TOPIC 3: The Law on Trademarks, Service Marks and Trade Names (Part 1)

1. 1. Purpose of the Trademark Law

Philip Morris Inc. vs. Fortune Tobacco Corp., G.R. No. 158589, June 27, 2006
The protection of trademarks is the law’s recognition of the psychological function of symbols.
If it is true that we live by symbols, it is no less true that we purchase goods by them. A
trade-mark is a merchandising short-cut which induces a purchaser to select what he wants,
or what he has been led to believe what he wants. The owner of a mark exploits this human
propensity by making every effort to impregnate the atmosphere of the market with the
drawing power of a congenial symbol. Whatever the means employed, the aim is the same
- to convey through the mark, in the minds of potential customers, the desirability of
the commodity upon which it appears. Once this is attained, the trade-mark owner has
something of value. If another poaches upon the commercial magnetism of the symbol he
has created, the owner can obtain legal redress.

1. 2. Historical Development

Mirpuri vs. CA, G.R. No. 114508, Nov. 19, 1999

Symbols have been used to identify the ownership or origin of articles for several
centuries. As early as 5,000 B.C., markings on pottery have been found by archaeologists.
Cave drawings in southwestern Europe show bison with symbols on their
flanks. Archaeological discoveries of ancient Greek and Roman inscriptions on sculptural
works, paintings, vases, precious stones, glassworks, bricks, etc. reveal some features which
are thought to be marks or symbols. These marks were affixed by the creator or maker of the
article, or by public authorities as indicators for the payment of tax, for disclosing state
monopoly, or devices for the settlement of accounts between an entrepreneur and his
workmen.

In the Middle Ages, the use of many kinds of marks on a variety of goods was commonplace.
Fifteenth century England saw the compulsory use of identifying marks in certain trades.
There were the baker's mark on bread, bottlemaker's marks, smith's marks, tanner's marks,
watermarks on paper, etc. Every guild had its own mark and every master belonging to it
had a special mark of his own. The marks were not trademarks but police marks
compulsorily imposed by the sovereign to let the public know that the goods were not
"foreign" goods smuggled into an area where the guild had a monopoly, as well as to
aid in tracing defective work or poor craftsmanship to the artisan. For a similar reason,
merchants also used merchants' marks. Merchants dealt in goods acquired from many
sources and the marks enabled them to identify and reclaim their goods upon recovery after
shipwreck or piracy.

With constant use, the mark acquired popularity and became voluntarily adopted. It was not
intended to create or continue monopoly but to give the customer an index or guarantee of
quality. It was in the late 18th century when the industrial revolution gave rise to mass
production and distribution of consumer goods that the mark became an important
instrumentality of trade and commerce. By this time, trademarks did not merely identify the
goods; they also indicated the goods to be of satisfactory quality, and thereby stimulated
further purchases by the consuming public. Eventually, they came to symbolize the goodwill
and business reputation of the owner of the product and became a property right protected
by law.

The common law developed the doctrine of trademarks and tradenames "to prevent a person
from palming off his goods as another's, from getting another's business or injuring his
reputation by unfair means, and, from defrauding the public." Subsequently, England and
the United States enacted national legislation on trademarks as part of the law regulating
unfair trade. It became the right of the trademark owner to exclude others from the use of
his mark, or of a confusingly similar mark where confusion resulted in diversion of trade or

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financial injury. At the same time, the trademark served as a warning against the imitation
or faking of products to prevent the imposition of fraud upon the public.

TRADEMARK PROTECTION REQUIRES REGISTRATION, WHY? Your trademark

distinguishes your goods form others; represents your business identity, image, and
reputation that sets it apart from competitors; part of your asset; becomes your property;
worth a lot of money; registration will protect business and shield from scrupulous persons
REMEDIES OF OWNERS OF REGISTERED MARKS: civil and criminal actions for
infringement, unfair competition, false or fraudulent declaration and false designation of
origin

1. 3. Definition of marks, service marks & collective marks

Sec. 121; 121.1; 121.2

Mark: 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.

Mark: 1) must be a visible sign, 2) capable of distinguishing one’s goods and services from
those of another.

If mark refers to goods, it is trademark. If mark refers to service, it is service mark.

Mark could be:

a) Word Mark (use of the name of a person, or any fanciful or arbitrary word);
b) Composite Mark (consisting of a combination of a word or letter and a device);

c) Device Mark (which may be geometrical figure, a stylized rendering of the alphabet or a
representation of any object)

d) Collective Mark: 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

Trademark vs Tradename (refer to Canon Kabushiki vs CA case below):

Question: Can tradenames be protected?

165.2. (a) Notwithstanding any laws or regulations providing for any obligation to
register trade names, such names shall be protected, even prior to or without
registration, against any unlawful act committed by third parties.
(b) In particular, any subsequent use of the trade name by a third party, whether as a
trade name or a mark or collective mark, or any such use of a similar trade name or
mark, likely to mislead the public, shall be deemed unlawful.

Mirpuri vs. CA, supra

A "trademark" is defined under R.A. 166, the Trademark Law, as including "any word, name,
symbol, emblem, sign or device or any combination thereof adopted and used by a
manufacturer or merchant to identify his goods and distinguish them from those
manufactured, sold or dealt in by others.

This definition has been simplified in R.A. No. 8293, the Intellectual Property Code of the
Philippines, which defines a "trademark" as "any visible sign capable of distinguishing
goods."

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 Canon Kabushiki Kaisha vs. CA, G.R. No. 120900, July 20, 2000
The term "trademark" is defined by RA 166, the Trademark Law, as including "any word,
name, symbol, emblem, sign or device or any combination thereof adopted and used by a
manufacturer or merchant to identify his goods and distinguish them for those
manufactured, sold or dealt in by others." Tradename is defined by the same law as including
"individual names and surnames, firm names, tradenames, devices or words used by
manufacturers, industrialists, merchants, agriculturists, and others to identify their
business, vocations, or occupations; the names or titles lawfully adopted and used by natural
or juridical persons, unions, and any manufacturing, industrial, commercial, agricultural or
other organizations engaged in trade or commerce." Simply put, a trade name refers to the
business and its goodwill; a trademark refers to the goods.

Societe des Produits vs. CA, G.R. No. 112012, April 4, 2001
A trademark has been generally defined as "any word, name, symbol or device adopted and
used by a manufacturer or merchant to identify his goods and distinguish them from those
manufactured and sold by others."

1. 4. Functions of a Trademark

Mirpuri vs. CA, supra

Modern authorities on trademark law view trademarks as performing three distinct functions:

(1) they indicate origin or ownership of the articles to which they are attached;
(2) they guarantee that those articles come up to a certain standard of quality; and
(3) they advertise the articles they symbolize.

Phil. Refining Co. vs. Ng Sam, G.R. No. L-26676, July 30, 1982
A trademark is designed to Identify the user. But it should be so distinctive and
sufficiently original as to enable those who come into contact with it to recognize instantly
the Identity of the user. " It must be affirmative and definite, significant and distinctive,
capable to indicate origin."

1. 5. Nature of a Trademark Right

Arce Sons and Co. vs. Selects Biscuits, 1 SCRA 253 (1961)
"The ownership or possession of a trade-mark, . . . shall be recognized and protected in the
same manner and to the same extent, as are other property rights known to the law," thereby
giving to any person entitled to the exclusive use of such trade-mark the right to
recover damages in a civil action from any person who may have sold goods of similar
kind bearing such trade-mark

Converse Rubber vs. Universal Rubber, G.R. No. L-27906, Jan. 8, 1987
The ownership of a trademark or tradename is a property right which the owner is entitled
to protect "since there is damage to him from confusion or reputation or goodwill in the mind
of the public as well as from confusion of goods. The modern trend is to give emphasis to the
unfairness of the acts and to classify and treat the issue as fraud.

From a cursory appreciation of the petitioner's corporate name "CONVERSE RUBBER

CORPORATION,' it is evident that the word "CONVERSE" is the dominant word which
Identifies petitioner from other corporations engaged in similar business. Knowing,
therefore, that the word "CONVERSE" belongs to and is being used by petitioner, and
is in fact the dominant word in petitioner's corporate name, respondent has no right
to appropriate the same for use on its products which are similar to those being
produced by petitioner. The testimony of petitioner's witness, who is a legitimate trader as
well as the invoices evidencing sales of petitioner's products in the Philippines, give credence
to petitioner's claim that it has earned a business reputation and goodwill in this country.
The word "CONVERSE" has grown to be Identified with petitioner's products, and in this
sense, has acquired a second meaning within the context of trademark and tradename laws.

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 1. 6. Trademark vs. Trade name

Sec. 121.3; 165

"Trade name" means the name or designation identifying or distinguishing an enterprise.

A name or designation may not be used as a trade name if by its nature or the use to which
such name or designation may be put, it is contrary to public order or morals and if, in
particular, it is liable to deceive trade circles or the public as to the nature of the enterprise
identified by that name.

(a) Notwithstanding any laws or regulations providing for any obligation to register trade
names, such names shall be protected, even prior to or without registration, against any
unlawful act committed by third parties.

(b) In particular, any subsequent use of the trade name by a third party, whether as a trade
name or a mark or collective mark, or any such use of a similar trade name or mark, likely
to mislead the public, shall be deemed unlawful.

The remedies provided for in Sections 153 to 156 and Sections 166 and 167 shall
apply mutatis mutandis.

Any change in the ownership of a trade name shall be made with the transfer of the
enterprise or part thereof identified by that name. The provisions of Subsections 149.2
to 149.4 shall apply mutatis mutandis.

Canon Kabushiki Kaisha, CA, supra

The term "trademark" is defined by RA 166, the Trademark Law, as including "any word,
name, symbol, emblem, sign or device or any combination thereof adopted and used by a
manufacturer or merchant to identify his goods and distinguish them for those
manufactured, sold or dealt in by others." Tradename is defined by the same law as including
"individual names and surnames, firm names, tradenames, devices or words used by
manufacturers, industrialists, merchants, agriculturists, and others to identify their
business, vocations, or occupations; the names or titles lawfully adopted and used by natural
or juridical persons, unions, and any manufacturing, industrial, commercial, agricultural or
other organizations engaged in trade or commerce." Simply put, a trade name refers to the
business and its goodwill; a trademark refers to the goods.

1. 7. Basis of the Right to a Mark (Sec. 122)

Question: When are rights to a mark acquired?

The rights in a mark shall be acquired through registration made validly in accordance
with the provisions of this law.
BUT Acquisition of such right CAN BE HAD THROUGH USE even if without registration

Legal Basis: 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.

Rights acquired through registration is considered more advantageous than that acquired
through use. Why? Because owner of registered mark can avail of cause of action for
infringement and unfair competition. But unregistered marks can only sue for unfair
competition.

Puma Sportsshenfabriken vs. IAC, G.R. No. 75067, Feb. 26, 1988
What kind of use that may give rise to rights even without registration?
3 requirements:

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1) Widespread
2) Favourably received
3) Bears name of manufacturer

Marvex Commercial Co., Inc. vs. Petra Hawpia & Co, L-16297, Dec. 22, 1926
The right to register trademarks, tradenames and service marks by any person, corporation,
partnership or association domiciled in the Philippines or in any foreign country, is based on
ownership, and the burden is upon the applicant to prove such ownership

Operators Inc. vs. Director of Patents, L-17901, Oct. 29, 1965

Where the applicant was not the owner of the trademark being applied for, he has no right
to apply for registration of the same

Gabriel vs. Perez, G.R. No. L-24075, Jan. 31, 1974

Thus, the right to register trademark is based on ownership and a mere distributor of a
product bearing a trademark, even if permitted to use said trademark, has no right to and
cannot register the said trademark

Unno vs. General Milling, G.R. No. L-28554, Feb. 28, 1983
The right to register trademark is based on ownership. When the applicant is not the owner
of the trademark being applied for, he has no right to apply for the registration of the same.
The term owner does not include the importer of the goods bearing the trademark, trade
name, service mark, or other mark of ownership, unless such importer is actually the owner
thereof in the country from which the goods are imported. A local importer, however, may
make application for the registration of a foreign trademark, trade name or service
mark if he is duly authorized by the actual owner of the name or other mark of
ownership.

Emerald Garments Mfg. Corp. v. Court of Appeals, G.R. No. 100098, December 29,
1995, 251 SCRA 600
"LEE" is primarily a surname. Private respondent cannot, therefore, acquire exclusive
ownership over and singular use of said term.
. . . It has been held that a personal name or surname may not be monopolized as a
trademark or tradename as against others of the same name or surname. For in the
absence of contract, fraud, or estoppel, any man may use his name or surname in all
legitimate ways. Thus, "Wellington" is a surname, and its first user has no cause of action
against the junior user of "Wellington" as it is incapable of exclusive appropriation.

Converse Rubber vs. Universal Rubber, G.R. No. L-27906, Jan. 8, 1987
The ownership of a trademark or tradename is a property right which the owner is entitled
to protect "since there is damage to him from confusion or reputation or goodwill in the mind
of the public as well as from confusion of goods. The modern trend is to give emphasis to the
unfairness of the acts and to classify and treat the issue as fraud.

A corporation is entitled to the cancellation of a mark that is confusingly similar to its

corporate name." "Appropriation by another of the dominant part of a corporate name
is an infringement."

A boundless choice of words, phrases and symbols is available to one who wishes a trademark
sufficient unto itself to distinguish his product from those of others. When, however, there is
no reasonable explanation for the defendant's choice of such a mark though the field for his
selection was so broad, the inference is inevitable that it was chosen deliberately to deceive.
"A trade name [corporate 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 the
trademark. "

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 Sterling Products International, Inc. v. Farbenfabriken Bayer Aktiengesellschaft,
G.R. No. L-19906, April 30, 1969, 27 SCRA 1214
A rule widely accepted and firmly entrenched because it has come down through the years
is that actual use in commerce or business is a prerequisite in the acquisition of the right of
ownership over a trademark.

It would seem quite clear that adoption alone of a trademark would not give exclusive right
thereto. Such right grows out of their actual use."19 Adoption is not use. One may make
advertisements, issue circulars, give out price lists on certain goods; but these alone
would not give exclusive right of use. For trademark is a creation of use. The underlying
reason for all these is that Purchasers have come to understand the mark as indicating the
origin of the wares.20 Flowing from this is the trader's right to protection in the trade he has
built up and the goodwill he has accumulated from use of the trademark. Registration of a
trademark, of course, has value: it is an administrative act declaratory of a pre-existing right.
Registration does not, however, perfect a trademark right.

1. 8. Prior Use of a Mark (Sec. 124)

Question: Is proof of prior use a requirement for registration?

Although use is a requirement for registration, no application for trademark registration
should be refused even if the applicant has not shown proof of use. Sec. 124.2 of the IPC
states that the applicant or the registrant shall file a declaration of actual use of the mark
with evidence to that effect, as prescribed by the Regulations within three (3) years from the
filing date of the application. Otherwise, the application shall be refused or the mark shall be
removed from the Register by the Director. THUS, PRIOR USE is not a requirement at the
time of filing of application.

Shangri-la vs DGC (GR 159938)

In the case of Shangri-la vs. DGC, the Supreme Court ruled that under the provisions of the
former trademark law, R.A. No. 166, as amended, which was in effect up to December 31,
1997, hence, the law in force at the time of respondent's application for registration of
trademark, the root of ownership of a trademark is actual use in commerce. Section 2 of said
law requires that before a trademark can be registered, it must have been actually used in
comer.

In the same case the Supreme Courte held that while the present law on trademarks has
dispensed with the requirement of prior actual use at the time of registration, the law in force
at the time of registration must be applied, and thereunder it was held that as a condition
precedent to registration of trademark, trade name or service mark, the same must have been
in actual use in the Philippines before the filing of the application for registration.

Sec. 152
Non-use of a Mark When Excused. -
152.1. Non-use of a mark may be excused if caused by circumstances arising
independently of the will of the trademark owner. Lack of funds shall not excuse non-use
of a mark.

152.2. The use of the mark in a form different from the form in which it is registered,
which does not alter its distinctive character, shall not be ground for cancellation or
removal of the mark and shall not diminish the protection granted to the mark.

152.3. The use of a mark in connection with one or more of the goods or services
belonging to the class in respect of which the mark is registered shall prevent its
cancellation or removal in respect of all other goods or services of the same class.

152.4. The use of a mark by a company related with the registrant or applicant shall
inure to the latter’s benefit, and such use shall not affect the validity of such mark or of its
registration: Provided, That such mark is not used in such manner as to deceive the public.
If use of a mark by a person is controlled by the registrant or applicant with respect to the

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nature and quality of the goods or services, such use shall inure to the benefit of the
registrant or applicant.

Sec. 138
A 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.

1. 9. Who may apply for a mark?

Sec. 3
Any person who is a national or who is domiciled or has a real and effective industrial
establishment in a country which is a party to any convention, treaty or agreement relating
to intellectual property rights or the repression of unfair competition, to which the Philippines
is also a party, or extends reciprocal rights to nationals of the Philippines by law, shall be
entitled to benefits to the extent necessary to give effect to any provision of such convention,
treaty or reciprocal law, in addition to the rights to which any owner of an intellectual
property right is otherwise entitled by this Act.

First-to-file Rule is observed. Thus, if you filed an application for a mark, no one can file an
application for the same mark anymore.

1. 10. Registrability of a Mark

Sec. 123.1; 123.3

Any mark may be registered as long as it does not fall within any of the exceptions.

Exceptions (a mark cannot be registered):

1) Consists of immoral, deceptive or scandalous matter, or matter which may disparage
or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national
symbols, or bring them into contempt or disrepute;

2) Consists of the flag or coat of arms or other insignia of the Philippines or any of its
political subdivisions, or of any foreign nation, or any simulation thereof;

3) Consists of a name, portrait or signature identifying a particular living

individual except by his written consent, or the name, signature, or portrait of a
deceased President of the Philippines, during the life of his widow, if any, except by
written consent of the widow;

4) (First-to-file Rule) Is identical with a registered mark belonging to a different

proprietor or a mark with an earlier filing or priority date, in respect of:

i) The same goods or services, or

ii) Closely related goods or services, or
iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion;

5) Is identical with, or confusingly similar to, or constitutes a translation of a mark which is

considered by the competent authority of the Philippines to be well-known internationally
and in the Philippines, whether or not it is registered here, as being already the mark of a
person other than the applicant for registration, and used for identical or similar goods or
services: Provided, That in determining whether a mark is well-known, account shall be taken
of the knowledge of the relevant sector of the public, rather than of the public at large,
including knowledge in the Philippines which has been obtained as a result of the promotion
of the mark;

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6) (Registered Well-known Marks) Is identical with, or confusingly similar to, or
constitutes a translation of a mark considered well-known in accordance with the
preceding paragraph, which is registered in the Philippines with respect to goods or
services which are not similar to those with respect to which registration is applied
for: Provided, That use of the 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;

7) (Descriptively Misleading) Is likely to mislead the public, particularly as to the nature,

quality, characteristics or geographical origin of the goods or services;

8) (Generic Marks) Consists exclusively of signs that are generic for the goods or
services that they seek to identify;

9) (Genericidal Marks) Consists exclusively of signs or of indications that have

become customary or usual to designate the goods or services in everyday language or
in bona fide and established trade practice;

10) (Descriptive Marks) Consists exclusively of signs or of 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;

11) Consists of shapes that may be necessitated by technical factors or by the nature of
the goods themselves or factors that affect their intrinsic value;

12) Consists of color alone, unless defined by a given form; or

13) Is contrary to public order or morality.

NOTE: The nature of the goods to which the mark is applied will not constitute an obstacle
to registration (Sec 123.3, IPC)

Emerald Garments Mfg. Corp. v. Court of Appeals, G.R. No. 100098, December 29,
1995, 251 SCRA 600
Lee used in jeans is primarily a surname and party cannot acquire exclusive ownership over
and singular use of name.

Except: written consent of owner of name

Ang vs. Wellington, 92 Phil 448 (1953)

Wellington cannot be registered as a trade name because it is a surname of a person
Except: written consent of owner of name

Identical with Prior Marks

Chuanchow Soy & Canning Co. vs. Director of Patents, 108 Phil 833, 836
When, as in the present case, one applies for the registration of a trademark or label which
is almost the same or 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 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.

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 Phil. Refining Co. vs. Ng Sam, G.R. No. L-26676, July 30, 1982
The particular goods of the parties are so unrelated that consumers would not in any
probability mistake one as the source or origin of the product of the other. "Ham" is not a
daily food fare for the average consumer. One purchasing ham would exercise a more
cautious inspection of what he buys on account of it price. Seldom, if ever, is the purchase
of said food product delegated to household helps, except perhaps to those who, like the
cooks, are expected to know their business. Besides, there can be no likelihood for the
consumer of respondent's ham to confuse its source as anyone but respondent.

Esso Standard Eastern Inc. vs. CA, G.R. No. L-29971, Aug. 31, 1982
Goods are related when they belong to the same class or have the same descriptive properties;
when they possess the same physical attributes or essential characteristics with reference to
their form, composition, texture or quality. They may also be related because they serve the
same purpose or are sold in grocery stores. Thus:

a) biscuits were held related to milk because they are both food products.
b) Soap and perfume, lipstick and nail polish are similarly related because they are common
household items now a days.
c) The trademark "Ang Tibay" for shoes and slippers was disallowed to be used for shirts and
pants because they belong to the same general class of goods.
d) Soap and pomade although non- competitive, were held to be similar or to belong to the
same class, since both are toilet articles. But no confusion or deception can possibly result
or arise when the name "Wellington" which is the trademark for shirts, pants, drawers and
other articles of wear for men, women and children is used as a name of a department store.

Another factor that shows that the goods involved are non-competitive and non-related is the
appellate court's finding that they flow through different channels of trade, thus: "The
products of each party move along and are disposed through different channels of
distribution. The (petitioner's) products are distributed principally through gasoline service
and lubrication stations, automotive shops and hardware stores. On the other hand, the
(respondent's) cigarettes are sold in sari-sari stores, grocery stores, and other small
distributor outlets. (Respondent's) cigarettes are even peddled in the streets while
(petitioner's) 'gasul' burners are not. Finally, there is a marked distinction between oil and
tobacco, as well as between petroleum and cigarettes. Evidently, in kind and nature the
products of (respondent) and of (petitioner) are poles apart."

Canon Kabushiki Kaisha vs. CA, G.R. No. 120900, July 20, 2000
In cases of confusion of business or origin, the question that usually arises is whether the
respective goods or services of the senior user and the junior user are so related as to likely
cause confusion of business or origin, and thereby render the trademark or tradenames
confusingly similar. Goods are related when they belong to the same class or have the same
descriptive properties; when they possess the same physical attributes or essential
characteristics with reference to their form, composition, texture or quality. They may also
be related because they serve the same purpose or are sold in grocery stores.

Confusingly Similar Marks

American Wire Cable Co. vs. Director of Patents, G.R. No. L-26557, Feb. 18, 1970
The determinative factor in a contest involving registration of trade mark is not whether the
challenged mark would actually cause confusion or deception of the purchasers but whether
the use of such mark would likely cause confusion or mistake on the part of the buying
public.

To constitute an infringement of an existing trademark patent and warrant a denial of an

application for registration, the law does not require that the competing trademarks must be
so identical as to produce actual error or mistake; it would be sufficient, for purposes of the
law, that the similarity between the two labels is such that there is a possibility or likelihood
of the purchaser of the older brand mistaking the newer brand for it.

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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.

The similarity between the competing trademarks, DURAFLEX and DYNAFLEX, is apparent.
Not only are the initial letters and the last half of the appellations identical, but the difference
exists only in two out of the eight literal elements of the designations. Coupled with the fact
that both marks cover insulated flexible wires under class 20; that both products are
contained in boxes of the same material, color, shape and size; that the dominant elements
of the front designs are a red circle and a diagonal zigzag commonly related to a spark or
flash of electricity; that the back of both boxes show similar circles of broken lines with arrows
at the center pointing outward, with the identical legend "Cut Out Ring" "Draw From Inside
Circle", no difficulty is experienced in reaching the conclusion that there is a deceptive
similarity that would lead the purchaser to confuse one product with the other.

Etepha vs. Director of Patents, G.R. No. L-20635, March 31, 1966
One of the factors in finding for confusing similarity:
And, we are to be guided by the rule that the validity of a cause for infringement is predicated
upon colorable imitation. The phrase "colorable imitation" denotes such a "close or ingenious
imitation as to be calculated to deceive ordinary persons, or such a resemblance to the
original as to deceive an ordinary purchaser, giving such attention as a purchaser usually
gives, and to cause him to purchase the one supposing it to be the other."
Duplication or imitation is not necessary nor is it necessary that the infringing label should
suggest an effort to imitate. The question at issue is whether the use of the marks involved
would be likely to cause confusion or mistake in the mind of the public or to deceive the
public

Who will be confused? The ordinary purchaser

There are two kinds of purchasers:
1) Casual Purchaser
2) Careful Purchaser

Although IPC does not define who are the purchasers likely to be confused, such purchasers
have been referred to as the ordinary average purchaser

The test is not found in the deception, or the possibility of deception, of the person who knows
nothing about the design. It depends on the goods he is buying.

Rueda Hermanos vs. Paglinawan, G.R. No. 10738, Jan. 14, 1916
The true test of unfair competition is whether certain goods have been clothed with an
appearance which is likely to deceive the ordinary purchaser exercising ordinary care, and
not whether a certain limited class of purchasers with special knowledge not possessed by
the ordinary purchaser could avoid mistake by the exercise of this special knowledge.
If the contents of two packages are the same commodity, it is no defense to an action for
unfair competition to show minor differences in the size or shape of the packages or in the
wording or color of the labels or wrappers of the packages. If the exterior size, shape, color
and description, in other words, those things which go to make up the general outside
appearances of the article, are so substantially similar as to "likely deceive the ordinary
purchaser exercising ordinary care," the defendant is guilty of unfair competition.

Ordinary Purchaser

Fruit of the Loom vs. CA, G.R. No. L-32747, Nov. 29, 1984
WE hold that the trademarks FRUIT OF THE LOOM and FRUIT FOR EVE do not resemble
each other as to confuse or deceive an ordinary purchaser. The ordinary purchaser must be
thought of as having, and credited with, at least a modicum of intelligence to be able to see
the obvious differences between the two trademarks in question.

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 Converse Rubber vs. Universal Rubber, supra
The similarity between the two labels is such that there is a possibility or likelihood of the
purchaser of the older brand mistaking the new brand for it." Even if not an the details just
mentioned were identical, with the general appearance alone of the two products, any
ordinary, or even perhaps even [sic] a not too perceptive and discriminating customer could
be deceived ... "
- When the law speaks co-purchaser," the reference is to ordinary average
purchaser. It is not necessary in either case that the resemblance be sufficient to deceive
experts, dealers, or other persons specially familiar with the trademark or goods involve."

Etepha vs. Director of Patents, L-20635, March 31, 1966

Careful Purchaser:
In the solution of a trademark infringement problem, regard too should be given to
the class of persons who buy the particular product and the circumstances ordinarily
attendant to its acquisition. 16 The medicinal preparation clothed with the trademarks in
question, are unlike articles of everyday use such as candies, ice cream, milk, soft drinks
and the like which may be freely obtained by anyone, anytime, anywhere. Petitioner's and
respondent's products are to be dispensed upon medical prescription. The respective labels
say so. An intending buyer must have to go first to a licensed doctor of medicine; he receives
instructions as to what to purchase; he reads the doctor's prescription; he knows what he is
to buy. He is not of the incautious, unwary, unobservant or unsuspecting type; he examines
the product sold to him; he checks to find out whether it conforms to the medical
prescription. The common trade channel is the pharmacy or the drugstore. Similarly, the
pharmacist or druggist verifies the medicine sold. The margin of error in the acquisition of
one for the other is quite remote.

Lim Hoa vs. Director of Patents, G.R. No. L-8072, Oct. 31, 1956
The danger of confusion in trademarks and brands which are similar may not be so great in
the case of commodities or articles of relatively great value, such as, radio and television sets,
air conditioning units, machinery, etc., for the prospective buyer, generally the head of the
family or a businessman, before making the purchase, reads the pamphlets and all literature
available, describing the article he is planning to buy, and perhaps even makes comparisons
with similar articles in the market. He is not likely to be deceived by similarity in the
trademarks because he makes a more or less thorough study of the same and may even
consult his friends about the relative merit and performance of the article or machinery, as
compared to others also for sale. But in the sale of a food seasoning product, a kitchen article
of everyday consumption, the circumstances are far different. Said product is generally
purchased by cooks and household help, sometimes illiterate who are guided by pictorial
representations and the sound of the word descriptive of said representation. The two
roosters appearing in the trademark of the applicant and the hen appearing on the trademark
of the Oppositor, although of different sexes, belong to the same family of chicken, known as
manok in all the principal dialects of the Philippines, and when a cook or a household help
or even a housewife buys a food seasoning product for the kitchen the brand of “Manok” or
“Marca Manok” would most likely be upper most in her mind and would influence her in
selecting the product, regardless of whether the brand pictures a hen or a rooster or two
roosters. To her, they are all manok. Therein lies the confusion, even deception.

Asia Brewery Inc. vs. CA, G.R. No. 103543, July 5, 1993
In order that there may be deception of the buying public in the sense necessary to constitute
unfair competition, it is necessary to suppose a public accustomed to buy, and therefore to
some extent familiar with, the goods in question. The test of fraudulent simulation is to be
found in the likelihood of the deception of persons in some measure acquainted with an
established design and desirous of purchasing the commodity with which that design has
been associated. The test is not found in the deception, or possibility of the deception, of the
person who knows nothing about the design which has been counterfeited, and who must be
indifferent as between that and the other. The simulation, in order to be objectionable, must
be such as appears likely to mislead the ordinarily intelligent buyer who has a need to supply
and is familiar with the article that he seeks to purchase.

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 Del Monte Corp. vs. CA, 181 SCRA 410 (1990)
What essentially determines the attitude of the purchaser, specifically his inclination to be
cautious, is the cost of the goods. To be sure, a person who buys a box of candies will not
exercise as much care as one who buys an expensive watch. As a general rule, an ordinary
buyer does not exercise as much prudence in buying an article for which he pays a few
centavos as he does in purchasing a more valuable thing. Expensive and valuable items are
normally bought only after deliberate, comparative and analytical investigation. But mass
products, low priced articles in wide use, and matters of everyday purchase requiring
frequent replacement are bought by the casual consumer without great care. In this latter
category is catsup.

Confusion of Goods vs. Confusion of Business

Two types of Confusion

1) Confusion of goods
2) Confusion of Business or Origin

Sterling Products International, Inc. v. Farbenfabriken Bayer Aktiengesellschaft,

G.R. No. L-19906, April 30, 1969, 27 SCRA 1214
The Court distinguished these two types of confusion, thus:
[Rudolf] Callman notes two types of confusion. The first is the confusion of goods "in which
event the ordinarily prudent purchaser would be induced to purchase one product in the
belief that he was purchasing the other." xxx The other is the confusion of business: "Here
though the goods of the parties are different, the 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."

McDonalds Corp. vs. L.C. Big Mak, G.R. No. 143993, Aug. 18, 2004
Confusion of Goods
Respondents further claim that petitioners use the "Big Mac" mark only on petitioners'
double-decker hamburgers, while respondents use the "Big Mak" mark on hamburgers and
other products like siopao, noodles and pizza. Respondents also point out that petitioners
sell their Big Mac double-deckers in a styrofoam box with the "McDonald's" logo and
trademark in red, block letters at a price more expensive than the hamburgers of
respondents. In contrast, respondents sell their Big Mak hamburgers in plastic wrappers and
plastic bags. Respondents further point out that petitioners' restaurants are air-conditioned
buildings with drive-thru service, compared to respondents' mobile vans.
These and other factors respondents cite cannot negate the undisputed fact that respondents
use their "Big Mak" mark on hamburgers, the same food product that petitioners' sell with the
use of their registered mark "Big Mac." Whether a hamburger is single, double or triple-
decker, and whether wrapped in plastic or styrofoam, it remains the same hamburger food
product. Even respondents' use of the "Big Mak" mark on non-hamburger food products
cannot excuse their infringement of petitioners' registered mark, otherwise registered marks
will lose their protection under the law.

Confusion of Business
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

Faberge Inc. vs. IAC, G.R. No. 71189, Nov. 4, 1992

The glaring discrepancies between the two products had been amply portrayed to such an
extent that indeed, "a purchaser who is out in the market for the purpose of buying

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respondent's BRUTE brief would definitely be not mistaken or misled into buying BRUT after
shave lotion or deodorant"

Hickock Manufacturing vs. CA, G.R. No. L-44707, Aug. 31, 1982
It is established doctrine, as held in the above-cited cases, that "emphasis should be on the
similarity of the products involved and not on the arbitrary classification or general
description of their properties or characteristics" and that "the mere fact that one person
has adopted and used a trademark on his goods does not prevent the adoption and use of
the same trademark by others on unrelated articles of a different kind."

Acoje Mining Co. vs. Director of Patents, G.R. No. L-28744, April 29, 1971
Can it be said then that petitioner's application would be likely to cause confusion or mistake
on the part of the buying public? The answer should be in the negative. It does not defy
common sense to assert that a purchaser would be cognizant of the product he is buying.
There can be no confusion to the buying public. There is quite difference between soy sauce
and edible oil. If one is in the market for the former, he is not likely to purchase the latter
just because of the trademark LOTUS. Even on the rare occasions that a mistake does occur,
it can easily be rectified.

Emerald Garments Mfg. Corp. v. Court of Appeals, G.R. No. 100098, December 29,
1995, 251 SCRA 600
- The products involved in the case at bar are, in the main, various kinds of
jeans. These are not your ordinary household items like catsup, soysauce or soap which are
of minimal cost. Maong pants or jeans are not inexpensive. Accordingly, the casual buyer is
predisposed to be more cautious and discriminating in and would prefer to mull over his
purchase.

Actual Confusion

Recaro vs. Embisan, G.R. No. L-17049, May 31, 1961

No proof of actual confusion is necessary

Test of Confusing similarity

1. Phonetic similarity

Phonetic Similarity Test is no longer as applicable since it relies mostly on sonar or hearing.
The more relevant are Holistic and Dominancy Test. SC has held that Dominancy Test should
be given preference. It is more reliable in determining confusing similarity.

Marvex Commercial Co vs. Petra Haw Pia, L-16297, Dec. 22, 1926
Salonpas and Lionpas are confusingly similar in sound. This Court held in Sapolin Co vs
Balmaceda that the name “Lusolin” is an infringement of the trademark “Sapolin”, as the
sound of the two names is almost the same

Operators Inc. vs. Director of Patents, L-17901, Oct. 29, 1965

Considering the similarities in appearance and sound between the marks AMBISCO and
NABISCO, the nature and similarity of the products of the parties together with the fact that
opposer's NABISCO has been used in commerce in the Philippines for more than fifty five
(55) years before AMBISCO was adopted by applicant, confusion of purchasers is likely.

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 2. Holistic Test
Bristol Myers vs. Director of Patents, 17 SCRA 128 (1966)
Are the trademarks "BIOFERIN" and "BUFFERIN", as presented to the public in their
respective labels, confusingly similar?

In determining whether two trademarks are confusingly similar, the test is not simply to take
their words and compare the spelling and pronunciation of said words. Rather, it is to
consider the two marks in their entirety, as they appear in the respective labels, in relation
to the goods to which they are attached.

For though the words "BIOFERIN" and "BUFFERIN" have the same suffix and similar
sounding prefixes, they appear in their respective labels with strikingly different backgrounds
and surroundings, as to color , size and design.

Mead Johnson & Co., NW Van Dorf Ltd, & SCRA 768 (1963)
It is true that between petitioner's trademark "ALACTA" and respondent's "ALASKA" there are
similarities in spelling, appearance and sound for both are composed of six letters of three
syllables each and each syllable has the same vowel, but in determining if they are
confusingly similar a comparison of said words is not the only determining factor. The two
marks in their entirety as they appear in the respective labels must also be considered in
relation to the goods to which they are attached. The discerning eye of the observer must
focus not only on the predominant words but also on the other features appearing in both
labels in order that he may draw his conclusion whether one is confusingly similar to the
other.

Del Monte Corp. vs. CA, 181 SCRA 410 (1990)

In determining whether two trademarks are confusingly similar, the two marks in their
entirety as they appear in the respective labels must be considered in relation to the goods
to which they are attached; the discerning eye of the observer must focus not only on the
predominant words but also on the other features appearing on both labels.

The court therefore should be guided by its first impression, for a buyer acts quickly and is
governed by a casual glance, the value of which may be dissipated as soon as the court
assumes to analyze carefully the respective features of the mark.

The judge must also be aware of the fact that usually a defendant in cases of infringement
does not normally copy but makes only colorable changes. Well has it been said that the
most successful form of copying is to employ enough points of similarity to confuse the public
with enough points of difference to confuse the courts.

to be continued…………………

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