MIGHTY CORP. vs.

E&J GALLO

G.R. NO. 154342

FACTS:

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

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

In their answer, petitioners alleged, among other affirmative defenses that: petitioners Gallo cigarettes
and Gallo Winery’s wine were totally unrelated products. To wit:

1. Gallo Winery’s GALLO trademark registration certificates covered wines only, and not cigarettes;

2. GALLO cigarettes and GALLO wines were sold through different channels of trade;

3. the target market of Gallo Winery’s wines was the middle or high-income bracket while Gallo cigarette
buyers were farmers, fishermen, laborers and other low-income workers;

4. that the dominant feature of the Gallo cigarette was the rooster device with the manufacturer’s name
clearly indicated as MIGHTY CORPORATION, while in the case of Gallo Winery’s wines, it was the full
names of the founders-owners ERNEST & JULIO GALLO or just their surname GALLO;

The Makati RTC denied, for lack of merit, respondent’s prayer for the issuance of a writ of preliminary
injunction. CA likewise dismissed respondent’s petition for review on certiorari.

After the trial on the merits, however, the Makati RTC held petitioners liable for committing trademark
infringement and unfair competition with respect to the GALLO trademark.

On appeal, the CA affirmed the Makati RTC’s decision and subsequently denied petitioner’s motion for
reconsideration.
ISSUE/S: Whether GALLO cigarettes and GALLO wines were identical, similar or related goods for the
reason alone that they were purportedly forms of vice.

RULING: NO.

Wines and cigarettes are not identical, similar, competing or related goods.

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

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

· the class of product to which the good belong

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

· the nature and cost of the articles

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

· the purpose of the goods

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

· the field of manufacture

· the conditions under which the article is usually purchased and

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

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

The petitioners are not liable for trademark infringement, unfair competition or damages.