Willaware Products Corporation v. Jessichris Manufacturing Corp.

GR No. 195549
September 3, 2014

Facts:
Jessichris Manufacturing is a partnership engaged in the manufacture and distribution of plastic and metal
products, while Willaware Products is engaged in the manufacture and distribution of kitchenware items
made of plastic and metal and has its office near Jessichris.
In view of the physical proximity of their respective offices and the fact that some employees of Jessichris
transferred to Willaware, Willaware developed familiarity with the products of Jessichris.
Sometime in 2000, Jessichris discovered that Willaware had been manufacturing and distributing the same
automotive parts with exactly a similar design, material and colors as that of Jessichris, but selling them at a
lower price.
Jessichris alleged that the copying of Willaware constitutes unfair competition and has caused them to lose P
2M worth of profit.
Willaware countered that there can be no unfair competition because such products just conforms to the
standard sizes that fits for every car. Even for the sake of argument that they copied Jessichris, Willaware
contends that it has no exclusive rights over the products because they have no patent over it.
RTC ruled that Willaware acts of deliberately copying and performing acts similar to that of Jessichris is
tantamount to unfair competition.
CA affirmed RTC

Issue/s:
1. WON Willaware committed acts amounting to unfair competition under Art 28 CC

Ruling:
1. Yes. The law does not prohibit competition per se, but the use of unjust, oppressive, or high handed methods
which may deprive others a fair chance to engage in business or to earn a living.
o There are two characteristics of an unfair competition: (a) it must involve an injury to a competitor
or a trade rival and (b) it must involve acts which are characterized as contrary to good conscience
or shocking to judicial sensibilities or otherwise unlawful.
o In this case, both characteristics are present.
o First, both parties are competitors or trade rivals engaged in the manufacture of plastic-made
automative parts.]
o Second, the acts of Willaware is contrary to good conscience as it employed Jessichris previous
employees, deliberately copied Jessichris products to the extent of stealing their customers.
Willaware hired the services of Jessichris mold setter and maintenance operator instead
of relying on their own.
Willaware employed the delivery man of Jessichris after being accussed as a spy.
o Aside from that, it is obvious that Willaware engaged in unfair competition by suddenly shifting its
business from manufacturing kitchenware products to plastic-made automotive parts.

WHEREFORE, the petition is DENIED.