G.R. No.

183404 : October 13, 2010 Abyadang filed a motion for reconsideration, and Berris, in turn, filed its opposition
to the motion.
BERRIS AGRICULTURAL CO., INC., Petitioner, v. NORVY
ABYADANG, Respondent.cralaw On August 2, 2006, Director Abelardo issued Resolution No. 2006-
09(D)7cra1aw (BLA resolution), denying the motion for reconsideration and
disposing as follows
DECISION

IN VIEW OF THE FOREGOING, the Motion for Reconsideration filed by the

NACHURA, J.:
Respondent-Applicant is hereby DENIED FOR LACK OF MERIT. Consequently,
Decision No. 2006-24 dated April 28, 2006 STANDS.
This petition for review1cra1aw on certiorari under Rule 45 of the Rules of Court
seeks the reversal of the Decision dated April 14, 20082cra1aw and the Resolution
Let the filewrapper of the trademark "NS D-10 PLUS" subject matter under
dated June 18, 20083cra1aw of the Court of Appeals (CA) in CA-G.R. SP No. 99928.
consideration be forwarded to the Bureau of Trademarks for appropriate action in
accordance with this Resolution.
The antecedents
SO ORDERED.8chanroblesvirtuallawlibrary
On January 16, 2004, respondent Norvy A. Abyadang (Abyadang), proprietor of NS
Northern Organic Fertilizer, with address at No. 43 Lower QM, Baguio City, filed with
Aggrieved, Abyadang filed an appeal on August 22, 2006 with the Office of the
the Intellectual Property Office (IPO) a trademark application for the mark "NS D-10
Director General, Intellectual Property Philippines (IPPDG), docketed as Appeal No.
PLUS" for use in connection with Fungicide (Class 5) with active ingredient 80%
14-06-13.
Mancozeb. The application, under Application Serial No. 4-2004-00450, was given
due course and was published in the IPO e-Gazette for opposition on July 28, 2005.
With the filing of the parties respective memoranda, Director General Adrian S.
Cristobal, Jr. of the IPPDG rendered a decision dated July 20, 2007,9cra1aw ruling
On August 17, 2005, petitioner Berris Agricultural Co., Inc. (Berris), with business
as follows
address in Barangay Masiit, Calauan, Laguna, filed with the IPO Bureau of Legal
Affairs (IPO-BLA) a Verified Notice of Opposition4cra1aw against the mark under
application allegedly because "NS D-10 PLUS" is similar and/or confusingly similar to Wherefore, premises considered[,] the appeal is hereby DENIED. Accordingly, the
its registered trademark "D-10 80 WP," also used for Fungicide (Class 5) with active appealed Decision of the Director is hereby AFFIRMED.
ingredient 80% Mancozeb. The opposition was docketed as IPC No. 14-2005-00099.
Let a copy of this Decision as well as the trademark application and records be
After an exchange of pleadings, on April 28, 2006, Director Estrellita Beltran- furnished and returned to the Director of Bureau of Legal Affairs for appropriate
Abelardo (Director Abelardo) of the IPO-BLA issued Decision No. 2006- action. Further, let also the Directors of the Bureau of Trademarks, the
245cra1aw (BLA decision), the dispositive portion of which reads Administrative, Financial and Human Resources Development Services Bureau, and
the library of the Documentation, Information and Technology Transfer Bureau be
furnished a copy of this Decision for information, guidance, and records purposes.
WHEREFORE, viewed in the light of all the foregoing, this Bureau finds and so holds
that Respondent-Applicants mark "NS D-10 PLUS" is confusingly similar to the
Opposers mark and as such, the opposition is hereby SUSTAINED. Consequently, SO ORDERED.10chanroblesvirtuallawlibrary
trademark application bearing Serial No. 4-2004-00450 for the mark "NS D-10
PLUS" filed on January 16, 2004 by Norvy A. Ab[yada]ng covering the goods
Undeterred, Abyadang filed a petition for review11cra1aw before the CA.
fungicide under Class 5 of the International Classification of goods is, as it is hereby,
REJECTED.
In its Decision dated April 14, 2008, the CA reversed the IPPDG decision. It held
Let the filewrapper of the trademark "NS D-10 PLUS" subject matter under
consideration be forwarded to the Administrative, Financial and Human Resources In sum, the petition should be granted due to the following reasons: 1) petitioners
Development Services Bureau (AFHRDSB) for appropriate action in accordance with mark "NS D-10 PLUS" is not confusingly similar with respondents trademark "D-10
this Order with a copy to be furnished the Bureau of Trademark (BOT) for 80 WP"; 2) respondent failed to establish its ownership of the mark "D-10 80 WP"
information and to update its records. and 3) respondents trademark registration for "D-10 80 WP" may be cancelled in
the present case to avoid multiplicity of suits.
SO ORDERED.6chanroblesvirtuallawlibrary
WHEREFORE, the petition is GRANTED. The decision dated July 20, 2007 of the IPO
Director General in Appeal No. 14-06-13 (IPC No. 14-2005-00099) is REVERSED
and SET ASIDE, and a new one is entered giving due course to petitioners
application for registration of the mark "NS D-10 PLUS," and canceling respondents
trademark registration for "D-10 80 WP."
SO ORDERED.12chanroblesvirtuallawlibrary
Berris filed a Motion for Reconsideration, but in its June 18, 2008 Resolution, the CA
denied the motion for lack of merit. Hence, this petition anchored on the following
arguments
I. The Honorable Court of Appeals finding that there exists no confusing similarity
between Petitioners and respondents marks is based on misapprehension of facts,
surmise and conjecture and not in accord with the Intellectual Property Code and
applicable Decisions of this Honorable Court [Supreme Court].
II. The Honorable Court of Appeals Decision reversing and setting aside the
technical findings of the Intellectual Property Office even without a finding or, at the
very least, an allegation of grave abuse of discretion on the part of said agency is
not in accord with law and earlier pronouncements of this Honorable Court
[Supreme Court].
III. The Honorable Court of Appeals Decision ordering the cancellation of herein
Petitioners duly registered and validly existing trademark in the absence of a
properly filed Petition for Cancellation before the Intellectual Property Office is not in
accord with the Intellectual Property Code and applicable Decisions of this
Honorable Court [Supreme Court].13chanroblesvirtuallawlibrary
The basic law on trademark, infringement, and unfair competition is Republic Act
(R.A.) No. 829314cra1aw(Intellectual Property Code of the Philippines), specifically
Sections 121 to 170 thereof. It took effect on January 1, 1998. Prior to its
effectivity, the applicable law was R.A. No. 166,15cra1aw as amended.
Interestingly, R.A. No. 8293 did not expressly repeal in its entirety R.A. No. 166,
but merely provided in Section 239.116cra1aw that Acts and parts of Acts
inconsistent with it were repealed. In other words, only in the instances where a
substantial and irreconcilable conflict is found between the provisions of R.A. No.
8293 and of R.A. No. 166 would the provisions of the latter be deemed repealed.
R.A. No. 8293 defines a "mark" as any visible sign capable of distinguishing the
goods (trademark) or services (service mark) of an enterprise and shall include a
stamped or marked container of goods.17cra1aw It also defines a "collective mark"
as any visible sign designated as such in the application for registration and capable
of distinguishing the origin or any other common characteristic, including the quality
of goods or services of different enterprises which use the sign under the control of
the registered owner of the collective mark.18chanroblesvirtuallawlibrary
On the other hand, R.A. No. 166 defines a "trademark" as any distinctive word,
name, symbol, emblem, sign, or device, or any combination thereof, adopted and
used by a manufacturer or merchant on his goods to identify and distinguish them
from those manufactured, sold, or dealt by another.19cra1aw A trademark, being a
special property, is afforded protection by law. But for one to enjoy this legal
protection, legal protection ownership of the trademark should rightly be
established.
The ownership of a trademark is acquired by its registration and its actual use by
the manufacturer or distributor of the goods made available to the purchasing
public. Section 12220cra1aw of R.A. No. 8293 provides that the rights in a mark
shall be acquired by means of its valid registration with the IPO. A certificate of
registration of a mark, once issued, constitutes prima facie evidence of the validity
of the registration, of the registrants ownership of the mark, and of the registrants
exclusive right to use the same in connection with the goods or services and those
that are related thereto specified in the certificate.21cra1aw R.A. No. 8293, however,
requires the applicant for registration or the registrant to file a declaration of actual
use (DAU) of the mark, with evidence to that effect, within three (3) years from the
filing of the application for registration; otherwise, the application shall be refused
or the mark shall be removed from the register.22cra1aw In other words, the prima
facie presumption brought about by the registration of a mark may be challenged
and overcome, in an appropriate action, by proof of the nullity of the registration or
of non-use of the mark, except when excused.23cra1aw Moreover, the presumption
may likewise be defeated by evidence of prior use by another person, i.e., it will
controvert a claim of legal appropriation or of ownership based on registration by a
subsequent user. This is because a trademark is a creation of use and belongs to
one who first used it in trade or commerce.24chanroblesvirtuallawlibrary
The determination of priority of use of a mark is a question of fact. Adoption of the
mark alone does not suffice. One may make advertisements, issue circulars,
distribute price lists on certain goods, but these alone will not inure to the claim of
ownership of the mark until the goods bearing the mark are sold to the public in the
market. Accordingly, receipts, sales invoices, and testimonies of witnesses as
customers, or orders of buyers, best prove the actual use of a mark in trade and
commerce during a certain period of time.25chanroblesvirtuallawlibrary
In the instant case, both parties have submitted proof to support their claim of
ownership of their respective trademarks.
Culled from the records, Berris, as oppositor to Abyadangs application for
registration of his trademark, presented the following evidence: (1) its trademark
application dated November 29, 200226cra1aw with Application No. 4-2002-
0010272; (2) its IPO certificate of registration dated October 25,
2004,27cra1aw with Registration No. 4-2002-010272 and July 8, 2004 as the date of
registration; (3) a photocopy of its packaging28cra1aw bearing the mark "D-10 80
WP"; (4) photocopies of its sales invoices and official receipts;29cra1aw and (5) its
notarized DAU dated April 23, 2003,30cra1aw stating that the mark was first used on
June 20, 2002, and indicating that, as proof of actual use, copies of official receipts
or sales invoices of goods using the mark were attached as Annex "B."
On the other hand, Abyadangs proofs consisted of the following: (1) a photocopy of
the packaging31cra1awfor his marketed fungicide bearing mark "NS D-10 PLUS"; (2)
Abyadangs Affidavit dated February 14, 2006,32cra1aw stating among others that
the mark "NS D-10 PLUS" was his own creation derived from: N for Norvy, his
name; S for Soledad, his wifes name; D the first letter for December, his birth
month; 10 for October, the 10th month of the year, the month of his business name
registration; and PLUS to connote superior quality; that when he applied for
registration, there was nobody applying for a mark similar to "NS D-10 PLUS"; that
he did not know of the existence of Berris or any of its products; that "D-10" could
not have been associated with Berris because the latter never engaged in any
commercial activity to sell "D-10 80 WP" fungicide in the local market; and that he
could not have copied Berris mark because he registered his packaging with the
Fertilizer and Pesticide Authority (FPA) ahead of Berris; (3) Certification dated
December 19, 200533cra1aw issued by the FPA, stating that "NS D-10 PLUS" is
owned and distributed by NS Northern Organic Fertilizer, registered with the FPA
since May 26, 2003, and had been in the market since July 30, 2003; (4)
Certification dated October 11, 200534cra1aw issued by the FPA, stating that, per
monitoring among dealers in Region I and in the Cordillera Administrative Region
registered with its office, the Regional Officer neither encountered the fungicide with
mark "D-10 80 WP" nor did the FPA provincial officers from the same area receive
any report as to the presence or sale of Berris product; (5) Certification dated March
14, 200635cra1aw issued by the FPA, certifying that all pesticides must be registered
with the said office pursuant to Section 936cra1aw of Presidential Decree (P.D.) No.
114437cra1aw and Section 1, Article II of FPA Rules and Regulations No. 1, Series of
1977; (6) Certification dated March 16, 200638cra1aw issued by the FPA, certifying
that the pesticide "D-10 80 WP" was registered by Berris on November 12, 2004;
and (7) receipts from Sunrise Farm Supply39cra1aw in La Trinidad, Benguet of the
sale of Abyadangs goods referred to as "D-10" and "D-10+."
Based on their proffered pieces of evidence, both Berris and Abyadang claim to be
the prior user of their respective marks.
We rule in favor of Berris.
Berris was able to establish that it was using its mark "D-10 80 WP" since June 20,
2002, even before it filed for its registration with the IPO on November 29, 2002, as
shown by its DAU which was under oath and notarized, bearing the stamp of the
Bureau of Trademarks of the IPO on April 25, 2003,40cra1awand which stated that it
had an attachment as Annex "B" sales invoices and official receipts of goods bearing
the mark. Indeed, the DAU, being a notarized document, especially when received
in due course by the IPO, is evidence of the facts it stated and has the presumption
of regularity, entitled to full faith and credit upon its face. Thus, the burden of proof
to overcome the presumption of authenticity and due execution lies on the party
contesting it, and the rebutting evidence should be clear, strong, and convincing as
to preclude all controversy as to the falsity of the certificate.41cra1aw What is more,
the DAU is buttressed by the Certification dated April 21, 200642cra1aw issued by
the Bureau of Trademarks that Berris mark is still valid and existing.
Hence, we cannot subscribe to the contention of Abyadang that Berris DAU is
fraudulent based only on his assumption that Berris could not have legally used the
mark in the sale of its goods way back in June 2002 because it registered the
product with the FPA only on November 12, 2004. As correctly held by the IPPDG in
its decision on Abyadangs appeal, the question of whether or not Berris violated
P.D. No. 1144, because it sold its product without prior registration with the FPA, is
a distinct and separate matter from the jurisdiction and concern of the IPO. Thus,
even a determination of violation by Berris of P.D. No. 1144 would not controvert
the fact that it did submit evidence that it had used the mark "D-10 80 WP" earlier
than its FPA registration in 2004.
Furthermore, even the FPA Certification dated October 11, 2005, stating that the
office had neither encountered nor received reports about the sale of the fungicide
"D-10 80 WP" within Region I and the Cordillera Administrative Region, could not
negate the fact that Berris was selling its product using that mark in 2002,
especially considering that it first traded its goods in Calauan, Laguna, where its
business office is located, as stated in the DAU.
Therefore, Berris, as prior user and prior registrant, is the owner of the mark "D-10
80 WP." As such, Berris has in its favor the rights conferred by Section 147 of R.A.
No. 8293, which provides
Sec. 147. Rights Conferred.
147.1. The owner of a registered mark shall have the exclusive right to prevent all
third parties not having the owners consent from using in the course of trade
identical or similar signs or containers for goods or services which are identical or
similar to those in respect of which the trademark is registered where such use
would result in a likelihood of confusion. In case of the use of an identical sign for
identical goods or services, a likelihood of confusion shall be presumed.
147.2. The exclusive right of the owner of a well-known mark defined in Subsection
123.1(e) which is registered in the Philippines, shall extend to goods and services
which are not similar to those in respect of which the mark is registered: Provided,
That use of that mark in relation to those goods or services would indicate a
connection between those goods or services and the owner of the registered mark:
Provided, further, That the interests of the owner of the registered mark are likely
to be damaged by such use.
Now, we confront the question, "Is Abyadangs mark NS D-10 PLUS confusingly
similar to that of Berris D-10 80 WP such that the latter can rightfully prevent the
IPO registration of the former?"
We answer in the affirmative.
According to Section 123.1(d) of R.A. No. 8293, a mark cannot be registered if it is
identical with a registered mark belonging to a different proprietor with an earlier
filing or priority date, with respect to: (1) the same goods or services; (2) closely
related goods or services; or (3) near resemblance of such mark as to likely deceive
or cause confusion.
In determining similarity and likelihood of confusion, jurisprudence has developed
teststhe Dominancy Test and the Holistic or Totality Test. The Dominancy Test
focuses on the similarity of the prevalent or dominant features of the competing
trademarks that might cause confusion, mistake, and deception in the mind of the
purchasing public. Duplication or imitation is not necessary; neither is it required
that the mark sought to be registered suggests an effort to imitate. Given more
consideration are the aural and visual impressions created by the marks on the
buyers of goods, giving little weight to factors like prices, quality, sales outlets, and
market segments.43chanroblesvirtuallawlibrary
In contrast, the Holistic or Totality Test necessitates a consideration of the entirety
of the marks as applied to the products, including the labels and packaging, in
determining confusing similarity. The discerning eye of the observer must focus not
only on the predominant words but also on the other features appearing on both
labels so that the observer may draw conclusion on whether one is confusingly
similar to the other.44chanroblesvirtuallawlibrary
Comparing Berris mark "D-10 80 WP" with Abyadangs mark "NS D-10 PLUS," as
appearing on their respective packages, one cannot but notice that both have a
common component which is "D-10." On Berris package, the "D-10" is written with
a bigger font than the "80 WP." Admittedly, the "D-10" is the dominant feature of
the mark. The "D-10," being at the beginning of the mark, is what is most
remembered of it. Although, it appears in Berris certificate of registration in the
same font size as the "80 WP," its dominancy in the "D-10 80 WP" mark stands
since the difference in the form does not alter its distinctive
character.45chanroblesvirtuallawlibrary
Applying the Dominancy Test, it cannot be gainsaid that Abyadangs "NS D-10 PLUS"
is similar to Berris "D-10 80 WP," that confusion or mistake is more likely to occur.
Undeniably, both marks pertain to the same type of goods fungicide with 80%
Mancozeb as an active ingredient and used for the same group of fruits, crops,
vegetables, and ornamental plants, using the same dosage and manner of
application. They also belong to the same classification of goods under R.A. No.
8293. Both depictions of "D-10," as found in both marks, are similar in size, such
that this portion is what catches the eye of the purchaser. Undeniably, the likelihood
of confusion is present.
regard are generally accorded great respect, if not finality by the courts, as long as
they are supported by substantial evidence, even if such evidence might not be
overwhelming or even preponderant. It is not the task of the appellate court to
weigh once more the evidence submitted before the administrative body and to
substitute its own judgment for that of the administrative agency in respect to
sufficiency of evidence.48chanroblesvirtuallawlibrary
Inasmuch as the ownership of the mark "D-10 80 WP" fittingly belongs to Berris,
and because the same should not have been cancelled by the CA, we consider it
proper not to belabor anymore the issue of whether cancellation of a registered
mark may be done absent a petition for cancellation.
WHEREFORE, the petition is GRANTED. The assailed Decision dated April 14, 2008
and Resolution dated June 18, 2008 of the Court of Appeals in CA-G.R. SP No.
99928 are REVERSED and SET ASIDE. Accordingly, the Decision No. 2006-24 dated
April 28, 2006 and the Resolution No. 2006-09(D) dated August 2, 2006 in IPC No.
14-2005-00099, and the Decision dated July 20, 2007 in Appeal No. 14-06-13 are
REINSTATED. Costs against respondent.
SO ORDERED.

This likelihood of confusion and mistake is made more manifest when the Holistic
Test is applied, taking into consideration the packaging, for both use the same type
of material (foil type) and have identical color schemes (red, green, and white); and
the marks are both predominantly red in color, with the same phrase "BROAD
SPECTRUM FUNGICIDE" written underneath.

Considering these striking similarities, predominantly the "D-10," the buyers of both
products, mainly farmers, may be misled into thinking that "NS D-10 PLUS" could
be an upgraded formulation of the "D-10 80 WP."

Moreover, notwithstanding the finding of the IPPDG that the "D-10" is a fanciful
component of the trademark, created for the sole purpose of functioning as a
trademark, and does not give the name, quality, or description of the product for
which it is used, nor does it describe the place of origin, such that the degree of
exclusiveness given to the mark is closely restricted,46cra1aw and considering its
challenge by Abyadang with respect to the meaning he has given to it, what
remains is the fact that Berris is the owner of the mark "D-10 80 WP," inclusive of
its dominant feature "D-10," as established by its prior use, and prior registration
with the IPO. Therefore, Berris properly opposed and the IPO correctly rejected
Abyadangs application for registration of the mark "NS D-10 PLUS."

Verily, 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.47cra1aw On this matter
of particular concern, administrative agencies, such as the IPO, by reason of their
special knowledge and expertise over matters falling under their jurisdiction, are in
a better position to pass judgment thereon. Thus, their findings of fact in that
G.R. No. 190065 August 16, 2010
DERMALINE, INC., Petitioner,
vs.
MYRA PHARMACEUTICALS, INC. Respondent.
DECISION
NACHURA, J.:
This is a petition for review on certiorari1 seeking to reverse and set aside the
Decision dated August 7, 20092and the Resolution dated October 28, 20093 of the
Court of Appeals (CA) in CA-G.R. SP No. 108627.
The antecedent facts and proceedings—
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
Opposition4 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. Myra said that the registration of Dermaline’s
trademark will violate Section 1235 of Republic Act (R.A.) No. 8293 (Intellectual
Property Code of the Philippines). It further alleged 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.
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 1476 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 447 for various skin
treatments, it could still be connected to the "DERMALIN" mark under Classification
58 for pharmaceutical products, since ultimately these goods are very closely
related.
In its Verified Answer,9 Dermaline countered that a simple comparison of the
trademark "DERMALINE DERMALINE, INC." vis-à-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. Dermaline contended 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. It claimed
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
On April 10, 2008, the IPO-Bureau of Legal Affairs rendered Decision No. 2008-
7011 sustaining Myra’s opposition pursuant to Section 123.1(d) of R.A. No. 8293. It
disposed—
WHEREFORE, the Verified Opposition is, as it is, hereby SUSTAINED. Consequently,
Application Serial No. 4-2006-011536 for the mark ‘DERMALINE, DERMALINE, INC.
Stylized Wordmark’ for Dermaline, Inc. under class 44 covering the aforementioned
goods filed on 21 October 2006, is as it is hereby, REJECTED.
Let the file wrapper of ‘DERMALINE, DERMALINE, INC. Stylized Wordmark’ subject
matter of this case be forwarded to the Bureau of Trademarks (BOT) for appropriate
action in accordance with this Decision.
SO ORDERED.12
Aggrieved, Dermaline filed a motion for reconsideration, but it was denied under
Resolution No. 2009-12(D)13dated January 16, 2009.
Expectedly, Dermaline appealed to the Office of the Director General of the IPO.
However, in an Order14 dated April 17, 2009, the appeal was dismissed for being
filed out of time.
Undaunted, Dermaline appealed to the CA, but it affirmed and upheld the Order
dated April 17, 2009 and the rejection of Dermaline’s application for registration of
trademark. The CA likewise denied Dermaline’s motion for reconsideration; hence,
this petition raising the issue of whether the CA erred in upholding the IPO’s
rejection of Dermaline’s application for registration of trademark.
The petition is without merit.
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 which provides—
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; (emphasis supplied)
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
Relative to the question on confusion of marks and trade names, 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
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 registrant’s ownership of the mark, and of the registrant’s exclusive right to use
the same in connection with the goods and those that are related thereto specified
in the certificate.
We agree with the findings of the IPO. As correctly applied by the IPO in this case,
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 Myra’s "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 Myra’s registered mark.
Further, 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.1avvphi1
Indeed, the registered trademark owner may use its mark on the same or similar
products, in different segments of the market, and at different price levels
depending on variations of the products for specific segments of the market. The
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, we
have held –
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 (v.
148 ALR 77, 84; 52 Am. Jur. 576, 577).23 (Emphasis supplied)

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

Besides, the issue on protection of intellectual property, such as trademarks, is

factual in nature. The findings of the IPO, upheld on appeal by the same office, and
further sustained by the CA, bear great weight and deserves respect from this
Court. 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.

SO ORDERED.
G.R. No. 185830 June 5, 2013
ECOLE DE CUISINE MANILLE (CORDON BLEU OF THE PHILIPPINES),
INC., Petitioner,
vs.
RENAUD COINTREAU & CIE and LE CORDON BLEU INT'L., B.V., Respondents.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 is the December 23, 2008
Decision2 of the Court of Appeals (CA) in CA-G.R. SP No. 104672 which affirmed in
toto the Intellectual Property Office (IPO) Director General’s April 21, 2008
Decision3 that declared respondent Renaud Cointreau & Cie (Cointreau) as the true
and lawful owner of the mark "LE CORDON BLEU & DEVICE" and thus, is entitled to
register the same under its name.
The Facts
On June 21, 1990, Cointreau, a partnership registered under the laws of France,
filed before the (now defunct) Bureau of Patents, Trademarks, and Technology
Transfer (BPTTT) of the Department of Trade and Industry a trademark application
for the mark "LE CORDON BLEU & DEVICE" for goods falling under classes 8, 9, 16,
21, 24, 25, 29, and 30 of the International Classification of Goods and Services for
the Purposes of Registrations of Marks ("Nice Classification") (subject mark). The
application was filed pursuant to Section 37 of Republic Act No. 166, as amended
(R.A. No. 166), on the basis of Home Registration No. 1,390,912, issued on
November 25, 1986 in France. Bearing Serial No. 72264, such application was
published for opposition in the March-April 1993 issue of the BPTTT Gazette and
released for circulation on May 31, 1993.4
On July 23, 1993, petitioner Ecole De Cuisine Manille, Inc. (Ecole) filed an
opposition to the subject application, averring that: (a) it is the owner of the mark
"LE CORDON BLEU, ECOLE DE CUISINE MANILLE," which it has been using since
1948 in cooking and other culinary activities, including in its restaurant business;
and (b) it has earned immense and invaluable goodwill such that Cointreau’s use of
the subject mark will actually create confusion, mistake, and deception to the
buying public as to the origin and sponsorship of the goods, and cause great and
irreparable injury and damage to Ecole’s business reputation and goodwill as a
senior user of the same.5
On October 7, 1993, Cointreau filed its answer claiming to be the true and lawful
owner of the subject mark. It averred that: (a) it has filed applications for the
subject mark’s registration in various jurisdictions, including the Philippines; (b) Le
Cordon Bleu is a culinary school of worldwide acclaim which was established in
Paris, France in 1895; (c) Le Cordon Bleu was the first cooking school to have set
the standard for the teaching of classical French cuisine and pastry making; and (d)
it has trained students from more than eighty (80) nationalities, including Ecole’s
directress, Ms. Lourdes L. Dayrit. Thus, Cointreau concluded that Ecole’s claim of
being the exclusive owner of the subject mark is a fraudulent misrepresentation.6
During the pendency of the proceedings, Cointreau was issued Certificates of
Registration Nos. 60631 and 54352 for the marks "CORDON BLEU & DEVICE" and
"LE CORDON BLEU PARIS 1895 & DEVICE" for goods and services under classes 21
and 41 of the Nice Classification, respectively.7
The Ruling of the Bureau of Legal Affairs
In its Decision8 dated July 31, 2006, the Bureau of Legal Affairs (BLA) of the IPO
sustained Ecole’s opposition to the subject mark, necessarily resulting in the
rejection of Cointreau’s application.9 While noting the certificates of registration
obtained from other countries and other pertinent materials showing the use of the
subject mark outside the Philippines, the BLA did not find such evidence sufficient to
establishCointreau’s claim of prior use of the same in the Philippines. It emphasized
that the adoption and use of trademark must be in commerce in the Philippines and
not abroad. It then concluded that Cointreau has not established any proprietary
right entitled to protection in the Philippine jurisdiction because the law on
trademarks rests upon the doctrine of nationality or territoriality.10
On the other hand, the BLA found that the subject mark, which was the predecessor
of the mark "LE CORDON BLEU MANILLE" has been known and used in the
Philippines since 1948 and registered under the name "ECOLE DE CUISINE MANILLE
(THE CORDON BLEU OF THE PHILIPPINES), INC." on May 9, 1980.11
Aggrieved, Cointreau filed an appeal with the IPO Director General.
The Ruling of the IPO Director General
In his Decision dated April 21, 2008, the IPO Director General reversed and set
aside the BLA’s decision, thus, granting Cointreau’s appeal and allowing the
registration of the subject mark.12 He held that while Section 2 of R.A. No. 166
requires actual use of the subject mark in commerce in the Philippines for at least
two (2) months before the filing date of the application, only the owner thereof has
the right to register the same, explaining that the user of a mark in the Philippines
is not ipso facto its owner. Moreover, Section 2-A of the same law does not require
actual use in the Philippines to be able to acquire ownership of a mark.13
In resolving the issue of ownership and right to register the subject mark in favor of
Cointreau, he considered Cointreau’s undisputed use of such mark since 1895 for its
culinary school in Paris, France (in which petitioner’s own directress, Ms. Lourdes L.
Dayrit, had trained in 1977). Contrarily, he found that while Ecole may have prior
use of the subject mark in the Philippines since 1948, it failed to explain how it
came up with such name and mark. The IPO Director General therefore concluded
that Ecole has unjustly appropriated the subject mark, rendering it beyond the
mantle of protection of Section 4(d)14 of R.A. No. 166.15
Finding the IPO Director General’s reversal of the BLA’s Decision unacceptable,
Ecole filed a Petition for Review16dated June 7, 2008 with the CA.
Ruling of the CA
In its Decision dated December 23, 2008, the CA affirmed the IPO Director
General’s Decision in toto.17 It declared Cointreau as the true and actual owner of
the subject mark with a right to register the same in the Philippines under Section
37 of R.A. No. 166, having registered such mark in its country of origin on
November 25, 1986.18
The CA likewise held that Cointreau’s right to register the subject mark cannot be
barred by Ecole’s prior use thereof as early as 1948 for its culinary school "LE
CORDON BLEU MANILLE" in the Philippines because its appropriation of the mark
was done in bad faith. Further, Ecole had no certificate of registration that would
put Cointreau on notice that the former had appropriated or has been using the
subject mark. In fact, its application for trademark registration for the same which
was just filed on February 24, 1992 is still pending with the IPO.19
Hence, this petition.
Issues Before the Court
The sole issue raised for the Court’s resolution is whether the CA was correct in
upholding the IPO Director General’s ruling that Cointreau is the true and lawful
owner of the subject mark and thus, entitled to have the same registered under its
name.
At this point, it should be noted that the instant case shall be resolved under the
provisions of the old Trademark Law, R.A. No. 166, which was the law in force at
the time of Cointreau’s application for registration of the subject mark.
The Court’s Ruling
The petition is without merit.
In the petition, Ecole argues that it is the rightful owner of the subject mark,
considering that it was the first entity that used the same in the Philippines. Hence,
it is the one entitled to its registration and not Cointreau.
Petitioner’s argument is untenable.
Under Section 220 of R.A. No. 166, in order to register a trademark, one must be the
owner thereof and must have actually used the mark in commerce in the Philippines
for two (2) months prior to the application for registration. Section 2-A21 of the
same law sets out to define how one goes about acquiring ownership thereof. Under
Section 2-A, it is clear that actual use in commerce is also the test of ownership but
the provision went further by saying that the mark must not have been so
appropriated by another. Additionally, it is significant to note that Section 2-A does
not require that the actual use of a trademark must be within the Philippines. Thus,
as correctly mentioned by the CA, under R.A. No. 166, one may be an owner of a
mark due to its actual use but may not yet have the right to register such
ownership here due to the owner’s failure to use the same in the Philippines for two
(2) months prior to registration.22
Nevertheless, foreign marks which are not registered are still accorded protection
against infringement and/or unfair competition. At this point, it is worthy to
emphasize that the Philippines and France, Cointreau’s country of origin, are both
signatories to the Paris Convention for the Protection of Industrial Property (Paris
Convention).23Articles 6bis and 8 of the Paris Convention state:
ARTICLE 6bis
(1) The countries of the Union undertake, ex officio if their legislation so permits, or
at the request of an interested party, to refuse or to cancel the registration, and to
prohibit the use, of a trademark which constitutes a reproduction, an imitation, or a
translation, liable to create confusion, of a mark considered by the competent
authority of the country of registration or use to be well known in that country as
being already the mark of a person entitled to the benefits of this Convention and
used for identical or similar goods.1âwphi1 These provisions shall also apply when
the essential part of the mark constitutes a reproduction of any such well-known
mark or an imitation liable to create confusion therewith.
ARTICLE 8
A trade name shall be protected in all the countries of the Union without the
obligation of filing or registration, whether or not it forms part of a trademark.
(Emphasis and underscoring supplied)
In this regard, Section 37 of R.A. No. 166 incorporated Article 8 of the Paris
Convention, to wit:
Section 37. Rights of foreign registrants. - Persons who are nationals of, domiciled
in, or have a bona fide or effective business or commercial establishment in any
foreign country, which is a party to any international convention or treaty relating to
marks or trade-names, or the repression of unfair competition to which the
Philippines may be a party, shall be entitled to the benefits and subject to the
provisions of this Act to the extent and under the conditions essential to give effect
to any such convention and treaties so long as the Philippines shall continue to be a
party thereto, except as provided in the following paragraphs of this section.
xxxx
Trade-names of persons described in the first paragraph of this section shall be
protected without the obligation of filing or registration whether or not they form
parts of marks.
xxxx
In view of the foregoing obligations under the Paris Convention, the Philippines is
obligated to assure nationals of the signatory-countries that they are afforded an
effective protection against violation of their intellectual property rights in the
Philippines in the same way that their own countries are obligated to accord similar
protection to Philippine nationals.24 "Thus, under Philippine law, a trade name of a
national of a State that is a party to the Paris Convention, whether or not the trade
name forms part of a trademark, is protected "without the obligation of filing or
registration.’"25

In the instant case, it is undisputed that Cointreau has been using the subject mark
in France since 1895, prior to Ecole’s averred first use of the same in the Philippines
in 1948, of which the latter was fully aware thereof. In fact, Ecole’s present
directress, Ms. Lourdes L. Dayrit (and even its foundress, Pat Limjuco Dayrit), had
trained in Cointreau’s Le Cordon Bleu culinary school in Paris, France. Cointreau was
likewise the first registrant of the said mark under various classes, both abroad and
in the Philippines, having secured Home Registration No. 1,390,912 dated
November 25, 1986 from its country of origin, as well as several trademark
registrations in the Philippines.26

On the other hand, Ecole has no certificate of registration over the subject mark but
only a pending application covering services limited to Class 41 of the Nice
Classification, referring to the operation of a culinary school. Its application was filed
only on February 24, 1992, or after Cointreau filed its trademark application for
goods and services falling under different classes in 1990. Under the foregoing
circumstances, even if Ecole was the first to use the mark in the Philippines, it
cannot be said to have validly appropriated the same.

It is thus clear that at the time Ecole started using the subject mark, the same was
already being used by Cointreau, albeit abroad, of which Ecole’s directress was fully
aware, being an alumna of the latter’s culinary school in Paris, France. Hence, Ecole
cannot claim any tinge of ownership whatsoever over the subject mark as Cointreau
is the true and lawful owner thereof. As such, the IPO Director General and the CA
were correct in declaring Cointreau as the true and lawful owner of the subject mark
and as such, is entitled to have the same registered under its name.

In any case, the present law on trademarks, Republic Act No. 8293, otherwise
known as the Intellectual Property Code of the Philippines, as amended, has already
dispensed with the requirement of prior actual use at the time of
registration.27 Thus, there is more reason to allow the registration of the subject
mark under the name of Cointreau as its true and lawful owner.

As a final note, "the function of a trademark is to point out distinctly the origin or
ownership of the goods (or services) to which it is affixed; to secure to him, who
has been instrumental in bringing into the market a superior article of merchandise,
the fruit of his industry and skill; to assure the public that they are procuring the
genuine article; to prevent fraud and imposition; and to protect the manufacturer
against substitution and sale of an inferior and different article as his product." 28 As
such, courts will protect trade names or marks, although not registered or properly
selected as trademarks, on the broad ground of enforcing justice and protecting one
in the fruits of his toil.29

WHEREFORE, the petition is DENIED. Accordingly, the December 23, 2008 Decision
of the Court of Appeals in CA-G.R. SP No. 104672 is hereby AFFIRMED in toto.

SO ORDERED.
G.R. No. 194307 November 20, 2013
BIRKENSTOCK ORTHOPAEDIE GMBH AND CO. KG (formerly BIRKENSTOCK
ORTHOPAEDIE GMBH),Petitioner,
vs.
PHILIPPINE SHOE EXPO MARKETING CORPORATION, Respondent.
DECISION
PERLAS-BERNABE, J.:
Assailed in this Petition for Review on Certiorari1 are the Court of Appeals (CA)
Decision2 dated June 25, 2010 and Resolution3 dated October 27, 2010 in CA-G.R.
SP No. 112278 which reversed and set aside the Intellectual Property Office (IPO)
Director General’s Decision4 dated December 22, 2009 that allowed the registration
of various trademarks in favor of petitioner Birkenstock Orthopaedie GmbH & Co.
KG.
The Facts
Petitioner, a corporation duly organized and existing under the laws of Germany,
applied for various trademark registrations before the IPO, namely: (a)
"BIRKENSTOCK" under Trademark Application Serial No. (TASN) 4-1994-091508 for
goods falling under Class 25 of the International Classification of Goods and
Services (Nice Classification) with filing date of March 11, 1994; (b) "BIRKENSTOCK
BAD HONNEF -RHEIN & DEVICE COMPRISING OF ROUND COMPANY SEAL AND
REPRESENTATION OF A FOOT, CROSS AND SUNBEA M" under TASN 4-1994-091509
for goods falling under Class 25 of the Nice Classification with filing date of March
11, 1994; and (c) "BIRKENSTOCK BAD HONNEF-RHEIN & DEVICE COMPRISING OF
ROUND COMPANY SEAL AND REPRESENTATION OF A FOOT, CROSS AND SUNBEAM"
under TASN 4-1994-095043 for goods falling under Class 10 of the Nice
Classification with filing date of September 5, 1994 (subject applications).5
However, registration proceedings of the subject applications were suspended in
view of an existing registration of the mark "BIRKENSTOCK AND DEVICE" under
Registration No. 56334 dated October 21, 1993 (Registration No. 56334) in the
name of Shoe Town International and Industrial Corporation, the predecessor-in-
interest of respondent Philippine Shoe Expo Marketing Corporation.6 In this regard,
on May 27, 1997 petitioner filed a petition for cancellation of Registration No. 56334
on the ground that it is the lawful and rightful owner of the Birkenstock marks
(Cancellation Case).7 During its pendency, however, respondent and/or its
predecessor-in-interest failed to file the required 10th Year Declaration of Actual
Use (10th Year DAU) for Registration No. 56334 on or before October 21,
2004,8 thereby resulting in the cancellation of such mark.9 Accordingly, the
cancellation case was dismissed for being moot and academic.10
The aforesaid cancellation of Registration No. 56334 paved the way for the
publication of the subject applications in the IPO e-Gazette on February 2,
2007.11 In response, respondent filed three (3) separate verified notices of
oppositions to the subject applications docketed as Inter Partes Case Nos. 14-2007-
00108, 14-2007-00115, and 14-2007-00116,12 claiming, inter alia, that: (a) it,
together with its predecessor-in-interest, has been using Birkenstock marks in the
Philippines for more than 16 years through the mark "BIRKENSTOCK AND DEVICE";
(b) the marks covered by the subject applications are identical to the one covered
by Registration No. 56334 and thus, petitioner has no right to the registration of
such marks; (c) on November 15, 1991, respondent’s predecessor-in-interest
likewise obtained a Certificate of Copyright Registration No. 0-11193 for the word
"BIRKENSTOCK" ; (d) while respondent and its predecessor-in-interest failed to file
the 10th Yea r DAU, it continued the use of "BIRKENSTOCK AND DEVICE" in lawful
commerce; and (e) to record its continued ownership and exclusive right to use the
"BIRKENSTOCK" marks, it has filed TASN 4-2006-010273 as a " re-application " of
its old registration, Registration No. 56334.13 On November 13, 2007, the Bureau of
Legal Affairs (BLA) of the IPO issued Order No. 2007-2051 consolidating the
aforesaid inter partes cases (Consolidated Opposition Cases).14
The Ruling of the BLA
In its Decision15 dated May 28, 2008, the BLA of the IPO sustained respondent’s
opposition, thus, ordering the rejection of the subject applications. It ruled that the
competing marks of the parties are confusingly similar since they contained the
word "BIRKENSTOCK" and are used on the same and related goods. It found
respondent and its predecessor-in-interest as the prior user and adopter of
"BIRKENSTOCK" in the Philippines, while on the other hand, petitioner failed to
present evidence of actual use in the trade and business in this country. It opined
that while Registration No. 56334 was cancelled, it does not follow that prior right
over the mark was lost, as proof of continuous and uninterrupted use in trade and
business in the Philippines was presented. The BLA likewise opined that petitioner’s
marks are not well -known in the Philippines and internationally and that the various
certificates of registration submitted by petitioners were all photocopies and,
therefore, not admissible as evidence.16
Aggrieved, petitioner appealed to the IPO Director General.
The Ruling of the IPO Director General
In his Decision17 dated December 22, 2009, the IPO Director General reversed and
set aside the ruling of the BLA, thus allowing the registration of the subject
applications. He held that with the cancellation of Registration No. 56334 for
respondent’s failure to file the 10th Year DAU, there is no more reason to reject the
subject applications on the ground of prior registration by another proprietor.18 More
importantly, he found that the evidence presented proved that petitioner is the true
and lawful owner and prior user of "BIRKENSTOCK" marks and thus, entitled to the
registration of the marks covered by the subject applications.19 The IPO Director
General further held that respondent’s copyright for the word "BIRKENSTOCK" is of
no moment since copyright and trademark are different forms of intellectual
property that cannot be interchanged.20
Finding the IPO Director General’s reversal of the BLA unacceptable, respondent
filed a petition for review with the CA.
Ruling of the CA
In its Decision21 dated June 25, 2010, the CA reversed and set aside the ruling of
the IPO Director General and reinstated that of the BLA. It disallowed the
registration of the subject applications on the ground that the marks covered by technical rules of procedure.32 On this score, Section 5 of the Rules on Inter Partes
such applications "are confusingly similar, if not outright identical" with respondent’s Proceedings provides:
mark.22 It equally held that respondent’s failure to file the 10th Year DAU for
Registration No. 56334 "did not deprive petitioner of its ownership of the
Sec. 5. Rules of Procedure to be followed in the conduct of hearing of Inter Partes
‘BIRKENSTOCK’ mark since it has submitted substantial evidence showing its
cases. – The rules of procedure herein contained primarily apply in the conduct of
continued use, promotion and advertisement thereof up to the present."23 It opined
hearing of Inter Partes cases. The Rules of Court may be applied suppletorily. The
that when respondent’s predecessor-in-interest adopted and started its actual use
Bureau shall not be bound by strict technical rules of procedure and evidence but
of "BIRKENSTOCK," there is neither an existing registration nor a pending
may adopt, in the absence of any applicable rule herein, such mode of proceedings
application for the same and thus, it cannot be said that it acted in bad faith in
which is consistent with the requirements of fair play and conducive to the just,
adopting and starting the use of such mark.24 Finally, the CA agreed with
speedy and inexpensive disposition of cases, and which will give the Bureau the
respondent that petitioner’s documentary evidence, being mere photocopies, were
greatest possibility to focus on the contentious issues before it. (Emphasis and
submitted in violation of Section 8.1 of Office Order No. 79, Series of 2005 (Rules
underscoring supplied)
on Inter Partes Proceedings).

In the case at bar, while petitioner submitted mere photocopies as documentary

Dissatisfied, petitioner filed a Motion for Reconsideration25 dated July 20, 2010,
which was, however, denied in a Resolution26 dated October 27, 2010. Hence, this
petition.27
Issues Before the Court
The primordial issue raised for the Court’s resolution is whether or not the subject
marks should be allowed registration in the name of petitioner.
The Court’s Ruling
The petition is meritorious.
A. Admissibility of Petitioner’s Documentary Evidence.
evidence in the Consolidated Opposition Cases, it should be noted that the IPO had
already obtained the originals of such documentary evidence in the related
Cancellation Case earlier filed before it. Under this circumstance and the merits of
the instant case as will be subsequently discussed, the Court holds that the IPO
Director General’s relaxation of procedure was a valid exercise of his discretion in
the interest of substantial justice.33
Having settled the foregoing procedural matter, the Court now proceeds to resolve
the substantive issues.
B. Registration and ownership of "BIRKENSTOCK."
Republic Act No. (RA) 166,34 the governing law for Registration No. 56334, requires
the filing of a DAU on specified periods,35 to wit:

Section 12. Duration. – Each certificate of registration shall remain in force for
In its Comment28 dated April 29, 2011, respondent asserts that the documentary
twenty years: Provided, That registrations under the provisions of this Act shall be
evidence submitted by petitioner in the Consolidated Opposition Cases, which are
cancelled by the Director, unless within one year following the fifth, tenth and
mere photocopies, are violative of Section 8.1 of the Rules on Inter Partes
fifteenth anniversaries of the date of issue of the certificate of registration, the
Proceedings, which requires certified true copies of documents and evidence
registrant shall file in the Patent Office an affidavit showing that the mark or trade-
presented by parties in lieu of originals.29 As such, they should be deemed
name is still in use or showing that its non-use is due to special circumstance which
inadmissible.
excuse such non-use and is not due to any intention to abandon the same, and pay
the required fee.
The Court is not convinced.
The Director shall notify the registrant who files the above- prescribed affidavits of
It is well-settled that "the rules of procedure are mere tools aimed at facilitating the his acceptance or refusal thereof and, if a refusal, the reasons therefor. (Emphasis
attainment of justice, rather than its frustration. A strict and rigid application of the and underscoring supplied)
rules must always be eschewed when it would subvert the primary objective of the
rules, that is, to enhance fair trials and expedite justice. Technicalities should never
The aforementioned provision clearly reveals that failure to file the DAU within the
be used to defeat the substantive rights of the other party. Every party-litigant
requisite period results in the automatic cancellation of registration of a trademark.
must be afforded the amplest opportunity for the proper and just determination of
In turn, such failure is tantamount to the abandonment or withdrawal of any right
his cause, free from the constraints of technicalities."30"Indeed, the primordial policy
or interest the registrant has over his trademark.36
is a faithful observance of [procedural rules], and their relaxation or suspension
should only be for persuasive reasons and only in meritorious cases, to relieve a
litigant of an injustice not commensurate with the degree of his thoughtlessness in In this case, respondent admitted that it failed to file the 10th Year DAU for
not complying with the procedure prescribed."31 This is especially true with quasi- Registration No. 56334 within the requisite period, or on or before October 21,
judicial and administrative bodies, such as the IPO, which are not bound by 2004. As a consequence, it was deemed to have abandoned or withdrawn any right
or interest over the mark "BIRKENSTOCK." Neither can it invoke Section 23637 of
the IP Code which pertains to intellectual property rights obtained under previous
intellectual property laws, e.g., RA 166, precisely because it already lost any right
or interest over the said mark.
Besides, petitioner has duly established its true and lawful ownership of the mark
"BIRKENSTOCK."
Under Section 238 of RA 166, which is also the law governing the subject
applications, in order to register a trademark, one must be the owner thereof and
must have actually used the mark in commerce in the Philippines for two (2)
months prior to the application for registration. Section 2-A39 of the same law sets
out to define how one goes about acquiring ownership thereof. Under the same
section, it is clear that actual use in commerce is also the test of ownership but the
provision went further by saying that the mark must not have been so appropriated
by another. Significantly, to be an owner, Section 2-A does not require that the
actual use of a trademark must be within the Philippines. Thus, under RA 166, one
may be an owner of a mark due to its actual use but may not yet have the right to
register such ownership here due to the owner’s failure to use the same in the
Philippines for two (2) months prior to registration.40
It must be emphasized that registration of a trademark, by itself, is not a mode of
acquiring ownership.1âwphi1 If the applicant is not the owner of the trademark, he
has no right to apply for its registration. Registration merely creates a prima facie
presumption of the validity of the registration, of the registrant’s ownership of the
trademark, and of the exclusive right to the use thereof. Such presumption, just like
the presumptive regularity in the performance of official functions, is rebuttable and
must give way to evidence to the contrary.41
Clearly, it is not the application or registration of a trademark that vests ownership
thereof, but it is the ownership of a trademark that confers the right to register the
same. A trademark is an industrial property over which its owner is entitled to
property rights which cannot be appropriated by unscrupulous entities that, in one
way or another, happen to register such trademark ahead of its true and lawful
owner. The presumption of ownership accorded to a registrant must then
necessarily yield to superior evidence of actual and real ownership of a trademark.
In the instant case, petitioner was able to establish that it is the owner of the mark
"BIRKENSTOCK." It submitted evidence relating to the origin and history of
"BIRKENSTOCK" and its use in commerce long before respondent was able to
register the same here in the Philippines. It has sufficiently proven that
"BIRKENSTOCK" was first adopted in Europe in 1774 by its inventor, Johann
Birkenstock, a shoemaker, on his line of quality footwear and thereafter, numerous
generations of his kin continuously engaged in the manufacture and sale of shoes
and sandals bearing the mark "BIRKENSTOCK" until it became the entity now known
as the petitioner. Petitioner also submitted various certificates of registration of the
mark "BIRKENSTOCK" in various countries and that it has used such mark in
different countries worldwide, including the Philippines.44
On the other hand, aside from Registration No. 56334 which had been cancelled,
respondent only presented copies of sales invoices and advertisements, which are
not conclusive evidence of its claim of ownership of the mark "BIRKENSTOCK" as
these merely show the transactions made by respondent involving the same.45
In view of the foregoing circumstances, the Court finds the petitioner to be the true
and lawful owner of the mark "BIRKENSTOCK" and entitled to its registration, and
that respondent was in bad faith in having it registered in its name. In this regard,
the Court quotes with approval the words of the IPO Director General, viz.:
The facts and evidence fail to show that [respondent] was in good faith in using and
in registering the mark BIRKENSTOCK. BIRKENSTOCK, obviously of German origin,
is a highly distinct and arbitrary mark. It is very remote that two persons did coin
the same or identical marks. To come up with a highly distinct and uncommon mark
previously appropriated by another, for use in the same line of business, and
without any plausible explanation, is incredible. The field from which a person may
select a trademark is practically unlimited. As in all other cases of colorable
imitations, the unanswered riddle is why, of the millions of terms and combinations
of letters and designs available, [respondent] had to come up with a mark identical
or so closely similar to the [petitioner’s] if there was no intent to take advantage of
the goodwill generated by the [petitioner’s] mark. Being on the same line of
business, it is highly probable that the [respondent] knew of the existence of
BIRKENSTOCK and its use by the [petitioner], before [respondent] appropriated the
same mark and had it registered in its name.46

The Court’s pronouncement in Berris Agricultural Co., Inc. v. Abyadang42 is

WHEREFORE, the petition is GRANTED. The Decision dated June 25, 2010 and
instructive on this point:
Resolution dated October 27, 2010 of the Court of Appeals in CA-G.R. SP No.
112278 are REVERSED and SET ASIDE. Accordingly, the Decision dated December
The ownership of a trademark is acquired by its registration and its actual use by 22, 2009 of the IPO Director General is hereby REINSTATED.
the manufacturer or distributor of the goods made available to the purchasing
public. x x x A certificate of registration of a mark, once issued, constitutes prima
SO ORDERED.
facie evidence of the validity of the registration, of the registrant’s ownership of the
mark, and of the registrant’s exclusive right to use the same in connection with the
goods or services and those that are related thereto specified in the certificate. x x x
In other words, the prima facie presumption brought about by the registration of a
mark may be challenged and overcome in an appropriate action, x x x by evidence
of prior use by another person, i.e. , it will controvert a claim of legal appropriation
or of ownership based on registration by a subsequent user. This is because a
trademark is a creation of use and belongs to one who first used it in trade or
commerce.43 (Emphasis and underscoring supplied)
G.R. No. 190706 July 21, 2014
SHANG PROPERTIES REALTY CORPORATION (formerly THE SHANG GRAND
TOWER CORPORATION) and SHANG PROPERTIES, INC. (formerly EDSA
PROPERTIES HOLDINGS, INC.), Petitioners,
vs.
ST. FRANCIS DEVELOPMENT CORPORATION, Respondent.
DECISION
PERLAS-BERNABE, J.:
Assailed in this petition for review on certiorari1 is the Decision2 dated December 18,
2009 of the Court of Appeals (CA) in CA-G.R. SP No. 105425 which affirmed with
modification the Decision3 dated September 3, 2008 of the Intellectual Property
Office (IPO) Director-General. The CA: (a) affirmed the denial of the application for
registration of the mark "ST. FRANCIS TOWERS" filed by petitioners Shang
Properties Realty Corporation and Shang Properties, Inc. (petitioners); ( b) found
petitioners to have committed unfair competition for using the marks "THE ST.
FRANCIS TOWERS" and "THE ST. FRANCIS SHANGRI-LA PLACE"; (c) ordered
petitioners to cease and desist from using "ST. FRANCIS" singly or as part of a
composite mark; and (d) ordered petitioners to jointly and severally pay respondent
St. Francis Square Development Corporation (respondent) a fine in the amount of
₱200,000.00.
The Facts
Respondent – a domestic corporation engaged in the real estate business and the
developer of the St. Francis Square Commercial Center, built sometime in 1992,
located at Ortigas Center, Mandaluyong City, Metro Manila (Ortigas Center)4 – filed
separate complaints against petitioners before the IPO - Bureau of Legal Affairs
(BLA), namely: (a) an intellectual property violation case for unfair competition,
false or fraudulent declaration, and damages arising from petitioners’ use and filing
of applications for the registration of the marks "THE ST. FRANCIS TOWERS" and
"THE ST. FRANCIS SHANGRI-LA PLACE," docketed as IPV Case No. 10-2005-00030
(IPV Case); and (b) an inter partes case opposing the petitioners’ application for
registration of the mark "THE ST. FRANCIS TOWERS" for use relative to the latter’s
business, particularly the construction of permanent buildings or structures for
residential and office purposes, docketed as Inter PartesCase No. 14-2006-00098
(St. Francis Towers IP Case); and (c) an inter partes case opposing the petitioners’
application for registration of the mark "THE ST. FRANCIS SHANGRI-LA PLACE,"
docketed as IPC No. 14-2007-00218 (St. Francis Shangri-La IP Case).5
In its complaints, respondent alleged that it has used the mark "ST. FRANCIS" to
identify its numerous property development projects located at Ortigas Center, such
as the aforementioned St. Francis Square Commercial Center, a shopping mall
called the "St. Francis Square," and a mixed-use realty project plan thatincludes the
St. Francis Towers. Respondent added that as a result of its continuous use of the
mark "ST. FRANCIS" in its real estate business,it has gained substantial goodwill
with the public that consumers and traders closely identify the said mark with its
property development projects. Accordingly, respondent claimed that petitioners
could not have the mark "THE ST. FRANCIS TOWERS" registered in their names,
and that petitioners’ use of the marks "THE ST. FRANCIS TOWERS" and "THE ST.
FRANCIS SHANGRI-LA PLACE" in their own real estate development projects
constitutes unfair competition as well as false or fraudulent declaration.6
Petitioners denied committing unfair competition and false or fraudulent declaration,
maintaining that they could register the mark "THE ST. FRANCIS TOWERS" and
"THE ST. FRANCIS SHANGRI-LA PLACE" under their names. They contended that
respondent is barred from claiming ownership and exclusive use ofthe mark "ST.
FRANCIS" because the same is geographically descriptive ofthe goods or services
for which it is intended to be used.7 This is because respondent’s as well as
petitioners’ real estate development projects are locatedalong the streets bearing
the name "St. Francis," particularly, St. FrancisAvenue and St. Francis Street (now
known as Bank Drive),8 both within the vicinity of the Ortigas Center.
The BLA Rulings
On December 19, 2006, the BLA rendered a Decision9 in the IPV Case, and found
that petitioners committed acts of unfair competition against respondent by its use
of the mark "THE ST. FRANCIS TOWERS" but not with its use of the mark "THE ST.
FRANCIS SHANGRI-LA PLACE." It, however, refused to award damages in the
latter’s favor, considering that there was no evidence presented to substantiate the
amount of damages it suffered due to the former’s acts. The BLA found that "ST.
FRANCIS," being a name of a Catholic saint, may be considered as an arbitrary
mark capable of registration when used in real estate development projects as the
name has no direct connection or significance when used in association with real
estate. The BLA neither deemed "ST. FRANCIS" as a geographically descriptive
mark, opiningthat there is no specific lifestyle, aura, quality or characteristic that
the real estate projects possess except for the fact that they are located along St.
Francis Avenueand St. Francis Street (now known as Bank Drive), Ortigas Center. In
this light, the BLA found that while respondent’s use of the mark "ST. FRANCIS" has
not attained exclusivity considering that there are other real estate development
projects bearing the name "St. Francis" in other areas,10 it must nevertheless be
pointed out that respondent has been known to be the only real estate firm to
transact business using such name within the Ortigas Center vicinity. Accordingly,
the BLA considered respondent to have gained goodwill and reputation for its mark,
which therefore entitles it to protection against the use by other persons, at least,
to those doing business within the Ortigas Center.11
Meanwhile, on March 28, 2007, the BLA rendered a Decision12 in the St. Francis
Towers IP Case, denying petitioners’ application for registration of the mark "THE
ST. FRANCIS TOWERS." Excluding the word "TOWERS" in view of petitioners’
disclaimer thereof, the BLA ruled that petitioners cannot register the mark "THE ST.
FRANCIS" since it is confusingly similar to respondent’s"ST. FRANCIS" marks which
are registered with the Department of Trade and Industry(DTI). It held that
respondent had a better right over the use of the mark "ST. FRANCIS" because of
the latter’s appropriation and continuous usage thereof for a long period of time.13 A
little over a year after, or on March 31, 2008, the BLA then rendered a Decision14 in
the St. Francis Shangri-La IP Case, allowing petitioners’ application for registration
of the mark "THE ST. FRANCIS SHANGRI-LA PLACE." It found that respondent
cannot preclude petitioners from using the mark "ST. FRANCIS" as the records show
that the former’s use thereof had not been attended with exclusivity. More
importantly, it found that petitioners had adequately appended the word "Shangri-
La" to its composite mark to distinguish it from that of respondent, in which case,
the former had removed any likelihood of confusion that may arise from the
contemporaneous use by both parties of the mark "ST. FRANCIS."
Both parties appealed the decision in the IPV Case, while petitioners appealed the
decision in the St. Francis Towers IP Case. Due to the identity of the parties and
issues involved, the IPO Director-General ordered the consolidation of the separate
appeals.15 Records are, however, bereft of any showing that the decision in the St.
Francis Shangri-La IP Casewas appealed by either party and, thus, is deemed to
have lapsed into finality.
The IPO Director-General Ruling
In a Decision16 dated September 3, 2008, then IPO Director-General Adrian S.
Cristobal, Jr. affirmedthe rulings of the BLA that: (a) petitioners cannot register the
mark "THEST. FRANCIS TOWERS"; and (b) petitioners are not guilty of unfair
competition in its use of the mark "THE ST. FRANCIS SHANGRI-LA PLACE."
However, the IPO DirectorGeneral reversed the BLA’s findingthat petitioners
committed unfair competition through their use of the mark "THE ST. FRANCIS
TOWERS," thus dismissing such charge. He foundthat respondent could not be
entitled to the exclusive use of the mark "ST. FRANCIS," even at least to the locality
where it conducts its business, because it is a geographically descriptive mark,
considering that it was petitioners’ as well as respondent’s intention to use the mark
"ST. FRANCIS"in order to identify, or at least associate, their real estate
development projects/businesses with the place or location where they are
situated/conducted, particularly, St. Francis Avenue and St. Francis Street (now
known as Bank Drive), Ortigas Center. He further opined that respondent’s
registration of the name "ST. FRANCIS" with the DTI is irrelevant since what should
be controlling are the trademark registrations with the IPO itself.17 Also, the IPO
Director-General held that since the parties are both engaged in the real estate
business, it would be "hard to imagine that a prospective buyer will be enticed to
buy, rent or purchase [petitioners’] goods or servicesbelieving that this is owned by
[respondent] simply because of the name ‘ST. FRANCIS.’ The prospective buyer
would necessarily discuss things with the representatives of [petitioners] and would
readily know that this does not belong to [respondent]."18
Disagreeing solely with the IPO Director-General’s ruling on the issue of unfair
competition (the bone of contention in the IPV Case), respondent elevated the
sameto the CA.
In contrast, records do not show that either party appealed the IPO Director-
General’s ruling on the issue ofthe registrability of the mark "THE ST. FRANCIS
TOWERS" (the bone of contention in the St. Francis Towers IP Case). As such, said
pronouncement isalso deemed to have lapsed into finality.
The CA Ruling
In a Decision19 dated December 18, 2009, the CA found petitioners guilty of unfair
competition not only withrespect to their use of the mark "THE ST. FRANCIS
TOWERS" but alsoof the mark "THE ST. FRANCIS SHANGRI-LA PLACE." Accordingly,
itordered petitioners to cease and desist from using "ST. FRANCIS" singly or as part
of a composite mark, as well as to jointly and severally pay respondent a fine in the
amount of ₱200,000.00.
The CA did not adhere to the IPO Director-General’s finding that the mark "ST.
FRANCIS" is geographically descriptive, and ruled that respondent – which has
exclusively and continuously used the mark "ST. FRANCIS" for more than a decade,
and,hence, gained substantial goodwill and reputation thereby – is very
muchentitled to be protected against the indiscriminate usage by other companies
of the trademark/name it has so painstakingly tried to establish and maintain.
Further, the CA stated that even on the assumption that "ST. FRANCIS" was indeed
a geographically descriptive mark, adequateprotection must still begiven to
respondent pursuant to the Doctrine of Secondary Meaning.20
Dissatisfied, petitioners filed the present petition.
The Issue Before the Court
With the decisions in both Inter PartesCases having lapsed into finality, the sole
issue thus left for the Court’s resolution is whether or not petitioners are guilty of
unfair competition in using the marks "THE ST. FRANCIS TOWERS" and "THE ST.
FRANCIS SHANGRI-LA PLACE."
The Court’s Ruling
The petition is meritorious.
Section 168 of Republic Act No. 8293,21 otherwise known as the "Intellectual
Property Code of the Philippines" (IP Code), provides for the rules and regulations
on unfair competition.
To begin, Section 168.1 qualifies who is entitled to protection against unfair
competition. It states that "[a]person who has identified in the mind of the public
the goods he manufacturesor deals in, his business or services from those of others,
whether or not a registered mark is employed, has a property right in the goodwill
of the said goods, business or services so identified, which will be protected inthe
same manner as other property rights."
Section 168.2proceeds to the core of the provision, describing forthwith who may be
found guilty of and subject to an action of unfair competition – that is, "[a]ny
person who shall employ deception or any other means contrary to good faith by
which he shall pass off the goods manufactured by him or in which he deals, or his
business, or services for those of the one having established such goodwill, or who
shall commit any acts calculated to produce said result x x x."
Without limiting its generality, Section 168.3goes on to specify examples of acts
which are considered as constitutive of unfair competition, viz.:
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 ofsuch 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
service 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.
Finally, Section 168.4 dwells on a matter of procedure by stating that the "[t]he
remedies provided by Sections 156,22 157,23 and 16124 shall apply mutatis
mutandis."
The statutory attribution of the unfair competition concept is wellsupplemented by
jurisprudential pronouncements. In the recent case of Republic Gas Corporation v.
Petron Corporation,25 the Court has echoed the classic definition of the term which
is "‘the passing off (or palming off) or attempting to pass off upon the public of the
goods or business of one person as the goods or business of another with the end
and probable effect of deceiving the public.’ Passing off (or palming off) takes place
where the defendant, by imitative devices on the general appearance of the goods,
misleads prospective purchasers into buying his merchandise under the impression
that they are buying that of his competitors. [In other words], the defendant gives
his goods the general appearance of the goods of his competitor with the intention
of deceiving the publicthat the goods are those of his competitor." 26 The "true test"
of unfair competition has thus been "whether the acts of the defendant have the
intent of deceiving or are calculated to deceive the ordinary buyer making his
purchases under the ordinary conditions of theparticular trade to which the
controversy relates." Based on the foregoing, it is therefore essential to prove the
existence of fraud, or the intent to deceive, actual or probable,27 determined
through a judicious scrutiny of the factual circumstances attendant to a particular
case.28
Here, the Court finds the element of fraud to be wanting; hence, there can be no
unfair competition. The CA’scontrary conclusion was faultily premised on its
impression that respondenthad the right to the exclusive use of the mark "ST.
FRANCIS," for which the latter had purportedly established considerable goodwill.
What the CA appears to have disregarded or been mistaken in its disquisition,
however, is the geographicallydescriptive nature of the mark "ST. FRANCIS" which
thus bars its exclusive appropriability, unless a secondary meaning is acquired. As
deftly explained in the U.S. case of Great Southern Bank v. First Southern
Bank:29 "[d]escriptive geographical terms are inthe ‘public domain’ in the sense that
every seller should have the right to inform customers of the geographical origin of
his goods. A ‘geographically descriptive term’ is any noun or adjective that
designates geographical location and would tend to be regarded by buyers as
descriptive of the geographic location of origin of the goods or services. A
geographically descriptive term can indicate any geographic location on earth, such
as continents, nations, regions, states, cities, streets and addresses, areas of cities,
rivers, and any other location referred to by a recognized name. In order to
determine whether or not the geographic term in question is descriptively used, the
following question is relevant: (1) Is the mark the name of the place or region from
which the goods actually come? If the answer is yes, then the geographic term is
probably used in a descriptive sense, and secondary meaning is required for
protection."30
In Burke-Parsons-Bowlby Corporation v. Appalachian Log Homes, Inc.,31 it was held
that secondary meaningis established when a descriptive mark no longer causes the
public to associate the goods with a particular place, but to associate the goods with
a particular source.In other words, it is not enough that a geographically-descriptive
mark partakes of the name of a place known generally to the public to be denied
registration as it is also necessary to show that the public would make a
goods/place association – that is, to believe that the goods for which the mark is
sought to be registered originatein that place.1âwphi1 To hold sucha belief, it is
necessary, of course, that the purchasers perceive the mark as a place name, from
which the question of obscurity or remoteness then comes to the fore.32 The more a
geographical area is obscure and remote, it becomes less likely that the public shall
have a goods/place association with such area and thus, the mark may not be
deemed as geographically descriptive. However, where there is no genuine issue
that the geographical significance of a term is its primary significanceand where the
geographical place is neither obscure nor remote, a public association of the goods
with the place may ordinarily be presumed from the fact that the applicant’s own
goods come from the geographical place named in the mark.33
Under Section 123.234 of the IP Code, specific requirements have to be met in order
to conclude that a geographically-descriptive mark has acquired secondary
meaning, to wit: (a) the secondary meaning must have arisen as a result of
substantial commercial use of a mark in the Philippines; (b) such use must result in
the distinctiveness of the mark insofar as the goods or theproducts are concerned;
and (c) proof of substantially exclusive and continuous commercial use in the
Philippines for five (5) years beforethe date on which the claim of distinctiveness is
made. Unless secondary meaning has been established, a geographically-descriptive
mark, dueto its general public domain classification, is perceptibly disqualified from
trademark registration. Section 123.1(j) of the IP Code states this rule as follows:
SEC. 123. Registrability. –
123.1 A mark cannot be registered if it:
xxxx
(j) Consists exclusively of signs orof indications that may serve in trade to designate
the kind, quality, quantity, intended purpose, value, geographical origin, time or
production of the goods or rendering of the services, or other characteristics of the
goods or services; (Emphasis supplied) x x x x
Cognizant of the foregoing, the Court disagrees with the CA that petitioners
committed unfair competition due to the mistaken notion that petitioner had
established goodwill for the mark "ST. FRANCIS" precisely because said
circumstance, by and of itself, does not equateto fraud under the parameters of registrability issues resolved therein are hereby deemed to have attained finality
Section 168 of the IP Code as above-cited. In fact, the records are bereft of any and, therefore, are now executory.
showing thatpetitioners gave their goods/services the general appearance that it
was respondent which was offering the same to the public. Neither did petitioners
WHEREFORE, the petition is GRANTED. The Decision dated December 18, 2009 of
employ any means to induce the public towards a false belief that it was offering
the Court of Appeals in CA-G.R. SP No. 105425 is hereby REVERSED and SET
respondent’s goods/services. Nor did petitioners make any false statement or
ASIDE. Accordingly, the Decision dated September 3, 2008 of the Intellectual
commit acts tending to discredit the goods/services offered by respondent.
Property Office-Director General is REINSTATED.
Accordingly, the element of fraud which is the core of unfair competition had not
been established.
SO ORDERED.
Besides, respondent was not able toprove its compliance with the requirements
stated in Section 123.2 of the IP Code to be able to conclude that it acquired a
secondary meaning – and, thereby, an exclusive right – to the "ST. FRANCIS" mark,
which is, as the IPO Director-General correctly pointed out, geographically-
descriptive of the location in which its realty developments have been built, i.e., St.
Francis Avenue and St. Francis Street (now known as "Bank Drive"). Verily, records
would reveal that while it is true that respondent had been using the mark "ST.
FRANCIS" since 1992, its use thereof has been merely confined to its realty projects
within the Ortigas Center, as specifically mentioned.As its use of the mark is clearly
limited to a certain locality, it cannot be said thatthere was substantial commercial
use of the same recognizedall throughout the country. Neither is there any showing
of a mental recognition in buyers’ and potential buyers’ minds that products
connected with the mark "ST. FRANCIS" are associated with the same source35 –
that is, the enterprise of respondent. Thus, absent any showing that there exists a
clear goods/service-association between the realty projects located in the aforesaid
area and herein respondent as the developer thereof, the latter cannot besaid to
have acquired a secondary meaning as to its use of the "ST. FRANCIS" mark.

In fact, even on the assumption that secondary meaning had been acquired, said
finding only accords respondents protectional qualification under Section 168.1 of
the IP Code as above quoted. Again, this does not automatically trigger the
concurrence of the fraud element required under Section 168.2 of the IP Code, as
exemplified by the acts mentioned in Section 168.3 of the same. Ultimately, as
earlier stated, there can be no unfair competition without this element. In this
respect, considering too the notoriety of the Shangri-La brand in the real estate
industry which dilutes petitioners' propensity to merely ride on respondent's
goodwill, the more reasonable conclusion is that the former's use of the marks "THE
ST. FRANCIS TOWERS" and "THE ST. FRANCIS SHANGRI-LA PLACE" was meant only
to identify, or at least associate, their real estate project/s with its geographical
location. As aptly observed by the IPO DirectorGeneral:36

In the case at hand, the parties are business competitors engaged in real estate or
property development, providing goods and services directly connected thereto. The
"goods" or "products" or "services" are real estate and the goods and the services
attached to it or directly related to it, like sale or lease of condominium units,
offices, and commercial spaces, such as restaurants, and other businesses. For
these kinds of goods or services there can be no description of its geographical
origin as precise and accurate as that of the name of the place where they are
situated. (Emphasis and underscoring supplied)

Hence, for all the reasons above-discussed, the Court hereby grants the instant
petition, and, thus, exonerates petitioners from the charge of unfair competition in
the IPV Case. As the decisions in the Inter Partes Cases were not appealed, the
G.R. NO. 175278
GSIS FAMILY BANK - THRIFT BANK [Formerly Inc.], Petitioner,
vs.
BPI FAMILY BANK, Respondent.
DECISION
JARDELEZA, J.:
This is a Petition for Review on Certiorari filed by GSIS Family Bank - Thrift
Bank1 assailing the Court of Appeals Decision2 dated March 29, 2006 (Decision) and
Resolution3 dated October 23, 2006 which denied petitioner's petition for review of
the Securities and Ex.change Commission Decision dated February 22, 2005 (SEC
En Banc Decision). The SEC En Banc Decision4 prohibited petitioner from using the
word "Family" as part of its corporate name and ordered petitioner to delete the
word from its name.5
Facts
Petitioner was originally organized as Royal Savings Bank and started operations in
1971. Beginning 1983 and 1984, petitioner encountered liquidity problems. On July
9, 1984, it was placed under receivership and later temporarily closed by the
Central Bank of the Philippines. Two (2) months after its closure, petitioner
reopened and was renamed Comsavings Bank, Inc. under the management of the
Commercial Bank of Manila.6
In 1987, the Government Service Insurance System (GSIS) acquired petitioner from
the Commercial Bank of Manila. Petitioner's management and control was thus
transferred to GSIS.7 To improve its marketability to the public, especially to the
members of the GSIS, petitioner sought Securities and Exchange Commission (SEC)
approval to change its corporate name to "GSIS Family Bank, a Thrift
Bank."8 Petitioner likewise applied with the Department of Trade and Industry (DTI)
and Bangko Sentral ng Pilpinas (BSP) for authority to use "GSIS Family Bank, a
Thrift Bank" as its business name. The DTI and the BSP approved the
applications.9 Thus, petitioner operates under the corporate name "GSIS Family
Bank – a Thrift Bank," pursuant to the DTI Certificate of Registration No. 741375
and the Monetary Board Circular approval.10
Respondent BPI Family Bank was a product of the merger between the Family Bank
and Trust Company (FBTC) and the Bank of the Philippine Islands (BPI).11 On June
27, 1969, the Gotianum family registered with the SEC the corporate name "Family
First Savings Bank," which was amended to "Family Savings Bank," and then later
to "Family Bank and Trust Company."12 Since its incorporation, the bank has been
commonly known as "Family Bank." In 1985, Family Bank merged with BPI, and the
latter acquired all the rights, privileges, properties, and interests of Family Bank,
including the right to use names, such as "Family First Savings Bank,"
"Family Bank," and "Family Bank and Trust Company." BPI Family Savings Bank
was registered with the SEC as a wholly-owned subsidiary of BPI. BPI Family
Savings Bank then registered with the Bureau of Domestic Trade the trade or
business name "BPI Family Bank," and acquired a reputation and goodwill under the
name.13
Proceedings before the SEC
Eventually, it reached respondent’s attention that petitioner is using or attempting
to use the name "Family Bank." Thus, on March 8, 2002, respondent petitioned the
SEC Company Registration and Monitoring Department (SEC CRMD) to disallow or
prevent the registration of the name "GSIS Family Bank" or any other corporate
name with the words "Family Bank" in it. Respondent claimed exclusive ownership
to the name "Family Bank," having acquired the name since its purchase and
merger with Family Bank and Trust Company way back 1985.14Respondent also
alleged that through the years, it has been known as "BPI Family Bank" or simply
"Family Bank" both locally and internationally. As such, it has acquired a reputation
and goodwill under the name, not only with clients here and abroad, but also with
correspondent and competitor banks, and the public in general.15
Respondent prayed the SEC CRMD to disallow or prevent the registration of the
name "GSIS Family Bank" or any other corporate name with the words "Family
Bank" should the same be presented for registration.
Respondent likewise prayed the SEC CRMD to issue an order directing petitioner or
any other corporation to change its corporate name if the names have already been
registered with the SEC.16
The SEC CRMD was thus confronted with the issue of whether the names BPI Family
Bank and GSIS Family Bank are confusingly similar as to require the amendment of
the name of the latter corporation.
The SEC CRMD declared that upon the merger of FBTC with the BPI in 1985, the
latter acquired the right to the use of the name of the absorbed corporation. Thus,
BPI Family Bank has a prior right to the use of the name
Family Bank in the banking industry, arising from its long and extensive nationwide
use, coupled with its registration with the Intellectual Property Office (IPO) of the
name "Family Bank" as its trade name. Applying the rule of "priority in registration"
based on the legal maxim first in time, first in right, the SEC CRMD concluded that
BPI has the preferential right to the use of the name "Family Bank." More, GSIS and
Comsavings Bank were then fully aware of the existence and use of the name
"Family Bank" by FBTC prior to the latter's merger with BPI.17
The SEC CRMD also held that there exists a confusing similarity between the
corporate names BPI Family Bank and GSIS Family Bank. It explained that although
not identical, the corporate names are indisputably similar, as to cause confusion in
the public mind, even with the exercise of reasonable care and observation,
especially so since both corporations are engaged in the banking business.18
In a decision19 dated May 19, 2003, the SEC CRMD said, PREMISES CONSIDERED
respondent GSIS FAMILY BANK is hereby directed to refrain from using the word
"Family" as part of its name and make good its commitment to change its name by
deleting or dropping the subject word from its corporate name within [thirty (30)
days] from the date of actual receipt hereof.20
Petitioner appealed21 the decision to the SEC En Banc, which denied the appeal, and
upheld the SEC CRMD in the SEC En Banc Decision.22 Petitioner elevated the SEC En
Banc Decision to the Court of Appeals, raising the following issues:
1. Whether the use by GSIS Family Bank of the words "Family Bank" is
deceptively and confusingly similar to the name BPI Family Bank;
2. Whether the use by Comsavings Bank of "GSIS Family Bank" as its
business constitutes unfair competition;
3. Whether BPI Family Bank is guilty of forum shopping;
4. Whether the approval of the DTI and the BSP of petitioner's application
to use the name GSIS Family Bank constitutes its authority to the lawful
and valid use of such trade name or trade mark;
5. Whether the application of respondent BPI Family Bank for the exclusive
use of the name "Family Bank," a generic name, though not yet approved
by IPO of the Bureau of Patents, has barred the GSIS Family Bank from
using such trade mark or name.23
Court of Appeals Ruling
The Court of Appeals ruled that the approvals by the BSP and by the DTI of
petitioner’s application to use the name "GSIS Family Bank" do not constitute
authority for its lawful and valid use. It said that the SEC has absolute jurisdiction,
supervision and control over all corporations.24 The Court of Appeals held that
respondent was entitled to the exclusive use of the corporate name because of its
prior adoption of the name "Family Bank" since 1969.25 There is confusing similarity
in the corporate names because "[c]onfusion as to the possible association with
GSIS might arise if we were to allow Comsavings Bank to add its parent company’s
acronym, ‘GSIS’ to ‘Family Bank.’ This is true especially considering both companies
belong to the banking industry. Proof of actual confusion need not be shown. It
suffices that confusion is probably or likely to occur."26The Court of Appeals also
ruled out forum shopping because not all the requirements of litis pendentia are
present.27
The dispositive portion of the decision read,
WHEREFORE, the instant petition for review is hereby DISMISSED for lack of
merit.28
After its Motion for Reconsideration was denied,29 petitioner brought the decision to
this Court via a Petition for Review on Certiorari.30
Issues in the Petition
Petitioner raised the following issues in its petition:
I. The Court of Appeals gravely erred in affirming the SEC Resolution
finding the word "Family" not generic despite its unregistered status with
the IPO of the Bureau of Patents and the use by GSIS-Family Bank in its
corporate name of the words "[F]amily [B]ank" as deceptive and
[confusingly similar] to the name BPI Family Bank;31
II. The Court of Appeals gravely erred when it ruled that the respondent is
not guilty of forum shopping despite the filing of three (3) similar
complaints before the DTI and BSP and with the SEC without the requisite
certification of non-forum shopping attached thereto;32
III. The Court of Appeals gravely erred when it completely disregarded the
opinion of the Banko Sentral ng Pilipinas that the use by the herein
petitioner of the trade name GSIS Family Bank – Thrift Bank is not similar
or does not deceive or likely cause any deception to the public.33
Court's Ruling
We uphold the decision of the Court of Appeals.
Section 18 of the Corporation Code provides,
Section 18. Corporate name. – No corporate name may be allowed by the Securities
and Exchange Commission if the proposed name is identical or deceptively or
confusingly similar to that of any existing corporation or to any other name already
protected by law or is patently deceptive, confusing or contrary to existing laws.
When a change in the corporate name is approved, the Commission shall issue an
amended certificate of incorporation under the amended name.
In Philips Export B.V. v. Court of Appeals,34 this Court ruled that to fall within the
prohibition of the law on the right to the exclusive use of a corporate name, two
requisites must be proven, namely:
(1) that the complainant corporation acquired a prior right over the use of
such corporate name; and
(2) the proposed name is either
(a) identical or
(b) deceptive or confusingly similar to that of any existing
corporation or to any other name already protected by law; or
(c) patently deceptive, confusing or contrary to existing law.35
These two requisites are present in this case. On the first requisite of a prior right,
Industrial Refractories Corporation of the Philippines v. Court of Appeals (IRCP
case)36 is instructive. In that case, Refractories Corporation of the Philippines (RCP)
filed before the SEC a petition to compel Industrial Refractories Corporation of the
Philippines (IRCP) to change its corporate name on the ground that its corporate
name is confusingly similar with that of RCP’s such that the public may be confused
into believing that they are one and the same corporation. The SEC and the Court of
Appeals found for petitioner, and ordered IRCP to delete or drop from its corporate
name the word "Refractories." Upon appeal of IRCP, this Court upheld the decision
of the CA.
Applying the priority of adoption rule to determine prior right, this Court said that
RCP has acquired the right to use the word "Refractories" as part of its corporate
name, being its prior registrant. In arriving at this conclusion, the Court considered
that RCP was incorporated on October 13, 1976 and since then continuously used
the corporate name "Refractories Corp. of the Philippines." Meanwhile, IRCP only
started using its corporate name "Industrial Refractories Corp. of the Philippines"
when it amended its Articles of Incorporation on August 23, 1985.37
In this case, respondent was incorporated in 1969 as Family Savings Bank and in
1985 as BPI Family Bank. Petitioner, on the other hand, was incorporated as GSIS
Family – Thrift Bank only in 2002,38 or at least seventeen (17) years after
respondent started using its name. Following the precedent in the IRCP case, we
rule that respondent has the prior right over the use of the corporate name.
The second requisite in the Philips Export case likewise obtains on two points: the
proposed name is (a) identical or (b) deceptive or confusingly similar to that of any
existing corporation or to any other name already protected by law.
On the first point (a), the words "Family Bank" present in both petitioner and
respondent's corporate name satisfy the requirement that there be identical names
in the existing corporate name and the proposed one.
Respondent cannot justify its claim under Section 3 of the Revised Guidelines in the
Approval of Corporate and Partnership Names,39 to wit:
3. The name shall not be identical, misleading or confusingly similar to one already
registered by another corporation or partnership with the Commission or a sole
proprietorship registered with the Department of Trade and Industry.
If the proposed name is similar to the name of a registered firm, the proposed name
must contain at least one distinctive word different from the name of the company
already registered.
Section 3 states that if there be identical, misleading or confusingly similar name to
one already registered by another corporation or partnership with the SEC, the
proposed name must contain at least one distinctive word different from the name
of the company already registered. To show contrast with respondent's corporate
name, petitioner used the words "GSIS" and "thrift." But these are not sufficiently
distinct words that differentiate petitioner's corporate name from respondent's.
While "GSIS" is merely an acronym of the proper name by which petitioner is
identified, the word "thrift" is simply a classification of the type of bank that
petitioner is. Even if the classification of the bank as "thrift" is appended to
petitioner's proposed corporate name, it will not make the said corporate name
distinct from respondent's because the latter is likewise engaged in the banking
business.
This Court used the same analysis in Ang mga Kaanib sa Iglesia ng Dios Kay Kristo
Hesus, H.S.K. sa Bansang Pilipinas, Inc. v. Iglesia ng Dios Kay Cristo Jesus, Haligi at
Suhay ng Katotohanan.40 In that case, Iglesia ng Dios Kay Cristo Jesus filed a case
before the SEC to compel Ang mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus to
change its corporate name, and to prevent it from using the same or similar name
on the ground that the same causes confusion among their members as well as the
public. Ang mga Kaanib sa Iglesia ng Dios Kay Kristo Hesus claimed that it complied
with SEC Memorandum Circular No. 14-2000 by adding not only two, but eight
words to their registered name, to wit: "Ang Mga Kaanib" and "Sa Bansang
Pilipinas, Inc.," which effectively distinguished it from Iglesia ng Dios Kay Cristo
Jesus. This Court rejected the argument, thus:
The additional words "Ang Mga Kaanib" and "Sa Bansang Pilipinas, Inc." in
petitioner's name are, as correctly observed by the SEC, merely descriptive
of and also referring to the members, or kaanib, of respondent who are
likewise residing in the Philippines. These words can hardly serve as an
effective differentiating medium necessary to avoid confusion or difficulty
in distinguishing petitioner from respondent. This is especially so, since
both petitioner and respondent corporations are using the same acronym –
H.S.K.; not to mention the fact that both are espousing religious beliefs
and operating in the same place. Xxx41
On the second point (b), there is a deceptive and confusing similarity between
petitioner's proposed name and respondent's corporate name, as found by the
SEC.42 In determining the existence of confusing similarity in corporate names, the
test is whether the similarity is such as to mislead a person using ordinary care and
discrimination.43 And even without such proof of actual confusion between the two
corporate names, it suffices that confusion is probable or likely to occur.44
Petitioner's corporate name is "GSIS Family Bank—A Thrift Bank" and respondent's
corporate name is "BPI Family Bank." The only words that distinguish the two are
"BPI," "GSIS," and "Thrift." The first two words are merely the acronyms of the
proper names by which the two corporations identify themselves; and the third
word simply describes the classification of the bank. The overriding consideration in
determining whether a person, using ordinary care and discrimination, might be
misled is the circumstance that both petitioner and respondent are engaged in the
same business of banking. "The likelihood of confusion is accentuated in cases
where the goods or business of one corporation are the same or substantially the
same to that of another corporation."45
Respondent alleged that upon seeing a Comsavings Bank branch with the signage
"GSIS Family Bank" displayed at its premises, some of the respondent’s officers and
their clients began asking questions. These include whether GSIS has acquired
Family Bank; whether there is a joint arrangement between GSIS and Family Bank;
whether there is a joint arrangement between BPI and GSIS regarding Family Bank;
whether Comsavings Bank has acquired Family Bank; and whether there is there an
arrangement among Comsavings Bank, GSIS, BPI, and Family Bank regarding BPI
Family Bank and GSIS Family Bank.46 The SEC made a finding that "[i]t is not a
remote possibility that the public may entertain the idea that a relationship or
arrangement indeed exists between BPI and GSIS due to the use of the term
‘Family Bank’ in their corporate names."47
Findings of fact of quasi-judicial agencies, like the SEC, are generally accorded
respect and even finality by this Court, if supported by substantial evidence, in
recognition of their expertise on the specific matters under their consideration, more
so if the same has been upheld by the appellate court, as in this case.48
Petitioner cannot argue that the word "family" is a generic or descriptive name,
which cannot be appropriated exclusively by respondent. "Family," as used in
respondent's corporate name, is not generic. Generic marks are commonly used as
the name or description of a kind of goods, such as "Lite" for beer or "Chocolate
Fudge" for chocolate soda drink. Descriptive marks, on the other hand, convey the
characteristics, function, qualities or ingredients of a product to one who has never
seen it or does not know it exists, such as "Arthriticare" for arthritis medication.49
Under the facts of this case, the word "family" cannot be separated from the word
"bank."50 In asserting their claims before the SEC up to the Court of Appeals, both
petitioner and respondent refer to the phrase "Family Bank" in their submissions.
This coined phrase, neither being generic nor descriptive, is merely suggestive and
may properly be regarded as arbitrary. Arbitrary marks are "words or phrases used
as a mark that appear to be random in the context of its use. They are generally
considered to be easily remembered because of their arbitrariness. They are original
and unexpected in relation to the products they endorse, thus, becoming
themselves distinctive."51 Suggestive marks, on the other hand, "are marks which
merely suggest some quality or ingredient of goods. xxx The strength of the
suggestive marks lies on how the public perceives the word in relation to the
product or service."52
In Ang v. Teodoro,53 this Court ruled that the words "Ang Tibay" is not a descriptive
term within the meaning of the Trademark Law but rather a fanciful or coined
phrase.54 In so ruling, this Court considered the etymology and meaning of the
Tagalog words, "Ang Tibay" to determine whether they relate to the quality or
description of the merchandise to which respondent therein applied them as
trademark, thus:
We find it necessary to go into the etymology and meaning of the Tagalog words
"Ang Tibay" to determine whether they are a descriptive term, i.e., whether they
relate to the quality or description of the merchandise to which respondent has
applied them as a trade-mark. The word "ang" is a definite article meaning "the" in
English. It is also used as an adverb, a contraction of the word "anong" (what or
how). For instance, instead of saying, "Anong ganda!" ("How beautiful!"), we
ordinarily say, "Ang ganda!" Tibay is a root word from which are derived the verb
magpatibay (to strengthen); the nouns pagkamatibay (strength, durability),
katibayan (proof, support, strength), katibaytibayan (superior strength); and the
adjectives matibay (strong, durable, lasting), napakatibay (very strong), kasintibay
or magkasintibay (as strong as, or of equal strength). The phrase "Ang Tibay" is an
exclamation denoting admiration of strength or durability. For instance, one who
tries hard but fails to break an object exclaims, "Ang tibay!" ("How strong!") It may
also be used in a sentence thus, "Ang tibay ng sapatos mo!" ("How durable your
shoes are!") The phrase "ang tibay" is never used adjectively to define or describe
an object. One does not say, "ang tibay sapatos" or "sapatos ang tibay" to mean
"durable shoes," but "matibay na sapatos" or "sapatos na matibay."
From all of this we deduce that "Ang Tibay" is not a descriptive term within the
meaning of the Trade-Mark Law but rather a fanciful or coined phrase which may
properly and legally be appropriated as a trade-mark or trade-name.
xxx55 (Underscoring supplied).
The word "family" is defined as "a group consisting of parents and children living
together in a household" or "a group of people related to one another by blood or
marriage."56 Bank, on the other hand, is defined as "a financial establishment that
invests money deposited by customers, pays it out when requested, makes loans at
interest, and exchanges currency."57 By definition, there can be no expected relation
between the word "family" and the banking business of respondent. Rather, the
words suggest that respondent’s bank is where family savings should be deposited.
More, as in the Ang case, the phrase "family bank" cannot be used to define an
object.
Petitioner’s argument that the opinion of the BSP and the certificate of registration
granted to it by the DTI constitute authority for it to use "GSIS Family Bank" as
corporate name is also untenable.
The enforcement of the protection accorded by Section 18 of the Corporation Code
to corporate names is lodged exclusively in the SEC. The jurisdiction of the SEC is
not merely confined to the adjudicative functions provided in Section 5 of the SEC
Reorganization Act,58 as amended.59 By express mandate, the SEC has absolute
jurisdiction, supervision and control over all corporations.60 It is the SEC’s duty to
prevent confusion in the use of corporate names not only for the protection of the
corporations involved, but more so for the protection of the public. It has authority
to de-register at all times, and under all circumstances corporate names which in its
estimation are likely to generate confusion.61
The SEC62 correctly applied Section 18 of the Corporation Code, and Section 15 of
SEC Memorandum Circular No. 14-2000, pertinent portions of which provide:
In implementing Section 18 of the Corporation Code of the Philippines (BP 69), the
following revised guidelines in the approval of corporate and partnership names are
hereby adopted for the information and guidance of all concerned:
xxx
15. Registrant corporations or partnership shall submit a letter undertaking to
change their corporate or partnership name in case another person or firm has
acquired a prior right to the use of the said firm name or the same is deceptively or
confusingly similar to one already registered unless this undertaking is already
included as one of the provisions of the articles of incorporation or partnership of
the registrant.
The SEC, after finding merit in respondent's claims, can compel petitioner to abide
by its commitment "to change its corporate name in the event that another person,
firm or entity has acquired a prior right to use of said name or one similar to it." 63
Clearly, the only determination relevant to this case is that one made by the SEC in
the exercise of its express mandate under the law. The BSP opinion invoked by
petitioner even acknowledges that "the issue on whether a proposed name is
identical or deceptively similar to that of any of existing corporation is matter within
the official jurisdiction and competence of the SEC."64

Judicial notice65 may also be taken of the action of the IPO in approving
respondent’s registration of the trademark "BPI Family Bank" and its logo on
October 17, 2008. The certificate of registration of a mark shall be prima facie
evidence of the validity of the registration, the registrant’s ownership of the mark,
and of the registrant’s exclusive right to use the same in connection with the goods
or services and those that are related thereto specified in the certificate.66

Finally, we uphold the Court of Appeals' finding that the issue of forum shopping
was belatedly raised by petitioner and, thus, cannot anymore be considered at the
appellate stage of the proceedings. Petitioner raised the issue of forum shopping for
the first time only on appeal.67 Petitioner argued that the complaints filed by
respondent did not contain certifications against non-forum shopping, in violation of
Section 5, Rule 7 of the Rules of Court.68

In S.C. Megaworld Construction and Development Corporation vs. Parada,69 this

Court said that objections relating to non-compliance with the verification and
certification of non-forum shopping should be raised in the proceedings below, and
not for the first time on appeal. In that case, S.C. Megaworld argued that the
complaint for collection of sum of money should have been dismissed outright by
the trial court on account of an invalid nonforum shopping certification. It alleged
that the Special Power of Attorney granted to Parada did not specifically include an
authority for the latter to sign the verification and certification of non-forum
shopping, thus rendering the complaint defective for violation of Sections 4 and 5 of
Rule 7 of the Rules of Court. On motion for reconsideration of the decision of the
Court of Appeals, petitioner raised for the first time, the issue of forum shopping.
The Court ruled against S.C. Megaworld, thus:

It is well-settled that no question will be entertained on appeal unless it has been

raised in the proceedings below. Points of law, theories, issues and arguments not
brought to the attention of the lower court, administrative agency or quasi-judicial
body, need not be considered by a reviewing court, as they cannot be raised for the
first time at that late stage. Basic considerations of fairness and due process impel
this rule. Any issue raised for the first time on appeal is barred by estoppel.70

In this case, the fact that respondent filed a case before the DTI was made known
to petitioner71 long before the SEC rendered its decision. Yet, despite its knowledge,
petitioner failed to question the alleged forum shopping before the SEC. The
exceptions to the general rule that forum shopping should be raised in the earliest
opportunity, as explained in the cited case of Young v. Keng Seng,72 do not obtain in
this case.

WHEREFORE, the petition is DENIED. The decision of the Court of Appeals dated
March 29, 2006 is hereby AFFIRMED.

SO ORDERED.
 G.R. No. 198889, January 20, 2016
UFC PHILIPPINES, INC. (NOW MERGED WITH NUTRI-ASIA, INC., WITH
NUTRI-ASIA, INC. AS THE SURVIVING ENTITY), Petitioner, v. FIESTA
BARRIO MANUFACTURING CORPORATION,Respondent.
DECISION
LEONARDO-DE CASTRO, J.:
For our disposition is a petition for review on certiorari under Rule 45 seeking to
annul and set aside the June 23, 2011 Decision1 and the October 4,
2011 Resolution2 of the Court of Appeals in CA-G.R. SP No. 107570, which
reversed and set aside the March 26, 2008 Decision3 of the Bureau of Legal Affairs
of the Intellectual Property Office (IPO-BLA) and the January 29, 2009 Decision4 of
the Director General of the IPO. Petitioner Nutri-Asia, Inc. (petitioner) is a
corporation duly organized and existing under Philippine laws.5 It is the emergent
entity in a merger with UFC Philippines, Inc. that was completed on February 11,
2009.6 Respondent Barrio Fiesta Manufacturing Corporation (respondent) is likewise
a corporation organized and existing under Philippine laws.
On April 4, 2002, respondent filed Application No. 4-2002-002757 for the mark
"PAPA BOY & DEVICE" for goods under Class 30, specifically for "lechon sauce."7 The
Intellectual Property Office (IPO) published said application for opposition in the IP
Phil. e-Gazette released on September 8, 2006. The mark appears as follows:
(Please see image G.R. No. 198889 pg. 2)
On December 11, 2006, petitioner filed with the IPO-BLA a Verified Notice of
Opposition to the above-mentioned application and alleged that:
1. The mark "PAPA" for use on banana catsup and other similar goods was
first used [in] 1954 by Neri Papa, and thus, was taken from his surname;
2. After using the mark "PAPA" for about twenty-seven (27) years, Neri Papa
subsequently assigned the mark "PAPA" to Hernan D. Reyes who, on
September 17, 1981, filed an application to register said mark "PAPA" for
use on banana catsup, chili sauce, achara, banana chips, and instant ube
powder;
3. On August 14, 1983, Hernan D. Reyes was issued Certificate of
Registration No. 32416;
4. [Certificate of] Registration No. 32416 was subsequently assigned to the
following in successive fashion: Acres & Acres Food, Inc., Southeast Asia
Food, Inc., Heinz-UFC Philippines, Inc., and Opposer UFC Philippines, Inc.;
5. Last October 28, 2005, Heinz-UFC Philippines, Inc. filed Application Serial
No. 4-2005-010788 which, in effect, is a re- registration of Registration No.
32416 which expired on August 11, 2003;
6. Hernan D. Reyes also filed on March 04, 1982 an application to register in
the Supplemental Register the "PAPA BANANA CATSUP Label";
7. On August 11, 1983, Hernan D. Reyes was issued Certificate of
Registration No. SR-6282 which was subsequently assigned to Acres &
Acres Food, Inc., Southeast Asia Food, Inc., Heinz-UFC Philippines, Inc.;
8. After its expiration, Opposer filed on November 15, 2006 Trademark
Application Serial No. 4-2006-012346 for the re-registration of the "PAPA
Label Design";
9. The mark "PAPA KETSARAP" for use on banana sauce falling under Class 30
was also registered in favor of Acres & Acres Food, Inc. under Registration
No. 34681 issued on August 23, 1985 and renewed last August 23, 2005
by Heinz-UFC Philippines, Inc. for ten (10) years;
10. On November 07, 2006, Registration No. 34681 was assigned to Opposer;
11. Opposer has not abandoned the use of the mark "PAPA" and the variations
thereof as Opposer has continued their use up to the present;
12. The mark "PAPA BOY & DEVICE" is identical to the mark "PAPA" owned by
Opposer and duly registered in its favor, particularly the dominant feature
thereof;
13. [With the] dominant feature of respondent-applicant's mark "PAPA BOY &
DEVICE", which is Opposer's "PAPA" and the variations thereof, confusion
and deception is likely to result: The consuming public, particularly the
unwary customers, will be deceived, confused, and mistaken into believing
that respondent-applicant's goods come from Opposer or are authorized by
Opposer to Opposer's prejudice, which is particularly true considering that
Opposer's sister company, Southeast Asia Food, Inc., and its predecessors-
in-interest have been major manufacturers and distributors of lechon sauce
and other table sauces since 1965 under its registered mark "Mang
Tomas";
14. Respondent-applicant's mark "PAPA BOY & DEVICE" which nearly
resembles Opposer's mark "PAPA" and the variations thereof will impress
upon the gullible or unsuspecting public that it is the same or related to
Opposer as to source because its dominant part is the same as Opposer's
mark and, thus, will likely be mistaken to be the mark, or related to, or a
derivative or variation of, Opposer's mark;
15. The goods covered by respondent-applicant's application fall under Class
30, the same Class under which Opposer's goods enumerated in its earlier
issued registrations;
16. The test of dominancy is now explicitly incorporated into law in Section
155.1 of the IP Code which defines infringement as the colorable imitation
of a registered mark or a dominant feature thereof, and is provided for by
jurisprudence;
 17. As a corporation also engaged in the food business, Respondent- applicant
knew and/or ought to know that Opposer and its predecessors-in-interest
have been using the mark "PAPA" and the variations thereof for the last
fifty-two (52) years while its sister company is engaged in the business of
manufacturing and distributing "lechon sauce" and other table sauces for
the last forty-one (41) years;
18. The approval of the subject application will violate Opposer's right to the
exclusive use of its registered mark "PAPA" and the variations thereof per
Section 13 8 of the IP Code;
19. The approval of the subject application has caused and will continue to
cause great and irreparable damage and injury to Opposer;
20. Respondent-applicant filed the subject application fraudulently and in bad
faith; and
21. Respondent-applicant is not entitled to register the subject mark in its
favor.8
In its verified opposition before the IPO, petitioner contended that "PAPA BOY &
DEVICE" is confusingly similar with its "PAPA" marks inasmuch as the former
incorporates the term "PAPA," which is the dominant feature of petitioner's "PAPA"
marks. Petitioner averred that respondent's use of "PAPA BOY & DEVICE" mark for
its lechon sauce product, if allowed, would likely lead the consuming public to
believe that said lechon sauce product originates from or is authorized by petitioner,
and that the "PAPA BOY & DEVICE" mark is a variation or derivative of petitioner's
"PAPA" marks. Petitioner argued that this was especially true considering that
petitioner's ketchup product and respondent's lechon sauce product are related
articles that fall under the same Class 30.9chanroblesvirtuallawlibrary
Petitioner alleged that the registration of respondent's challenged mark was also
likely to damage the petitioner, considering that its former sister company,
Southeast Asia Food, Inc., and the latter's predecessors-in-interest, had been major
manufacturers and distributors of lechon and other table sauces since 1965, such as
products employing the registered "Mang Tomas" mark.
In its Verified Answer, respondent argued that there is no likelihood of confusion
between petitioner's family of "PAPA" trademarks and respondent's "PAPA BOY &
DEVICE" trademark. Respondent raised affirmative defenses and we quote the
relevant ones below:
3. Opposer cites several of its following marks in support of its opposition to the
application but an examination of said marks [reveals] that these have already
expired and/or that no confusing similarity exists x xx;
4. Assuming that the mark "PAPA KETSARAP" had been timely renewed on August
23, 2005 for "banana sauce" under Class 30, the same is not a hindrance to the
successful registration of the mark "PAPA BOY & DEVICE": Jurisprudence provides
that a certificate of registration confers upon the trademark owner the exclusive
right to use its own symbol only to those goods specified in the certificate subject to
the conditions and limitations stated therein;
5. As a result, Opposer's right to use the mark "PAPAKETSARAP" is limited to the
products covered by its certificate of registration which is Class 30 for banana
sauce;
6. Contrary to Opposer's belief, the dominant features of Respondent-applicant's
mark "PAPA BOY & DEVICE" are the words "PAPA BOY" and the representation of a
smiling hog-like character gesturing the thumbs-up sign and wearing a traditional
Filipino hat and scarf while the dominant feature of Opposer's mark "PAPA
KETSARAP" are the words "Papa" and "Ketsarap", not the word "Papa"; and the
word "Ketsarap " is more prominently printed and displayed in the foreground than
the word "Papa" for which reasons opposer's reference to the Dominancy Test fails;
7. Opposer's allegation that the registration of Respondent-applicant's mark "PAPA
BOY & DEVICE" will damage and prejudice the mark "MANG TOMAS" is irrelevant
considering that Opposer's basis for filing this opposition is the alleged confusing
similarity between Respondent-applicant's mark and Opposer's mark "PAPA
KETSARAP", not the mark "MANG TOMAS";
8. Respondent-applicant's mark "PAPA BOY & DEVICE" is neither identical nor
confusingly similar to Opposer's mark "PAPA KETSARAP": Respondent-applicant's
mark "PAPABOY & DEVICE" is an arbitrary mark which differs in overall sound,
spelling, meaning, style, configuration, presentation, and appearance from
Opposer's mark "PAPA KETSARAP";
9. The dissimilarities between the marks are so distinct, thus, confusion is very
unlikely: While Opposer's mark is a plain word mark, Respondent-applicant's mark
"PAPA BOY & DEVICE" is much more intricate and distinctive such as Opposer's
mark not having the words "Lechon Sauce" printed inside a blue ribbon-like device
which is illustrated below the words "PAPA BOY", Opposer's mark not having a
prominent smiling hog-like character gesturing a thumbs-up sign and wearing a
Filipino hat and scarf stands beside the words "PAPA BOY", and Opposer's mark not
having the words "Barrio Fiesta" albeit conspicuously displayed above the mark, all
which leave no doubt in the consumer's mind on the product that he is purchasing;
10. Aside from the fact that Respondent-applicant's mark "PAPA BOY & DEVICE" is
distinct and different in appearance, spelling, sound, meaning, and style from
Opposer's mark "PAPA KETSARAP", the difference in the goods covered by both
marks is obvious: Since the goods covered by Respondent-applicant's mark is
unrelated and non- competing to those covered by Opposer's mark, the doctrine
allowing the registrations of marks covering unrelated and non-competing goods as
enunciated by the Supreme Court is therefore applicable in this case;
11. Respondent-applicant's mark cannot be confusingly similar to Opposer's mark
considering that the products covered by these marks are different: While
Respondent-applicant's mark "PAPA BOY & DEVICE" covers lechon sauce under
Class 30, Opposer's mark "PAPA KETSARAP" covers banana sauce;
12. If a consumer is in the market for banana sauce, he will not buy lechon sauce
and vice-versa and as a result, the margin of error in the acquisition of one from the
other is simply remote;
13. Respondent-applicant is the exclusive owner of the mark "PAPA BOY & DEVICE"
for lechon sauce under Class 30: The words "PAPA BOY" is a combination of the
nickname of Bonifacio Ongpauco who is one of Respondent-applicant's incorporators
and founders- "BOY"- and the word "PAPA" as Bonifacio Ongpauco's mother, Sixta
P. Evangelista, had been fondly known as "Mama Chit", making Respondent-
applicant the prior adopter, user, and applicant of the mark "PAPA BOY & DEVICE"
in the Philippines;
14. To protect its ownership over the mark "PAPA BOY & DEVICE" considering that it
is the first to adopt and use said mark, Respondent-applicant applied for its
registration under Application Serial No. 4-2002-002757 for Class 30, and said
application was found registrable by the Examiner as a consequence of which the
same was recommended for allowance after undergoing a thorough process of
examination, which recommendation was then approved by the Director of the
Bureau of Trademarks (BOT);
15. Respondent-applicant's mark "PAPA BOY & DEVICE" has been commercially
used in the Philippines;
16. Respondent-applicant's mark "PAPA BOY & DEVICE" has been promoted and
advertised for a considerable duration of time and over wide geographical areas:
Respondent-applicant has invested tremendous amount of resources in the
promotion of its mark "PAPA BOY & DEVICE" through various media including print
publications and promotional materials;
17. The widespread local commercial use of the subject mark by Respondent-
applicant to distinguish and identify its various high-quality consumer products has
earned Respondent-applicant a well-deserved business reputation and goodwill;
18. Respondent-applicant's mark is distinctive and capable of identifying its goods
and distinguishing them from those offered for sale by others in the market
including Opposer's goods for which reason no confusion will result because
Respondent-applicant's mark is for lechon sauce while Opposer's mark is for banana
sauce; and
19. The presence of a common prefix "PAPA" in the marks of both parties does not
render said marks identical or confusingly similar: Opposer cannot exclusively
appropriate said prefix considering that other marks such as "Papa Heinz Pizza",
"Papa Heinz Sausage", "Papa Beaver", "Papa Pop", "Pizza Papa John's & Design",
"Papadoods", and "Papa in Wine and Device" are valid and active.10chanrobleslaw
Petitioner's mark and its variations appear as follows:
1. 1. "PAPA" under Registration No. 32416 for Class 29 goods;11
(Please see image G.R. No. 198889 page 7.)
2. The mark "PAPA" as it appeared upon re-registration of Certificate No.
32416, under Application No. 4-2005-010788 for Classes 29 and 30
goods;12
(Please see image G.R. No. 198889 page 7.)
3. "PAPA LABEL DESIGN" under Registration No. 4-2006-012364;13 and
(Please see image G.R. No. 198889 page 7.)
4. "PAPA KETSARAP" under Certificate of Registration No. 34681, for banana
sauce (Class 30).14
(Please see image G.R. No. 198889 page 8.)
PROCEEDINGS BEFORE THE INTELLECTUAL PROPERTY OFFICE
The case was referred to mediation but the parties failed to arrive at an amicable
settlement. The case was thus set for preliminary conference. Subsequently, the
IPO-BLA directed the parties to file their respective position papers and draft
decisions.
The IPO-BLA rendered a Decision on March 26, 2008 sustaining petitioner's
Opposition and rejecting respondent's application for "PAPA BOY & DEVICE."
The fallo of said decision reads as follows:
WHEREFORE, the VERIFIED NOTICE OF OPPOSITION filed by UFC Philippines, Inc.
is, as it is hereby, SUSTAINED. Consequently, Application Serial No. 4-2002-002757
for the mark "PAPA BOY & DEVICE" for lechon sauce under Class 30 filed on April
04, 2002 by Barrio Fiesta Manufacturing Corporation, is, as it is hereby, REJECTED.
Let the file wrapper of PAPA BOY & Device subject matter of this case be forwarded
to the Bureau of Trademarks (BOT) for appropriate action in accordance with this
Decision.15chanrobleslaw
Respondent filed an appeal before the IPO Director General, who found it
unmeritorious, and disposed of the case in the following manner:
WHEREFORE, the instant appeal is hereby DISMISSED. Let a copy of this Decision
as well as the trademark application and records be furnished and returned to the
Director of the Bureau of Legal Affairs for appropriate action. Further, let also the
Director of the Bureau of Trademarks and the library of the Documentation,
Information and Technology Transfer Bureau be furnished a copy of this Decision for
information, guidance, and records purposes."16
DECISION OF THE COURT OF APPEALS
Respondent then filed a petition with the Court of Appeals, questioning the above
decision of the IPO Director General that affirmed the decision of the IPO Bureau of
Legal Affairs Director, which disallowed respondent's application for trademark
registration. Respondent's arguments before the Court of Appeals are quoted
below:
 A.
REGISTRATION NOS. 32416 AND 42005010788 ISSUED FOR THE "PAPA" MARK
AND REGISTRATION NOS. SR-6282 AND 42006012364 ISSUED FOR THE
TRADEMARK "PAPA BANANA CATSUP LABEL/PAPA LABEL DESIGN" SHOULD NOT BE
USED AS BASIS IN DETERMINING THE EXISTENCE OF CONFUSING SIMILARITY.
B.
THERE IS NO CONFUSING SIMILARITY BETWEEN PETITIONER-APPLICANT'S "PAPA
BOY & DEVICE" AND RESPONDENT'S "PAPA KETSARAP" MARK.
C.
PETITIONER-APPLICANT IS ENTITLED TO THE REGISTRATION OF THE MARK "PAPA
BOY & DEVICE."
D.
THE OPPOSITION STATES NO CAUSE OF ACTION, AND HENCE, SHOULD BE DENIED
OUTRIGHT.17chanrobleslaw
As regards the first ground, the Court of Appeals held:
Records show that respondent UFC has Certificates of Registration for the
trademarks PAPA, PAPA BANANA CATSUP label and PAPA KETSARAP. A closer look
at the respective Certificate[s] of Registration of the aforementioned marks,
however, reveals that at the time the trademark application of petitioner was
published in the IPO e-Gazette on September 8, 2006, the duration of the
trademark registration of respondent over the marks PAPA and PAPA BANANA
CATSUP have already expired. On the other hand, the mark PAPA KETSARAP
was timely renewed by respondent as shown by the Certificate of Renewal
of Registration issued on September 1, 2006 by the Director of the Bureau
of Trademarks.
Under R.A. No. 8293, as amended by R.A. No. 9150, the duration of a trademark
registration is 10 years, renewable for periods of 10 years each renewal. The
request for renewal must be made within 6 months before or after the expiration of
the registration. Respondent's PAPA mark was not renewed within the period
provided for under RA No. 8293. Its registered term ended on August 11, 2003 but
was reapplied for registration only on April 4, 2005. Meanwhile, the mark PAPA
BANANA CATSUP was registered by respondent only in the Supplemental Register,
hence, was not provided any protection, x x x. It is noted that the PAPA BANANA
CATSUP label was applied for registration on November 15, 2006, over three years
after the expiration of its registration in the Supplemental Register of the Philippine
Patent Office on August 11, 2003. Thus, while petitioner has a point that the
marks PAPA and PAPA BANANA CATSUP have already expired and the latter
having been afforded no protection at all and should not be juxtaposed
with petitioner's trademark, respondent can still use the marks PAPA
KETSARAP and PAPA BANANA CATSUP, it appearing that the Intellectual
Property Office issued a Certificate of Registration No. 4-2006-012364 for
the latter on April 30, 2007, to bar the registration of petitioner's "PAPA
BOY & DEVICE" mark.18 (Emphases supplied, citations omitted.)
Anent the second ground, the Court of Appeals ruled in the following manner:
After taking into account the aforementioned doctrines and the factual
circumstances of the case at bar, this Court, after considering the
trademarks involved as a whole, is of the view that petitioner's trademark
"PAPA BOY & DEVICE" is not confusingly similar to respondent's "PAPA
KETSARAP" and "PAPA BANANA CATSUP" trademark. Petitioner's trademark is
"PAPA BOY" as a whole as opposed to respondent's "PAPA". Although on its label the
word "PAPA" is prominent, the trademark should be taken as a whole and not
piecemeal. The difference between the two marks are conspicuous and noticeable.
While respondent's products are both labeled as banana sauces, that of petitioner
Barrio Fiesta is labeled as lechon sauce.
Moreover, it appears on the label of petitioner's product that the said lechon sauce
is manufactured by Barrio Fiesta thus, clearly informing the public [of) the identity
of the manufacturer of the lechon sauce. As claimed by respondent, its products
have been in commercial use for decades. It is safe to assume then that the
consumers are already aware that "PAPA KETSARAP" and "PAPA BANANA CATSUP"
are products of UFC and not of petitioner or the other way around. In addition, as
correctly pointed out by petitioner, if a consumer is in the market for banana sauce,
he will not buy lechon sauce and vice-versa because aside from the fact that the
labels of both parties' products contain the kind of sauce they are marketing, the
color of the products is visibly different. An ordinary consumer is familiar with the
fact that the color of a banana sauce is red while a lechon sauce is dark brown.
There can be no deception as both products are marketed in bottles making the
distinction visible to the eye of the consumer and the likelihood of acquiring a wrong
sauce, remote. Even if the products are placed side by side, the dissimilarities
between the two marks are conspicuous, noticeable and substantial enough to
matter especially in the light of the following variables that must be factored in.
Lastly, respondent avers that the word "PAPA" was coined after the surname of the
person who first created and made use of the mark. Admittedly, while "PAPA" is a
surname, it is more widely known as a term of endearment for one's father.
Respondent cannot, therefore, claim exclusive ownership over and singular use of
[the] term. Petitioner was able to explain that it adopted the word "PAPA" in parallel
to the nickname of the founder of Barrio fiesta which is "MAMA CHIT". "PAPA BOY"
was derived from the nickname of one of the incorporators of herein petitioner, a
certain Bonifacio Ongpauco, son of Mama Chit.19(Emphasis ours, citation omitted.)
THEORY OF PETITIONER
Thus, petitioner came to this Court, seeking the reversal of the questioned decision
and resolution of the Court of Appeals, and the reinstatement of the decision of the
IPO Director General affirming the decision of the IPO-BLA. Petitioner raises the
following grounds:
I.
The court a quo erred in applying the "holistic test" to determine whether there is
confusing similarity between the contending marks, and in reversing the IPO-BLA
and the Director General's application of the "dominancy test."
II.
The court a quo erred in holding that there is no likelihood of confusion between the
contending marks given that the "PAPA BOY & DEVICE" mark is used on lechon
sauce, as opposed to ketchup products.
III.
The court a quo erred in holding that Petitioner cannot claim exclusive ownership
and use of the "PAPA" mark for its sauce products because "PAPA" is supposedly a
common term of endearment for one's father.20chanrobleslaw
Under the first ground, petitioner submitted the following arguments:
1. The findings of administrative agencies, if supported by substantial
evidence, are binding upon the courts.21
Petitioner alleges that the Court of Appeals should have respected the ruling of the
IPO Director General, which was consistent with the ruling of the IPO-BLA and
supported by substantial evidence, instead of substituting its findings of fact for
those of the Director General and the IPO-BLA.
2. The dominancy test should have been applied to determine if there is
confusing similarity between the competing marks.22
Petitioner points out that the Director General and the IPO-BLA found that the
dominant feature of the competing marks is the word "PAPA" and the minor
additions to respondent's "PAPA BOY & DEVICE" mark do not negate likelihood of
confusion caused by the latter's use of the dominant word "PAPA." Petitioner claims
that even compared solely to petitioner's "PAPA KETSARAP" mark (Registration No.
34681), which is conceded to have been timely renewed and to have never expired,
respondent's "PAPA BOY & DEVICE" would still create the likelihood of
confusion.23chanroblesvirtuallawlibrary
According to petitioner, the Court of Appeals based its decision on Mead Johnson &
Co. v. N.V.J. Van Dorp, Ltd.,24 a case decided almost five decades ago, long before
Republic Act No. 8293 or the 1998 Intellectual Property Code was enforced. Thus,
the Court of Appeals erroneously applied the holistic test since given the nature of
the products bearing the competing marks, the dominancy test should have been
applied.
Petitioner claims that "[k]etchup and lechon sauce are common and inexpensive
household products that are sold in groceries and regularly encountered by the
ordinary or common purchaser who is not expected to examine, scrutinize, and
compare the details of the competing marks."25cralawred
Petitioner distinguishes this case from Mead Johnson and claims that the ordinary
purchaser of ketchup or lechon sauce is not likely to closely scrutinize each mark as
a whole, for the latter is "undiscerningly rash" and usually in a hurry, and cannot be
expected to take note of the smiling hog-like character or the blue ribbon-like
device with the words "Lechon Sauce." Petitioner argues that under the Intellectual
Property Code, it is not necessary for one to colorably imitate the competing
trademark as a whole. It is sufficient that one imitates a "dominant feature" of the
mark to constitute trademark infringement.
Petitioner asserts that as the IPO-BLA and the Director General observed that the
ordinary purchaser is most likely to notice the words "PAPA BOY," which, in turn,
may lead him to believe that there is a connection between respondent's lechon
sauce and petitioner's ketchup products.
Under the second ground, petitioner argues that the Court of Appeals seemed to be
unmindful that two kinds of confusion may arise from the use of similar or colorable
imitation marks, i.e., confusion of goods (product confusion) and confusion of
business (source or origin confusion). Petitioner claims that it is reasonable to
assume that it may expand its business to producing lechon sauce, inasmuch as it
already produces food sauce products and its Articles of Incorporation authorizes it
to do so.
Petitioner alleges that the IPO-BLA recognized that confusion of business may arise
from respondent's use of its "PAPA BOY & DEVICE" mark for lechon sauce products,
and that the Director-General agreed with the IPO-BLA's findings on this issue.
Petitioner asserts that ketchup and lechon sauce are undeniably related goods; that
they belong to the same class, i.e., Class 30 of the Nice Classifications; that they
serve practically the same purpose, i.e.,to spice up dishes; and that they are sold in
similar bottles in the same shelves in grocery stores. Petitioner argues that the
Court of Appeals had absolutely no basis for stating that a person who is out to buy
ketchup is not likely to buy lechon sauce by mistake, as this analysis allegedly only
applies to "product confusion" and does not consider confusion of business.
Petitioner alleges that "[t]here equally is actionable confusion when a buyer
purchases Respondent's 'PAPA BOY' lechon sauce believing that the said product is
related to or associated with the famous 'PAPA KETSUP' makers." Petitioner further
alleges that "it is reasonable and likely for a consumer to believe that Respondent's
'PAPA BOY' lechon sauce originated from or is otherwise connected with Petitioner's
line of sauces" and that this is "the precise evil that recognition of confusion of
business seeks to prevent."26chanroblesvirtuallawlibrary
Petitioner avers that "PAPA" is a well-known mark and that it has been in
commercial use as early as 1954 on banana ketchup and similar goods. The "PAPA"
mark is also registered as a trademark and in commercial use in other parts of the
world such as the United States of America and the Middle East. Petitioner claims
that "[bjeing a trademark that is registered and well-known both locally and
internationally, Petitioner's 'PAPA' marks cannot be appropriated by another person
or entity not only with respect to goods similar to those with respect to which it is
registered, but also with respect to goods which are not similar to those for which
the 'PAPA' marks are registered."27chanroblesvirtuallawlibrary
Under the third ground, petitioner claims that the fact that the word "PAPA" is a
known term of endearment for fathers does not preclude it from being used as a
mark to identify goods. Petitioner claims that their mark falls under a type of mark
known as "arbitrary or fanciful marks," which are "marks that bear no logical
relation to the actual characteristics of the products they represent," are "highly
distinctive and valid," and "are entitled to the greatest
protection."28chanroblesvirtuallawlibrary
Petitioner claims that the mark "PAPA" falls under this class of arbitrary marks, even
if "PAPA" is also a common term of endearment for one's father. Petitioner states
that there is no logical connection between one's father and food sauces, such as
ketchup; thus, with respect to ketchup, food sauces, and their related products, and
for the purpose of identifying its products, petitioner claims exclusive ownership of
the term "PAPA" as an arbitrary mark.
Petitioner alleges that if respondent "has a good faith and proud desire to
unmistakably and distinctly identify its lechon sauce product out in the market, it
should have coined a mark that departs from and is distinguished from those of its
competitors." Petitioner claims that respondent, with full knowledge of the fame and
the decades-long commercial use of petitioner's "PAPA" marks, opted for "PAPA BOY
& DEVICE," which obviously is just a "colorable imitation." 29
THEORY OF RESPONDENT
In its Comment,30 respondent claims that petitioner's marks have either expired
and/or "that no confusing similarity exists between them and respondent's "PAPA
BOY & DEVICE' mark." Respondent alleges that under Section 15 of Republic Act No.
166, a renewal application should be filed within six months before the expiration of
the period or within three months after such expiration. Respondent avers that the
expiration of the 20-year term for the "PAPA" mark under Registration No. 32416
issued on August 11, 1983 was August 11, 2003. The sixth month before August
11, 2003 was February 11, 2003 and the third month after August 11, 2003 was
November 11, 2003. Respondent claims that the application that petitioner filed on
October 28, 2005 was almost two years late. Thus, it was not a renewal application,
but could only be considered a new application under the new Trademark Law, with
the filing date reckoned on October 28, 2005. The registrability of the mark under
the new application was examined again, and any certificate issued for the
registration of "PAPA" could not have been a renewal certificate.
As for petitioner's other mark "PAPA BANANA CATSUP LABEL," respondent claims
that its 20-year term also expired on August 11, 2003 and that petitioner only filed
its application for the new "PAPA LABEL DESIGN" on November 15, 2006. Having
been filed three years beyond the renewal application deadline, petitioner was not
able to renew its application on time, and cannot claim a "continuous existence of
its rights over the 'PAPA BANANA CATSUP LABEL.'" Respondent claims that the two
marks are different from each other and that the registration of one is independent
of the other. Respondent concludes that the certificate of registration issued for
"PAPA LABEL DESIGN" is "not and will never be a renewal
certificate."31chanroblesvirtuallawlibrary
Respondent also avers as follows:
1.3. With regard to the two new registrations of petitioner namely: "PAPA" (Reg.
No. 4-2005-010788) and "PAPA LABEL DESIGN" (Reg. No. 4-2006-012364), these
were filed on October 28, 2005 and November 15, 2006, respectively, under the
Intellectual Property Code (RA 8293), which follows the "first to file" rule, and were
obviously filed later than respondent's "PAPA BOY & DEVICE" mark filed on April 4,
2002. These new marks filed much later than the opposed "PAPA BOY & DEVICE"
mark cannot, therefore, be used as basis for the opposition and should in fact, be
denied outrightly.
xxxx
A search of the Online Trademark Database of Intellectual Property Office (IPO) will
show that only Registration No. 34681 issued for "PAPA KETSARAP" was properly
renewed on August 23, 2005. x x x Clearly, the registrations of "PAPA" and "PAPA
BANANA CATSUP LABEL" marks under registration nos. 32416 and SR-6282
respectively, have already expired when Petitioner filed its opposition proceeding
against Respondent's trademark on December 11, 2006. Having expired, and
therefore, no longer legally existing, the "PAPA" and "PAPA BANANA CATSUP LABEL"
marks CANNOT BAR the registration of respondent's mark. To allow petitioner's
expired marks to prevent respondent's distinct "PAPA BOY & DEVICE" mark from
being registered would be the ultimate absurdity.32chanrobleslaw
Respondent posits that the Court of Appeals did not err in reversing the decisions of
the administrative agencies, alleging that "[while] it is true that the general rule is
that the factual findings of administrative bodies deserve utmost respect when
supported by evidence, the same is subject to exceptions,"33 and that the Court of
Appeals had justifiable reasons to disregard the factual finding of the IPO. Here, the
Court of Appeals wisely identified certain material facts that were overlooked by the
IPO-BLA and the IPO Director General which it opined, when correctly appreciated,
would alter the result of the case.
Respondent alleges that the IPO-BLA erroneously considered petitioner's marks
"PAPA" and "PAPA BANANA CATSUP LABEL" when it applied the dominancy test in
determining whether petitioner's marks are confusingly similar to those of
respondent's mark "PAPA BOY & DEVICE."
Respondent avers that the IPO-BLA absurdly took emphasis on the mark "PAPA" to
arrive at its decision and did not take into consideration that petitioner's mark was
already expired when respondent applied for the registration of its "PAPA BOY &
DEVICE" mark. Respondent compares its "PAPA BOY & DEVICE" with the only mark
that respondent allegedly has, "PAPA KETSARAP," and found no confusing similarity
between the two.
We quote below respondent's discussion of its application of the dominancy test to
the marks in question:
Applying the Dominancy test, as correctly emphasized by the Court of Appeals, the
dominant feature in respondent's mark is "PAPA BOY" and not "PAPA". It can be
gleaned from respondent's mark that the word "PAPA" was written in the same font,
style and color as the word "BOY". There is also the presence of a "smiling hog-like
character" which is positioned very prominently, both in size and location in said
mark, at glance (sic) even more dominant than the word "PAPA BOY".
xxxx
On the other hand, the dominant feature in petitioner's mark is "KETSARAP", not
"PAPA". Even an ordinary examiner could observe that the word "KETSARAP" in
petitioner's mark is more prominently printed than the word "PAPA".
xxxx
In a dominancy test, the prominent feature of the competing trademarks must be
similar to cause confusion or deception, x x x.
Verily, respondent's dominant feature "PAPA BOY" and the smiling hog-like
character and petitioner's dominant feature "KETSARAP", being the word written in
a larger font, are neither confusing nor deceiving to the public. In fact, the
differences between their dominant marks are very noticeable and conspicuous to
every purchaser.
Furthermore, the Supreme Court in Societe des Produits Nestle, S.A. v. Dy [641
Phil. 345], applied the dominancy test by taking into account the aural effects of the
words and letters contained in the marks in determining the issue of confusing
similarity. Obviously, petitioners' "PAPA KETSARAP" mark does not in any way
sounds (sic) like respondent's "PAPA BOY" mark. The common prefix "PAPA" does
not render the marks aurally the same. As discussed above, the dominant feature in
petitioner's mark is "KETSARAP" and the dominant feature in respondent's mark is
"PAPA BOY". Thus, the words "KETSARAP" and "PAPA BOY" in petitioner's and
respondent's respective marks are obviously different in sound, making "PAPA BOY
& DEVICE" even more distinct from petitioner's "PAPA KETSARAP"
mark.35chanrobleslaw
Using the holistic test, respondent further discusses the differences in the marks in
this wise:
Even the use of the holistic test x x x takes into consideration the entirety of the
marks in question [to] be considered in resolving confusing similarity. The
differences are again very obvious. Respondent's mark has (1) the word "lechon
sauce" printed inside a blue ribbon-like device which is illustrated below the word
"PAPA BOY"; (2) a prominent smiling hog-like character gesturing a thumbs-up sign
and wearing a Filipino hat and scarf stands beside the word "PAPA BOY"; and the
word "BARRIO FIESTA" conspicuously displayed above the said trademark which
leaves no doubt in the consumer's mind on the product that he or she is purchasing.
On the other hand, petitioner's mark is the word "PAPA" enclosed by a cloud on top
of the word "KETSARAP' enclosed by a geometrical figure.
xxxx
In the instant case, the respective marks are obviously different in color scheme,
logo, spelling, sound, meaning and connotation. Thus, yet again, under the holistic
test there can be no confusion or deception between these marks.
It also bears stressing that petitioner's "PAPA KETSARAP" mark covers "banana
catsup" while respondent's "PAPA BOY & DEVICE" covers "lechon sauce", thereby
obliterating any confusion of products of both marks as they travel different
channels of trade. If a consumer is in the market for banana catsup, he or she will
not buy lechon sauce and vice-versa. As a result, the margin of error in the
acquisition of one for the other is simply remote. Lechon sauce which is liver sauce
is distinct from catsup extracted/ made from banana fruit. The flavor and taste of a
lechon sauce are far from those of a banana catsup. Lechon sauce is sauce for
"lechon" while banana catsup is apparently catsup made from
banana.36chanrobleslaw
Respondent also contends that "PAPA BOY & DEVICE" mark is not confusingly
similar to petitioner's trademark "PAPA KETSARAP" in terms of appearance, sound,
spelling and meaning. The difference in nature, usage, taste and appearance of
products decreases the possibility of deception among
buyers.37chanroblesvirtuallawlibrary
Respondent alleges that since petitioner merely included banana catsup as its
product in its certificate, it cannot claim any further right to the mark "PAPA
KETSARAP" on products other than banana catsup. Respondent also alleges that
petitioner cannot raise "international notoriety of the mark" for the first time on
appeal and that there is no proof that petitioner's mark is internationally well-
known.38chanroblesvirtuallawlibrary
Furthermore, respondent argues that petitioner cannot claim exclusive ownership
over the use of the word "PAPA," a term of endearment for one's father. Respondent
points out that there are several other valid and active marks owned by third parties
which use the word "PAPA," even in classes of goods similar to those of petitioner's.
Respondent avers that petitioner's claim that its "PAPA" mark is an arbitrary mark is
belatedly raised in the instant petition, and cannot be allowed because the "PAPA
KETSARAP" mark would immediately bring the consuming public to thinking that the
product involved is catsup and the description of said catsup is "masarap"
(delicious) and due to the logical relation of the petitioner's mark to the actual
product, it being descriptive or generic, it is far from being arbitrary or
fanciful.39chanroblesvirtuallawlibrary
Lastly, respondent claims that the Court of Appeals correctly ruled that respondent's
product cannot be confused as originating from the petitioner. Since it clearly
appears in the product label of the respondent that it is manufactured by Barrio
Fiesta, the public is dutifully informed of the identity of the lechon sauce
manufacturer. The Court of Appeals further took into account the fact that
petitioner's products have been in commercial use for
decades.40chanroblesvirtuallawlibrary
Petitioner, in its Reply41 to respondent's Comment, contends that respondent
cannot invoke a prior filing date for the "PAPA BOY" mark as against Petitioner's
"PAPA" and "PAPA BANANA CATSUP LABEL" marks, because the latter marks were
still registered when respondent applied for registration of its "PAPA BOY" mark.
Thus, the IPO-BLA and Director General correctly considered them in deciding
whether the "PAPA BOY" mark should be registered, using the "first to file" rule
under Section 123.1(d) of Republic Act No. 8293, or the Intellectual Property Code
(IP Code).
Petitioner reiterates its argument that the Court of Appeals erred in applying the
holistic test and that the proper test under the circumstances is the dominancy test,
which was correctly applied by the IPO-BLA and the Director General.42
THIS COURT'S RULING
The petition has merit. We find that the Court of Appeals erred in applying the
holistic test and in reversing and setting aside the decision of the IPO-BLA and that
of the IPO Director General, both of which rejected respondent's application for the
mark "PAPA BOY & DEVICE."
In Dermaline, Inc. v. Myra Pharmaceuticals, Inc.,43 we defined a trademark as "any
distinctive word, name, symbol, emblem, sign, or device, or any combination
thereof, adopted and used by a manufacturer or merchant on his goods to identify
and distinguish them from those manufactured, sold, or dealt by others." We held
that a trademark is "an intellectual property deserving protection by law."

The rights of the trademark owner are found in the Intellectual Property Code,
which provides:
Section 147. Rights Conferred. - 147.1. The owner of a registered mark shall
have the exclusive right to prevent all third parties not having the owner's consent
from using in the course of trade identical or similar signs or containers for goods or
services which are identical or similar to those in respect of which the trademark is
registered where such use would result in a likelihood of confusion. In case of the
use of an identical sign for identical goods or services, a likelihood of confusion shall
be presumed.
Section 168. Unfair Competition, Rights, Regulation and Remedies. -
168.1. 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, whether or
not a registered mark is employed, 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.
The guideline for courts in determining likelihood of confusion is found in A.M. No.
10-3-10-SC, or the Rules of Procedure for Intellectual Property Rights Cases, Rule
18, which provides:
RULE 18
Evidence in Trademark Infringement and Unfair Competition Cases SECTION
1.Certificate of Registration. — A certificate of registration of a mark shall be prima
facieevidence of:
a) the validity of the registration; b) the registrant's ownership of the mark; and
c) the registrant's exclusive right to use the same in connection with the goods or
services and those that are related thereto specified in the certificate.
xxxx
SECTION 3. Presumption of Likelihood of Confusion. — Likelihood of confusion shall
be presumed in case an identical sign or mark is used for identical goods or
services.
SECTION 4. Likelihood of Confusion in Other Cases. — In determining whether one
trademark is confusingly similar to or is a colorable imitation of another, the court
must consider the general impression of the ordinary purchaser, buying under the
normally prevalent conditions in trade and giving the attention such purchasers
usually give in buying that class of goods. Visual, aural, connotative comparisons
and overall impressions engendered by the marks in controversy as they are
encountered in the realities of the marketplace must be taken into account. Where
there are both similarities and differences in the marks, these must be weighed
against one another to see which predominates.
In determining likelihood of confusion between marks used on non-identical goods
or services, several factors may be taken into account, such as, but not limited to:
a) the strength of plaintiff s mark;
b) the degree of similarity between the plaintiffs and the defendant's marks;
c) the proximity of the products or services;
d) the likelihood that the plaintiff will bridge the gap;
e) evidence of actual confusion;
f) the defendant's good faith in adopting the mark;
g) the quality of defendant's product or service; and/or h) the sophistication of the
buyers.
"Colorable imitation" denotes such a close or ingenious imitation as to be calculated
to deceive ordinary persons, or such a resemblance to the original as to deceive an
ordinary purchaser giving such attention as a purchaser usually gives, as to cause
him to purchase the one supposing it to be the other.
SECTION 5. Determination of Similar and Dissimilar Goods or Services. — Goods or
services may not be considered as being similar or dissimilar to each other on the
ground that, in any registration or publication by the Office, they appear in different
classes of the Nice Classification.
In this case, the findings of fact of the highly technical agency, the Intellectual
Property Office, which has the expertise in this field, should have been given great
weight by the Court of Appeals. As we held in Berris Agricultural Co., Inc. v.
Abyadang44:
R.A. No. 8293 defines a "mark" as any visible sign capable of distinguishing the
goods (trademark) or services (service mark) of an enterprise and shall include a
stamped or marked container of goods. It also defines a "collective mark" as any
visible sign designated as such in the application for registration and capable of
distinguishing the origin or any other common characteristic, including the quality of
goods or services of different enterprises which use the sign under the control of the
registered owner of the collective mark.
On the other hand, R.A. No. 166 defines a "trademark" as any distinctive word,
name, symbol, emblem, sign, or device, or any combination thereof, adopted and
used by a manufacturer or merchant on his goods to identify and distinguish them
from those manufactured, sold, or dealt by another. A trademark, being a special
property, is afforded protection by law. But for one to enjoy this legal protection,
legal protection ownership of the trademark should rightly be established.
The ownership of a trademark is acquired by its registration and its actual use by
the manufacturer or distributor of the goods made available to the purchasing
public. Section 122 of R.A.. No. 8293 provides that the rights in a mark shall be
acquired by means of its valid registration with the IPO. A certificate of registration
of a mark, once issued, constitutes prima facie evidence of the validity of the
registration, of the registrant's ownership of the mark, and of the registrant's
exclusive right to use the same in connection with the goods or services and those
that are related thereto specified in the certificate. R.A. No. 8293, however, requires
the applicant for registration or the registrant to file a declaration of actual use
(DAU) of the mark, with evidence to that effect, within three (3) years from the
filing of the application for registration; otherwise, the application shall be refused
or the mark shall be removed from the register. In other words, the prima facie
presumption brought about by the registration of a mark may be challenged and
overcome, in an appropriate action, by proof of the nullity of the registration or of
non-use of the mark, except when excused. Moreover, the presumption may
likewise be defeated by evidence of prior use by another person, i.e., it will
controvert a claim of legal appropriation or of ownership based on registration by a
subsequent user. This is because a trademark is a creation of use and belongs to
one who first used it in trade or commerce.
The determination of priority of use of a mark is a question of fact. Adoption of the
mark alone does not suffice. One may make advertisements, issue circulars,
distribute price lists on certain goods, but these alone will not inure to the claim of
ownership of the mark until the goods bearing the mark are sold to the public in the
market. Accordingly, receipts, sales invoices, and testimonies of witnesses as
customers, or orders of buyers, best prove the actual use of a mark in trade and
commerce during a certain period of time.
xxxx
Verily, 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. On this matter of
particular concern, administrative agencies, such as the IPO, by reason of
their special knowledge and expertise over matters falling under their
jurisdiction, are in a better position to pass judgment thereon. Thus, their
findings of fact in that regard are generally accorded great respect, if not
finality by the courts, as long as they are supported by substantial
evidence, even if such evidence might not be overwhelming or even
preponderant. It is not the task of the appellate court to weigh once more
the evidence submitted before the administrative body and to substitute its
own judgment for that of the administrative agency in respect to
sufficiency of evidence. (Emphasis added, citations omitted.)
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.45The cases discussed below are mentioned only for
purposes of lifting the applicable doctrines, laws, and concepts, but not for their
factual circumstances, because of the uniqueness of each case in controversies such
as this one.
There are two tests used in jurisprudence to determine likelihood of confusion,
namely the dominancy test used by the IPO, and the holistic test adopted by the
Court of Appeals. In Skechers, U.S.A., Inc. v. Inter Pacific Industrial Trading
Corp.,46 we held:
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. The Dominancy Test focuses on the similarity of the prevalent or
dominant features of the competing trademarks that might cause confusion,
mistake, and deception in the mind of the purchasing public. Duplication or imitation
is not necessary; neither is it required that the mark sought to be registered
suggests an effort to imitate. Given more consideration are the aural and visual
impressions created by the marks on the buyers of goods, giving little weight to
factors like prices, quality, sales outlets, and market segments.
xxxx
Relative to the question on confusion of marks and trade names, 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.
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.
This Court cannot agree with the observation of the CA that the use of the letter "S"
could hardly be considered as highly identifiable to the products of petitioner alone.
The CA even supported its conclusion by stating that 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 the CA says is identifiable to Superman.
Such reasoning, however, misses the entire point, which is that respondent had
used a stylized "S," which is the same stylized "S" which petitioner has a registered
trademark for. The letter "S" used in the Superman logo, on the other hand, has a
block-like tip on the upper portion and a round elongated tip on the lower portion.
Accordingly, the comparison made by the CA of the letter "S" used in the Superman
trademark with petitioner's stylized "S" is not appropriate to the case at bar.
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.
XXXX
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, x x x.
Based on the foregoing, this Court is at a loss as to how the RTC and the CA, in
applying the holistic test, ruled that there was no colorable imitation, when 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.
xxxx
Neither can the difference in price be a complete defense in trademark
infringement. InMcDonald's Corporation v. L.C. Big Mak Burger, Inc., this Court
held:
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 56et 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 (v.
148 ALR 77, 84; 52 Am. Jur. 576, 577). x x x.
Indeed, the registered trademark owner may use its mark on the same or similar
products, in different segments of the market, and at different price levels
depending on variations of the products for specific segments of the market. The
purchasing public might be mistaken in thinking that petitioner had ventured into a
lower market segment such that it is not inconceivable for the public to think that
Strong or Strong Sport Trail might be associated or connected with petitioner's
brand, which scenario is plausible especially since both petitioner and respondent
manufacture rubber shoes.
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. 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. 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. (Citations omitted.)
The Court discussed the concept of confusion of business in the case of Societe Des
Produits Nestle, S.A. v. Dy, Jr.,47 as quoted below:
Among the elements, the element of likelihood of confusion is the gravamen of
trademark infringement. There are two types of confusion in trademark
infringement: confusion of goods and confusion of business. In Sterling Products
International, Inc. v. Farbenfabriken Bayer Aktiengesellschaft, the Court
distinguished the two types of confusion:
Callman notes two types of confusion. The first is the confusion of goods "in which
event the ordinarily prudent purchaser would be induced to purchase one product in
the belief that he was purchasing the other." In which case, "defendant's goods are
then bought as the plaintiffs, and the poorer quality of the former reflects adversely
on the plaintiffs reputation." The other is the confusion of business: "Here though
the goods of the parties are different, the defendant's product is such as might
reasonably be assumed to originate with the plaintiff, and the public would then be
deceived either into that belief or into the belief that there is some connection
between the plaintiff and defendant which, in fact, does not exist."
There are two tests to determine likelihood of confusion: the dominancy test and
holistic test. The dominancy test focuses on the similarity of the main, prevalent or
essential features of the competing trademarks that might cause confusion.
Infringement takes place when the competing trademark contains the essential
features of another. Imitation or an effort to imitate is unnecessary. The question is
whether the use of the marks is likely to cause confusion or deceive purchasers.
xxxx
In cases involving trademark infringement, no set of rules can be deduced. Each
case must be decided on its own merits. Jurisprudential precedents must be studied
in the light of the facts of each particular case. In McDonald's Corporation v. MacJoy
Fastfood Corporation, the Court held:
In trademark cases, particularly in ascertaining whether one trademark is
confusingly similar to another, no set rules can be deduced because each case must
be decided on its merits. In such cases, even more than in any other litigation,
precedent must be studied in the light of the facts of the particular case. That is the
reason why in trademark cases, jurisprudential precedents should be applied only to
a case if they are specifically in point.
In the light of the facts of the present case, the Court holds that the dominancy test
is applicable. In recent cases with similar factual milieus, the Court has consistently
applied the dominancy test, x x x.
xxxx
In McDonald's Corporation v. MacJoy Fastfood Corporation, the Court applied the
dominancy test in holding that "MACJOY" is confusingly similar to "MCDONALD'S."
The Court held:
While we agree with the CA's detailed enumeration of differences between the two
(2) competing trademarks herein involved, we believe that the holistic test is not
the one applicable in this case, the dominancy test being the one more suitable. In
recent cases with a similar factual milieu as here, the Court has consistently used
and applied the dominancy test in determining confusing similarity or likelihood of
confusion between competing trademarks.
xxxx
Applying the dominancy test to the instant case, the Court finds that herein
petitioner's "MCDONALD'S" and respondent's "MACJOY" marks are confusingly
similar with each other that an ordinary purchaser can conclude an association or
relation between the marks.
To begin with, both marks use the corporate "M" design logo and the prefixes "Me"
and/or "Mac" as dominant features, x x x.
For sure, it is the prefix "Me," and abbreviation of "Mac," which visually and aurally
catches the attention of the consuming public. Verily, the word "MACJOY" attracts
attention the same way as did "McDonalds," "Mac Fries," "Me Spaghetti," "McDo,"
"Big Mac" and the rest of the MCDONALD'S marks which all use the prefixes Me
and/or Mac.
Besides and most importantly, both trademarks are used in the sale of fastfood
products. Indisputably, the respondent's trademark application for the "MACJOY &
DEVICE" trademark covers goods under Classes 29 and 30 of the International
Classification of Goods, namely, fried chicken, chicken barbeque, burgers, fries,
spaghetti, etc. Likewise, the petitioner's trademark registration for the MCDONALD'S
marks in the Philippines covers goods which are similar if not identical to those
covered by the respondent's application.
In McDonald's Corporation v. L.C. Big Mak Burger, Inc., the Court applied the
dominancy test in holding that "BIG MAK" is confusingly similar to "BIG MAC." The
Court held:
This Court x x x has relied on the dominancy test rather than the holistic test. The
dominancy test considers the dominant features in the competing marks in
determining whether they are confusingly similar. Under the dominancy test, courts
give greater weight to the similarity of the appearance of the product arising from
the adoption of the dominant features of the registered mark, disregarding minor
differences. Courts will consider more 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.
Thus, in the 1954 case of Co Tiong Sa v. Director of Patents, the Court ruled:
x x x 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; nor is it
necessary that the infringing label should suggest an effort to imitate. (G. Heilman
Brewing Co. vs. Independent Brewing Co., 191 F., 489, 495, citing Eagle White Lead
Co. vs. 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; x x x)
xxxx
The test of dominancy is now explicitly incorporated into law in Section 155.1 of the
Intellectual Property Code which defines infringement as the "colorable imitation of
a registered mark x x x or a dominant featurethereof."
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 "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 Societe Des Produits Nestle, S.A. v. Court of Appeals, the Court applied the
dominancy test in holding that "FLAVOR MASTER" is confusingly similar to "MASTER
ROAST" and "MASTER BLEND." The Court held:
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.
Moreover, the totality or holistic test is contrary to the elementary postulate of the
law on trademarks and unfair competition that confusing similarity is to be
determined on the basis of visual, aural, connotative comparisons and overall
impressions engendered by the marks in controversy as they are encountered in the
realities of the marketplace. The totality or holistic test only relies on visual
comparison between two trademarks whereas the dominancy test relies not only on
the visual but also on the aural and connotative comparisons and overall
impressions between the two trademarks.
For this reason, this Court agrees with the BPTTT when it applied the test of
dominancy and held that:
xxxx
The scope of protection afforded to registered trademark owners is not
limited to protection from infringers with identical goods. The scope of
protection extends to protection from infringers with related goods, and to
market areas that are the normal expansion of business of the registered
trademark owners. Section 138 of R.A. No. 8293 states:
Certificates of Registration. — A certificate of registration of a mark shall be prima
facie evidence of validity of the registration, the registrant's ownership of the mark,
and of the registrant's exclusive right to use the same in connection with the goods
or services and those that are related thereto specified in the certificate, x x x.
In Mighty Corporation v. E. & J. Gallo Winery, the Court held that, "Non-competing
goods may be those which, though they are not in actual competition, are so related
to each other that it can reasonably be assumed that they originate from one
manufacturer, in which case, confusion of business can arise out of the use of
similar marks." In that case, the Court enumerated factors in determining whether
goods are related: (1) classification of the goods; (2) nature of the goods; (3)
descriptive properties, physical attributes or essential characteristics of the goods,
with reference to their form, composition, texture or quality; and (4) style of
distribution and marketing of the goods, including how the goods are displayed and
sold.
xxxx
xxx. However, as the registered owner of the "NAN" mark, Nestle should be
free to use its mark on similar products, in different segments of the
market, and at different price levels. In McDonald's Corporation v. L.C. Big Mak
Burger, Inc., the Court held that the scope of protection afforded to registered
trademark owners extends to market areas that are the normal expansion of
business:
xxxx
Even respondent's use of the "Big Mak" mark on non-hamburger food products
cannot excuse their infringement of petitioners' registered mark, otherwise
registered marks will lose their protection under the law.
The registered trademark owner may use his mark on the same or similar
products, in different segments of the market, and at different price levels
depending on variations of the products for specific segments of the
market. The Court has recognized that the registered trademark owner
enjoys protection in product and market areas that are the normal
potential expansion of his business. 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 sq; 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 (v.
148 ALR, 77, 84; 52 Am. Jur. 576, 577). (Emphases supplied, citations omitted.)
Again, this Court discussed the dominancy test and confusion of business
in Dermaline, Inc. v. Myra Pharmaceuticals, Inc.,48 and we quote:
The Dominancy Test focuses on the similarity of the prevalent features of the
competing trademarks that might cause confusion or deception. 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. 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. The test of dominancy is now explicitly
incorporated into law in Section 155.1 of R.A. No. 8293 which provides —
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 x x x.
xxxx
Relative to the question on confusion of marks and trade names, 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.
xxxx
We agree with the findings of the IPO. As correctly applied by the IPO in this case,
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.
xxxx
Further, 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.
Indeed, the registered trademark owner may use its mark on the same or similar
products, in different segments of the market, and at different price levels
depending on variations of the products for specific segments of the market. The
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, we
have held —
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 (v. 148 ALR 77, 84; 52 Am. Jur. 576, 577).
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. (Citations omitted.)
Section 123. l(d) of the IP Code provides:
A mark cannot be registered if it: impressions engendered by the marks in controversy as they are encountered in the
realities of the marketplace are the main considerations (McDonald's Corporation, et
xxxx al., v. L. C. Big Mak Burger, Inc., et al., G. R. No. 143993, August 18, 2004; Societe
Des Produits Nestle, S. A." et al. v. Court of Appeals, et al., G. R. No. 112012, April
(d) Is identical with a registered mark belonging to a different proprietor or a mark 4, 2001). If the competing trademark contains the main or essential or dominant
with an earlier filing or priority date, in respect of: features of another, and confusion and deception is likely to result, infringement
takes place. (Lim Hoa v. Director of Patents, 100 Phil. 214 [1956]); Co Tiong Sa v.
Director of Patents, et al., G. R. No. L-5378, May 24, 1954). Duplication or imitation
i. The same goods or services, or
is not necessary; nor is it necessary that the infringing label should suggest an
effort to imitate (Lim Hoa v. Director of Patents, supra, and Co Liong Sa v. Director
ii. Closely related goods or services, or of Patents, supra). Actual confusion is not required: Only likelihood of confusion on
the part of the buying public is necessary so as to render two marks confusingly
iii. If it nearly resembles such a mark as to be likely to deceive or cause similar so as to deny the registration of the junior mark (Sterling Products
confusion[.] International, Inc. v. Farbenfabriken Bayer Aktiengesellschaft, 137 Phil. 838
[1969]).

A scrutiny of petitioner's and respondent's respective marks would show that the As to the first issue of whether PAPA BOY is confusingly similar to Opposer's PAPA
IPO-BLA and the IPO Director General correctly found the word "PAPA" as the mark, this Bureau rules in the affirmative.
dominant feature of petitioner's mark "PAPA KETSARAP." Contrary to respondent's
contention, "KETSARAP" cannot be the dominant feature of the mark as it is merely The records bear the following:
descriptive of the product. Furthermore, it is the "PAPA" mark that has been in
commercial use for decades and has established awareness and goodwill among 1. Registration No. 32416 issued for the mark "PAPA" under Class 29 goods was
consumers. deemed expired as of February 11, 2004 (Exhibit "A" attached to the VERIFIED
NOTICE OF OPPOSITION). Application Serial No. 4- 2005-010788 was filed on
We likewise agree with the IPO-BLA that the word "PAPA" is also the dominant October 28, 2005 for the same mark "PAPA" for Class 30 goods and Registration No.
feature of respondent's "PAPA BOY & DEVICE" mark subject of the application, such 42005010788 was issued on March 19,2007;
that "the word 'PAPA' is written on top of and before the other words such that it is
the first word/figure that catches the eyes."49 Furthermore, as the IPO Director 2. Opposer was issued for the mark "PAPA BANANA CATSUP LABEL" on August 11,
General put it, the part of respondent's mark which appears prominently to the eyes 1983 Registration No. SR-6282 for Class 30 goods in the Supplemental Register,
and ears is the phrase "PAPA BOY" and that is what a purchaser of respondent's which registration expired in 2003. Application Serial No. 4-2006-012364 was filed
product would immediately recall, not the smiling hog. for the mark "PAPA LABEL DESIGN" for Class 30 goods on November 15, 2006, and
Registration No. 42006012364 was issued on April 30, 2007; and
We quote the relevant portion of the IPO-BLA decision on this point below:
3. Lastly, Registration No. 34681 for the mark "PAPA KETSARAP" for Class 30 goods
was issued on August 23, 1985 and was renewed on August 23, 2005.
A careful examination of Opposer's and Respondent-applicant's respective marks
shows that the word "PAPA" is the dominant feature: In Opposer's marks, the word
Though Respondent-applicant was first to file the subject application on April 04,
"PAPA" is either the mark by itself or the predominant word considering its stylized
2002 vis-a-vis the mark "PAPA" the filing date of which is reckoned on October 28,
font and the conspicuous placement of the word "PAPA" before the other words. In
2005, and the mark "PAPA LABEL DESIGN" the filing date of which is reckoned on
Respondent-applicant's mark, the word "PAPA" is written on top of and before the
November 15, 2006, Opposer was able to secure a registration for the mark "PAPA
other words such that it is the first word figure that catches the eyes. The visual and
KETSARAP" on August 23, 1985 considering that Opposer was the prior registrant
aural impressions created by such dominant word "PAPA" at the least is that the
and that its renewal application timely filed on August 23, 2005.
respective goods of the parties originated from the other, or that one party has
permitted or has been given license to the other to use the word "PAPA" for the
xxxx
other party's product, or that there is a relation/connection between the two parties
when, in fact, there is none. This is especially true considering that the products of
Pursuant to [Section 123.l(d) of the IP Code], the application for registration of the
both parties belong to the same class and are closely related: Catsup and lechon
subject mark cannot be allowed considering that Opposer was earlier registrant of
sauce or liver sauce are both gravy-like condiments used to spice up dishes. Thus,
the marks PAPA and PAPA KETSARAP which registrations were timely renewed upon
confusion of goods and of business may likely result.
its expiration. Respondent-applicant's mark "PAPA BOY & DEVICE" is confusingly
similar to Opposer's mark "PAPA KETSARAP" and is applied to goods that are related
Under the Dominancy Test, the dominant features of the competing marks are
to Opposer's goods, but Opposer's mark "PAPA KETSARAP" was registered on
considered in determining whether these competing marks are confusingly similar.
August 23, 1985 per Certificate of Registration No. 34681, which registration was
Greater weight is given to the similarity of the appearance of the products arising
renewed for a period of 10 years counted from August 23, 2005 per Certificate of
from the adoption of the dominant features of the registered mark, disregarding
Renewal of Registration No. 34681 issued on August 23, 2005. To repeat, Opposer
minor differences. The visual, aural, connotative, and overall comparisons and
has already registered a mark which Respondent-applicant's mark nearly resembles
as to likely deceive or cause confusion as to origin and which is applied to goods to
which respondent-applicant's goods under Class 30 are closely related.

Section 138 of the IP Code provides that a certificate of registration of a mark

is prima facie evidence of the validity of the registration, the registrant's ownership
of the mark, and of the registrant's exclusive right to use the same in connection
with the goods and those that are related thereto specified in the certificate.

We agree that respondent's mark cannot be registered. Respondent's mark is

related to a product, lechon sauce, an everyday all-purpose condiment and sauce,
that is not subjected to great scrutiny and care by the casual purchaser, who knows
from regular visits to the grocery store under what aisle to find it, in which bottle it
is contained, and approximately how much it costs. Since petitioner's product,
catsup, is also a household product found on the same grocery aisle, in similar
packaging, the public could think that petitioner had expanded its product mix to
include lechon sauce, and that the "PAPA BOY" lechon sauce is now part of the
"PAPA" family of sauces, which is not unlikely considering the nature of business
that petitioner is in. Thus, if allowed registration, confusion of business may set in,
and petitioner's hard-earned goodwill may be associated to the newer product
introduced by respondent, all because of the use of the dominant feature of
petitioner's mark on respondent's mark, which is the word "PAPA." The words
"Barrio Fiesta" are not included in the mark, and although printed on the label of
respondent's lechon sauce packaging, still do not remove the impression that "PAPA
BOY" is a product owned by the manufacturer of "PAPA" catsup, by virtue of the use
of the dominant feature. It is possible that petitioner could expand its business to
include lechon sauce, and that would be well within petitioner's rights, but the
existence of a "PAPA BOY" lechon sauce would already eliminate this possibility and
deprive petitioner of its rights as an owner of a valid mark included in the
Intellectual Property Code.

The Court of Appeals likewise erred in finding that "PAPA," being a common term of
endearment for one's father, is a word over which petitioner could not claim
exclusive use and ownership. The Merriam-Webster dictionary defines "Papa" simply
as "a person's father." True, a person's father has no logical connection with catsup
products, and that precisely makes "PAPA" as an arbitrary mark capable of being
registered, as it is distinctive, coming from a family name that started the brand
several decades ago. What was registered was not the word "Papa" as defined in
the dictionary, but the word "Papa" as the last name of the original owner of the
brand. In fact, being part of several of petitioner's marks, there is no question that
the IPO has found "PAPA" to be a registrable mark.

Respondent had an infinite field of words and combinations of words to choose from
to coin a mark for its lechon sauce. While its claim as to the origin of the term
"PAPA BOY" is plausible, it is not a strong enough claim to overrule the rights of the
owner of an existing and valid mark. Furthermore, this Court cannot equitably allow
respondent to profit by the name and reputation carefully built by petitioner without
running afoul of the basic demands of fair play.51

WHEREFORE, we hereby GRANT the petition. We SET ASIDE the June 23, 2011
Decision and the October 4, 2011 Resolution of the Court of Appeals in CA-G.R. SP
No. 107570, and REINSTATE the March 26, 2008 Decision of the Bureau of Legal
Affairs of the Intellectual Property Office (IPO-BLA) and the January 29,
2009 Decision of the Director General of the IPO.

SO ORDERED.