CONVERSE RUBBER CORPORATION and EDWARDSON MANUFACTURING CORPORATION vs.

JACINTO
RUBBER & PLASTICS CO., INC., and ACE RUBBER & PLASTICS CORPORATION

FACTS:

Plaintiff Converse Rubber Corporation, (is) an American Corporation, manufacturer (of) canvas rubber
shoes under the trade name "Converse Chuck Taylor All Star"; in the Philippines. The trademark "Chuck
Taylor" was registered by plaintiff Converse with the Philippines Patent Office on March 3, 1966. Since
1946, "Chuck Taylor" is being sold in the Philippines.

Defendant Jacinto Rubber & Plastics Company, Inc., a local corporation, likewise, manufactures and sells
canvas rubber shoes. It sells its product under the trade names "Custombuilt Viscount", "Custombuilt
Challenger", and "Custombuilt Jayson's". Its trademark "Custombuilt Jayson's" was registered by the
Philippines Patent Office on November 29, 1957

In 1963, plaintiff Converse and defendant Jacinto entered into protracted negotiations for a licensing
agreement whereby defendant Jacinto would be the exclusive license of plaintiff Converse in the
Philippines for the manufacture and sale of "Chuck Taylor" shoes but with the right to continue
manufacturing and selling its own products. One of the points taken up by parties was the design and
general appearance of "Custombuilt" shoes. Plaintiff Converse insisted on the condition that defendant
Jacinto change the design of "Custombuilt" shoes so as to give "Custombuilt" a general appearance
different from "Chuck Taylor." Defendant Jacinto gave into to the demand of plaintiff Converse and
presented a new design which was accepted by the latter.

Defendant Jacinto Rubber then proposed that the licensing agreement be made in favor of its affiliates,
defendant Ace Rubber. On January 22, 1965, defendant Ace Rubber signed the licensing agreement

Ace acknowledges that Converse is the exclusive owner of the said Converse - names and design, as used
in connection with the manufacture, advertising and sale of footwear: that Converse has the exclusive
right to use said Converse names and that neither Ace nor any person acting by, through or under Ace
will, at anytime, question or dispute said ownership or the exclusive rights of Converse with respect
thereto

However, the licensing agreement did not materialize, because Hermogenes Jacinto refused to sign the
guarantee.

Plaintiff Converse and plaintiff Edwardson then executed licensing agreement, making plaintiff Edwardson
the exclusive Philippine licensee for the manufacture and sale of "Chuck Taylor."

Plaintiffs sent a written demand to defendants to stop manufacturing and selling "Custombuilt" shoes of
Identical appearance as "Chuck Taylor". Defendants did not reply to plaintiffs' letter. Hence, this suit.

Plaintiffs contend that "Custombuilt" shoes are Identical in design and General appearance to "Chuck
Taylor" and, claiming prior Identification of "Chuck Taylor" in the mind of the buying public in the
Philippines, they contend that defendants are guilty of unfair competition by selling "Custombuilt" of the
design and with the general appearance of "Chuck Taylor". The design and appearance of both products,
as shown by the samples and photographs of both products, are not disputed.

Defendants insist that (a) there is no similarity in design and general appearance between "Custombuilt"
and "Chuck Taylor" It is also vigorously contended by defendants that the registration of defendant Jacinto
Rubber's trademark "Custombuilt" being prior to the registration in the Philippines of plaintiff Converse
Rubber's trademark "Chuck Taylor", plaintiffs have no cause of action.

The Trial Court is not impressed by defendants' good faith in claiming that they have the right to continue
manufacturing "Custombuilt" of Identical design and appearance as "Chuck Taylor". While it is true that
the licensing agreement between plaintiff Converse and defendant did not materialize, the execution of
the documents by the defendants constitute an admission on the part of plaintiff Converse Rubber's
property right in design and appearance of "Chuck Taylor". The agreement shows that the defendants
acknowledged that plaintiff Converse Rubber "is the exclusive owner of the said Converse-names and
design." Defendants further covenanted not to "manufacture or sell footwear which would by reason of
its appearance and/or design, be likely, or tend, to be confused by the public with any of the Converse-
named products ... or shall, in any manner, infringe Converse designs". That defendants are fully aware
that "Custombuilt" is Identical in design and appearance to "Chuck Taylor" has conclusively been admitted
by them in their correspondence with plaintiff Converse leading to the submission by defendants to
plaintiff Converse of a sketch of a new design that should give "Custombuilt" an appearance different
from that of "Chuck Taylor".

Aside from the written admission of defendants, the facts clearly indicate that defendants copied the
design of "Chuck Taylor" with intent to gain "Chuck Taylor", as has been noted earlier, was ahead of
Custombuilt' in the Philippines market and has been enjoining a high reputation for quality and style.

ISSUE: W/N the defendants are guilty of unfair labor practice

HELD: YES

The Court finds the shoes manufactured by defendants to contain practically all the features of those of
the plaintiff Converse Rubber Corporation and manufactured, sold or marketed by plaintiff Edwardson
Manufacturing Corporation, except for their respective brands.

We fully agree with the trial court that "the respective designs, shapes, the colors of the ankle patches,
the bands, the toe patch and the soles of the two products are exactly the same ... (such that) at a distance
of a few meters, it is impossible to distinguish "Custombuilt" from "Chuck Taylor". These elements are
more than sufficient to serve as basis for a charge of unfair competition. Even if not all the details just
mentioned were Identical, with the general appearances alone of the two products, any ordinary, or even
perhaps even a not too perceptive and discriminating customer could be deceived, and, therefore,
Custombuilt could easily be passed off for Chuck Taylor. Jurisprudence supports the view that under such
circumstances, the imitator must be held liable.
It stands to reason that when the law speaks of purchasers' it generally refers to ordinary or average
purchasers.

... in cases of unfair competition, while the requisite degree of resemblance or similarity
between the names, brands, or other indicia is not capable of exact definition, it may be
stated generally that the similarity must be such, but need only be such, as is likely to
mislead purchasers of ordinary caution and prudence; or in other words, the ordinary
buyer, into the belief that the goods or wares are those, or that the name or business is
that, of another producer or tradesman. It is not necessary in either case that the
resemblance be sufficient to deceive experts, dealers, or other persons specially familiar
with the trademark or goods involved. Nor is it material that a critical inspection and
comparison would disclose differences, or that persons seeing the trademarks or articles
side by side would not be deceived

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

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

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

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

* It is the theory of defendants-appellants, however, that plaintiffs-appellees have failed to establish a

case of unfair competition because "inasmuch as the former (Converse Chuck Taylor) was not sold in the
local markets from 1949 to 1967, no competition, fair or unfair, could have been offered to it by the latter
product (Custombuilt Challenger) during the said period."

-> in Ang vs. Toribio, 74 Phil. 129, this Court aptly pointed out:

... As trade has developed and commercial changes have come about, the law of unfair
competition has expanded to keep pace with the times and the elements of strict
competition in itself has ceased to be the determining factor. The owner of a trademark
or trade-name has property right in which he is entitled to protection, since there is
damage to him from confusion of reputation or goodwill in the mind of the public as well
 as from confusion of goods. The modern trend is to give emphasis to the unfairness of the
acts and to classify and treat the issue as fraud.

Indeed, good-will established in other than a competitive milieu is no less a property right that deserves
protection from unjust appropriation or injury. This, to us, is precisely the clear sense of the law when it
declares without equivocation that a "person who has Identified in the mind of the public the goods he
manufactures or deals in, his business or services from those of others, has a property right in the goodwill
of the said goods, business or services so Identified, which will be protected in the same manner as other
property rights."

Plaintiffs-appellees have a established goodwill. This goodwill, the trial court found, defendants-
appellants have pirated in clear bad faith to their unjust enrichment.

-----------------------------------------------------------------------------------------------

DEL MONTE CORPORATION and PHILIPPINE PACKING CORPORATION,vs.

COURT OF APPEALS and SUNSHINE SAUCE MANUFACTURING INDUSTRIES

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.

Petitioner Philippine Packing Corporation (Philpack) is a domestic corporation duly organized under the
laws of the Philippines. On April 11, 1969, 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.

On October 27,1965, Del Monte authorized Philpack to register with the Philippine Patent Office the Del
Monte catsup bottle configuration, for which it was granted by the Philippine Patent Office under the
Supplemental Register. On November 20, 1972, 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 on April 17,1980, to engage in the manufacture, packing, distribution and sale
of various kinds of sauce, identified by the logo Sunshine Fruit Catsup. This logo was registered in the
Supplemental Register on September 20, 1983. 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 warned it to desist from doing so on pain of legal action.
Thereafter, claiming that the demand had been ignored, Philpack and Del Monte filed a complaint against
the private respondent for infringement of trademark and unfair competition, with a prayer for damages
and the issuance of a writ of preliminary injunction.
In its answer, Sunshine alleged that it had long ceased to use the Del Monte bottle and that its logo was
substantially different from the Del Monte logo and would not confuse the buying public to the detriment
of the petitioners.

After trial, the Regional Trial Court of Makati dismissed the complaint. It held that there were substantial
differences between the logos or trademarks of the parties; that the defendant had ceased using the
petitioners' bottles; and that in any case the defendant became the owner of the said bottles upon its
purchase thereof from the junk yards. Furthermore, the complainants had failed to establish the
defendant's malice or bad faith, which was an essential element of infringement of trademark or unfair
competition. 7

This decision was affirmed in toto by the respondent court, which is now faulted in this petition
for certiorari under Rule 45 of the Rules of Court.

Issue: w/n private respondent is guilty of infringement and unfair labor practice

Held:

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

A. Infringement

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

To determine whether a trademark has been infringed, we must consider the mark as a whole and not as
dissected. If the buyer is deceived, it is attributable to the marks as a totality, not usually to any part of
it. The court therefore should be guided by its first impression, for a buyer acts quickly and is governed
by a casual glance, the value of which may be dissipated as soon as the court assumes to analyze carefully
the respective features of the mark.

It been said that the most successful form of copying is to employ enough points of similarity to confuse
the public with enough points of difference to confuse the courts.
We also note that the respondent court failed to take into consideration several factors which should have
affected its 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 . Among these, what essentially determines the attitude of the purchaser,
specifically his inclination to be cautious, is the cost of the goods. As a general rule, an ordinary buyer
does not exercise as much prudence in buying an article for which he pays a few centavos as he does in
purchasing a more valuable thing. Expensive and valuable items are normally bought only after
deliberate, comparative and analytical investigation. But mass products, low priced articles in wide use,
and matters of everyday purchase requiring frequent replacement are bought by the casual consumer
without great care. 23 In this latter category is catsup.

At that, even if the labels were analyzed together it is not difficult to see that the Sunshine label is a
colorable imitation of the Del Monte trademark. The predominant colors used in the Del Monte label are
green and red-orange, the same with Sunshine. The word "catsup" in both bottles is printed in white and
the style of the print/letter is the same. Although the logo of Sunshine is not a tomato, the figure
nevertheless approximates that of a tomato.

As previously stated, the person who infringes a trade mark does not normally copy out but only makes
colorable changes, employing enough points of similarity to confuse the public with enough points of
differences to confuse the courts. What is undeniable is the fact that when a manufacturer prepares to
package his product, he has before him a boundless choice of words, phrases, colors and symbols
sufficient to distinguish his product from the others. When as in this case, Sunshine chose, without a
reasonable explanation, to use the same colors and letters as those used by Del Monte though the field
of its selection was so broad, the inevitable conclusion is that it was done deliberately to deceive

It has been aptly observed that the ultimate ratio in cases of grave doubt is the rule that as between a
newcomer who by the confusion has nothing to lose and everything to gain and one who by honest dealing
has already achieved favor with the public, 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

B. Unfair Competition

we find that the private respondent is not guilty of infringement for having used the Del Monte bottle.
The reason is that the configuration of the said bottle was merely registered in the Supplemental Register.

Although Del Monte has actual use of the bottle's configuration, the petitioners cannot claim exclusive
use thereof because it has not been registered in the Principal Register. However, we find that Sunshine,
despite the many choices available to it and notwithstanding that the caution "Del Monte Corporation,
Not to be Refilled" was embossed on the bottle, still opted to use the petitioners' bottle to market a
product which Philpack also produces. This clearly shows the private respondent's bad faith and its
intention to capitalize on the latter's reputation and goodwill and pass off its own product as that of Del
Monte.
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.

-----------------------------------------------------------------------------------------------

G.R. No. L-21587 May 19, 1966

BRISTOL MYERS COMPANY vs. THE DIRECTOR OF PATENTS and UNITED AMERICAN PHARMACEUTICALS,
INC.

Facts: A petition for registration in the Principal Register of the Patent Office of the trademark
"BIOFERIN" was filed on October 21, 1957 by United American Pharmaceuticals, Inc. Said domestic
corporation first used the afore-stated trademark in the Philippines on August 13, 1957. It covers "a
medicinal preparation of antihistamic, analgesic, antipyritic with vitamin C and Bioflavenoid used in the
treatment of common colds, influenza and other febrile diseases with capillary hemmorrhagic
tendencies." The product falls under Class 6 of the official classification, that is, "Medicines and
Pharmaceutical Preparations".

Bristol Myers Co., a corporation of the State of Delaware, U.S.A., filed on January 6, 1959 an
opposition to the application. Said oppositor is the owner in the Philippines of the trademark "BUFFERIN"
under Certificate of Registration No. 4578 issued by the Philippine Patent Office on March 3, 1954. Its
trademark is also registered in the United States under Certificate of Registration No. 566190 issued on
November 4, 1952. It was first used in the Philippines on May 13, 1953. The product covered by
"BUFFERIN" also belongs to Class 6, Medicines and Pharmaceutical Preparations. Designated as "Antacid
analgesic", it is intended for relief in cases of "simple headaches, neuralgia, colds, menstrual pain and
minor muscular aches."

The thrust of oppositor's contention was that the registration of the applicant's trademark
"BIOFERIN would violate its rights and interests in its registered trademark "BUFFERIN" as well as mislead
and confuse the public as to the source and origin of the goods covered by the respective marks, in view
of the allegedly practically the same spelling, pronunciation and letter-type design of the two trademarks
covering goods of the same class.

The parties thereafter filed a joint petition stipulating as to the facts and submitting the case upon
the issue of whether or not there will be such confusing similarity between the two trademarks as will be
likely to deceive the purchasing public.

The Director of Patents rendered a decision granting the petition for registration and dismissing
the opposition, on the ground that, all factors considered the trademarks in question are not confusingly
similar, so that the damage feared by the oppositor will not result. The oppositor appealed to this Court
by petition for review.
Issue: W/N the trademarks "BIOFERIN" and "BUFFERIN", as presented to the public in their respective
labels, are confusingly similar

Held: No. In determining whether two trademarks are confusingly similar, the test is not simply to take
their words and compare the spelling and pronunciation of said words. Rather, it is to consider the two
marks in their entirety, as they appear in the respective labels, in relation to the goods to which they are
attached. Said rule was enunciated by this by this Court through Justice Felix Bautista Angelo in Mead
Johnson & Co. vs. N.V.J Van Dorp, Ltd., L,17501, April 27, 1963, thus:

It is true that between petitioner's trademark "ALACTA" and respondent's "ALASKA" there are
similarities in spelling, appearance and sound for both are composed of six letters of three
syllables each and each syllable has the same vowel, but in determining if they are confusingly
similar a comparison of said words is not the only determining factor. The two marks in their
entirety as they appear in the respective labels must also be considered in relation to the goods
to which they are attached. The discerning eye of the observer must focus not only on the
predominant words but also on the other features appearing in both labels in order that he may
draw his conclusion whether one is confusingly similar to the other. ...

Applying this test to the trademarks involved in this case, it is at once evident that the Director of Patents
did not err in finding no confusing similarity. For though the words "BIOFERIN" and "BUFFERIN" have the
same suffix and similar sounding prefixes, they appear in their respective labels with strikingly different
backgrounds and surroundings, as to color , size and design.
For convenience we sum up these differences, as follows:

Relevant
"BIOFERIN" "BUFFERIN"
Factors

1. Shape & Rectangular, about 3-3/4" 2-1/4" Rectangular, 3-3/4"' 1-1/4"

Size of Label

2. Color of Predominantly Yellow Predominantly White

Label

3. Color Olive-green Blue

background
of Word-mark

4. Over-all At the top center-word mark "BIOFERIN"; At left side of label — Wood-
Layout below it are contents of medicine, mark "BUFFERIN"; with "Bristol
arranged horizontally; at bottom, center, Myers Co., New York, N.Y."
"United Pharmaceuticals, Inc." in below at right side,contents,
olivegreen background. At left side indications dosageare grouped
— dosage, printed perpendicularly; at right together, printed
side,indications, also perpendicularly perpendicularly
printed.
 5. Form of Capsules — Tablets —
product label says: "50 capsules" label says: "36 Tablets"

6. Label states: No such statement

Prescription "To be dispensed only by or on the
prescription of a physician"

Accordingly, taken as they will appear to a prospective customer, the trademark in question are not apt
to confuse. Furthermore, the product of the applicant is expressly stated as dispensable only upon doctor's
prescription, while that of oppositor does not require the same. The chances of being confused into
purchasing one for the other are therefore all the more rendered negligible. Although oppositor avers
that some drugstores sell "BIOFERIN" without asking for a doctor's prescription, the same if true would
be an irregularity not attributable to the applicant, who has already clearly stated the requirement of a
doctor's prescription upon the face of the label of its product.

G.R. No. 114508. November 19, 1999

PRIBHDAS J. MIRPURI vs. COURT OF APPEALS, DIRECTOR OF PATENTS and the BARBIZON
CORPORATION

Facts: Lolita Escobar, the predecessor-in-interest of petitioner Pribhdas J. Mirpuri, filed an application with
the Bureau of Patents for the registration of the trademark "Barbizon" for use in brassieres and ladies
undergarments. Escobar alleged that she had been manufacturing and selling these products under the
firm name "L & BM Commercial" since March 3, 1970.

Private respondent Barbizon Corporation, a corporation organized and doing business under the laws
of New York, U.S.A., opposed the application. It claimed that:

"The mark BARBIZON of respondent-applicant is confusingly similar to the trademark BARBIZON which
opposer owns and has not abandoned.

That opposer will be damaged by the registration of the mark BARBIZON and its business reputation and
goodwill will suffer great and irreparable injury.

That the respondent-applicant's use of the said mark BARBIZON which resembles the trademark used and
owned by opposer, constitutes an unlawful appropriation of a mark previously used in the Philippines and
not abandoned and therefore a statutory violation of Section 4 (d) of Republic Act No. 166, as amended."

This was docketed as Inter Partes Case No. 686 (IPC No. 686). After filing of the pleadings, the parties
submitted the case for decision.

Director of Patents rendered judgment dismissing the opposition and giving due course to
Escobar's application.
 This decision became final and on September 11, 1974, Lolita Escobar was issued a certificate of
registration for the trademark "Barbizon." The trademark was "for use in "brassieres and lady's underwear
garments like panties."

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

In 1979, however, Escobar failed to file with the Bureau of Patents the Affidavit of Use of the
trademark required under Section 12 of Republic Act (R.A.) No. 166, the Philippine Trademark Law. Due
to this failure, the Bureau of Patents cancelled Escobar's certificate of registration.

On May 27, 1981, Escobar reapplied for registration of the cancelled trademark. Mirpuri filed his own
application for registration of Escobar's trademark. Escobar later assigned her application to herein
petitioner and this application was opposed by private respondent. The case was docketed as Inter Partes
Case No. 2049 (IPC No. 2049).

Replying to private respondent's opposition, petitioner raised the defense of res judicata.
On March 2, 1982, Escobar assigned to petitioner the use of the business name "Barbizon
International." Petitioner registered the name with the Department of Trade and Industry (DTI) for which
a certificate of registration was issued in 1987.
Forthwith, private respondent filed before the Office of Legal Affairs of the DTI a petition for
cancellation of petitioner's business name.

On November 26, 1991, the DTI, Office of Legal Affairs, cancelled petitioner's certificate of
registration, and declared private respondent the owner and prior user of the business name "Barbizon
International."

Meanwhile, in IPC No. 2049, the evidence of both parties were received by the Director of
Patents. On June 18, 1992, the Director rendered a decision declaring private respondent's opposition
barred by res judicata and giving due course to petitioner's application for registration.

The CA reversed the Director of Patents finding that IPC No. 686 was not barred by judgment in IPC
No. 2049 and ordered that the case be remanded to the Bureau of Patents for further proceedings
CA denied reconsideration of its decision. Hence, this recourse.

Issue: 1. W/N IPC No. 2049 is barred on the ground of res judicata

2. W/N the treaty affords protection to a foreign corporation against a Philippine applicant for the
registration of a similar trademark

Held:

1. No. IPC No. 2049 raised the issue of ownership of the trademark, the first registration and use of the
trademark in the United States and other countries, and the international recognition and reputation of
the trademark established by extensive use and advertisement of private respondent's products for over
forty years here and abroad. These are different from the issues of confusing similarity and damage in IPC
No. 686. The issue of prior use may have been raised in IPC No. 686 but this claim was limited to prior use
in the Philippines only. Prior use in IPC No. 2049 stems from private respondent's claim as originator of
the word and symbol "Barbizon," as the first and registered user of the mark attached to its products
which have been sold and advertised worldwide for a considerable number of years prior to petitioner's
first application for registration of her trademark in the Philippines. Indeed, these are substantial
allegations that raised new issues and necessarily gave private respondent a new cause of action. Res
judicata does not apply to rights, claims or demands, although growing out of the same subject matter,
which constitute separate or distinct causes of action and were not put in issue in the former action.

Respondent corporation also introduced in the second case a fact that did not exist at the time the
first case was filed and terminated. The cancellation of petitioner's certificate of registration for failure to
file the affidavit of use arose only after IPC No. 686. It did not and could not have occurred in the first
case, and this gave respondent another cause to oppose the second application. Res judicata extends only
to facts and conditions as they existed at the time judgment was rendered and to the legal rights and
relations of the parties fixed by the facts so determined. When new facts or conditions intervene before
the second suit, furnishing a new basis for the claims and defenses of the parties, the issues are no longer
the same, and the former judgment cannot be pleaded as a bar to the subsequent action.

It is also noted that the oppositions in the first and second cases are based on different laws. The
opposition in IPC No. 686 was based on specific provisions of the Trademark Law, i.e., Section 4 (d) on
confusing similarity of trademarks and Section 8 on the requisite damage to file an opposition to a petition
for registration. The opposition in IPC No. 2049 invoked the Paris Convention, particularly Article
6bis thereof, E.O. No. 913 and the two Memoranda of the Minister of Trade and Industry. This opposition
also invoked Article 189 of the Revised Penal Code which is a statute totally different from the Trademark
Law. Causes of action which are distinct and independent from each other, although arising out of the
same contract, transaction, or state of facts, may be sued on separately, recovery on one being no bar to
subsequent actions on others. The mere fact that the same relief is sought in the subsequent action will
not render the judgment in the prior action operative as res judicata, such as where the two actions are
based on different statutes. Res judicata therefore does not apply to the instant case and respondent
Court of Appeals did not err in so ruling.

2. Yes.

The Intellectual Property Code of the Philippines declares that "an effective intellectual and industrial
property system is vital to the development of domestic and creative activity, facilitates transfer of
technology, it attracts foreign investments, and ensures market access for our products." The Intellectual
Property Code took effect on January 1, 1998 and by its express provision, repealed the Trademark
Law, the Patent Law, Articles 188 and 189 of the Revised Penal Code, the Decree on Intellectual
Property, and the Decree on Compulsory Reprinting of Foreign Textbooks. The Code was enacted to
strengthen the intellectual and industrial property system in the Philippines as mandated by the
country's accession to the Agreement Establishing the World Trade Organization (WTO).

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

A major proportion of international trade depends on the protection of intellectual property

rights. Since the late 1970's, the unauthorized counterfeiting of industrial property and trademarked
products has had a considerable adverse impact on domestic and international trade revenues. The TRIPs
Agreement seeks to grant adequate protection of intellectual property rights by creating a favorable
economic environment to encourage the inflow of foreign investments, and strengthening the multi-
lateral trading system to bring about economic, cultural and technological independence.

The Philippines and the United States of America have acceded to the WTO Agreement. This
Agreement has revolutionized international business and economic relations among states, and has
propelled the world towards trade liberalization and economic globalization. Protectionism and
isolationism belong to the past. Trade is no longer confined to a bilateral system. There is now "a new era
of global economic cooperation, reflecting the widespread desire to operate in a fairer and more open
multilateral trading system." Conformably, the State must reaffirm its commitment to the global
community and take part in evolving a new international economic order at the dawn of the new
millenium.

IN VIEW WHEREOF, the petition is denied and the Decision and Resolution of the Court of Appeals
in CA-G.R. SP No. 28415 are affirmed.

_____________________________________________________________________________________

McDonald's vs. L.C. Big Mak

Facts:

Petitioner McDonald's Corporation ("McDonald's") is a US corporation that operates a global chain of

fast-food restaurants, with Petitioner McGeorge Food Industries ("McGeorge"), as the Philippine
franchisee.

McDonald's owns the "Big Mac" mark for its "double-decker hamburger sandwich." with the US
Trademark Registry on 16 October 1979.

Based on this Home Registration, McDonald's applied for the registration of the same mark in the
Principal Register of the then Philippine Bureau of Patents, Trademarks and Technology ("PBPTT") (now
IPO). On 18 July 1985, the PBPTT allowed registration of the "Big Mac."

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

On 21 October 1988, respondent corporation applied with the PBPTT for the registration of the "Big
Mak" mark for its hamburger sandwiches, which was opposed by McDonald's. McDonald's also informed
LC Big Mak chairman of its exclusive right to the "Big Mac" mark and requested him to desist from using
the "Big Mac" mark or any similar mark.

Having received no reply, petitioners sued L.C. Big Mak Burger, Inc. and its directors before Makati RTC
Branch 137 ("RTC"), for trademark infringement and unfair competition.

RTC rendered a Decision finding respondent corporation liable for trademark infringement and unfair
competition. CA reversed RTC's decision on appeal.

On the Manner Respondents Use Big Mak in their Business

The evidence presented during the hearings on petitioners motion for the issuance of a writ of
preliminary injunction shows that the plastic wrappings and plastic bags used by respondents 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. It is respondents snack vans that carry the words L.C. Big Mak
Burger, Inc.

On the Issue of Trademark Infringement

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

Infringement, what constitutes. Any person who [1] shall use, without the consent of the
registrant, any reproduction, counterfeit, copy or colorable imitation of any registered
mark or trade-name in connection with the sale, offering for sale, or advertising
of any goods, business or services on or in connection with which such use is likely to
cause confusion or mistake or to deceive purchasers or others as to the source or origin
of such goods or services, or identity of such business; or [2] reproduce, counterfeit,
copy, or colorably imitate any such mark or trade-name and apply such reproduction,
counterfeit, copy, or colorable imitation to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used upon or in connection with such
goods, business or services, shall be liable to a civil action by the registrant for any or all
of the remedies herein provided.
Petitioners base their cause of action under the first part of Section 22, i.e. respondents allegedly used,
without petitioners consent, a colorable imitation of the Big Mac mark in advertising and selling
respondents hamburger sandwiches. This likely caused confusion in the mind of the purchasing public on
the source of the hamburgers or the identity of the business.

To establish trademark infringement, the following elements must be shown: (1) the validity of plaintiffs
mark; (2) the plaintiffs ownership of the mark; and (3) the use ofthe 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.

On Types of Confusion
Section 22 covers two types of confusion arising from the use of similar or colorable imitation
marks, namely, confusion of goods (product confusion) and confusion of business (source or origin
confusion). In Sterling Products International, Incorporated v. Farbenfabriken Bayer
Aktiengesellschaft, et al., the Court distinguished these two types of confusion, thus:

[Rudolf] 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. xxx The other is the confusion of
business: Here though the goods of the parties are different, the defendants 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.

Under Act No. 666,the first trademark law, infringement was limited to confusion of goods only,
when the infringing mark is used on goods of a similar kind.Thus, no relief was afforded to the party whose
registered mark or its colorable imitation is used on different although related goods.

On Whether Confusion of Goods and Confusion of Business are Applicable

Respondents ccannot negate the undisputed fact that they use their Big Mak mark on hamburgers,
the same food product that petitioners sell with the use of their registered mark Big Mac. Whether a
hamburger is single, double or triple-decker, and whether wrapped in plastic or styrofoam, it remains the
same hamburger food product. Even respondents 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 thenormal potential expansion of his business. Thus, the Court has declared:

Modern law recognizes that the protection to which the owner of a trademark is
entitled is not limited to guarding his goods or business from actual market competition
with identical or similar products of the parties, but extends to all cases in which the use
by a junior appropriator of a trade-mark or trade-name is likely to lead to a confusion of
source, as where prospective purchasers would be misled into thinking that the
complaining party has extended his business into the field (see 148 ALR 56 et seq; 53 Am
 Jur. 576) or is in any way connected with the activities of the infringer; or when it
forestalls the normal potential expansion of his business

On Whether Respondents Use of the Big Mak Mark Results in Likelihood of Confusion

Applying the dominancy test, the Court finds that respondents use of the Big Mak mark results in
likelihood of confusion. First, Big Mak sounds exactly the same as Big Mac. Second, the first word in Big
Mak is exactly the same as the first word in Big Mac. Third, the first two letters in Mak are the same as the
first two letters in Mac. Fourth, the last letter in Mak while a k sounds the same as c when the word Mak
is pronounced. Fifth, in Filipino, the letter k replaces c in spelling, thus Caloocan is spelled Kalookan.

In short, aurally the two marks are the same, with the first word of both marks phonetically the
same, and the second word of both marks also phonetically the same.Visually, the two marks
have both two words and six letters, with the first word of both marks having the same letters and the
second word having the same first two letters. In spelling, considering the Filipino language, even the
last letters of both marks are the same.

Clearly, respondents have adopted in Big Mak not only the dominant but also almost all the
features of Big Mac. Applied to the same food product of hamburgers, the two marks will likely result in
confusion in the public mind.

On the Issue of Unfair Competition

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.

To support their claim of unfair competition, petitioners allege that respondents fraudulently
passed off their hamburgers as Big Mac hamburgers. Petitioners add that respondents fraudulent intent
can be inferred from the similarity of the marks in question.

Passing off (or palming off) takes place where the defendant, by imitative devices on the general
appearance of the goods, misleads prospective purchasers into buying his merchandise under the
impression that they are buying that of his competitors. Thus, the defendant gives his goods the general
appearance of the goods of his competitor with the intention of deceiving the public that the goods are
those of his competitor.

Respondents point to these dissimilarities as proof that they did not give their hamburgers the
general appearance of petitioners Big Mac hamburgers.
 The dissimilarities in the packaging are minor compared to the stark similarities in the
words that give respondents Big Mak hamburgers the general appearance of petitioners Big Mac
hamburgers. Section 29(a) expressly provides that the similarity in the general appearance of the goods
may be in the devices or words used on the wrappings. Respondents have applied on their plastic
wrappers and bags almost the same words that petitioners use on their styrofoam box. What attracts
the attention of the buying public are the words Big Mak which are almost the same, aurally and visually,
as the words Big Mac. The dissimilarities in the material and other devices are insignificant compared to
the glaring similarity in the words used in the wrappings.

Section 29(a) also provides that the defendant gives his goods the general appearance of goods
of another manufacturer. Respondents goods are hamburgers which are also the goods of petitioners. If
respondents sold egg sandwiches only instead of hamburger sandwiches, their use of the Big Mak mark
would not give their goods the general appearance of petitioners Big Mac hamburgers. In such case,
there is only trademark infringement but no unfair competition. However, since respondents chose to
apply the Big Mak mark on hamburgers, just like petitioners use of the Big Mac mark on hamburgers,
respondents have obviously clothed their goods with the general appearance of petitioners goods.

Moreover, there is no notice to the public that the Big Mak hamburgers are products of L.C. Big
Mak Burger, Inc. Respondents introduced during the trial plastic wrappers and bags with the words L.C.
Big Mak Burger, Inc. to inform the public of the name of the seller of the hamburgers. However,
petitioners introduced during the injunctive hearings plastic wrappers and bags with the Big Mak
mark without the name L.C. Big Mak Burger, Inc. Respondents belated presentation of plastic wrappers
and bags bearing the name of L.C. Big Mak Burger, Inc. as the seller of the hamburgers is an after-
thought designed to exculpate them from their unfair business conduct. As earlier stated, we cannot
consider respondents evidence since petitioners complaint was based on facts existing before and during
the injunctive hearings.

Thus, there is actually no notice to the public that the Big Mak hamburgers are products of L.C.
Big Mak Burger, Inc. and not those of petitioners who have the exclusive right to the Big Mac mark. This
clearly shows respondents intent to deceive the public. Had respondents placed a notice on their plastic
wrappers and bags that the hamburgers are sold by L.C. Big Mak Burger, Inc., then they could validly
claim that they did not intend to deceive the public. In such case, there is only trademark infringement
but no unfair competition.Respondents, however, did not give such notice. We hold that as found by the
RTC, respondent corporation is liable for unfair competition.

_____________________________________________________________________________________
______

Shangri-La vs CA

FACTS:

The Shangri-La International Hotel Management, Ltd.,Shangri-La Properties, Inc., Makati Shangri-La Hotel and
Resort, Inc. and KuokPhilippine Properties, Inc., filed with the Bureau of Patents, Trademarks andTechnology Transfer (BPTTT)
a petition praying for the cancellation of the registration ofthe Shangri-La mark and “S” device/logo issued to the Developers
Group of Companies Inc., on the ground that the same was illegally and fraudulently obtained and appropriated for the
latter’s restaurant business.

The Shangri-La Group alleged that it isthe legal and beneficial owners of the subject mark and logo; that it has been
using thesaid mark and logo for its corporate affairs and business since March 1962 and causedthe same to be specially
designed for their international hotels in 1975, much earlierthan the alleged first use by the Developers Group in
1982.Likewise, the Shangri-La Group filed with the BPTTT its own application for registrationof the subject mark and logo. The
Developers Group filed an opposition to theapplication.,

Almost three (3) years later, the Developers Group instituted with the RTC a complaintfor infringement and
damages with prayer for injunction. When the Shangri-La Groupmoved for the suspension of the proceedings, the trial court
denied such in a Resolution.

The Shangri-La Group filed a petition for certiorari before the CA but the CA dismissedthe petition for certiorari.
Hence, the instant petition.

ISSUE:

Whether or not the infringement case should be dismissed or at least suspended

HELD:
There can be no denying that the infringement case is validly pass upon the rightof registration. Section 161 of
Republic Act No. 8293 provides to wit:SEC. 161.

Authority to Determine Right to Registration

“In any action involving a registered mark the court may determine the right to registration, order
the cancellation of the registration, in whole or in part, and otherwise rectify the register with respect
to the registration of any party to the action in the exercise of this.”

Judgement and orders shall be certified by the court to the Director, who shallmake appropriate entry upon the
records of the Bureau, and shall be controlled thereby.(Sec. 25, R.A. No. 166a). (Emphasis provided)

To provide a judicious resolution of the issues at hand, the Court find it apropos to orderthe suspension of the
proceedings before the Bureau pending final determination of theinfringement case, where the issue of the validity of the
registration of the subjecttrademark and logo in the name of Developers Group was passed upon.

Wolverine Worldwide, Inc. v. CA

GR. No. 78298 January 30, 1989
Facts:
On February 8, 1984, the petitioner, a foreign corporation organized and existing under the laws
of the United States, brought a petition before the Philippine Patent Office, for the cancellation of
Certificate of Registration No. 24986-B of the trademark HUSH PUPPIES and DOG DEVICE issued to the
private respondent, a Filipino citizen.

In support of its petition for cancellation, the petitioner alleged, inter alia, that it is the registrant
of the internationally known trademark HUSH PUPPIES and the DEVICE of a Dog in the United States and
in other countries which are members of the Paris Convention for the Protection of Industrial Property;
that the goods sold by the private respondent, on the one hand, and by the petitioner, on the other hand,
belong to the same class such that the private respondent's use of the same trademark in the Philippines
(which is a member of said Paris Convention) in connection with the goods he sells constitutes an act of
unfair competition, as denied in the Paris Convention.

Subsequently, the private respondent moved to dismiss the petition on the ground of res judicata,
averring that in 1973, or more than ten years before this petition was filed, the same petitioner filed two
petitions for cancellation and was a party to an interference proceeding, all of which involved the
trademark HUSH PUPPIES and DEVICE, before the Philippine Patent Office. The Director of Patents had
ruled in all three inter parties cases in favor of Ramon Angeles, the private respondent's predecessor-in-
interest.

The Court of Appeals affirmed tile above decision, finding the same to be in accordance with law
and supported by substantial evidence.

In the present case, after both parties had submitted their respective memoranda, the Director
of Patents rendered the questioned decision, DISMISSING the petition for cancellation.

On appeal, the Court of Appeals at first set aside the Director's decision; 5 however, upon
reconsideration the latter was revived.

Issue: W/N the petition for cancellation is barred by res judicata?

Held: Yes.
Contrary to the petitioner's assertion, the judgment in Inter Partes Cases Nos. 700, 701, and 709
had long since become final and executory. That Sec. 17 of Republic Act 166, also known as the Trademark
Law, allows the cancellation of a registered trademark is not a valid premise for the petitioner's
proposition that a decision granting registration of a trademark cannot be imbued with the character of
absolute finality as is required in res judicata. A judgment or order is final, as to give it the authority of res
judicata, if it can no longer be modified by the court issuing it or by any other court.

In the case at bar, the decision of the Court of Appeals affirming that of the Director of Patents,
in the cancellation cases filed in 1973, was never appealed to us. Consequently, when the period to appeal
from the Court of Appeals to this Court lapsed, with no appeal having been perfected, the foregoing
judgment denying cancellation of registration in the name of private respondent's predecessor-in-interest
but ordering cancellation of registration in the name of the petitioner's predecessor-in-interest, became
the settled law in the case.
Undoubtedly, final decisions, orders, and resolutions, of the Director of Patents are clothed with
a judicial character as they are, in fact, reviewable by the Court of Appeals and by us.

It is argued, however, that res judicata does not apply in this particular instance because when
the May 9, 1977 decision was handed down by the Director of Patents, Executive Order No. 913 dated
October 7, 1983 and the resulting memorandum of Minister Roberto Ongpin dated October 25, 1983 had
not yet been issued.

The petitioner underscores the following specific directive contained in the abovementioned
memorandum of Minister Ongpin for the Director of Patents:

5.All pending applications for Philippine registration of signature and other world famous
trademarks filed by applicants other than their original owners or users shall be rejected
forthwith. Where such applicants have already obtained registration contrary to the
abovementioned PARIS CONVENTION and/or Philippine Law, they shall be directed to
surrender their Certificates of Registration to the Philippine Patent Office for immediate
cancellation proceedings.

It is thus contended that despite the previous grant of registration to the private respondent, the
present petition for cancellation could still be brought, and the same should be granted by the Director of
Patents, pursuant to the abovequoted clause. Stated otherwise, the petitioner suggests that the petition
is not barred by res judicata because while the former petitions were filed under Republic Act 166, the
present one was brought pursuant to the cited memorandum which expressly sanctions the cancellation
of registration of a trademark granted even prior to the same memorandum.

In the first place, the subject memorandum never amended, nor was it meant to amend, the
Trademark Law. It did not indicate a new policy with respect to the registration in the Philippines of world-
famous trademarks. The protection against unfair competition, and other benefits, accorded to owners
of internationally known marks, as mandated by the Paris Convention, is already guaranteed under the
Trademark Law. 14 Thus, the subject memorandum, as well as Executive Order No. 913, merely reiterated
the policy already existing at the time of its issuance.

The aforesaid cases, involving as they were the registration of a trademark, necessarily litigated
the issue of ownership of such trademark because ownership is, indeed, the basis of registration of a
trademark. 18 Thus, Section 4 of R.A. 166 provides: ". . . The owner of a trademark, trade name or service-
mark used to distinguish his goods, business or services from the goods, business or services of others
shall have the right to register the same on the principal register. . . " Res judicata now bars the petitioner
from reopening, by way of another petition for cancellation (the present Inter Partes Case No. 1807), the
issue of ownership of the trademark HUSH PUPPIES. Otherwise, there will never be an end to litigation.

Superior Commercial Enterprises vs. Kunnan Enterprises

FACTS:
On October 1, 1982, after the expiration of its initial distributorship agreement with another company,
KUNNAN appointed SUPERIOR as its exclusive distributor in the Philippines under a Distributorship
Agreement. The agreement, among others, contained:

1. KUNNAN in accordance with this Agreement, will appoint the sole distributorship right
to Superior in the Philippines, and this Agreement could be renewed with the consent
of both parties upon the time of expiration.

2. The Superior, in accordance with this Agreement, shall assign the ownership of KENNEX
trademark, under the registration of Patent Certificate No. 4730 dated 23 May 1980 to
KUNNAN on the effects [sic] of its ten (10) years contract of distributorship, and it is
required that the ownership of the said trademark shall be genuine, complete as a
whole and without any defects.

Even though this Agreement clearly stated that SUPERIOR was obligated to assign the ownership
of the KENNEX trademark to KUNNAN, the latter claimed that the Certificate of Registration for the
KENNEX trademark remained with SUPERIOR because Mariano Tan Bon Diong (Mr. Tan Bon Diong),
SUPERIORs President and General Manager, misled KUNNANs officers into believing that KUNNAN
was not qualified to hold the same due to the many requirements set by the Philippine Patent
Office that KUNNAN could not meet.

KUNNAN further asserted that SUPERIOR deceived it into assigning its applications for registration
of the PRO KENNEX trademark in favor of SUPERIOR, through an Assignment Agreement dated June
14, 1983

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

ISSUE: Was Superior, as distributor, the true and rightful owners of the trademark?
HELD:

No. As a mere distributor, petitioner Superior undoubtedly had no right to register the questioned mark in
its name. Well-entrenched in our jurisdiction is the rule that the right to register a trademark should be
based on ownership. When the applicant is not the owner of the trademark being applied for, he has no
right to apply for the registration of the same. Under the Trademark Law, only the owner of the trademark,
trade name or service mark used to distinguish his goods, business or service from the goods, business or
service of others is entitled to register the same.

ON THE ISSUE OF INFRINGEMENT

In the present case, by operation of law, specifically Section 19 of RA 166, the trademark infringement
aspect of SUPERIORs case has been rendered moot and academic in view of the finality of the decision in
the Registration Cancellation Case. In short, SUPERIOR is left without any cause of action for trademark
infringement since the cancellation of registration of a trademark deprived it of protection from
infringement from the moment judgment or order of cancellation became final. To be sure, in a trademark
infringement, title to the trademark is indispensable to a valid cause of action and such title is shown by its
certificate of registration. With its certificates of registration over the disputed trademarks effectively
cancelled with finality, SUPERIORs case for trademark infringement lost its legal basis and no longer
presented a valid cause of action.

Even assuming that SUPERIORs case for trademark infringement had not been rendered moot and
academic, there can be no infringement committed by KUNNAN who was adjudged with finality to be the
rightful owner of the disputed trademarks in the Registration Cancellation Case. Even prior to the
cancellation of the registration of the disputed trademarks, SUPERIOR as a mere distributor and not the
owner cannot assert any protection from trademark infringement as it had no right in the first place to the
registration of the disputed trademarks. In fact, jurisprudence holds that in the absence of any inequitable
conduct on the part of the manufacturer, an exclusive distributor who employs the trademark of the
manufacturer does not acquire proprietary rights of the manufacturer, and a registration of the trademark
by the distributor as such belongs to the manufacturer, provided the fiduciary relationship does not
terminate before application for registration is filed.
In addition, we also note that the doctrine of res judicata bars SUPERIORs present case for trademark
infringement.

In the present case, the second concept conclusiveness of judgment applies. Under the concept of res
judicata by conclusiveness of judgment, a final judgment or decree on the merits by a court of competent
jurisdiction is conclusive of the rights of the parties or their privies in all later suits on points and matters
determined in the former suit. Stated differently, facts and issues actually and directly resolved in a former
suit cannot again be raised in any future case between the same parties, even if the latter suit may involve
a different cause of action. This second branch of the principle of res judicata bars the re-litigation of
particular facts or issues in another litigation between the same parties on a different claim or cause of
action.

Because the Registration Cancellation Case and the present case involve the same parties, litigating with
respect to and disputing the same trademarks, we are bound to examine how one case would affect the
other. In the present case, even if the causes of action of the Registration Cancellation Case (the
cancellation of trademark registration) differs from that of the present case (the improper or unauthorized
use of trademarks), the final judgment in the Registration Cancellation Case is nevertheless conclusive on
the particular facts and issues that are determinative of the present case.

To establish trademark infringement, the following elements must be proven: (1) the validity of plaintiffs
mark; (2) the plaintiffs ownership of the mark; and (3) the use of the mark or its colorable imitation by the
alleged infringer results in likelihood of confusion.

Based on these elements, we find it immediately obvious that the second element the plaintiffs ownership
of the mark was what the Registration Cancellation Case decided with finality. On this element depended
the validity of the registrations that, on their own, only gave rise to the presumption of, but was not
conclusive on, the issue of ownership

ON THE ISSUE OF UNFAIR COMPETITION

In the present case, no evidence exists showing that KUNNAN ever attempted to pass off the goods it sold
(i.e. sportswear, sporting goods and equipment) as those of SUPERIOR. In addition, there is no evidence of
bad faith or fraud imputable to KUNNAN in using the disputed trademarks. Specifically, SUPERIOR failed to
adduce any evidence to show that KUNNAN by the above-cited acts intended to deceive the public as to
the identity of the goods sold or of the manufacturer of the goods sold. In McDonalds Corporation v. L.C.
Big Mak Burger, Inc., we held that there can be trademark infringement without unfair competition such as
when the infringer discloses on the labels containing the mark that he manufactures the goods, thus
preventing the public from being deceived that the goods originate from the trademark owner. In this case,
no issue of confusion arises because the same manufactured products are sold; only the ownership of the
trademarks is at issue. Furthermore, KUNNANs January 29, 1993 notice by its terms prevents the public
from being deceived that the goods originated from SUPERIOR since the notice clearly indicated that
KUNNAN is the manufacturer of the goods bearing the trademarks KENNEX and PRO KENNEX.

Finally, with the established ruling that KUNNAN is the rightful owner of the trademarks of the
goods that SUPERIOR asserts are being unfairly sold by KUNNAN under trademarks registered in SUPERIORs
name, the latter is left with no effective right to make a claim. In other words, with the CAs final ruling in
the Registration Cancellation Case, SUPERIORs case no longer presents a valid cause of action. For this
reason, the unfair competition aspect of the SUPERIORs case likewise falls.

ESPIRITU VS PETRON

FACTS:

Respondent Petron sold and distributed liquefied petroleum gas (LPG) in cylinder tanks that carried its
trademark Gasul. Respondent Carmen J. Doloiras owned and operated Kristina Patricia Enterprises (KPE),
the exclusive distributor of Gasul LPGs in the whole of Sorsogon. Petitioner Audie Llona managed Bicol Gas,
which was also in the business of selling and distributing LPGs in Sorsogon but theirs carried the trademark
Bicol Savers Gas.

In the course of trade and competition, any given distributor of LPGs at times acquired possession of LPG
cylinder tanks belonging to other distributors operating in the same area. They called these captured
cylinders.

According to Jose, KPEs manager, in April 2001 Bicol Gas agreed with KPE for the swapping of captured
cylinders since one distributor could not refill captured cylinders with its own brand of LPG.
On August 4, 2001 KPEs Jose saw a particular Bicol Gas truck on the Maharlika Highway. While the truck
carried mostly Bicol Savers LPG tanks, it had on it one unsealed 50-kg Gasul tank and one 50-kg Shellane
tank. Jose followed the truck and when it stopped at a store, he asked the driver, Jun Leorena, and the Bicol
Gas sales representative, Jerome Misal, about the Gasul tank in their truck. They said it was empty but,
when Jose turned open its valve, he noted that it was not. Misal and Leorena then admitted that the Gasul
and Shellane tanks on their truck belonged to a customer who had them filled up by Bicol Gas.

Because of such incident, KPE filed a complaint for violations of Republic Act (R.A.) 623 (illegally filling up
registered cylinder tanks), as amended, and Sections 155 (infringement of trade marks) and 169.1 (unfair
competition) of the Intellectual Property Code (R.A. 8293).

ISSUES:

1. Was there Trademark infringement consisting in Bicol Gas use of a trademark that is confusingly
similar to Petrons registered Gasul trademark in violation of section 155 also of R.A. 8293?
2. Was there Unfair competition consisting in passing off Bicol Gas-produced LPGs for Petron-
produced Gasul LPG in violation of Section 168.3 of R.A. 8293.

HELD:

1. None.

For the crime of trademark infringement, Section 155 of R.A. 8293 (in relation to Section 1701[13])
provides that it is committed by any person who shall, without the consent of the owner of the
registered mark:

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

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

2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant

feature thereof and apply such reproduction, counterfeit, copy or colorable imitation to
 labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be
used in commerce upon or in connection with the sale, offering for sale, distribution, or
advertising of goods or services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive.

KPE and Petron have to show that the alleged infringer, the responsible officers and staff of Bicol
Gas, used Petrons Gasul trademark or a confusingly similar trademark on Bicol Gas tanks with intent
to deceive the public and defraud its competitor as to what it is selling.

The allegations in the complaint do not show that Bicol Gas painted on its own tanks Petrons Gasul
trademark or a confusingly similar version of the same to deceive its customers and cheat Petron. Indeed,
in this case, the one tank bearing the mark of Petron Gasul found in a truck full of Bicol Gas tanks was a
genuine Petron Gasul tank, more of a captured cylinder belonging to competition. No proof has been shown
that Bicol Gas has gone into the business of distributing imitation Petron Gasul LPGs.

2. None.

As to the charge of unfair competition, Section 168.3 (a) of R.A. 8293 (also in relation to Section 170)
describes the acts constituting the offense as follows:

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

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

Essentially, what the law punishes is the act of giving ones goods the general appearance of the goods of
another, which would likely mislead the buyer into believing that such goods belong to the latter. Examples
of this would be the act of manufacturing or selling shirts bearing the logo of an alligator, similar in design
to the open-jawed alligator in La Coste shirts, except that the jaw of the alligator in the former is closed, or
the act of a producer or seller of tea bags with red tags showing the shadow of a black dog when his
competitor is producing or selling popular tea bags with red tags showing the shadow of a black cat.

Here, there is no showing that Bicol Gas has been giving its LPG tanks the general appearance of the tanks
of Petrons Gasul. As already stated, the truckfull of Bicol Gas tanks that the KPE manager arrested on a road
in Sorsogon just happened to have mixed up with them one authentic Gasul tank that belonged to Petron.

_____________________________________________________________________________________

Lim Hoa v. director of Patents

100 SCRA 214
Facts:
On April 26, 1949, the Petitioner, Lim Hoa, filed with the Patent Office an application for the
registration of a trademark, consisting of a representation of two midget roosters in an attitude of combat
with the word “Bantam” printed above them, he claiming that he had used said trademark on a food
seasoning product since April 25 of that year. The application was published in the Official Gazette in its
issue of February, 1953, released for circulation on April 18, of the same year. On April 30, 1953, the
Agricom Development Co., Inc., a domestic corporation, opposed the application on several grounds,
among others, that the trademark sought to be registered was confusingly similar to its register mark,
consisting of a pictorial representation of a hen with the words “Hen Brand” and “Marca Manok”, which
mark or brand was also used on a food seasoning product, before the use of the trademark by the
applicant.
It is a fact that the family of C. Javier Advincula, since the year 1946, had adopted and used as a
trademark of said food seasoning product manufactured by it, the pictorial representation of a hen. In
1947, the members of the Advincula family organized the Agricom Development Co., Inc., the Oppositor in
this case, and said corporation took over the manufacture of the same food product of the Advincula
family, including the use of the brand of the pictorial representation of a hen but adding to it the word
“Hen”. In the year 1948, an addition was made to the brand with the words “Ve-Tsin, Hen Brand” and
“Marca Manok,” and since then, on its food seasoning product at different times, labels were used, in
different colors but bearing the representation of a hen and the words just mentioned. So that the
application to register applicant’s brand, consisting of two roosters is an attitude of combat, with the word
“Bantam” printed above them, came along after the use and registration of the mark or brand of
the Oppositor corporation and its predecessor, the Advincula family.
After considering the application and the opposition thereto, and after comparing the two brands,
the Director of Patents issued his order dated June 26, 1954, wherein he found and held that to allow the
registration of the applicant’s trademark would likely cause confusion or mistake or deceive purchasers,
and he refused registration of said trademark, under Rule 178 of the Revised Rules of Practice in
Trademark Cases, 1953. The Petitioner is now appealing said order.

Issue: W/N the marks were confusingly similar?

Held: Yes.
After a careful examination of the facts above mentioned, and after comparing the two brands,
we do not hesitate to say and to hold that there is such similarity between the two brands as to cause
confusion in the mind of the public that buys the food seasoning product on the strength and on the
indication of the trademark or brand identifying or distinguishing the same. In the case of Go Tiong Sa vs.
Director of Patents, (95 Phil., 1), we had occasion to say the following: chanroblesvirtuallawlibrary

It has been consistently held that the question of infringement of a trademark is to be determined by the
test of dominancy. Similarity in size, form, and color, while relevant, is not conclusive. If the competing trademark
contains the main or essential or dominant features of another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not necessary or it is necessary that the infringing label should
suggest an effort to imitate. (C. Neilman Brewing Co. vs. Independent Brewing Co., 191 F. 489, 495, citing Eagle White
Lead Co. v. Pflugh (CC) 180 Fed. 579). The question at issue in cases of infringement of trademarks is whether the
use of the marks involved would be likely to cause confusion or mistakes in the mind of the public or deceive
purchasers. (Auburn Rubber Corporation vs. Honover Rubber Co., 107 F 2d 588, 590, citing Procter and Gamble Co.
vs. J. L. Prescot Co., 49 F 2d 959, 18 CCPA, Patents, 1433Pepsodent Co. vs. Comfort Manufacturing Co., 83 F 2d
906; 23 CCPA, Patents, 124)”
The danger of confusion in trademarks and brands which are similar may not be so great in the
case of commodities or articles of relatively great value, such as, radio and television sets, air conditioning
units, machinery, etc., for the prospective buyer, generally the head of the family or a businessman, before
making the purchase, reads the pamphlets and all literature available, describing the article he is planning
to buy, and perhaps even makes comparisons with similar articles in the market. He is not likely to be
deceived by similarity in the trademarks because he makes a more or less thorough study of the same and
may even consult his friends about the relative merit and performance of the article or machinery, as
compared to others also for sale. But in the sale of a food seasoning product, a kitchen article of everyday
consumption, the circumstances are far different. Said product is generally purchased by cooks and
household help, sometimes illiterate who are guided by pictorial representations and the sound of the
word descriptive of said representation. The two roosters appearing in the trademark of the applicant and
the hen appearing on the trademark of the Oppositor, although of different sexes, belong to the same
family of chicken, known as manok in all the principal dialects of the Philippines, and when a cook or a
household help or even a housewife buys a food seasoning product for the kitchen the brand of “Manok”
or “Marca Manok” would most likely be upper most in her mind and would influence her in selecting the
product, regardless of whether the brand pictures a hen or a rooster or two roosters. To her, they are all
manok. Therein lies the confusion, even deception.
We do not see why applicant could not have stretched his imagination even a little and extended
his choice to other members of the animal kingdom, as a brand to differentiate his product from similar
products in the market. In a similar case decided by this Tribunal wherein, although one brand consisting
of the representation of a rooster was already being used by one party, another party wanted to register
a similar brand, consisting of two roosters on a similar product, namely, candy, this Court said: chanroblesvirtuallawlibrary

“Counsel for Defendant insists that there is no real resemblance between a picture of one rooster and a
picture of two roosters; that no person could or would be deceived by the use by theDefendant of a trade-mark
wholly distinct from that of the Plaintiff; that the fact that theDefendant used two roosters as its trademark clearly
discloses its innocence of any intent to deceive, since a comparison of the trade-mark of the Plaintiff with that of
the Defendant makes apparent at once that was not intended to be an imitation of the other.
“We ask, however, why, with all the birds in the air, and all the fishes in the sea, and all the animals on the
face of the earth to choose from, the Defendant company selected two roosters as its trade- mark, although its
directors, and managers must have been well aware of the long-continued use of a rooster by the Plaintiff in
connection with the sale and advertisement of his goods?
In view of the foregoing, the order appealed from is hereby affirmed, with costs. We do not deem
it necessary to discuss and rule upon the other questions raised in the appeal.
G.R. No. 112012 April 4, 2001

SOCIETE DES PRODUITS NESTLE, S.A. and NESTLE PHILIPPINES, INC vs.
COURT OF APPEALS and CFC CORPORATION.,

FACTS:

private respondent CFC Corporation filed with the BPTTT an application for the registration of the
trademark "FLAVOR MASTER" for instant coffee, The applicatioN, was published in the July 18, 1988 issue
of the BPTTT’s Official Gazette.

Petitioner Societe Des Produits Nestle, S.A., a Swiss company registered under Swiss laws and
domiciled in Switzerland, filed an unverified Notice of Opposition,3 claiming that the trademark of private
respondent’s product is "confusingly similar to its trademarks for coffee and coffee extracts, to wit:
MASTER ROAST and MASTER BLEND."

Likewise, a verified Notice of Opposition was filed by Nestle Philippines, Inc., a Philippine
corporation and a licensee of Societe Des Produits Nestle S.A., against CFC’s application for registration of
the trademark FLAVOR MASTER. Nestle claimed that the use, if any, by CFC of the trademark FLAVOR
MASTER and its registration would likely cause confusion in the trade; or deceive purchasers and would
falsely suggest to the purchasing public a connection in the business of Nestle, as the dominant
word present in the three (3) trademarks is "MASTER"; or that the goods of CFC might be mistaken as
having originated from the latter.

In answer to the two oppositions, CFC argued that its trademark, FLAVOR MASTER, is not
confusingly similar with the former’s trademarks, MASTER ROAST and MASTER BLEND, alleging that,
"except for the word MASTER (which cannot be exclusively appropriated by any person for being a
descriptive or generic name), the other words that are used respectively with said word in the three
trademarks are very different from each other – in meaning, spelling, pronunciation, and sound". CFC
further argued that its trademark, FLAVOR MASTER, "is clearly very different from any of Nestle’s alleged
trademarks MASTER ROAST and MASTER BLEND, especially when the marks are viewed in their entirety,
by considering their pictorial representations, color schemes and the letters of their respective labels."

BPTTT denied CFC’s application for registration. the Court of Appeals reversed Decision No. 90-47 of the
BPTTT and ordered the Director of Patents to approve CFC’s application.

ISSUE: whether the trademark FLAVOR MASTER is a colorable imitation of the trademarks MASTER
ROAST and MASTER BLEND?

COURT’S RULING:
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.9 In
determining if colorable imitation exists, jurisprudence has developed two kinds of tests - the Dominancy
Test and the Holistic Test.10 The test of dominancy focuses on the similarity of the prevalent features of
the competing trademarks which might cause confusion or deception and thus constitute infringement.
On the other side of the spectrum, the holistic test mandates that the entirety of the marks in question
must be considered in determining confusing similarity

As the Court of Appeals itself has stated, "[t]he determination of whether two trademarks are
indeed confusingly similar must be taken from the viewpoint of the ordinary purchasers who are, in
general, undiscerningly rash in buying the more common and less expensive household products like
coffee, and are therefore less inclined to closely examine specific details of similarities and dissimilarities
between competing products."21

The Court of Appeals held that the test to be applied should be the totality or holistic test
reasoning, since what is of paramount consideration is the ordinary purchaser who is, in general,
undiscerningly rash in buying the more common and less expensive household products like coffee, and
is therefore less inclined to closely examine specific details of similarities and dissimilarities between
competing products.

This Court cannot agree with the above reasoning. If the ordinary purchaser is "undiscerningly
rash" in buying such common and inexpensive household products as instant coffee, and would therefore
be "less inclined to closely examine specific details of similarities and dissimilarities" between the two
competing products, then it would be less likely for the ordinary purchaser to notice that CFC’s trademark
FLAVOR MASTER carries the colors orange and mocha while that of Nestle’s uses red and brown. The
application of the totality or holistic test is improper since the ordinary purchaser would not be inclined
to notice the specific features, similarities or dissimilarities, considering that the product is an inexpensive
and common household item.

It must be emphasized that the products bearing the trademarks in question are "inexpensive and
common" household items bought off the shelf by "undiscerningly rash" purchasers. As such, if the
ordinary purchaser is "undiscerningly rash", then he would not have the time nor the inclination to make
a keen and perceptive examination of the physical discrepancies in the trademarks of the products in
order to exercise his choice.

While this Court agrees with the Court of Appeals’ detailed enumeration of differences between
the respective trademarks of the two coffee products, this Court cannot agree that totality test is the one
applicable in this case. Rather, this Court believes that the dominancy test is more suitable to this case in
light of its peculiar factual milieu. The totality or holistic test is contrary to the elementary postulate of
the law on trademarks and unfair competition that confusing similarity is to be determined on the basis
of visual, aural, connotative comparisons and overall impressions engendered by the marks in controversy
as they are encountered in the realities of the marketplace.

In addition, the word "MASTER" is neither a generic nor a descriptive term. As such, said term can
not be invalidated as a trademark and, therefore, may be legally protected. Rather, the term "MASTER" is
a suggestive term brought about by the advertising scheme of Nestle. Suggestive terms27 are those which,
in the phraseology of one court, require "imagination, thought and perception to reach a conclusion as to
the nature of the goods." Such terms, "which subtly connote something about the product," are eligible
for protection in the absence of secondary meaning. While suggestive marks are capable of shedding
"some light" upon certain characteristics of the goods or services in dispute, they nevertheless involve "an
element of incongruity," "figurativeness," or " imaginative effort on the part of the observer."

This is evident from the advertising scheme adopted by Nestle in promoting its coffee products.
In this case, Nestle has, over time, promoted its products as "coffee perfection worthy of masters like
Robert Jaworski and Ric Puno Jr."

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.

Emerald Garment v. CA
G.R. No. 100098 Dec 29, 1995

Facts:
On 18 September 1981, private respondent H.D. Lee Co., Inc., a foreign corporation organized
under the laws of Delaware, U.S.A., filed with the Bureau of Patents, a Petition for Cancellation of
Registration No. SR 5054 for the trademark "STYLISTIC MR. LEE" used on skirts, jeans, blouses, socks,
briefs, jackets, jogging suits, dresses, shorts, shirts and lingerie issued on 27 October 1980 in the name of
petitioner Emerald Garment Manufacturing Corporation, a domestic corporation organized and existing
under Philippine laws.

Private respondent, invoking Sec. 37 of R.A. No. 166 (Trademark Law) and Art. VIII of the Paris
Convention for the Protection of Industrial Property, averred that petitioner's trademark "so closely
resembled its own trademark, 'LEE' as previously registered and used in the Philippines, and not
abandoned, as to be likely, when applied to or used in connection with petitioner's goods, to cause
confusion, mistake and deception on the part of the purchasing public as to the origin of the goods.
In its answer dated 23 March 1982, petitioner contended that its trademark was entirely and
unmistakably different from that of private respondent and that its certificate of registration was legally
and validly granted.

On 20 February 1984, petitioner caused the publication of its application for registration of the
trademark "STYLISTIC MR. LEE" in the Principal Register."

On 27 July 1984, private respondent filed a notice of opposition to petitioner's application for
registration also on grounds that petitioner's trademark was confusingly similar to its "LEE" trademark.
On 19 July 1988, the Director of Patents rendered a decision granting private respondent's petition for
cancellation and opposition to registration; finding the private respondent to be the prior registrant of
the trademark "LEE" in the Philippines and that it had been using said mark in the Philippines.
Moreover, the Director of Patents, using the test of dominancy, declared that petitioner's trademark was
confusingly similar to private respondent's mark because "it is the word 'Lee' which draws the attention
of the buyer and leads him to conclude that the goods originated from the same manufacturer. It is
undeniably the dominant feature of the mark.
 On 3 August 1988, petitioner appealed to the Court of Appeals. On 29 November 1990, the Court
of Appeals promulgated its decision affirming the decision of the Director of Patents dated 19 July 1988
in all respects.
n said decision the Court of Appeals expounded, thus:
Xxx xxx xxx
Whether or not a trademark causes confusion and is likely to deceive the public is a question of
fact which is to be resolved by applying the "test of dominancy", meaning, if the competing trademark
contains the main or essential or dominant features of another by reason of which confusion and deception
are likely to result, then infringement takes place; that duplication or imitation is not necessary, a similarity
in the dominant features of the trademark would be sufficient.

The word "LEE" is the most prominent and distinctive feature of the appellant's trademark and all
of the appellee's "LEE" trademarks. It is the mark which draws the attention of the buyer and leads him to
conclude that the goods originated from the same manufacturer. While it is true that there are other words
such as "STYLISTIC", printed in the appellant's label, such word is printed in such small letters over the word
"LEE" that it is not conspicuous enough to draw the attention of ordinary buyers whereas the word "LEE" is
printed across the label in big, bold letters and of the same color, style, type and size of lettering as that of
the trademark of the appellee. The alleged difference is too insubstantial to be noticeable. Even granting
arguendo that the word "STYLISTIC" is conspicuous enough to draw attention, the goods may easily be
mistaken for just another variation or line of garments under the ap appelle's "LEE" trademarks in view of
the fact that the appellee has registered trademarks which use other words in addition to the principal mark
"LEE" such as "LEE RIDERS", "LEESURES" and "LEE LEENS". The likelihood of confusion is further made more
probable by the fact that both parties are engaged in the same line of business. It is well to reiterate that
the determinative factor in ascertaining whether or not the marks are confusingly similar to each other is
not whether the challenged mark would actually cause confusion or deception of the purchasers but
whether the use of such mark would likely cause confusion or mistake on the part of the buying public.
Xxx xxx xxx

Issue: W/N petitioner’s trademark STYLYSTIC MR. LEE is consfusingly similar with respondent’s trademark
LEE?

Held: No.
The pertinent provision of R.A. No. 166 (Trademark Law) states thus:
Sec. 22. Infringement, what constitutes. — Any person who shall use, without the consent
of the registrant, any reproduction, counterfeit, copy or colorable imitation of any registered mark
or trade-name in connection with the sale, offering for sale, or advertising of any goods, business
or services on or in connection with which such use is likely to cause confusion or mistake or to
deceive purchasers or others as to the source or origin of such goods or services, or identity of
such business; or reproduce, counterfeit, copy or colorably imitable any such mark or trade-name
and apply such reproduction, counterfeit, copy, or colorable imitation to labels, signs, prints,
packages, wrappers, receptacles or advertisements intended to be used upon or in connection
with such goods, business or services; shall be liable to a civil action by the registrant for any or all
of the remedies herein provided.

Proceeding to the task at hand, the essential element of infringement is colorable imitation. This
term has been defined as "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."
 In determining whether colorable imitation exists, jurisprudence has developed two kinds of tests
— the Dominancy Test applied in Asia Brewery, Inc. v. Court of Appeals 28 and other cases 29 and the
Holistic Test developed in Del Monte Corporation v. Court of Appeals.

As its title implies, 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. If
the competing trademark contains the main or essential or dominant features of another, and confusion
and deception is likely to result, infringement takes place. Duplication or imitation is not necessary; nor it
is necessary that the infringing label should suggest an effort to imitate.

On the other side of the spectrum, the holistic test mandates that the entirety of the marks in
question must be considered in determining confusing similarity. In determining whether the trademarks
are confusingly similar, a comparison of the words is not the only determinant factor. The trademarks in
their entirety as they appear in their respective labels or hang tags must also be considered in relation to
the goods to which they are attached. The discerning eye of the observer must focus not only on the
predominant words but also on the other features appearing in both labels in order that he may draw his
conclusion whether one is confusingly similar to the other.

Applying the foregoing tenets to the present controversy and taking into account the factual
circumstances of this case, we considered the trademarks involved as a whole and rule that petitioner's
"STYLISTIC MR. LEE" is not confusingly similar to private respondent's "LEE" trademark.
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.

First, the products involved in the case at bar are, in the main, various kinds of jeans. These are
not your ordinary household items like catsup, soysauce or soap which are of minimal cost. Maong pants
or jeans are not inexpensive. Accordingly, the casual buyer is predisposed to be more cautious and
discriminating in and would prefer to mull over his purchase. Confusion and deception, then, is less likely.

Second, like his beer, the average Filipino consumer generally buys his jeans by brand. He does
not ask the sales clerk for generic jeans but for, say, a Levis, Guess, Wrangler or even an Armani. He is,
therefore, more or less knowledgeable and familiar with his preference and will not easily be distracted.
Finally, in line with the foregoing discussions, more credit should be given to the "ordinary purchaser."
Cast in this particular controversy, the ordinary purchaser is not the "completely unwary consumer" but
is the "ordinarily intelligent buyer" considering the type of product involved.

The definition laid down in Dy Buncio v. Tan Tiao Bok is better suited to the present case. There,
the "ordinary purchaser" was defined as one "accustomed to buy, and therefore to some extent familiar
with, the goods in question. The test of fraudulent simulation is to be found in the likelihood of the
deception of some persons in some measure acquainted with an established design and desirous of
purchasing the commodity with which that design has been associated. The test is not found in the
deception, or the possibility of deception, of the person who knows nothing about the design which has
been counterfeited, and who must be indifferent between that and the other. The simulation, in order to
be objectionable, must be such as appears likely to mislead the ordinary intelligent buyer who has a need
to supply and is familiar with the article that he seeks to purchase."
 As we have previously intimated the issue of confusing similarity between trademarks is resolved
by considering the distinct characteristics of each case. In the present controversy, taking into account
these unique factors, we conclude that the similarities in the trademarks in question are not sufficient as
to likely cause deception and confusion tantamount to infringement.

Del Monte Corporation Vs. Court Of Appeals

Facts:

Petitioner Del Monte Corporation is a foreign company organized and existing under the laws of the United
States and not engaged in business in the Philippines. On 1969, Del Monte granted Philippine Packing Corp.
the right to manufacture, distribute, and sell in the Philippines various products, including catsup, under
the Del Monte trademark and logo. Del Monte authorized Philpack to register the Del Monte trademark as
well as the Del Monte catsup bottle configuration in the Philippine Patent Office. Meanwhile, on 1980,
respondent Sunshine sauce Manufacturing Industries was issued a certificate of registration by the Bureau
of Domestic Trade to engage in the manufacturing, distribution, packing, and selling of various kinds of
sauce under the logo Sunshine Fruit Product. After receiving reports that respondent Sunshine was using
the bottles (which respondent bought from junkshops and subsequently recycled) exclusively designed by
the petitioner and a logo confusingly similar to that of the latter, PhilPack warned the respondent to desist
from doing so on pain of legal action. Thereafter, claiming that the demand has been ignored, Philpack filed
a case of trademark infringement and unfair competition against respondent.

Respondent's contention: In its answer, Sunshine alleged that it had ceased to use the Del Monte bottle and
that its logo was substantially different from the Del Monte logo and would not confuse the buying public
to the detriment of the petitioners.

Ruling of RTC: The Regional Trial Court of Makati dismissed the complaint. It held that there were
substantial differences between the logos or trademarks of the parties and there was good faith on the
part of respondent by desisting to useof Del Monte bottles. The decision was affirmed in toto by the Court
of Appeals.

ISSUE: Whether or not Sunshine committed infringement against Del Monte in the use of its logos and bottles.

HELD:

Yes. 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 precognizant words but also on the other features
appearing on both labels. It has been correctly held that side-by-side comparison is not the final test of
similarity. In determining whether a trademark has been infringed, we must consider the mark as a whole
and not as dissected.
 The Court is agreed that are indeed distinctions, but similarities holds a greater weight in this case.
The Sunshine label is a colorable imitation of the Del Monte trademark. What is undeniable is the fact that
when a manufacturer prepares to package his product, he has before him a boundless choice of words,
phrases, colors and symbols sufficient to distinguish his product from the others. Sunshine chose, without
a reasonable explanation, to use the same colors and letters as those used by Del Monte though the field
of its selection was so broad, the inevitable conclusion is that it was done deliberately to deceive. With
regard to the bottle use, Sunshine despite the many choices available to it and notwithstanding that the
caution "Del Monte Corporation, Not to be Refilled" was embossed on the bottle, still opted to use the
petitioners' bottle to market a product which Philpack also produces. This clearly shows the private
respondent's bad faith and its intention to capitalize on the latter's reputation and goodwill and pass off its
own product as that of Del Monte.

Etepha Vs. Diretor Of Patents

FACTS:

On April 23, 1959, respondent Westmont Pharmaceuticals, Inc., a New York corporation, sought
registration of trademark “Atussin” placed on its “medicinal preparation of expectorant antihistaminic,
bronchodilator sedative, ascorbic acid (Vitamin C) used in the treatment of cough”. The trademark is used
exclusively in the Philippines since January 21, 1959. Petitioner, Etepha, A.G., a Liechtenstein (principality)
corporation, objected. Petitioner claims that it will be damaged because Atussin is so confusedly similar to
its Pertussin (Registration No. 6089, issued on September 25, 1957) used on a preparation for the
treatment of coughs, that the buying public will be misled into believing that Westmont’s product is that
of petitioner’s which allegedly enjoys goodwill.

ISSUE: May trademark ATUSSIN be registered, given the fact that PERTUSSIN, another trademark, had been
previously registered in the Patent Office?

Ruling of the Director of Patents: Affirmative. Hence, this appeal. The Supreme Court affirmed the decision
of the Director of Patents.

HELD:

YES. We concede the possibility that buyers might be able to obtain Pertussin or Atussin without
prescription. When this happens, then the buyer must be one thoroughly familiar with what he intends to
get, else he would not have the temerity to ask for a medicine — specifically needed to cure a given ailment.
In which case, the more improbable it will be to palm off one for the other. For a person who purchases
with open eyes is hardly the man to be deceived.
 For the reasons given below, the appealed decision of respondent Director of Patents, — giving
due course to the application for the registration of trademark ATUSSIN, is hereby affirmed.

1.TRADEMARKS; OBJECTS OF. — The objects of a trademark are to point out distinctly the origin or
ownership of the article to which it is affixed, to secure to him who has been instrumental in bringing into
market a superior article of merchandise the fruit of his industry and skill, and to prevent fraud and
imposition.

2. INFRINGEMENT OF TRADEMARKS; “COLORABLE IMITATION” EXPLAINED. — The validity of a cause for

infringement is predicated upon colorable imitation. The phrase “colorable imitation” denotes such a “close
or ingenious imitation as to be calculated to deceive ordinary persons, or such a resemblance to the original
as to deceive an ordinary purchaser giving such attention as a purchaser usually gives, and to cause him to
purchase the one supposing it to be the other.” (87 C.J.S., p. 287.)

3. MARK BARRED FROM REGISTRATION; WORD “TUSSIN”, HOW MAY IT BECOME SUBJECT OF TRADEMARK.
— “TUSSIN” is merely descriptive; it is generic; it furnishes to the buyer no indication of the origin of the
goods; it is open for appropriation by anyone. It is accordingly barred from registration as trademark. But
while “tussin” by itself cannot thus be used exclusively to identify one’s goods, it may properly become the
subject of a trademark “by combination with another word or phrase”. (Annotations, Lawyers’ Reports,
Annotated, 1918 A, p. 966.)

4. SIMILARITY AND DISSIMILARITY OF TRADEMARKS. HOW DETERMINED. — A practical approach to the

problem of similarity or dissimilarity is to go into the whole of the two trademarks pictured in their manner
of display. Inspection should be undertaken from the viewpoint of prospective buyer. The trademark
complained of should be compared and contrasted with the purchaser’s memory (not in juxtaposition) of
the trade mark said to be infringed. (87 C.J.S., pp. 288-291) Some such factors as `sound; appearance; form,
style, shape, size or format; color; ideas connoted by marks; the meaning, spelling, and pronunciation of
words used; and the setting in which the words appear” may be considered, (87 C.J.S., pp. 291-292.) For,
indeed, trademark infringement is a form of unfair competition. (Clarke vs. Manila Candy Co., 36 Phil. 100,
106; Co Tiong Sa vs. Director of Patents, 95 Phil., 1, 4,)

5. WHEN THERE IS CONFUSION BETWEEN TRADEMARK. — Confusion is likely between trademarks only if
their over-all presentations in any of the particulars of sound, appearance, or meaning are such as would
lead the purchasing public into believing that the products to which the marks are applied emanated from
the same source.

6. “PERTUSSIN” AND “ATUSSIN” COMPARED. — Considering the two labels in question — Pertussin and
Atussin — as they appear on the respective labels, these words are presented to the public in different
styles of writing and methods of design. The horizontal plain, block letters of Atussin and the diagonally and
artistically upward writing of Pertussin leave distinct visual impressions. One look is enough to denude the
mind of that illuminating similarity so essential for a trademark infringement case to prosper. Moreover,
the two words do not sound alike — when pronounced. There is not as much as phonetic similarity between
the two. In Pertussin the pronunciation of the prefix “Per”, whether correct or incorrect, includes a
combination of three letters P, e and r; whereas, in Atussin the whole word starts with the single letter A
added to the suffix “tussin”. Appeals to the ear are dissimilar. And this, because in a word- combination,
the part that comes first is the most pronounced.

7. SOLUTION OF TRADEMARK INFRINGEMENT; CLASS OF PERSONS WHO BUY SHOULD BE CONSIDERED. — In

the solution of a trademark infringement problem, regard too should be given to the class of persons who
buy the particular product and the circumstances ordinarily attendant to its acquisition. (87 C.J.S., p. 295).
The medicinal preparations, clothed with the trade marks in question, are unlike articles of everyday use
such as candies, ice cream, milk, soft drinks and the like which may be freely obtained by anyone, anytime,
anywhere. Petitioner’s and respondent’s products are to be dispensed upon medical prescription. An
intending buyer must have to go first to a licensed doctor of medicine; he receives instructions as to what
to purchase; he examines the product sold to him; he checks to find out whether it conforms to the medical
prescription. Similarly, the pharmacist or druggist verifies the medicine sold. The margin of error in the
acquisition of one for the other is quite remote. It is possible that buyers might be able to obtain Pertussin
or Atussin without prescription. When this happens, then the buyer must be one thoroughly familiar with
what he intends to get, else he would not have the temerity to ask for a medicine — specifically needed to
cure a given ailment. For a person who purchases with open eyes is hardly the man to be deceived.

G.R. No. L-23035 July 31, 1975

PHILIPPINE NUT INDUSTRY, INC., petitioner,

vs.
STANDARD BRANDS INCORPORATED and TIBURCIO S. EVALLE as Director of Patents, respondents.

MUNOZ PALMA, J.:

FACTS:

Philippine Nut, a domestic corporation, obtained from the Patent Office on August 10, 1961, Certificate of
Registration No. SR-416 covering the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS," the label
used on its product of salted peanuts.

On May 14, 1962, Standard Brands a foreign corporation, filed with the Director of Patents Inter Partes
Case No. 268 asking for the cancellation of Philippine Nut's certificate of registration on the ground that
"the registrant was not entitled to register the mark at the time of its application for registration thereof"
for the reason that it (Standard Brands) is the owner of the trademark "PLANTERS COCKTAIL PEANUTS"
covered by Certificate of Registration No. SR-172, issued by the Patent Office on July 28, 1958. Standard
Brands alleged in its petition that Philippine Nut's trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS"
closely resembles and is confusingly similar to its trademark "PLANTERS COCKTAIL PEANUTS" used also
on salted peanuts, and that the registration of the former is likely to deceive the buying public and cause
damage to it.
On June 1, 1962, Philippine Nut filed its answer invoking the special defense that its registered label is not
confusingly similar to that of Standard Brands as the latter alleges.

The stipulations agreed by the parties are: (1) that Standard Brands is the present owner of the trademark
"PLANTERS COCKTAIL PEANUTS" covered by Certificate of Registration No. SR-172 issued on July 28, 1958;
(2) that Standard Brands trademark was first used in commerce in the Philippines in December, 1938 and
(3) that Philippine Nut's trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" was first used in the
Philippines on December 20, 1958 and registered with the Patent Office on August 10, 1961.

On December 10, 1963, respondent Director of Patents rendered Decision No. 281 giving due course to
Standard Brand's petition and ordering the cancellation of Philippine Nut's Certificate of Registration No.
SR-416. The Director of Patents found and held that in the labels using the two trademarks in question,
the dominant part is the word "Planters", displayed "in a very similar manner" so much so that "as to
appearance and general impression" there is "a very confusing similarity," and he concluded that
Philippine Nut "was not entitled to register the mark at the time of its filing the application for
registration" as Standard Brands will be damaged by the registration of the same. Its motion for
reconsideration having been denied, Philippine Nut came up to this Court for a review of said decision.

ISSUE:

Is the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" used by Philippine Nut on its label for salted
peanuts confusingly similar to the trademark "PLANTERS COCKTAIL PEANUTS" used by Standard Brands
on its product so as to constitute an infringement of the latter's trademark rights and justify its
cancellation?

RULING:

(1)The first argument advanced by petitioner which We believe goes to the core of the matter in litigation
is that the Director of Patents erred in holding that the dominant portion of the label of Standard Brands
in its cans of salted peanuts consists of the word PLANTERS which has been used in the label of Philippine
Nut for its own product. PLANTERS cannot be considered as the dominant feature of the trademarks in
question because it is a mere descriptive term. While it is true that PLANTERS is an ordinary word,
nevertheless it is used in the labels not to describe the nature of the product, but to project the source
or origin of the salted peanuts contained in the cans. The word PLANTERS printed across the upper
portion of the label in bold letters easily attracts and catches the eye of the ordinary consumer and it is
that word and none other that sticks in his mind when he thinks of salted peanuts. In cases of this nature
there can be no better evidence as to what is the dominant feature of a label and as to whether there
is a confusing similarity in the contesting trademarks than the labels themselves. A visual and graphic
presentation of the labels will constitute the best argument for one or the other
(2)The next argument of petitioner is that respondent Director should not have based his decision simply
on the use of the term PLANTERS, and that what he should have resolved is whether there is a confusing
similarity in the trademarks of the parties. It is quite obvious from the record, that respondent Director's
decision is based not only on the fact that petitioner herein adopted the same dominant mark of
Standard Brands, that is, the word PLANTERS, but that it also used in its label the same coloring scheme
of gold, blue, and white, and basically the same lay-out of words such as "salted peanuts" and "vacuum
packed" with similar type and size of lettering as appearing in Standard Brands' own trademark, all of
which result in a confusing similarity between the two labels.

It is correctly observed by respondent Director that the merchandize or goods being sold by the parties
herein are very ordinary commodities purchased by the average person and many times by the ignorant
and unlettered 6 and these are the persons who will not as a rule examine the printed small letterings on
the container but will simply be guided by the presence of the striking mark PLANTERS on the label.
Differences there will always be, but whatever differences exist, these pale into insignificance in the face
of an evident similarity in the dominant feature and overall appearance of the labels of the parties.

(3) What is next submitted by petitioner is that it was error for respondent Director to have enjoined it
from using PLANTERS in the absence of evidence showing that the term has acquired secondary
meaning. The applicability of the doctrine of secondary meaning to the situation now before Us is
appropriate because there is oral and documentary evidence showing that the word PLANTERS has
been used by and closely associated with Standard Brands for its canned salted peanuts since 1938 in
this country. This Court held that the doctrine is to the effect that a word or phrase originally incapable
of exclusive appropriation with reference to an article on the market, because geographically or otherwise
descriptive, might nevertheless have been used so long and so exclusively by one producer with reference
to his article that, in that trade and to that branch of the purchasing public, the word or phrase has come
to mean that the article was his product. Petitioner contends that Standard Brands' use of the trademark
PLANTERS was interrupted during the Japanese occupation and in fact was discontinued when the
importation of peanuts was prohibited by Central Bank regulations effective July 1, 1953, hence it cannot
be presumed that it has acquired a secondary meaning. We hold otherwise. Respondent Director correctly
applied the rule that non-use of a trademark on an article of merchandize due to legal restrictions or
circumstances beyond one's control is not to be considered as an abandonment.

AFFIRM the decision of respondent Director of Patents with costs against petitioner.

_____________________________________________________________________________________
______________________

AMIGO MANUFACTURING, Inc., petitioner, vs. CLUETT PEABODY CO., INC., respondent.

G.R. No. 139300. March 14, 2001

PANGANIBAN, J
FACTS:

The facts, which are undisputed, are summarized by the Court of Appeals in its original Decision, as
follows:

The source of the controversy that precipitated the filing by Cluett Peabody Co., Inc. (a New York
corporation) of the present case against Amigo Manufacturing Inc. (a Philippine corporation) for
cancellation of trademark is respondents claim of exclusive ownership (as successor in interest of Great
American Knitting Mills, Inc.) of the following trademark and devices, as used on mens socks:

a) GOLD TOE, under Certificate of Registration No. 6797 dated September 22, 1958;

b) DEVICE, representation of a sock and magnifying glass on the toe of a sock, under Certificate of
Registration No. 13465 dated January 25, 1968;

c) DEVICE, consisting of a plurality of gold colored lines arranged in parallel relation within a 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

d) LINENIZED, under Certificate of Registration No. 15440 dated April 13, 1970.

On the other hand, petitioners trademark and device GOLD TOP, Linenized for Extra Wear has the
dominant color white at the center and a blackish brown background with a magnified design of the socks
garter, and is labeled Amigo Manufacturing Inc., Mandaluyong, Metro Manila, Made in the Philippines.

This case was heard the decision signed and issued by the Director of Patents adversely against the
respondent Amigo Manufacturing, Inc. as heretofore mentioned. Upon appeal to the CA, in its
reconsideration, they found respondents motion for reconsideration meritorious. 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 or 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 question is not whether the two
articles are distinguishable by their label when set aside 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 confounding it with the original. The most successful form of copying is to employ enough points of
similarity to confuse the public with enough points of difference to confuse the courts. Furthermore,
petitioner’s mark is only registered with the Supplemental Registry which gives no right of exclusivity to
the owner and cannot overturn the presumption of validity and exclusivity given to a registered mark.

ISSUES:
(1) the date of actual use of the two trademarks; (2) their confusing similarities, and (3) the
applicability of the Paris Convention.

RULING:

(1)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. We do not agree. Based on the evidence presented, this Court concurs
in the findings of the Bureau of Patents that respondent had actually used the trademark and the
devices in question prior to petitioner’s use of its own. During the hearing at the Bureau of Patents,
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, of respondent’s ownership of those marks, the dates
of appropriation and the validity of other pertinent facts stated therein. Indeed, Section 20 of
Republic Act 166 provides as follows:
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.
Furthermore, petitioner registered its trademark only with the supplemental register. In La
Chemise Lacoste v. Fernandez, the Court held that registration with the supplemental register gives
no presumption of ownership of the trademark. The registration of a mark upon the supplemental
register is not, as in the case of the principal register, prima facie evidence of (1) the validity of
registration; (2) registrants ownership of the mark; and (3) registrants exclusive right to use the
mark. It is not subject to opposition, although it may be cancelled after its issuance. Neither may it
be the subject of interference proceedings. Registration in the supplemental register is not
constructive notice of registrant’s claim of ownership. A supplemental register is provided for the
registration because of some defects (conversely, defects which make a mark unregistrable on the
principal register, yet do not bar them from the supplemental register.)

(2)Petitioner points out that the director of patents erred in its application of the idem
sonans rule, claiming that the two trademarks Gold Toe and Gold Top do not sound alike and are
pronounced differently. It avers that since the words gold and toe are generic, respondent has no
right to their exclusive use. The arguments of petitioner are incorrect. True, it would not be guilty of
infringement on the basis alone of the similarity in the sound of petitioners Gold Top with that of
respondents Gold Toe. Admittedly, the pronunciations of the two do not, by themselves, create
confusion. The Bureau of Patents, however, did not rely on the idem sonans test alone in arriving at
its conclusion. The Bureau considered the drawings and the labels, the appearance of the labels, the
lettering, and the representation of a man’s foot wearing a sock. Obviously, its conclusion is based on
the totality of the similarities between the parties trademarks and not on their sounds alone.
 In Emerald Garment Manufacturing Corporation v. Court of Appeals, this Court stated that in
determining whether trademarks are confusingly similar, jurisprudence has developed two kinds of
tests, the Dominancy Test and the Holistic Test. In the present case, a resort to either the Dominancy
Test or the Holistic Test shows that colorable imitation exists between respondents Gold Toe and
petitioners Gold Top. A glance at petitioners mark shows that it definitely has a lot of similarities and
in fact looks like a combination of the trademark and devices that respondent has already registered;
namely, Gold Toe, the representation of a sock with a magnifying glass, the Gold Toe representation
and linenized. 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.

(3) Petitioner claims that the Court of Appeals erred in applying the Paris Convention. Although
respondent registered its trademark ahead, petitioner argues that the actual use of the said mark is
necessary in order to be entitled to the protection of the rights acquired through registration. As
already discussed, respondent registered its trademarks under the principal register, which means
that the requirement of prior use had already been fulfilled. To emphasize, Section 5-A of Republic
Act 166 requires the date of first use to be specified in the application for registration. Since the
trademark was successfully registered, there exists a prima facie presumption of the correctness of
the contents thereof, including the date of first use. Petitioner has failed to rebut this presumption.
Thus, applicable is the Union Convention for the Protection of Industrial Property adopted in Paris on
March 20, 1883, otherwise known as the Paris Convention, of which the Philippines and the United
States are members. Respondent is domiciled in the United States and is the registered owner of the
Gold Toe trademark. Hence, it is entitled to the protection of the Convention.

WHEREFORE, the Petition is hereby DENIED and the assailed Resolution AFFIRMED. Costs against
petitioner.

DERMALINE INC. V. MYRA PHARMACEUTICALS

FACTS:

 On October 21, 2006, petitioner Dermaline, Inc. (Dermaline) filed before the Intellectual
Property Office (IPO) an application for registration of the trademark DERMALINE
DERMALINE, INC. (Application No. 4-2006011536). The application was published for
Opposition in the IPO E-Gazette on March 9, 2007.
 On May 8, 2007, respondent Myra Pharmaceuticals, Inc. (Myra) filed a Verified
Opposition[4] alleging:
- that the trademark sought to be registered by Dermaline so resembles its trademark
DERMALIN and will likely cause confusion, mistake and deception to the purchasing
public.
 - that the registration of Dermaline’s trademark will violate Section 123[5] of Republic
Act (R.A.) No. 8293 (Intellectual Property Code of the Philippines).
- that Dermaline’s use and registration of its applied trademark will diminish the
distinctiveness and dilute the goodwill of Myra’s DERMALIN, registered with the IPO
way back July 8, 1986, renewed for ten (10) years on July 8, 2006. Myra has been
extensively using DERMALIN commercially since October 31, 1977, and said mark is
still valid and subsisting.

RESPONDENT’S CONTENTION:

 Myra claimed that, despite Dermaline’s attempt to differentiate its applied mark, the
dominant feature is the term DERMALINE, which is practically identical with its own
DERMALIN, more particularly that the first eight (8) letters of the marks are identical, and
that notwithstanding the additional letter E by Dermaline, the pronunciation for both
marks are identical. Further, both marks have three (3) syllables each, with each syllable
identical in sound and appearance, even if the last syllable of DERMALINE consisted of
four (4) letters while DERMALIN consisted only of three (3).
 Myra also pointed out that Dermaline applied for the same mark DERMALINE on June 3,
2003 and was already refused registration by the IPO. By filing this new application for
registration, Dermaline appears to have engaged in a fishing expedition for the approval
of its mark. Myra argued that its intellectual property right over its trademark is protected
under Section 147[6] of R.A. No. 8293.
 Myra asserted that the mark DERMALINE DERMALINE, INC. is aurally similar to its own
mark such that the registration and use of Dermaline’s applied mark will enable it to
obtain benefit from Myra’s reputation, goodwill and advertising and will lead the public
into believing that Dermaline is, in any way, connected to Myra.
 Myra added that even if the subject application was under Classification 44[7] for various
skin treatments, it could still be connected to the DERMALIN mark under Classification
5[8] for pharmaceutical products, since ultimately these goods are very closely related.

PETITIONER’S CONTENTION:

 Dermaline countered that a simple comparison of the trademark DERMALINE

DERMALINE, INC. vis--vis Myra’s DERMALIN trademark would show that they have
entirely different features and distinctive presentation, thus it cannot result in confusion,
mistake or deception on the part of the purchasing public.
 that, in determining if the subject trademarks are confusingly similar, a comparison of the
words is not the only determinant, but their entirety must be considered in relation to
the goods to which they are attached, including the other features appearing in both
labels.
  that there were glaring and striking dissimilarities between the two trademarks, such that
its trademark DERMALINE DERMALINE, INC. speaks for itself (Res ipsa loquitur).
 Dermaline further argued that there could not be any relation between its trademark for
health and beauty services from Myra’s trademark classified under medicinal goods
against skin disorders.

The parties failed to settle amicably. Consequently, the preliminary conference was terminated
and they were directed to file their respective position papers.[10]

IPO RULING:

 In favor of Myra. Rejected TM application of DERMALINE, DERMALINE, INC.

 MR Denied
 Appeal to Director General of IPO, dismissed for being filed out of time.

CA RULING:

 Affirmed IPO Ruling, rejected TM application.

 MR also denied

ISSUE: WoN CA erred in denying DERMALINE’s petition for registration.

HELD: NO

 A trademark is any distinctive word, name, symbol, emblem, sign, or device, or any
combination thereof, adopted and used by a manufacturer or merchant on his goods to
identify and distinguish them from those manufactured, sold, or dealt by others.[15]
Inarguably, it is an intellectual property deserving protection by law. In trademark
controversies, each case must be scrutinized according to its peculiar circumstances,
such that jurisprudential precedents should only be made to apply if they are specifically
in point.[16]
 As Myra correctly posits, as a registered trademark owner, it has the right under Section
147 of R.A. No. 8293 to prevent third parties from using a trademark, or similar signs or
containers for goods or services, without its consent, identical or similar to its registered
trademark, where such use would result in a likelihood of confusion.

- In determining likelihood of confusion, case law has developed two (2) tests, the
Dominancy Test and the Holistic or Totality Test.
- The Dominancy Test focuses on the similarity of the prevalent features of the
competing trademarks that might cause confusion or deception.[17] It is applied
when the trademark sought to be registered contains the main, essential and
 dominant features of the earlier registered trademark, and confusion or deception is
likely to result. Duplication or imitation is not even required; neither is it necessary
that the label of the applied mark for registration should suggest an effort to imitate.
The important issue is whether the use of the marks involved would likely cause
confusion or mistake in the mind of or deceive the ordinary purchaser, or one who is
accustomed to buy, and therefore to some extent familiar with, the goods in
question.[18] Given greater consideration are the aural and visual impressions
created by the marks in the public mind, giving little weight to factors like prices,
quality, sales outlets, and market segments.[19] The test of dominancy is now
explicitly incorporated into law in Section 155.1 of R.A. No. 8293
- On the other hand, the Holistic Test entails a consideration of the entirety of the marks
as applied to the products, including labels and packaging, in determining confusing
similarity. The scrutinizing eye of the observer must focus not only on the
predominant words but also on the other features appearing in both labels so that a
conclusion may be drawn as to whether one is confusingly similar to the other.[20]
- Jurisprudence has noted two (2) types of confusion, viz: (1) confusion of goods
(product confusion), where the ordinarily prudent purchaser would be induced to
purchase one product in the belief that he was purchasing the other; and (2) confusion
of business (source or origin confusion), where, although the goods of the parties are
different, the product, the mark of which registration is applied for by one party, is
such as might reasonably be assumed to originate with the registrant of an earlier
product, and the public would then be deceived either into that belief or into the
belief that there is some connection between the two parties, though inexistent.[21]

 We agree with the findings of the IPO. In rejecting the application of Dermaline for the
registration of its mark DERMALINE DERMALINE, INC., the IPO applied the Dominancy
Test. It declared that both confusion of goods and service and confusion of business or of
origin were apparent in both trademarks. It also noted that, per Bureau Decision No.
2007-179 dated December 4, 2007, it already sustained the opposition of Myra involving
the trademark DERMALINE of Dermaline under Classification 5.
 The IPO also upheld Myra’s right under Section 138 of R.A. No. 8293, which provides that
a certification of registration of a mark is prima facie evidence of the validity of the
registration, the registrants ownership of the mark, and of the registrants exclusive right
to use the same in connection with the goods and those that are related thereto specified
in the certificate.
 while there are no set rules that can be deduced as what constitutes a dominant feature
with respect to trademarks applied for registration; usually, what are taken into account
are signs, color, design, peculiar shape or name, or some special, easily remembered
 earmarks of the brand that readily attracts and catches the attention of the ordinary
consumer.[22
 Dermaline’s insistence that its applied trademark DERMALINE DERMALINE, INC. had
differences too striking to be mistaken from Myras DERMALIN cannot, therefore, be
sustained. While it is true that the two marks are presented differently Dermaline’s mark
is written with the first DERMALINE in script going diagonally upwards from left to right,
with an upper case D followed by the rest of the letters in lower case, and the portion
DERMALINE, INC. is written in upper case letters, below and smaller than the long-hand
portion; while Myra’s mark DERMALIN is written in an upright font, with a capital D and
followed by lower case letters the likelihood of confusion is still apparent. This is because
they are almost spelled in the same way, except for Dermaline’s mark which ends with
the letter E, and they are pronounced practically in the same manner in three (3) syllables,
with the ending letter E in Dermaline’s mark pronounced silently. Thus, when an ordinary
purchaser, for example, hears an advertisement of Dermaline’s applied trademark over
the radio, chances are he will associate it with Myras registered mark.
 Dermaline’s stance that its product belongs to a separate and different classification from
Myra’s products with the registered trademark does not eradicate the possibility of
mistake on the part of the purchasing public to associate the former with the latter,
especially considering that both classifications pertain to treatments for the skin.
- The Court is cognizant that the registered trademark owner enjoys protection in product
and market areas that are the normal potential expansion of his business.
- Thus, the public may mistakenly think that Dermaline is connected to or associated with
Myra, such that, considering the current proliferation of health and beauty products in
the market, the purchasers would likely be misled that Myra has already expanded its
business through Dermaline from merely carrying pharmaceutical topical applications for
the skin to health and beauty services.
 Verily, when one applies for the registration of a trademark or label which is almost the
same or that very closely resembles one already used and registered by another, the
application should be rejected and dismissed outright, even without any opposition on
the part of the owner and user of a previously registered label or trademark. This is
intended not only to avoid confusion on the part of the public, but also to protect an
already used and registered trademark and an established goodwill.[24]
 Moreover, the decision of the IPO had already attained finality when Dermaline failed to
timely file its appeal with the IPO Office of the Director General.

WHEREFORE, the petition is DENIED. The Decision dated August 7, 2009 and the
Resolution dated October 28, 2009 of the Court of Appeals in CA-G.R. SP No. 108627 are
AFFIRMED. Costs against petitioner.
 SKECHERS V. INTER PACIFIC

FACTS:

 Petitioner filed with Branch 24 of the Regional Trial Court (RTC) of Manila 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, otherwise known as the Intellectual Property Code of the
Philippines.2
 In the course of its business, petitioner has registered the trademark "SKECHERS" 3 and
the trademark "S" (within an oval design)4 with the Intellectual Property Office (IPO).
 Two search warrants5 were issued by the RTC and were served on the premises of
respondents. As a result of the raid, more than 6,000 pairs of shoes bearing the "S" logo
were seized.
 Later, respondents moved to quash the search warrants, arguing that there was no
confusing similarity between petitioner’s "Skechers" rubber shoes and its "Strong" rubber
shoes.
 On November 7, 2002, the RTC issued an Order6 quashing the search warrants and
directing the NBI to return the seized goods. The RTC agreed with respondent’s view that
Skechers rubber shoes and Strong rubber shoes have glaring differences such that an
ordinary prudent purchaser would not likely be misled or confused in purchasing the
wrong article.
 Aggrieved, petitioner filed a petition for certiorari7 with the Court of Appeals (CA)
assailing the RTC Order. On November 17, 2003, the CA issued a Decision8 affirming the
ruling of the RTC.
 Trendworks International Corporation filed a Petition-in-Intervention claiming to be the
sole licensed distributor of Skechers products here in the Philippines

ISSUE: Whether or not respondent is guilty of Trademark Infringement

RTC Ruling

 Applied the Holistic Test in ruling that respondent had not infringed petitioner’s
trademark. For its part, the RTC noted the following supposed dissimilarities between the
shoes, to wit:

1. The mark "S" found in Strong Shoes is not enclosed in an "oval design."
2. The word "Strong" is conspicuously placed at the backside and insoles.
3. The hang tags and labels attached to the shoes bears the word "Strong" for respondent and
"Skechers U.S.A." for private complainant;
4. Strong shoes are modestly priced compared to the costs of Skechers Shoes.19
CA Ruling:

 Also applied the Holistic test and ruled in favor of respondent

 The use of the letter "S" could hardly be considered as highly identifiable to the products
of petitioner alone. The letter "S" has been used in so many existing trademarks, the most
popular of which is the trademark "S" enclosed by an inverted triangle, which is
identifiable to Superman.

HELD:

 The basic law on trademark, infringement, and unfair competition is Republic Act (R.A.)
No. 8293. Specifically, Section 155 of R.A. No. 8293 states:

Remedies; Infringement. — Any person who shall, without the consent of the owner of
the registered mark: 155.1. Use in commerce any reproduction, counterfeit, copy, or
colorable imitation of a registered mark or the same container or a dominant feature
thereof in connection with the sale, offering for sale, distribution, advertising of any goods
or services including other preparatory steps necessary to carry out the sale of any goods
or services on or in connection with which such use is likely to cause confusion, or to cause
mistake, or to deceive; or

155.2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant

feature thereof and apply such reproduction, counterfeit, copy or colorable imitation to
labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be
used in commerce upon or in connection with the sale, offering for sale, distribution, or
advertising of goods or services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive, shall be liable in a civil action for
infringement by the registrant for the remedies hereinafter set forth: Provided, That the
infringement takes place at the moment any of the acts stated in Subsection 155.1 or this
subsection are committed regardless of whether there is actual sale of goods or services
using the infringing material.15

 The essential element of infringement under R.A. No. 8293 is that the infringing mark is
likely to cause confusion. In determining similarity and likelihood of confusion,
jurisprudence has developed tests the Dominancy Test and the Holistic or Totality Test.
(Refer to Dermaline Case re Holistic and Dominancy Test Discussion)
 Applying the Dominancy Test to the case at bar, this Court finds that the use of the stylized
"S" by respondent in its Strong rubber shoes infringes on the mark already registered by
petitioner with the IPO. While it is undisputed that petitioner’s stylized "S" is within an
oval design, to this Court’s mind, the dominant feature of the trademark is the stylized
"S," as it is precisely the stylized "S" which catches the eye of the purchaser. Thus, even if
respondent did not use an oval design, the mere fact that it used the same stylized "S",
 the same being the dominant feature of petitioner’s trademark, already constitutes
infringement under the Dominancy Test.
 Furthermore, respondent did not simply use the letter "S," but it appears to this Court
that based on the font and the size of the lettering, the stylized "S" utilized by respondent
is the very same stylized "S" used by petitioner; a stylized "S" which is unique and
distinguishes petitioner’s trademark. Indubitably, the likelihood of confusion is present as
purchasers will associate the respondent’s use of the stylized "S" as having been
authorized by petitioner or that respondent’s product is connected with petitioner’s
business.
 While there may be dissimilarities between the appearances of the shoes, to this Court’s
mind such dissimilarities do not outweigh the stark and blatant similarities in their general
features. As can be readily observed by simply comparing petitioner’s Energy20 model and
respondent’s Strong21 rubber shoes, as to the color scheme and “wavelike” midsole and
outer sole patterns are very similar, if not exactly the same. At the side of the midsole
near the heel of both shoes are two elongated designs in practically the same location.
Even the outer soles of both shoes have the same number of ridges, five at the back and
six in front. On the side of respondent’s shoes, near the upper part, appears the stylized
"S," placed in the exact location as that of the stylized "S" on petitioner’s shoes. On top
of the "tongue" of both shoes appears the stylized "S" in practically the same location and
size. Moreover, at the back of petitioner’s shoes, near the heel counter, appears
"Skechers Sport Trail" written in white lettering. However, on respondent’s shoes appears
"Strong Sport Trail" noticeably written in the same white lettering, font size, direction and
orientation as that of petitioner’s shoes. On top of the heel collar of petitioner’s shoes are
two grayish-white semi-transparent circles. Not surprisingly, respondent’s shoes also
have two grayish-white semi-transparent circles in the exact same location.lihpwa1
 It cannot be any more clear and apparent to this Court that there is colorable imitation.
The dissimilarities between the shoes are too trifling and frivolous that it is indubitable
that respondent’s products will cause confusion and mistake in the eyes of the public.
Respondent’s shoes may not be an exact replica of petitioner’s shoes, but the features
and overall design are so similar and alike that confusion is highly likely.
 In Converse Rubber Corporation v. Jacinto Rubber & Plastic Co., Inc.,22 this Court, in a case
for unfair competition, had opined that even if not all the details are identical, as long as
the general appearance of the two products are such that any ordinary purchaser would
be deceived, the imitator should be liable.
 Neither can the difference in price be a complete defense in trademark infringement. In
McDonald’s Corporation v. L.C. Big Mak Burger. Inc., (see ruling)
 Withal, the protection of trademarks as intellectual property is intended not only to
preserve the goodwill and reputation of the business established on the goods bearing
the mark through actual use over a period of time, but also to safeguard the public as
consumers against confusion on these goods.27 While respondent’s shoes contain some
dissimilarities with petitioner’s shoes, this Court cannot close its eye to the fact that for
all intents and purpose, respondent had deliberately attempted to copy petitioner’s mark
and overall design and features of the shoes. Let it be remembered, that defendants in
cases of infringement do not normally copy but only make colorable changes.28 The most
successful form of copying is to employ enough points of similarity to confuse the public,
with enough points of difference to confuse the courts.29

WHEREFORE, premises considered, the Motion for Reconsideration is GRANTED. The

Decision dated November 30, 2006 is RECONSIDERED and SET ASIDE.

SO ORDERED.