a private
investigation group to verify the information. Surveillance and
the purchase of jeans from the tailoring shops of Diaz
established that the jeans bought from the tailoring shops of
Diaz were counterfeit or imitations of LEVI’S 501. Armed with
search warrants, NBI agents searched the tailoring shops of
Diaz and seized several fake LEVI’S 501 jeans from them. Levi’s
Philippines claimed that it did not authorize the making and
selling of the seized jeans; that each of the jeans were mere
imitations of genuine LEVI’S 501 jeans by each of them bearing
the registered trademarks, like the arcuate design, the tab, and
the leather patch; and that the seized jeans could be mistaken
for original LEVI’S 501 jeans due to the placement of the
arcuate, tab, and two-horse leather patch.
On his part, Diaz admitted being the owner of the shops
searched, but he denied any criminal liability. Diaz stated that
he did not manufacture Levi’s jeans, and that he used the label
“LS Jeans Tailoring” in the jeans that he made and sold; that the
label “LS Jeans Tailoring” was registered with the Intellectual
Property Office; that his shops received clothes for sewing or
repair; that his shops offered made-to-order jeans, whose
styles or designs were done in accordance with instructions of
the customers; that since the time his shops began operating in
1992, he had received no notice or warning regarding his
operations; that the jeans he produced were easily
recognizable because the label “LS Jeans Tailoring,” and the
names of the customers were placed inside the pockets, and
each of the jeans had an “LSJT” red tab; that “LS” stood for
“Latest Style;” and that the leather patch on his jeans had two
buffaloes, not two horses.
Issue:
Whether there exists a likelihood of confusion between the
trademarks of Levi’s and Diaz.
Held:
The Court held, through the application of the holistic test, that
there was no likelihood of confusion between the trademarks
involved. Accordingly, the jeans trademarks of Levi’s Philippines
and Diaz must be considered as a whole in determining the
likelihood of confusion between them. The maong pants or
jeans made and sold by Levi’s Philippines, which included LEVI’S
501, were very popular in the Philippines. The consuming public
knew that the original LEVI’S 501 jeans were under a foreign
brand and quite expensive. Such jeans could be purchased only
in malls or boutiques as ready-to-wear items, and were not
available in tailoring shops like those of Diaz’s as well as not
acquired on a “made-to-order” basis. Under the circumstances,
the consuming public could easily discern if the jeans were
23
original or fake LEVI’S 501, or were manufactured by other
brands of jeans.
Diaz used the trademark “LS JEANS TAILORING” for the jeans he
produced and sold in his tailoring shops. His trademark was
visually and aurally different from the trademark “LEVI
STRAUSS & CO” appearing on the patch of original jeans under
the trademark LEVI’S 501. The word “LS” could not be confused
as a derivative from “LEVI STRAUSS” by virtue of the “LS” being
connected to the word “TAILORING”, thereby openly
suggesting that the jeans bearing the trademark “LS JEANS
TAILORING” came or were bought from the tailoring shops of
Diaz, not from the malls or boutiques selling original LEVI’S 501
jeans to the consuming public.
The prosecution also alleged that the accused copied the “two
horse design” of the petitioner-private complainant but the
evidence will show that there was no such design in the seized
jeans. Instead, what is shown is “buffalo design.” Again, a horse
and a buffalo are two different animals which an ordinary
customer can easily distinguish.
The prosecution further alleged that the red tab was copied by
the accused. However, evidence will show that the red tab used
by the private complainant indicates the word “LEVI’S” while
that of the accused indicates the letters “LSJT” which means LS
JEANS TAILORING. Again, even an ordinary customer can
distinguish the word LEVI’S from the letters LSJT.
In terms of classes of customers and channels of trade, the
jeans products of the private complainant and the accused
cater to different classes of customers and flow through the
different channels of trade. The customers of the private
complainant are mall goers belonging to class A and B market
group – while that of the accused are those who belong to class
D and E market who can only afford Php 300 for a pair of made-
to-order pants.
24. Chester Uyco, Winston Uychiyong, and Cherry C. Uyco-
Ong vs. Vicente Lo
Facts:
The disputed marks in this case are the "HIPOLITO & SEA HORSE
& TRIANGULAR DEVICE," "FAMA," and other related marks,
service marks and trade names of Casa Hipolito S.A. Portugal
appearing in kerosene burners. Respondent Vicente Lo and
Philippine Burners Manufacturing Corporation (PBMC) filed a
complaint against the officers of Wintrade Industrial
SalesCorporation (Wintrade), including petitioners Chester
Uyco, Winston Uychiyong and Cherry Uyco-Ong, and of
National Hardware, including Mario Sy Chua, for violation of
Section 169.1, in relation to Section 170, of RA 8293. Lo claimed
in his complaint that Gasirel-Industria de Comercio e
ComponentesparaGass, Lda. (Gasirel), the owner of the
disputed marks, executed a deed of assignment transferring
these marks in his favor, to be used in all countries except for
those in Europe and America.
In a test buy, Lo purchased from National Hardware kerosene
burners with the subject marks and the designations "Made in
Portugal" and "Original Portugal" in the wrappers. These
products were manufactured by Wintrade. Lo claimed that as
the assignee for the trademarks, he had not authorized
Wintrade to use these marks, nor had Casa Hipolito S.A.
Portugal.
The kerosene burners manufactured by Wintrade have caused
confusion, mistake and deception on the part of the buying
public. Lo stated that the real and genuine burners are those
manufactured by its agent, PBMC. (Philippine Burners
Manufacturing Corporation)
The petitioners stated that they are the officers of Wintrade
which owns the subject trademarks and their variants. To prove
this assertion, they submitted as evidence the certificates of
registration with the Intellectual Property Office.
They alleged that Gasirel, not Lo, was the real party-in-interest.
They allegedly derived their authority to use the marks from
Casa Hipolito S.A. Portugal through Wonder, their predecessor-
in-interest.
PBMC had already ceased to be a corporation and, thus, the
licensing agreement between PBMC and Lo could not be given
effect, particularly because the agreement was not notarized
and did not contain the provisions required by Section 87 of RA
8293.
The petitioners pointed out that Lo failed to sufficiently prove
that the burners bought from National Hardware were those
that they manufactured.
They also argued that the marks "Made in Portugal" and
"Original Portugal" are merely descriptive and refer to the
source of the design and the history of manufacture.
Petitioner Chua admitted that he had dealt with Wintrade for
several years and had sold its products. He had not been aware
that Wintrade had lost the authority to manufacture, distribute,
and deal with products containing the subject marks, and he
was never informed of Wintrade’s loss of authority. Thus, he
could have not been part of any conspiracy.
24
After the preliminary investigation, the Chief State Prosecutor
found probable cause to indict the petitioners for violation of
Section 169.1, in relation with Section 170, of RA 8293.
On appeal, the DOJ issued a resolution affirming the finding of
probable cause.
Thus this motion for reconsideration.
Issue:
Whether or not WINTRADE and its officers are liable for
violation of the law on trademarks, trade names and false
designation of origin?
Held:
Yes.
The predecessor-in-interest of Wintrade was the former
exclusive licensee of Casa Hipolito SA of Portugal since the
1970’s, and that Wintrade purchased all the rights on the said
trademarks prior to the closure of said company.
Indeed, the burners sold by Wintrade used to be imported from
Portugal, but Wintrade later on discovered the possibility of
obtaining these burners from other sources or of
manufacturing the same in the Philippines.
The presence of the words "made in Portugal" and "original
Portugal" on the wrappings of the burners and on the burners
themselves which are manufactured by Wintrade is an allusion
to the fact that the origin of the design of said burners can be
traced back to Casa Hipolito SA of Portugal, and that the history
of the manufacture of said burners are rooted in Portugal.
It gave credence to Lo’s assertion that he is the proper assignee
of the subject marks.
More importantly, it took note of the petitioners’ admission
that they used the words "Made in Portugal" when in fact,
these products were made in the Philippines.
Had they intended to refer to the source of the design or the
history of the manufacture, they should have explicitly said so
in their packaging.
The products that Wintrade sold were admittedly produced in
the Philippines, with no authority from Casa Hipolito S.A.
Portugal.
The law on trademarks and trade names precisely precludes a
person from profiting from the business reputation built by
another and from deceiving the public as to the origins of
products.
The argument that the words "Made in Portugal" and "Original
Portugal" refer to the origin of the design and not to the origin
of the goods does not negate the finding of probable cause.
The motion was denied for lack of merit.
25. E.Y. Industrial Sales Inc. vs. Shen Dar Electronics and
Machinery Co., Ltd.
Facts:
EYIS is a domestic corporation engaged in the production,
manufacture, sales and distribution of air compressors,
etc. Shen Dar is a Taiwan-based foreign corporation engaged in
the manufacture of air compressors. Both companies claim to
have the right to register the trademark “VESPA” for
air compressors.
1997
— Shen Dar applied with IPO to register “VESPA, Chinese characters
and devise” for use on air compressors and welding machines;
2007approved, COR received
1999
— EYIS applied with IPO to register “VESPA” for use on air
compressors; 2004approved, COR received
Shen Dar thus filed a Petition for Cancellation of EYIS’ COR with
the BLA, arguing that EYIS is a mere distributor of air
compressors bearing the mark “VESPA” which it imported
from Shen Dar. It further argued that it had prior and exclusive
right to use “VESPA” in the Philippines under the Paris
Convention.
EYIS denied Shen Dar’s claims, saying it has been the sole
assembler and fabricator of “VESPA” air compressors since the
early 90s. They further contend that Shen Dar supplied them
“SD” air compressors, and that Shen Dar is not the owner of the
mark and thus could not seek protection from the Paris
Convention of the IP Code.BLA, IP Director-General, found for
EYIS and cancelled Shen Dar’s COR. CA reversed IPO.
Issues:
 IftheIPODirectorGeneralcanvalidlycancelShenDar’sCOR
 Who owns the “VESPA” mark
25
 Held:
 YES, SC upholds IPO–Director General’s statement: that the interest
of justice requires that Certificate of Registration No. 4-1997-
121492 be cancelled.
While the normal course of proceedings should have been the
filing of a petition for cancellation of Certificate of
Registration No. 4-1997-121492, that would involve critical
facts and issues that have already been resolved in this case.
To allow the Applicant to still maintain in the Trademark
Registry Certificate of Registration No. 4-1997-121492 would
nullify the exclusive rights of Appellee as the true and
registered owner of the mark VESPA and defeat the purpose of
the trademark registration system.
 Based on the evidence, EYIS owns the “VESPA”trademark;ithasprior
use,asshownbyvarioussalesinvoices.
Ownership of a mark or trade name may be acquired not
necessarily by registration but by adoption and use in trade or
commerce. As between actual use of a mark without
registration, and registration of the mark without actual use
thereof, the former prevails over the latter.
For a rule widely accepted and firmly entrenched, because it
has come down through the years, is that actual use in
commerce or business is a pre-requisite to the acquisition of
the right of ownership. It is non sequitur to hold that por que
EYIS is a distributor, it is no longer the owner.
26. Birkenstock v. Philippine Shoe
Petitioner’s Claim:
Petitioner filed a petition for cancellation of Registration
No.56334 on the ground that it is the lawful and rightful owner
of the Birkenstock marks.
Respondent’s Claim:
In response, respondent claims, inter alia, that:
(a) Respondent, together with its predecessor-in-interest, has
been using Birkenstock marks in the Philippines for more than
16 years through the mark "BIRKENSTOCK AND DEVICE".
(b) The marks covered by the subject applications are identical
to the one covered by Registration
No. 56334 and thus, petitioner has no right to the registration
of such marks.
(c) Respondent's predecessor-in-interest likewise obtained a
Certificate of Copyright Registration No. 0-11193 for the word
"BIRKENSTOCK".
(d) While respondent and its predecessor-in-interest failed to
file the 10th Year DAU, it continued the use of "BIRKENSTOCK
AND DEVICE" in lawful commerce.
(e) to record its continued ownership and exclusive right to use
the "BIRKENSTOCK" marks, it has filed TASN 4-2006-010273 as
a "re-application" of its old registration, Registration No. 56334.
Issue/s:
Whether or not the subject marks should be allowed
registration in the name of petitioner?
Court’s ruling:
Yes, It is well-settled that "the rules of procedure are mere
tools aimed at facilitating the attainment of justice, rather than
its frustration. A strict and rigid application of the rules must
always be eschewed when it would subvert the primary
objective of the rules, that is, to enhance fair trials and expedite
justice. Technicalities should never be used to defeat the
substantive rights of the other party.
In the case at bar, while petitioner submitted mere photocopies
as documentary evidence in the Consolidated Opposition Cases,
it should be noted that the IPO had already obtained the
originals of such documentary evidence in the related
Cancellation Case earlier filed before it.
In addition, Section 12 of Republic Act No. (RA) 166, requires
the filing of a DAU on specified periods, to wit: “That
registrations under the provisions of this Act shall be
cancelled by the Director, unless within one year following the
fifth, tenth and fifteenth anniversaries of the date of issue of
26
the certificate of registration, the registrant shall file in the FACTS:
Patent Office an affidavit showing that the mark or trade-
name is still in use” Cointreau filed before the (now defunct) Bureau of Patents,
Trademarks, and Technology Transfer (BPTTT) of the
The aforementioned provision clearly reveals that failure to file Department of Trade and Industry a trademark application for
the DAU within the requisite period results in the automatic the mark "LE CORDON BLEU & DEVICE".
cancellation of registration of a trademark. In turn, such failure
is tantamount to the abandonment or withdrawal of any right Application was filed pursuant to Section 37 of Republic Act

or interest the registrant has over his trademark. No. 166 and such application was published for opposition

Lastly, in the instant case, petitioner was able to establish that Petitioner Ecole filed an opposition to the subject application,

it is the owner of the mark "BIRKENSTOCK." It submitted averring that:

evidence relating to the origin and history of "BIRKENSTOCK"

It is the owner of the mark "LE CORDON BLEU, ECOLE DE
and its use in commerce long before respondent was able to
CUISINE MANILLE," which it has been using since 1948 in
register the same here in the Philippines. It has sufficiently
cooking and other culinary activities, including in its restaurant
proven that "BIRKENSTOCK" was first adopted in Europe in
business; and
1774 by its inventor, Johann

Cointreau’s use of the subject mark will actually create

Birkenstock, a shoemaker, on his line of quality footwear and
confusion, mistake, and deception to the buying public as to
thereafter, numerous generations of his kin continuously
the origin and sponsorship of the goods, and cause great and
engaged in the manufacture and sale of shoes and sandals
irreparable injury and damage to Ecole’s business reputation
bearing the mark "BIRKENSTOCK" until it became the entity
and goodwill as a senior user
now known as the petitioner.

Cointreau filed its answer claiming to be the true and lawful

owner of the subject mark. It averred that:

27. ECOLE DE CUISINE MANILLE (CORDON BLEU OF THE

It has filed applications for the subject mark’s registration in
PHILIPPINES), INC., v.RENAUIL COINTREAU & CIE AND LE
various jurisdictions, including the Philippines;
CORDON BLEU INT'L.,

Le Cordon Bleu is a culinary school which was established in

OVERVIEW:
Paris, France in 1895; and

Assailed in this petition for review on certiorari is the

it has trained students from more than eighty (80)
decision of the CA which affirmed in toto the IPO Director
nationalities, including Ecole’s directress, Ms. Lourdes L. Dayrit.
General's Decision that declared respondent Renaud Cointreau
Thus, Cointreau concluded that Ecole’s claim of being the
& Cie (Cointreau) as the true and lawful owner of the mark "LE
exclusive owner of the subject mark is a fraudulent
CORDON BLEU & DEVICE" and thus, is entitled to register the
misrepresentation.
same under its name.

27
During the pendency of the proceedings, Cointreau was issued
Certificates of Registration for the marks "CORDON BLEU &
DEVICE" and "LE CORDON BLEU PARIS 1895 & DEVICE"
THE RULING OF THE BLA
BLA sustained Ecole’s opposition to the subject mark,
resulting in the rejection of Cointreau’s application. It
emphasized that the adoption and use of trademark must be in
commerce in the Philippines and not abroad.
Aggrieved, Cointreau filed an appeal with the IPO Director
General.
THE RULING OF THE IPO DIRECTOR GENERAL
The IPO Director General reversed and set aside the BLA’s
decision, thus, granting Cointreau’s appeal and allowing the
registration of the subject mark.
He considered Cointreau’s undisputed use of such mark since
1895 for its culinary school in Paris, France (in which
petitioner’s own directress, Ms. Lourdes L. Dayrit, had trained
in 1977).
He also added that Ecole may have prior use of the subject
mark in the Philippines since 1948, but it failed to explain how
it came up with such name and mark.
Hence, the Petition for Review with the CA.
THE RULING OF THE CA
CA affirmed the IPO Director General’s Decision in toto. It
declared Cointreau as the true and actual owner of the subject
mark with a right to register the same in the Philippines, having
registered such mark in its country of origin.
The CA likewise held that Cointreau’s right to register the
subject mark cannot be barred by Ecole’s prior use because its
appropriation of the mark was done in bad faith. Furthermore,
Ecole had no certificate of registration that would put
Cointreau on notice that the former had appropriated or has
been using the subject mark. In fact, its application for
trademark registration for the same which was just filed is still
pending with the IPO.
Hence, this petition.
ISSUE:
Whether the CA was correct in upholding the IPO Director
General’s ruling that Cointreau is the true and lawful owner of
the subject mark and thus, entitled to have the same registered.
RULING:
In denying the opposition, the Supreme Court explained that
only the owner of a mark has the right to register the mark, and
a prior user of the mark in the Philippines is not necessarily the
owner. A Prior user of a mark in commerce can prove
ownership only when the mark has not been validly
appropriated by another. In this case, the Supreme Court noted,
Cointreau had been using the subject mark in France well
before Ecole started using it in the Philippines.
It is worthy to emphasize that the Philippines and France are
both signatories to the Paris Convention for the Protection of
Industrial Property. Thus, Cointreau’s mark, even if not
registered in the Philippines, was also afforded protection
against infringement and/or unfair competition.
The court found that prior use of the mark in France
effectively barred it subsequent registration by another party in
the Philippines. That being the case, even if Ecole was the first
to use the mark in the Philippines, it could not be to have
legally appropriated the mark, and hence was not entitled to
registration.
In view of the obligations under the Paris Convention, the
Philippines is obligated to assure nationals of the signatory-
28
countries that they are afforded an effective protection against
violation of their intellectual property rights in the Philippines
in the same way that their own countries are obligated to
accord similar protection to Philippine nationals.
It is undisputed that Cointreau has been using the subject
mark in France since 1895, prior to Ecole’s averred first use of
the same in the Philippines in 1948, of which the latter was fully
aware thereof. In fact, Ecole’s present directress, Ms. Lourdes L.
Dayrit had trained as a student in Cointreau’s Le Cordon Bleu
culinary school in Paris, France.
Cointreau was likewise the first registrant of the said mark
under various classes, both abroad and in the Philippines,
having secured Home Registration from its country of origin, as
well as several trademark registrations in the Philippines.
On the other hand, Ecole has no certificate of registration
over the subject mark but only a pending application. Its
application was filed only after Cointreau filed its trademark
application for goods and services.
Ecole’s directress was fully aware, being an alumna of the
latter’s culinary school in Paris, France. Hence, Ecole cannot
claim any tinge of ownership whatsoever over the subject mark.
As such, IPO and the CA were correct in declaring Cointreau as
the true and lawful owner of the subject mark and is entitled to
have the same registered under its name.
In any case, the present law on trademarks, Republic Act No.
8293, has already dispensed with the requirement of prior
actual use at the time of registration. Thus, there is more
reason to allow the registration of the subject mark under the
name of Cointreau as its true and lawful owner.
WHEREFORE, the petition is DENIED. Decision of the Court of
Appeals is hereby AFFIRMED in toto. SO ORDERED.
28. MIGHTY CORPORATION and LA CAMPANA FABRICA DE
TABACO, INC. petitioners, vs.
E. & J. GALLO WINERY and THE ANDRESONS GROUP,
INC. respondents
Facts: Gallo Winery, producer of wines and brandy products
which is based in California, U.S.A., registered its GALLO wine
trademark in the Philippines in 1971. Gallo Winery produces
different kinds of wines and brandy products and sells them in
many countries under different registered trademarks,
including the GALLO and ERNEST & JULIO GALLO wine
trademarks.
On the other hand, petitioners Mighty Corporation and La
Campana and their sister company, Tobacco Industries of the
Philippines (Tobacco Industries), are engaged in the cultivation,
manufacture, distribution and sale of tobacco products for
which they have been using the GALLO cigarette trademark
since 1973.
In May 1984, Tobacco Industries assigned the GALLO cigarette
trademark to La Campana which, on July 16, 1985, applied for
trademark registration in the Philippine Patent Office. On July
17, 1985, the National Library issued Certificate of Copyright
Registration No. 5834 for La Campana lifetime copyright claim
over GALLO cigarette labels.
Subsequently, La Campana authorized Mighty Corporation to
manufacture and sell cigarettes bearing the GALLO
trademark.BIR approved Mighty Corporations use of GALLO
100s cigarette brand, under licensing agreement with Tobacco
Industries, on May 18, 1988, and GALLO SPECIAL MENTHOL
100s cigarette brand on April 3, 1989.
Issue: Whether or not there was trademark infringement
Ruling: On 14 July 2004, the Supreme Court ruled that Mighty
Corporation, et al. are not liable for trademark infringement or
unfair competition and reaffirmed the doctrine that the use of
an identical mark does not, by itself, lead to a legal conclusion
that there is trademark infringement. A crucial issue in any
trademark infringement case is the likelihood of confusion,
mistake or deceit as to the identity, source or origin of the
goods, or identity of the business as a consequence of using a
certain mark.
According to the High Court, there are two types of confusion
in trademark infringement, namely, "confusion of goods" and
"confusion of business." Confusion of goods is evident where
the litigants are actually in competition; but confusion of
29
business may arise between non-competing interests as well. plaintiff to make or sell the same class of goods as those made
Thus, there is likelihood of confusion when, although the goods or sold by the defendant.
of the parties are different, they are so related that the
defendant's product can reasonably be assumed to originate
from the plaintiff.
29. Wilton Dy and/or Philites Electronic & Lighting Products v.
In determining likelihood of confusion, the Supreme Court Koninklijke Philips Products, N.V.
considered the following factors: [a] the resemblance between
G.R. no. 186088, March 22, 2017
the trademarks; [b] the similarity of the goods to which the
trademarks are attached; [c] the likely effect on the purchaser;
Sereno, C.J.
and [d] the registrant's express or implied consent and other
fair and equitable considerations. Nature of the Case: This is a Petition for Review by Wilton Dy,
assailing the Decision and Resolution of the CA, which reversed
In comparing the resemblance or colorable imitation of marks,
and set aside the Decision of the Intellectual Property
various elements were considered, such as the dominant color,
Philippines Office of the Director General (IPP-DG), which
style, size, form, meaning of letters, words, designs and
affirmed the Decisionof the Intellectual Property Philippines
emblems used, the likelihood of deception of the mark or
Bureau of Legal Affairs (IPP-BLA), upholding petitioner’s
name's tendency to confuse, and the commercial impression
trademark application.
likely to be conveyed by the trademarks if used in conjunction
with the respective goods of the parties. Facts: On April 12, 2000, petitioner PHILITES filed a trademark
application covering its fluorescent bulb, incandescent light,
The Supreme Court found that the similarity between the
starter and ballast. After publication, respondent Koninklijke
parties' GALLO trademarks, i.e., the use of the word "GALLO" - a
Philips Electronics, N .V. ("PHILIPS") opposed the application on
family surname for Gallo Winery's wines and a Spanish word for
March 17, 2006, alleging that the approval of the trademark
"rooster" for Mighty Corporation, et al.'s cigarettes, was
application of the petitioner will cause damage to the
overridden by their different features like color schemes, art
proprietary rights, business reputation and goodwill over its
works and other markings of both products.
trademark, and will also cause unfair commercial profit, due to
the tendency that it will mislead the public as to the origin,
The Supreme Court distinguished between GALLO wines and
nature, quality, and characteristic of the goods on which it is
GALLO cigarettes as follows: (1) wines are bottled and
affixed, because an identical or confusingly similar mark that
consumed by drinking while cigarettes are packed in cartons or
clearly infringes the well-known mark of the respondent.
packages and smoked; (2) there is a whale of a difference
Petitioner answered that Philips and and ‘Philites & Letter P
between their descriptive properties, physical attributes or
Device’ have vast dissimilarities in terms of spelling, sound, and
essential characteristics like form, composition, texture and
meaning.
quality; (3) GALLO cigarettes are inexpensive items that appeal
only to simple folks like farmers, fishermen, laborers and other
The IPP-BLA denied the opposition by the respondent. It held
low-income workers while GALLO wines are patronized by
that the PHILIPS and PHILITES marks were so unlike, both
middle-to-high-income earners; and (4) GALLO cigarettes are
visually and aurally, and that no confusion was likely to concur
distributed through sidewalk vendors, sari-sari stores and
despite their contemporaneous use. On appeal, the IPP-DG
grocery stores in rural areas, mainly in Misamis Oriental,
affirmed the Decision of the IPP-BLA, stating that while the first
Pangasinan, Bohol, and Cebu, whereas GALLO wines are
syllables of the marks are identical, the second syllables are not.
imported and exclusively distributed by a local entity and sold
There were also “glaring differences and dissimilarities” in the
in hotels, expensive bars and restaurants, and high-end grocery
design and general appearance of the PHILIPS mark and the
stores and supermarkets.
PHILITES mark. Upon intermediate appellate review, the CA
reversed and set aside the Decision of the IPP-DG. It held that
Based on these distinctions, the High Tribunal declared that
it found the petitioner’s actual wrapper and packaging that
wines and cigarettes are non-competing and totally unrelated
contain the light bulbs confusingly similar with that of the
products which are not likely to cause confusion vis-à-vis the
respondent’s. petitioner filed MR, but was denied. hence, this
goods or business of Gallo Winery and Mighty Corporation, et
Petition for Review.
al. Thus, even though similar marks are used, there is no
trademark infringement if the public does not expect the
Issue: Whether or not the mark applied for by the petitioner is
identical or confusingly similar with that of the respondent.

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Ratio Decidendi: Despite respondent's diversification to
numerous and varied industries, the records show that both
parties are engaged in the same line of business: selling
identical or similar goods such as fluorescent bulbs,
incandescent lights, starters and ballasts.
In determining similarity and likelihood of confusion,
jurisprudence has developed two tests: the dominancy test,
and the holistic or totality test. Applying the dominancy test in
the instant case, it shows the uncanny resemblance or
confusing similarity between the trademark applied for by
respondent with that of petitioner's registered trademark. An
examination of the trademarks shows that their dominant or
prevalent feature is the five-letter "PHILI", "PHILIPS" for
petitioner, and "PHILITES" for respondent. The marks are
confusingly similar with each other such that an ordinary
purchaser can conclude an association or relation between the
marks. The consuming public does not have the luxury of time
to ruminate the phonetic sounds of the trademarks, to find out
which one has a short or long vowel sound. At bottom, the
letters "PHILI'' visually catch the attention of the consuming
public and the use of respondent's trademark will likely deceive
or cause confusion. Most importantly, both trademarks are
used in the sale of the same goods, which are light bulbs.
The confusing similarity becomes even more prominent when
we examine the entirety of the marks used by petitioner and
respondent, including the way the products are packaged.
Applying the holistic test, entails a consideration of the entirety
of the marks as applied to the products, including the labels
and packaging, in determining confusing similarity. A
comparison between petitioner's registered trademark
"PHILIPS'' as used in the wrapper or packaging of its light bulbs
and that of respondent's applied for trademark "PHILITES" as
depicted in the container or actual wrapper/packaging of the
latter's light bulbs will readily show that there is a strong
similitude and likeness between the two trademarks that will
likely cause deception or confusion to the purchasing public.
The fact that the parties' wrapper or packaging reflects
negligible differences considering the use of a slightly different
font and hue of the yellow is of no moment because taken in
their entirety, respondent's trademark "PHILITES" will likely
cause confusion or deception to the ordinary purchaser with a
modicum of intelligence.
Dispositive Portion: the Petition for Review on Certiorari is
hereby DENIED. The 7 October 2008 Decision and 18 December
2008 Resolution of the Court of Appeals are hereby AFFIRMED.
SO ORDERED.
30. Skechers, U.S.A. vs. Inter Pacific Industrial Trading
Corporation, et.al.
[GR No. 164321, March 23, 2011]
FACTS: Petitioner Skechers USA has registered the trademark
"Skechers" and the trademark "S" (with an oval design) with the
IPO. Petitioner filed an application for the issuance of search
warrants against an outlet and warehouse operated by
respondents for infringement of trademark under Section 155,
in relation to Section 170 of Republic Act No. 8293, IP Code of
the Philippines. Pursuant to a search warrant, more than 6,000
pairs of shoes bearing the "S" logo were seized. Respondents
moved to quash the search warrant arguing that there was no
confusing similarity between petitioner's "Skechers" rubber
shoes and its "Strong" rubber shoes. RTC applying the Holistic
Test ordered the quashing of the warrant which was affirmed
by the CA. RTC noted the following differences: 1) the mark "S"
is not enclosed in an oval design; 2) the hang tags and labels
bear the word "Strong" for respondent and "Skechers USA" for
petitioner; 3) Strong shoes are modestly priced compared to
Skechers shoes.
ISSUE: Whether or not respondents are guilty of Infringement
RULING: Yes. Applying the Dominancy Test, even if respondents
did not use the oval design, the mere fact that it used the same
stylized "S" (same font and size of the lettering) the same being
the dominant feature of petitioner's trademark constitutes
infringement. Applying the Holistic Test, the dissimilarities
between the shoes are too trifling and frivolous that it is
indubitable that respondent's products will cause confusion
and mistakes in the eyes of the public. Respondent's shoes may
not be an exact replica of the petitioner's shoes, but the
features and overall design are so similar and alike that
confusion is highly likely to happen. Registered trademark
owner may use its mark on the same or similar products, in
different segments of the market, and at different price levels
depending on variations of the products for specific segments
of the market. The purchasing public might be mistaken in
thinking that petitioner had ventured into a lower market
segment which scenario is plausible especially since both
petitioner and respondent manufacture rubber shoes.
31
31. UFC PHILIPPINES v BARRIO FIESTA
GR No. 198889
Facts:
Petitioner Nutri-Asia, Inc. (petitioner) is a corporation duly
organized and existing under Philippine laws. It is the emergent
entity in a merger with UFC Philippines Inc. that was completed
on Feb. 11, 2009.
On April 4, 2002, respondent Barrio Fiesta Manufacturing
Coroporation filed ofr the mark “PAPA BOY & DEVICE” for
goods under Class 30, specifically for “lechon sauce.” The
Intellectual Property Office (IPO) published said application for
opposition in the IP Phil e-Gazette on Sept. 8 2006.
Petitioner Nutri-asia filed with the IPO Bureau of Legal Affairs a
Verified Notice of Opposition to the application alleging that
the mark “PAPA” is for use on banana catsup and other similar
goods first used in 1954 by Neri Papa.
After using “PAPA” for 27 years, Neri Papa subsequently
assigned the mark to Herman Reyes who filed an application to
register the said “PAPA” mark for use on banana catsup, chili
sauce, achara, banana chips and instate ube powder.
On November 7, 2006 the registration was assigned to Nutri-
Asia. The company has not abandoned the use of the mark
“PAPA” and the variations (such as “PAPA BANANA CATSUP
label” and “PAPA KETSARAP”.) thereof as it continued the use
of the mark up to the present. Petitioner further allege that
“PAPA BOY & DEVICE” is identical to the mark “PAPA” owned
by Nutri-Asia and duly registered in its favor. The petitioner
contends that the use of “PAPA” by the respondent-applicant
would likely result in confusion and deception. The consuming
public, particularly the unwary customers, will be deceived,
confused, and mistaken into believing that respondent-
applicant's goods come from Nutri-Asia, which is particularly
true since Southeast Asia Food Inc, sister company of Nutri-Asia,
have been major manufacturers and distributors of lechon
sauce since 1965 under the registered mark “Mang Tomas”.
The IPO-BLA rejected Barrio Fiesta’s application for “PAPA BOY
& DEVICE”. Respondent appealed before the IPO Director
General, but the appeal was denied. The CA, however, reversed
the decision of the IPO-BLA and ruled to grant the application.
Petitioner brought the case before the Supreme Court, seeking
the reversal of the decision and resolution of the CA.
Issue:
Whether or not by using the “dominant feature” of Nutri-Asia’s
“PAPA” mark for “PAPA BOY & DEVICE” would constitute
trademark infringement.
Held:
Petition has merit.
In Dermaline, Inc. v. Myra Pharmaceuticals, Inc., 43 we defined
a trademark as "any distinctive word, name, symbol, emblem,
sign, or device, or any combination thereof, adopted and used
by a manufacturer or merchant on his goods to identify and
distinguish them from those manufactured, sold, or dealt by
others." We held that a trademark is "an intellectual property
deserving protection by law."
The Intellectual Property Code provides:
Section 147. Rights Conferred. - 147.1. The owner of a
registered mark shall have the exclusive right to prevent all
third parties not having the owner's consent from using in the
course of trade identical or similar signs or containers for goods
or services which are identical or similar to those in respect of
which the trademark is registered where such use would result
in a likelihood of confusion. In case of the use of an identical
sign for identical goods or services, a likelihood of confusion
shall be presumed.
To determine the likelihood of confusion, the Rules of
Procedure for Intellectual Property Rights Cases, Rule 18,
provides:
RULE 18
Evidence in Trademark Infringement and Unfair Competition
Cases
SECTION 1. Certificate of Registration. - A certificate of
registration of a mark shall be prima facie evidence of:
a) the validity of the registration;
b) the registrant's ownership of the mark; and
c) the registrant's exclusive right to use the same in connection
with the goods or services and those that are related thereto
specified in the certificate.
32
SECTION 3. Presumption of Likelihood of Confusion. -
Likelihood of confusion shall be presumed in case an identical
sign or mark is used for identical goods or services.
SECTION 4. Likelihood of Confusion in Other Cases. - In
determining whether one trademark is confusingly similar to or
is a colorable imitation of another, the court must consider the
general impression of the ordinary purchaser, buying under the
normally prevalent conditions in trade and giving the attention
such purchasers usually give in buying that class of goods.
Visual, aural, connotative comparisons and overall impressions
engendered by the marks in controversy as they are
encountered in the realities of the marketplace must be taken
into account.
Where there are both similarities and differences in the marks,
these must be weighed against one another to see which
predominates.
In determining likelihood of confusion between marks used on
non-identical goods or services, several factors may be taken
into account, such as, but not limited to:
a) the strength of plaintiffs mark;
b) the degree of similarity between the plaintiffs and the
defendant's
marks;
c) the proximity of the products or services;
d) the likelihood that the plaintiff will bridge the gap;
e) evidence of actual confusion;
f) the defendant's good faith in adopting the mark;
g) the quality of defendant's product or service; and/or
h) the sophistication of the buyers.
"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.
SECTION 5. Determination of Similar and Dissimilar Goods or
Services. - Goods or services may not be considered as being
similar or dissimilar to each other on the ground that, in any
registration or publication by the Office, they appear in
different classes of the Nice
Classification.
On the other hand, R.A. No. 166 defines a "trademark" as any
distinctive word, name, symbol, emblem, sign, or device, or any
combination thereof, adopted and used by a manufacturer or
merchant on his goods to identify and distinguish them from
those manufactured, sold, or dealt by another. A trademark,
being a special property, is afforded protection by law. But for
one to enjoy this legal protection, legal protection ownership of
the trademark should right be established.
The ownership of a trademark is acquired by its registration and
its actual use by the manufacturer or distributor of the goods
made available to the purchasing public. The prima facie
presumption brought by the registration of a mark may be
challenge in an appropriate action. Moreover the protection
may likewise be defeated by evidence of prior use by another
person. This is because the trademark is a creation of use and
belongs to one who first used it in trade or commerce.
The essential element of infringement under the law is that the
infringing mark is likely to cause confusion. There are two tests
used to determine likelihood of confusion: the dominancy test
and the holistic test. The dominancy test applies to this case.
The Dominancy Test
focuses on the similarity of the prevalent or dominant features
of the competing trademarks that might cause confusion,
mistake, and deception in the mind of the purchasing public.
Duplication or imitation is not necessary; neither is it required
that the mark sought to be registered suggests an effort to
imitate. Given more consideration are the aural and visual
impressions created by the marks on the buyers of goods,
giving little weight to factors like prices, quality, sales outlets,
and market segments.
xx xx
The Totality Test
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
33
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.
There are two types of confusion in trademark infringement:
confusion of goods and confusion of business. In Sterling
Products International, Inc. v. Farbenfabriken Bayer
Aktiengesellschaft, the Court distinguished the two types of
confusion:
Callman notes two types of confusion. The first is the confusion
of goods "in which event the ordinarily prudent purchaser
would be induced to purchase one product in the belief that he
was purchasing the other." In which case, "defendant's goods
are then bought as the plaintiff's, and the poorer quality of the
former reflects adversely on the plaintiff's reputation." The
other is the confusion of business: "Here though the goods of
the parties are different, the defendant's product is such as
might reasonably be assumed to originate with the plaintiff,
and the public would then be deceived either into that belief or
into the belief that there is some connection between the
plaintiff and defendant which, in fact, does not exist."
In relation to this, the court has held that the registered
trademark owner may use his mark on the same or similar
products, in different segments of the market, and at different
price levels depending on variations of the products for specific
segments of the market. The Court has recognized that the
registered trademark owner enjoys protection in product and
market areas that are the normal potential expansion of his
business. The scope of protection thus extends to protection
from infringers with related goods.
It cannot be denied that since petitioner’s product, catsup, and
respondent’s product, lechon sauce, are both household
products in similar packaging the public could think that
petitioner Nutri-Asia has expanded its product mix to include
lechon sauce, which is not unlikely considering the nature of
petitioner’s business.
Moreover, the CA erred in finding that “PAPA” is a common
term of endearment for “father” and therefore could not be
claimed for exclusive use and ownership. What was registered
was not “Papa” as denied in dictionary, but “Papa” as the last
name of the owner of the brand, making it a registrable mark.
Petition granted.
32. Shang Properties v. St. Francis Development Corporation
GR No. 190706; July 21, 2014
FACTS:
Respondent domestic corporation is engaged in the real estate
business and is the developer of the St. Francis Square
Commercial Center (built sometime in 1992).
It filed separate complaints against petitioners before the IPO -
BLA, namely:
(a) IPV Case – an intellectual property violation case for unfair
competition, false or fraudulent declaration, and damages
arising from petitioners’ use and filing of applications for the
registration of the marks “THE ST. FRANCIS TOWERS” and “THE
ST. FRANCIS SHANGRI-LA PLACE,”; and
(b) St. Francis Towers IP Case – an inter partes case opposing
the petitioners’ application for registration of the mark “THE ST.
FRANCIS TOWERS” for use relative to the latter’s business,
particularly the construction of permanent buildings or
structures for residential and office purposes; and
(c) St. Francis Shangri-La IP Case – an inter partes case opposing
the petitioners’ application for registration of the mark “THE ST.
FRANCIS SHANGRI-LA PLACE,”.
Respondent alleged that it has used the mark “ST. FRANCIS” to
identify its numerous property development projects located at
Ortigas Center, such as the aforementioned St. Francis Square
Commercial Center, a shopping mall called the “St. Francis
Square,” and a mixed-use realty project plan that includes the
St. Francis Towers. Respondent added that as a result of its
continuous use of the mark “ST. FRANCIS” in its real estate
business, it has gained substantial goodwill with the public that
consumers and traders closely identify the said mark with its
property development projects. Accordingly, respondent
claimed that petitioners could not have the mark “THE ST.
FRANCIS TOWERS” registered in their names, and that
petitioners’ use of the marks “THE ST. FRANCIS TOWERS” and
“THE ST. FRANCIS SHANGRI-LA PLACE” in their own real estate
development projects constitutes unfair competition as well as
false or fraudulent declaration.
Petitioners denied committing unfair competition and false or
fraudulent declaration, maintaining that they could register the
mark “THE ST. FRANCIS TOWERS” and “THE ST. FRANCIS
SHANGRI-LA PLACE” under their names. They contended that
respondent is barred from claiming ownership and exclusive
use of the mark “ST. FRANCIS” because the same is
geographically descriptive of the goods or services for which it
34
is intended to be used. This is because respondent’s as well as
petitioners’ real estate development projects are located along
the streets bearing the name “St. Francis,” particularly, St.
Francis Avenue and St. Francis Street (now known as Bank
Drive), both within the vicinity of the Ortigas Center.
ISSUE:
Whether or not petitioners are guilty of unfair competition in
using the marks “THE ST. FRANCIS TOWERS” and “THE ST.
FRANCIS SHANGRI-LA PLACE.”
RULING:
NO.
RATIO DECIDENDI:
The unfair competition concept refers to the “‘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.’ Passing off (or palming off) takes place where the
defendant, by imitative devices on the general appearance of
the goods, misleads prospective purchasers into buying his
merchandise under the impression that they are buying that of
his competitors. [In other words], the defendant gives his goods
the general appearance of the goods of his competitor with the
intention of deceiving the public that the goods are those of his
competitor.”
The “true test” of unfair competition has thus been “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.” Based on the foregoing, it is therefore
essential to prove the existence of fraud, or the intent to
deceive, actual or probable, determined through a judicious
scrutiny of the factual circumstances attendant to a particular
case.
Here, the Court finds the element of fraud to be wanting; hence,
there can be no unfair competition. The CA’s contrary
conclusion was faultily premised on its impression that
respondent had the right to the exclusive use of the mark “ST.
FRANCIS,” for which the latter had purportedly established
considerable goodwill. What the CA appears to have
disregarded or been mistaken in its disquisition, however, is the
geographically descriptive nature of the mark “ST. FRANCIS”
which thus bars its exclusive appropriability, unless a secondary
meaning is acquired.
As deftly explained in the U.S. case of Great Southern Bank v.
First Southern Bank: “[d]escriptive geographical terms are in
the ‘public domain’ in the sense that every seller should have
the right to inform customers of the geographical origin of his
goods. A ‘geographically descriptive term’ is any noun or
adjective that designates geographical location and would tend
to be regarded by buyers as descriptive of the geographic
location of origin of the goods or services. A geographically
descriptive term can indicate any geographic location on earth,
such as continents, nations, regions, states, cities, streets and
addresses, areas of cities, rivers, and any other location
referred to by a recognized name. In order to determine
whether or not the geographic term in question is descriptively
used, the following question is relevant: (1) Is the mark the
name of the place or region from which the goods actually
come? If the answer is yes, then the geographic term is
probably used in a descriptive sense, and secondary meaning is
required for protection.”
Secondary meaning is established when a descriptive mark no
longer causes the public to associate the goods with a
particular place, but to associate the goods with a particular
source. In other words, it is not enough that a geographically-
descriptive mark partakes of the name of a place known
generally to the public to be denied registration as it is also
necessary to show that the public would make a goods/place
association
– that is, to believe that the goods for which the mark is sought
to be registered originate in that place. However, where there
is no genuine issue that the geographical significance of a term
is its primary significance and where the geographical place is
neither obscure nor remote, a public association of the goods
with the place may ordinarily be presumed from the fact that
the applicant’s own goods come from the geographical place
named in the mark.
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