Professional Documents
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Lichauco, Picazo & Agcaoli Law Office For Petitioner
Lichauco, Picazo & Agcaoli Law Office For Petitioner
Lichauco, Picazo & Agcaoli Law Office For Petitioner
L-32747 November 29, 1984 At the pre-trial on May 5, 1965, the following admissions were made: (1) That the
trademark FRUIT OF THE LOOM has been registered with the Bureau of Patents and
FRUIT OF THE LOOM, INC., petitioner, it does not bear the notice 'Reg. Phil. Patent Off.', and (2) That the trademark FRUIT
vs. FOR EVE has been registered with the Bureau of Patents and it bears the notice
COURT OF APPEALS and GENERAL GARMENTS CORPORATION, respondents. "Reg. Phil. Patent Off." and (3) That at the time of its registration, plaintiff filed no
opposition thereto.
Lichauco, Picazo & Agcaoli Law Office for petitioner.
After trial, judgment was rendered by the lower court in favor of herein petitioner, the
dispositive portion of which reads as follows:
Lastly, petitioner asserts that respondent court should have awarded damages in its 2. The designs differ. Petitioner's trademark is written in almost
favor because private respondent had clearly profited from the infringement of the semi-circle while that of private respondent is written in straight line
former's trademark. in bigger letters than petitioner's. Private respondent's tag has only
an apple in its center but that of petitioner has also clusters of
The main issue involved in this case is whether or not private respondent's trademark grapes that surround the apple in the center.
FRUIT FOR EVE and its hang tag are confusingly similar to petitioner's trademark
FRUIT OF THE LOOM and its hang tag so as to constitute an infringement of the 3. The colors of the hang tag are also very distinct from each other.
latter's trademark rights and justify the cancellation of the former. Petitioner's hang tag is fight brown while that of respondent is pink
with a white colored center piece. The apples which are the only
In cases involving infringement of trademark brought before this Court it has been similarities in the hang tag are differently colored. Petitioner's apple
consistently held that there is infringement of trademark when the use of the mark is colored dark red, while that of private respondent is light red.
involved would be likely to cause confusion or mistake in the mind of the public or to
deceive purchasers as to the origin or source of the commodity (Co Tiong Sa vs. The similarities of the competing trademarks in this case are completely lost in the
Director of Patents, 95 Phil. 1; Alhambra Cigar & Cigarette Co. vs. Mojica, 27 Phil. substantial differences in the design and general appearance of their respective hang
266; Sapolin Co. vs. Balmaceda, 67 Phil. 705; La Insular vs. Jao Oge, 47 Phil. 75). tags. WE have examined the two trademarks as they appear in the hang tags
submitted by the parties and We are impressed more by the dissimilarities than by the
In cases of this nature, there can be no better evidence as to whether there is a similarities appearing therein. WE hold that the trademarks FRUIT OF THE LOOM
confusing similarity in the contesting trademarks than the labels or hang tags and FRUIT FOR EVE do not resemble each other as to confuse or deceive an
themselves. A visual presentation of the labels or hang tags is the best argument for ordinary purchaser. The ordinary purchaser must be thought of as having, and
one or the other, hence, We are reproducing hereunder pictures of the hang tags of credited with, at least a modicum of intelligence (Carnation Co. vs. California Growers
the products of the parties to the case. The pictures below are part of the Wineries, 97 F. 2d 80; Hyram Walke and Sons vs. Penn-Maryland Corp., 79 F. 2d
documentary evidence appearing on page 124 of the original records. 836) to be able to see the obvious differences between the two trademarks in
question. Furthermore, We believe that a person who buys petitioner's products and
Petitioner asseverates in the third and fourth assignment of errors, which, as We have starts to have a liking for it, will not get confused and reach out for private
said, constitute the main argument, that the dominant features of both trademarks is respondent's products when she goes to a garment store.
the word FRUIT. In determining whether the trademarks are confusingly similar, a
comparison of the words is not the only determinant factor. The trademarks in their These findings in effect render immaterial the other errors assigned by petitioner
entirety as they appear in their respective labels or hang tags must also be which are premised on the assumption that private respondent's trademark FRUIT
considered in relation to the goods to which they are attached. The discerning eye of FOR EVE had infringed petitioner's trademark FRUIT OF THE LOOM.
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 WHEREFORE, THE DECISION APPEALED FROM IS AFFIRMED. COSTS
one is confusingly similar to the other (Bristol Myers Co. vs. Director of Patents, 17 AGAINST PETITIONER.
SCRA 131).
SO ORDERED.
In the trademarks FRUIT OF THE LOOM and FRUIT FOR EVE, the lone similar word
is FRUIT. WE agree with the respondent court that by mere pronouncing the two
marks, it could hardly be said that it will provoke a confusion, as to mistake one for
the other. Standing by itself, FRUIT OF THE LOOM is wholly different from FRUIT
FOR EVE. WE do not agree with petitioner that the dominant feature of both
trademarks is the word FRUIT for even in the printing of the trademark in both hang
tags, the word FRUIT is not at all made dominant over the other words.
CONRAD AND COMPANY, INC., petitioner, On September 7, 1990, FITRITE assigned its trademark
vs. "SUNSHINE AND DEVICE LABEL," together with its interest and
HON. COURT OF APPEALS, FITRITE INC., and VICTORIA BISCUITS CO., business goodwill to said VICTORIA BISCUIT. From the time
INC., respondents. FITRITE was issued the Certificate of Registration for this
trademark on May 20, 1983 up to the filing of the complaint a
quoFITRITE and VICTORIA BISCUIT have been manufacturing,
selling and distributing on a massive scale biscuits and cookies
bearing this trademark; so that through the years of extensive
VITUG, J.: marketing of plaintiffs' biscuits and cookies with this trademark,
their products have become popularly known and enjoyed wide
In an Amended Decision, dated 20 April 1994, the Court of Appeals reversed an acceptability in Metro Manila and in the provinces.
order of the Regional Trial Court ("RTC") which dismissed Civil Case No. 91-3119 for
"Injunction with Damages with Prayer for Preliminary Injunction" filed by herein private Then sometime in June 1990, through the affidavit executed on
respondents Fitrite, Inc., and Victoria Biscuits Co., Inc., against petitioner Conrad and May 30, 1990 by defendant CONRAD's own Import Manager and
Company, Inc. Executive Assistant by the name of Raul Olaya, plaintiffs
succeeded in tracing and discovered that CONRAD had been
The RTC, acting on a motion to dismiss filed by petitioner, ordered the dismissal of importing, selling and distributing biscuits and cookies, and other
the complaint. Accordingly, for purposes of this review, the facts alleged in the food items bearing this trademark in the Philippines. Although
complaint, narrated by the appellate court and hereunder reproduced, should be CONRAD had never before been engaged in the importation, sale
deemed hypothetically admitted. and distribution of products similar to those of plaintiffs, on April 18,
1988 CONRAD was suddenly designated exclusive importer and
. . . Plaintiffs appellants FITRITE, INC. and VICTORIA BISCUIT dealer of the products of "Sunshine Biscuits, Inc." for sale in the
CO., INC. [private respondents here], both domestic corporations, Philippine market; and on April 21, 1988, per the affidavit of said
are engaged in the business of manufacturing, selling and Raul Olaya, CONRAD made its first importation, which was
distributing biscuits and cookies bearing the trademark continuously repeated up to the present (May 30, 1990 [date of the
"SUNSHINE" in the Philippines. Defendant CONRAD AND affidavit]), altogether consisting of 51,575 cartons and amounting to
COMPANY [petitioner here] is also engaged in the business of $579,224.35.
importing, selling and distributing biscuits and cookies in the
Philippines. Those acts of CONRAD, done without plaintiffs' consent, were
deliberately calculated to mislead and deceive the purchasers by
Sometime in April 1982, plaintiff FITRITE filed in the Bureau of making them believe that its (CONRAD'S) "Sunshine" products had
Patents, Trademarks and Technology Transfer (hereto referred as originated from plaintiffs and thereby inducing them to patronize
BPTTT) applications for registration of the trademark "SUNSHINE," those products, all to the damage and prejudice of both the
both in the Supplemental and Principal Registers, to be used on purchasing public and plaintiffs. Through their counsel, plaintiffs
biscuits and cookies. Since March 31, 1981 FITRITE had addressed a letter to CONRAD demanding, among other things,
exclusively used this trademark in the concept of owner on its that it cease and desist from continuing with those acts, but the
biscuits and cookies. On May 20, 1983 demand was ignored. Being acts of infringement and unfair
FITRITE's application for this trademark in the Supplemental competition in violation of plaintiffs' rights, plaintiffs can validly avail
Register was approved by the BPTTT and FITRITE was issued a themselves of the remedies against infringement under Sec. 23 of
Certificate of Registration No. SR-6217 for a term of 20 years from Republic Act No. 166, as amended, as well as of the remedies
the date of approval. On March 22, 1990 FITRITE's application for against unfair competition under
the same trademark in the Principal Registerwas approved by Sec. 29 of the same statute.1
BPTTT and FITRITE was issued a Certificate of Registration No.
47590 for a term of 20 years from said date of approval. On June In seeking the dismissal of the complaint filed by private respondents with the trial
28, 1984 FITRITE authorized its sister company, co-plaintiff court, petitioner invoked, among other grounds, litis pendentia, the doctrine of primary
VICTORIA BISCUIT CO., to use this trademark on its biscuits and jurisdiction and failure to state a cause of action.
cookies, as well as to manufacture, promote, sell and distribute
products bearing said trademark. The trial court, agreeing with petitioner, granted the motion to dismiss the complaint in
an Order, dated 26 February 1992, reading thusly:
The Court agrees with defendant that internationally accepted 2. No evidence whatever had
trademarks enjoy protection under Philippine laws. Defendant been introduced before the
having been granted distributorship by Sunshine Biscuits USA over outright dismissal, despite the
Philippine territory it follows that the resolution of the issue with fact that the factual issues
respect to the ownership of Sunshine Biscuits which is the basis of involved in CONRAD's
plaintiffs' claim is lodged under the exclusive jurisdiction of the "affirmative defense" were
BPTTT.The action filed by defendant's principal in whose name the whether the "SUNSHINE"
trademark "SUNSHINE BISCUITS" is trademark has been registered
alleged to be registered in the United States should be considered in the United States of America
as including defendant Conrad and Company, Inc., it being the as claimed by CONRAD; if so
beneficiary/agent/assignee of said Sunshine Biscuits, Inc. Thus, the registered, whether such
Court finds the ground of forum shopping applicable to the case at registration antedated the
bar. It cannot also be denied that there is another action pending registered trademark of
between the same parties for the same cause. Plaintiffs, therefore, FITRITE in the Philippines;
should not have filed this case with this court. It must, therefore, be whether Sunshine Biscuits,
summarily dismissed. The ground of Inc., CONRAD's principal, is
litis pendentia is no doubt meritorious. The doctrine of primary the actual registrant thereof;
jurisdiction should be made to apply in this case considering that and whether CONRAD is truly
the BPTTT had already acquired jurisdiction over the suit brought an agent of Sunshine Biscuits,
by defendant's principal against the plaintiffs involving the right of Inc. who is protected by the
plaintiffs to use said trademark. No doubt the BPTTT is better alleged American "SUNSHINE"
situated, considering its experience and special knowledge to trademark and therefore vested
determine the matters of fact involved. Indeed, the rulings laid down with the legal capacity to raise
by the Supreme Court on the point is along this trend. such "affirmative defense" in
the action a quo; etc.; and
WHEREFORE, premises considered, the Motion To Dismiss filed
by defendant is hereby GRANTED. The instant case filed by 3. Unless and until FITRITE's
plaintiffs is hereby ordered DISMISSED.2 (Emphasis ours) certificates both in the
Supplemental and Principal
Unsuccessful in their attempt to have the order reconsidered, private respondents Registers as registrant of said
brought the case to the Court of Appeals (CA-G.R. CV No. 38822). "SUNSHINE" trademark are
cancelled by BPTTT, or so long
as said "SUNSHINE"
In an amended decision, dated 20 April 1994, the appellate court reversed the order trademark has not been
of the trial court and ordered the reinstatement of the case, holding, in part, thusly: successfully proved by
CONRAD in the action
1. It was a motion to dismiss a quo as belonging to
that CONRAD filed instead of Sunshine Biscuits, Inc. or so
an answer where its long as said trademark has not
"affirmative defense" could been successfully proved by
have been alleged and later Sunshine Biscuits, Inc. in the
raised in a motion for cancellation proceeding before
preliminary hearing for BPTTT as belonging to it
reception of evidence and not, (Sunshine Biscuits), for all legal
as CONRAD did, raise such intents and purposes the
defense in a mere motion to trademark belongs to FITRITE
dismiss, although such defense and all those acts of importing,
involved factual matters selling and distributing by
outside of the allegations CONRAD constitute
contained in the complaint; infringement as defined in said
Sec. 22 of Republic Act No. No pronouncement as to costs.
166, as amended.
SO ORDERED.3 (Emphasis ours.)
xxx xxx xxx
In the instant petition for review, which has additionally prayed for a writ of preliminary
In sum, we find the appeal impressed with merit, considering that injunction or for a temporary restraining order, petitioner tells us that the appellate
FITRITE is the registrant of the "SUNSHINE" trademark in the court has erred —
Philippines; that CONRAD's claim that its principal, Sunshine
Biscuits, Inc., is the registrant of a "SUNSHINE" trademark in the 1. When it ordered the issuance of a writ of preliminary injunction,
United States of America is a mere allegation still subject to proof; upon private respondents, posting of a bond in the sum of
that there is no identity of causes of action and because the cause P10,000.00, despite the pendency of the cancellation proceedings
before BPTTT is the cancellability of FITRITE's registration while in Inter Partes case Nos. 3397 and 3739, and in subsequently
the cause in the case a quo is infringement by CONRAD of said amending its decision by issuing the writ of preliminary injunction
"SUNSHINE" trademark of FITRITE; that there is implied admission itself.
that CONRAD has been importing, selling and distributing biscuits,
cookies and other food items bearing said "SUNSHINE" trademark
without FITRITE's consent; that so long as the cancellation 2. When respondent court failed to apply and totally disregarded
proceeding remains pending in BPTTT, said "SUNSHINE" the provisions of the Paris Convention for the protection of
trademark belongs exclusively to FITRITE in the Philippines, and industrial property, as well as the memorandum of the Minister of
any person using it without FITRITE's consent is guilty of Trade, dated November 20, 1980.
infringement.
3. In holding that the doctrine of primary jurisdiction by the Bureau
WHEREFORE, the Court hereby: of Patents, Trademarks and Technology Transfer (BPTTT) is not
applicable in this case, and in further holding that the issues
involved in this case is not whether the "SUNSHINE" trademark in
(1) SETS ASIDE the appealed order dated February 26, 1992 question is registerable or cancellable.
dismissing the complaint a quo;
4. Respondent court erred in holding that the ground of litis
(2) REINSTATES the complaint; pendentia under the Rules of Court does not apply in this case for
the reason that the cause of action in the cancellation proceedings
(3) ORDERS defendant Conrad and Company, Inc. to file its before the BPTTT is not the same as the cause of action in the
answer within the reglementary period from receipt hereof; case a quo.
(4) ORDERS the lower court to proceed with the action a quo, 5. In ordering the lower court to proceed with the action a quo,
although for a good cause shown the lower court, in its sound although for a good cause shown the lower court, in its sound
discretion, may suspend the action pending outcome of the discretion, may suspend the action pending outcome of the
cancellation proceeding between Sunshine Biscuits, Inc. and Fitrite, cancellation proceeding between Sunshine Biscuits, Inc. and Fitrite,
Inc. in Inter Partes Case Inc. in inter partes Case No. 3397 and 3739 before BPTTT.4
No. 3397 before BPTTT, subject to the condition provided for in No.
(5) below; The petition was given due course; however, neither a writ of preliminary injunction
nor a restraining order was issued by this Court.
(5) ORDERS defendant-appellee Conrad and Company, Inc. to
desist and refrain from importing, manufacturing, selling and Unadorned, the issues would revolve simply around the question of whether or not
distributing in the Philippines any goods bearing the trademark the Court of Appeals committed reversible error (1) in allowing the trial court to
"SUNSHINE & DEVICE LABEL" registered in FITRITE's name proceed with the case for "injunction with damages" filed by private respondents
pending final decision in the action a quo, it being understood that notwithstanding the pendency of an administrative case for the cancellation of the
this order, to effect such desistance and enjoin defendant-appellee former's trademark filed by supposedly "petitioner's principal" with the Bureau of
from the aforesaid activities, shall be considered as the Writ of Patents, Trademarks and Technology Transfer ("BPTTT"); and (2) in meanwhile
Injunction itself and an integral part of this Amended Decision. issuing an injunction order against petitioner.
We find for private respondents. knowledge for resolution to justify the exercise of primary
jurisdiction by BPTTT.
The assailed amended decision of the appellate court reinstated the complaint for
"Injunction with Damages with Prayer for Preliminary Injunction" filed by private But, even assuming — which is not the case — that the issue
respondents with the trial court and ordered petitioner to file its answer. The appellate involved here is technical in nature requiring specialized skills and
court enjoined petitioner in the meantime from importing, manufacturing, selling and knowledge, still Industrialized Enterprises does not authorize the
distributing in the Philippines goods bearing the trademark "Sunshine and Device outright dismissal of a case originally cognizable in the courts; what
Label" duly registered with BPTTT in private respondents' name. it says is where primary jurisdiction comes into play in a case "the
judicial process is suspended pending referral of such issues to the
Petitioner, invoking the case of Developers Group of Companies vs. Court of administrative body for its view.5
Appeals (219 SCRA 715), contends that the "Petitions for Cancellation" of Fitrite's
Certificate of Registration No. SR-6217 and No. 47590 in the Supplemental Register We cannot see any error in the above disquisition. It might be mentioned that while an
and the Principal Register, respectively, which Sunshine Biscuits, Inc., of the United application for the administrative cancellation of a registered trademark on any of the
States of America filed in 1989 and in 1990 (docketed Inter Partes Case No. 3397 grounds enumerated in Section 176 of Republic Act No. 166, as amended, otherwise
and 3739) with BPTTT cast a cloud of doubt on private respondents' claim of known as the Trade-Mark Law, falls under the exclusive cognizance of BPTTT (Sec.
ownership and exclusive right to the use of the trademark "Sunshine." Considering 19, Trade-Mark Law), an action, however, for infringement or unfair competition, as
that this matter is at issue before the BPTTT, which has primary jurisdiction over the well as the remedy of injunction and relief for damages, is explicitly and
case, petitioner argues, an injunctive relief from any court would be precipitate and unquestionably within the competence and jurisdiction of ordinary courts.
improper.
Private respondents are the holder of Certificate of Registration No. 47590 (Principal
The appellate court, in disposing of petitioner's argument, points out: Register) for the questioned trademark. In Lorenzana vs. Macagba, 154 SCRA 723,
cited with approval in Del Monte Corporation vs. Court of Appeals, 181 SCRA 410,
Notwithstanding those provisions, it is CONRAD's contention — we have declared that registration in the Principal Register gives rise to a
relying on the ruling in Industrial Enterprises, Inc. vs. Court of presumption of validity of the registration and of the registrant's ownership and right to
Appeals (G.R. No. 88550, 184 SCRA 426 [1990]) — that, because the exclusive use of the mark. It is precisely such a registration that can serve as the
technical matters or intricate issues of fact regarding the ownership basis for an action for infringement.7 An invasion of this right entitles the registrant to
of the trademark in question are involved, its determination requires court protection and relief. Section 23 and Section 27, Chapter V, of the Trade-Mark
the expertise, specialized skills and knowledge of the proper Law provides:
administrative body, which is BPTTT, which has the primary
jurisdiction over the action a quo; and therefore the trial court Sec. 23. Actions, and damages and injunction for infringement. —
should, and as it correctly did, yield its jurisdiction to BPTTT. Any person entitled to the exclusive use of a registered mark or
trade-name may recover damages in a civil action from any person
The trial court erred in adopting such fallacious argument. The who infringes his rights, and the measure of the damages suffered
issue involved in the action a quo is not whether the "SUNSHINE" shall be either the reasonable profit which the complaining party
trademark in question is registerable or cancellable — which is the would have made, had the defendant not infringe his said rights, or
issue pending in BPTTT that may be technical in nature requiring the profit which the defendant actually made out of the
"expertise, specialized skills and knowledge" — since the infringement, or in the event such measure of damages cannot be
trademark has already been registered in both the Supplemental readily ascertained with reasonable certainty, then the court may
and Principal Registers of BPTTT in the name of FITRITE; actually, award as damages a reasonable percentage based upon the
the issue involved in the action a quo is whether CONRAD's acts of amount of gross sales of the defendant or the value of the services
importing, selling and distributing biscuits, cookies and other food in connection with which the mark or trade-name was used in the
items bearing said registered "SUNSHINE" trademark in the infringement of the rights of the complaining party. In cases where
Philippines without the consent of its registrant (FITRITE) constitute actual intent to mislead the public or to defraud the complaining
infringement thereof in contemplation of Sec. 22 of Republic Act party shall be shown, in the discretion of the court, the damages
No. 166, as amended. Under Sec. 22, the elements that constitute may be doubled.
infringement are simply (1) the use by any person, without the
consent of the registrant, (2) of any registered mark or trade-name The complaining party, upon proper showing, may also be granted
in connection with the sale, business or services, among other injunction.
things, bearing such registered mark or trade-name. This, clearly, is
a factual question that does not require any specialized skill and
Sec. 27. Jurisdiction of [Regional Trial Court]. All actions under this All given, we find no reversible error on the part of the appellate court in its appealed
Chapter and Chapters VI and VII hereof shall be brought before the decision.
proper [Regional Trial Court].
In closing, the Court would urge the Bureau of Patents, Trademarks and Technology
Surely, an application with BPTTT for an administrative cancellation of a registered Transfer to resolve with dispatch the administrative cases (Inter Partes Case No.
trade mark cannot per se have the effect of restraining or preventing the courts from 3397 and No. 3739) referred to in this decision.
the exercise of their lawfully conferred jurisdiction. A contrary rule would unduly
expand the doctrine of primary jurisdiction which, simply expressed, would merely WHEREFORE, the petition for review is DENIED for lack of merit, and the questioned
behoove regular courts, in controversies involving specialized disputes, to defer to the amended decision of the Court of Appeals is AFFIRMED. Costs against petitioner.
findings of resolutions of administrative tribunals on certain technical matters. This
rule, evidently, did not escape the appellate court for it likewise decreed that for "good
cause shown, the lower court, in its sound discretion, may suspend the action
pending outcome of the cancellation proceedings" before BPTTT.
Needless to say, we cannot at this stage delve into the merits of the
cancellation case. In this instance, the sole concern, outside of the
jurisdictional aspect of the petition hereinbefore discussed, would be that
which focuses on the propriety of the injunction order of the appellate court.
On this score, the appellate court has said:
The appellate court's finding that there is an urgent necessity for the issuance of the
writ of preliminary injunction pending resolution by BPTTT of the petition for
cancellation filed by Sunshine USA in Inter Partes Case No. 3397 would indeed
appear to have merit. The prematurity of petitioner's motion to dismiss places the
case at bench quite apart from that of Developers Group of Companies,
Inc. vs. Court of Appeals, 219 SCRA 715. The allegations of the complaint, perforced
hypothetically deemed admitted by petitioner, would here justify the issuance by
appellate court of its injunction order. Petitioner, itself, does not even appear to be a
party in the administrative case (Inter Partes Case No. 3397). The averment that
Sunshine USA is petitioner's principal, and that it has a prior foreign registration that
should be respected conformably with the Convention of the Union of Paris for the
Protection of Industrial Property are mere asseverations in the motion to dismiss
which, along with some other factual assertions, are yet to be established.
AMIGO MANUFACTURING, Inc., petitioner, vs. CLUETT PEABODY CO., The source of the controversy that precipitated the filing by [herein Respondent]
INC., respondent. Cluett Peabody Co., Inc. (a New York corporation) of the present case against [herein
Petitioner] Amigo Manufacturing Inc. (a Philippine corporation) for cancellation of
DECISION trademark is [respondents] claim of exclusive ownership (as successor in interest of
Great American Knitting Mills, Inc.) of the following trademark and devices, as used
PANGANIBAN, J.: on mens socks:
The findings of the Bureau of Patents that two trademarks are confusingly and a) GOLD TOE, under Certificate of Registration No. 6797 dated
deceptively similar to each other are binding upon the courts, absent any sufficient September 22, 1958;
evidence to the contrary. In the present case, the Bureau considered the totality of the
similarities between the two sets of marks and found that they were of such degree, b) DEVICE, representation of a sock and magnifying glass on the toe of a
sock, under Certificate of Registration No. 13465 dated January 25,
number and quality as to give the overall impression that the two products are
confusingly if not deceptively the same. 1968;
c) DEVICE, consisting of a plurality of gold colored lines arranged in
parallel relation within a triangular area of toe of the stocking and
Statement of the Case spread from each other by lines of contrasting color of the major part of
the stocking under Certificate of Registration No. 13887 dated May 9,
1968; and
Petitioner Amigo Manufacturing Inc. challenges, under Rule 45 of the Rules of d) LINENIZED, under Certificate of Registration No. 15440 dated April 13,
Court, the January 14, 1999 Resolution[1] of the Court of Appeals (CA) in CA-GR SP 1970.
No. 22792, which reversed, on reconsideration, its own September 29, 1998
Decision.[2] The dispositive portion of the assailed Resolution reads as follows:
On the other hand, [petitioners] trademark and device GOLD TOP, Linenized for
Extra Wear has the dominant color white at the center and a blackish brown
WHEREFORE, the Motion for Reconsideration is GRANTED, and the Decision dated background with a magnified design of the socks garter, and is labeled Amigo
September 29, 1998 REVERSED. Consequently, the decision rendered by the Manufacturing Inc., Mandaluyong, Metro Manila, Made in the Philippines.
Director of Patents dated September 3, 1990 is hereby AFFIRMED.
In the Patent Office, this case was heard by no less than six Hearing Officers: Attys.
The Decision of the Director of Patents, referred to by the CA, disposed as Rodolfo Gilbang, Rustico Casia, M. Yadao, Fabian Rufina, Neptali Bulilan and Pausi
follows: Sapak. The last named officer drafted the decision under appeal which was in due
court signed and issued by the Director of Patents (who never presided over any
WHEREFORE, the Petition is GRANTED. Consequently, Certificate of Registration hearing) adversely against the respondent Amigo Manufacturing, Inc. as heretofore
No. SR-2206 issued to Respondent-Registrant [herein petitioner] is hereby cancelled. mentioned (supra, p.1).
Let the records of this case be remanded to the Patent/Trademark Registry and EDP The decision pivots on two point: the application of the rule of idem sonans and the
Division for appropriate action in accordance with this Decision. existence of a confusing similarity in appearance between two trademarks (Rollo, p.
33).[4]
Petitioner also seeks the reversal of the June 30, 1999 CA Resolution[3] denying
its own Motion for Reconsideration.
Ruling of the Court of Appeals
The Facts
In its assailed Resolution, the CA held as follows:
The facts, which are undisputed, are summarized by the Court of Appeals in its After a careful consideration of [respondents] arguments and a re-appreciation of the
original Decision, as follows: records of this case. [w]e find [respondents] motion for reconsideration
meritorious. As shown by the records, and as correctly held by the Director of
Patents, there is hardly any variance in the appearance of the marks GOLD TOP and
GOLD TOE since both show a representation of a mans foot wearing a sock, and the
marks are printed in identical lettering. Section 4(d) of R.A. No. 166 declares to be II
unregistrable, a mark which consists o[r] comprises a mark or trademark which so
resembles a mark or tradename registered in the Philippines of tradename previously Since the petitioners actual use of its trademark was ahead of the respondent,
used in the Philippines by another and not abandoned, as to be likely, when applied whether or not the Court of Appeals erred in canceling the registration of petitioners
to or used in connection with the goods, business or services of the applicant, to trademark instead of canceling the trademark of the respondent.
cause confusion or mistake or to deceive the purchasers. [Petitioner]s mark is a
combination of the different registered marks owned by [respondent]. As held in Del
Monte Corporation v. Court of Appeals, 181 SCRA 410 (1990), the question is not III
whether the two articles are distinguishable by their label when set aside but whether
the general confusion made by the article upon the eye of the casual purchaser who Whether or not the Court of Appeals erred in affirming the findings of the Director of
is unsuspicious and off his guard, is such as to likely result in confounding it with the Patents that petitioners trademark [was] confusingly similar to respondents
original. As held by the Court in the same decision[,] The most successful form of trademarks.
copying is to employ enough points of similarity to confuse the public with enough
points of difference to confuse the courts. Furthermore, [petitioner]s mark is only IV
registered with the Supplemental Registry which gives no right of exclusivity to the
owner and cannot overturn the presumption of validity and exclusiv[ity] given to a
registered mark. Whether or not the Court of Appeals erred in applying the Paris Convention in holding
that respondent ha[d] an exclusive right to the trademark gold toe without taking into
consideration the absence of actual use in the Philippines.[8]
Finally, the Philippines and the United States are parties to the Union Convention for
the Protection of Industrial Property adopted in Paris on March 20, 1883, otherwise
known as the Paris Convention.(Puma Sportschuhfabriken Rudolf Dassler K.G. v. In the main, the Court will resolve three issues: (1) the date of actual use of the
Intermediate Appellate Court, 158 SCRA 233). [Respondent] is domiciled in the two trademarks; (2) their confusing similarities, and (3) the applicability of the Paris
United States of America and is the lawful owner of several trademark registrations in Convention.
the United States for the mark GOLD TOE.
By virtue of the Philippines membership to the Paris Union, trademark rights in favor
of the [respondent] were created. The object of the Convention is to accord a national The Petition has no merit.
of a member nation extensive protection against infringement and other types of
unfair competition. (Puma Sportschuhfabriken Rudolf Dassler K.G. v. Intermediate
Appellate Court, 158 SCRA 233; La Chemise Lacoste, S.A. v. Fernandez, 129 SCRA First Issue:
373)[5] Dates of First Use of Trademark and Devices
THE EXCEPTIONAL CIRCUMSTANCES We note that respondents sued petitioners on March 12, 1993 for trademark
IN THIS CASE OBLIGE THE COURT TO REVIEW infringement and unfair competition committed during the effectivity of the Paris
THE CAS FACTUAL FINDINGS Convention and the Trademark Law.
Yet, in the Makati RTC decision of November 26, 1998, petitioners were held
As a general rule, a petition for review on certiorari under Rule 45 must raise
liable not only under the aforesaid governing laws but also under the IP Code which
only questions of law[32] (that is, the doubt pertains to the application and
took effect only on January 1, 1998,[37] or about five years after the filing of the
interpretation of law to a certain set of facts) and not questions of fact (where the
complaint:
doubt concerns the truth or falsehood of alleged facts),[33] otherwise, the petition will
be denied. We are not a trier of facts and the Court of Appeals factual findings are
generally conclusive upon us.[34] Defendants unauthorized use of the GALLO trademark constitutes trademark
infringement pursuant to Section 22 of Republic Act No. 166, Section 155 of the IP
This case involves questions of fact which are directly related and intertwined Code, Article 6bis of the Paris Convention, and Article 16 (1) of the TRIPS Agreement
with questions of law. The resolution of the factual issues concerning the goods as it causes confusion, deception and mistake on the part of the purchasing public.
similarity, identity, relation, channels of trade, and acts of trademark infringement and [38]
(Emphasis and underscoring supplied)
unfair competition is greatly dependent on the interpretation of applicable laws. The
controversy here is not simply the identity or similarity of both parties trademarks but
whether or not infringement or unfair competition was committed, a conclusion based The CA apparently did not notice the error and affirmed the Makati RTC
on statutory interpretation. Furthermore, one or more of the following exceptional decision:
circumstances oblige us to review the evidence on record:[35]
In the light of its finding that appellants use of the GALLO trademark on its cigarettes
(1) the conclusion is grounded entirely on speculation, surmises, and is likely to create confusion with the GALLO trademark on wines previously registered
conjectures; and used in the Philippines by appellee E & J Gallo Winery, the trial court thus did
(2) the inference of the Court of Appeals from its findings of fact is not err in holding that appellants acts not only violated the provisions of the our
manifestly mistaken, absurd and impossible; trademark laws (R.A. No. 166 and R.A. Nos. (sic) 8293) but also Article 6bis of the
Paris Convention.[39] (Emphasis and underscoring supplied)
(3) there is grave abuse of discretion;
We therefore hold that the courts a quo erred in retroactively applying the IP
(4) the judgment is based on a misapprehension of facts;
Code in this case.
(5) the appellate court, in making its findings, went beyond the issues of It is a fundamental principle that the validity and obligatory force of a law
the case, and the same are contrary to the admissions of both the proceed from the fact that it has first been promulgated. A law that is not yet effective
appellant and the appellee; cannot be considered as conclusively known by the populace. To make a law binding
(6) the findings are without citation of specific evidence on which they are even before it takes effect may lead to the arbitrary exercise of the legislative power.
[40]
based; Nova constitutio futuris formam imponere debet non praeteritis. A new state of the
law ought to affect the future, not the past. Any doubt must generally be resolved
(7) the facts set forth in the petition as well as in the petitioner's main and against the retroactive operation of laws, whether these are original enactments,
reply briefs are not disputed by the respondents; and amendments or repeals.[41] There are only a few instances when laws may be given
retroactive effect,[42] none of which is present in this case.
(8) the findings of fact of the Court of Appeals are premised on the
absence of evidence and are contradicted [by the evidence] on record. The IP Code, repealing the Trademark Law,[43] was approved on June 6,
[36]
1997. Section 241 thereof expressly decreed that it was to take effect only on January
1, 1998, without any provision for retroactive application. Thus, the Makati RTC and
In this light, after thoroughly examining the evidence on record, weighing, the CA should have limited the consideration of the present case within the
analyzing and balancing all factors to determine whether trademark infringement parameters of the Trademark Law and the Paris Convention, the laws in force at the
and/or unfair competition has been committed, we conclude that both the Court of time of the filing of the complaint.
Appeals and the trial court veered away from the law and well-settled jurisprudence.
DISTINCTIONS BETWEEN
Thus, we give due course to the petition. TRADEMARK INFRINGEMENT
THE TRADEMARK LAW AND THE PARIS AND UNFAIR COMPETITION
Although the laws on trademark infringement and unfair competition have a On the other hand, Section 22 of the Trademark Law holds a person liable for
common conception at their root, that is, a person shall not be permitted to infringement when, among others, he uses without the consent of the registrant, any
misrepresent his goods or his business as the goods or business of another, the law reproduction, counterfeit, copy or colorable imitation of any registered mark or
on unfair competition is broader and more inclusive than the law on trademark tradename in connection with the sale, offering for sale, or advertising of any goods,
infringement. The latter is more limited but it recognizes a more exclusive right business or services or in connection with which such use is likely to cause confusion
derived from the trademark adoption and registration by the person whose goods or or mistake or to deceive purchasers or others as to the source or origin of such goods
business is first associated with it. The law on trademarks is thus a specialized or services, or identity of such business; or reproduce, counterfeit, copy or colorably
subject distinct from the law on unfair competition, although the two subjects are imitate any such mark or tradename and apply such reproduction, counterfeit, copy or
entwined with each other and are dealt with together in the Trademark Law (now, colorable imitation to labels, signs, prints, packages, wrappers, receptacles or
both are covered by the IP Code). Hence, even if one fails to establish his exclusive advertisements intended to be used upon or in connection with such goods, business
property right to a trademark, he may still obtain relief on the ground of his or services.[49] Trademark registration and actual use are material to the complaining
competitors unfairness or fraud.Conduct constitutes unfair competition if the effect is partys cause of action.
to pass off on the public the goods of one man as the goods of another. It is not
necessary that any particular means should be used to this end.[44] Corollary to this, Section 20 of the Trademark Law[50] considers the trademark
registration certificate as prima facie evidence of the validity of the registration, the
In Del Monte Corporation vs. Court of Appeals, [45] we distinguished trademark registrants ownership and exclusive right to use the trademark in connection with the
infringement from unfair competition: goods, business or services as classified by the Director of Patents [51] and as
specified in the certificate, subject to the conditions and limitations stated
(1) Infringement of trademark is the unauthorized use of a trademark, therein. Sections 2 and 2-A[52] of the Trademark Law emphasize the importance of the
whereas unfair competition is the passing off of one's goods trademarks actual use in commerce in the Philippines prior to its registration. In the
as those of another. adjudication of trademark rights between contending parties, equitable principles of
(2) In infringement of trademark fraudulent intent is unnecessary, whereas laches, estoppel, and acquiescence may be considered and applied.[53]
in unfair competition fraudulent intent is essential. Under Sections 2, 2-A, 9-A, 20 and 22 of the Trademark Law therefore, the
following constitute the elements of trademark infringement:
(3) In infringement of trademark the prior registration of the trademark is a
prerequisite to the action, whereas in unfair competition (a) a trademark actually used in commerce in the Philippines and registered in
registration is not necessary. the principal register of the Philippine Patent Office
Pertinent Provisions on Trademark (b) is used by another person in connection with the sale, offering for sale, or
Infringement under the Paris advertising of any goods, business or services or in connection with which
Convention and the Trademark Law such use is likely to cause confusion or mistake or to deceive purchasers or
others as to the source or origin of such goods or services, or identity of
Article 6bis of the Paris Convention,[46] an international agreement binding on the such business; or such trademark is reproduced, counterfeited, copied or
Philippines and the United States (Gallo Winerys country of domicile and origin) colorably imitated by another person and such reproduction, counterfeit,
prohibits the [registration] or use of a trademark which constitutes a reproduction, copy or colorable imitation is applied to labels, signs, prints, packages,
imitation or translation, liable to create confusion, of a mark considered by the wrappers, receptacles or advertisements intended to be used upon or in
competent authority of the country of registration or use to be well-known in that connection with such goods, business or services as to likely cause
country as being already the mark of a person entitled to the benefits of the [Paris] confusion or mistake or to deceive purchasers,
Convention and used for identical or similar goods. [This rule also applies] when the (c) the trademark is used for identical or similar goods, and
essential part of the mark constitutes a reproduction of any such well-known mark or
an imitation liable to create confusion therewith. There is no time limit for seeking the (d) such act is done without the consent of the trademark registrant or assignee.
prohibition of the use of marks used in bad faith.[47]
In summary, the Paris Convention protects well-known trademarks only (to be
Thus, under Article 6bis of the Paris Convention, the following are the elements determined by domestic authorities), while the Trademark Law protects all
of trademark infringement: trademarks, whether well-known or not, provided that they have been registered and
are in actual commercial use in the Philippines. Following universal acquiescence and
(a) registration or use by another person of a trademark which is a reproduction, comity, in case of domestic legal disputes on any conflicting provisions between the
imitation or translation liable to create confusion, Paris Convention (which is an international agreement) and the Trademark law (which
(b) of a mark considered by the competent authority of the country of registration is a municipal law) the latter will prevail.[54]
or use[48] to be well-known in that country and is already the mark of a Under both the Paris Convention and the Trademark Law, the protection of a
person entitled to the benefits of the Paris Convention, and registered trademark is limited only to goods identical or similar to those in respect of
(c) such trademark is used for identical or similar goods. which such trademark is registered and only when there is likelihood of confusion.
Under both laws, the time element in commencing infringement cases is material in The provisions of the 1965 Paris Convention for the Protection of Industrial
ascertaining the registrants express or implied consent to anothers use of its Property relied upon by private respondent and Sec. 21-A of the Trademark Law
trademark or a colorable imitation thereof. This is why acquiescence, estoppel or (R.A. No. 166) were sufficiently expounded upon and qualified in the recent case
laches may defeat the registrants otherwise valid cause of action. of Philip Morris, Inc. v. Court of Appeals (224 SCRA 576 [1993]):
Hence, proof of all the elements of trademark infringement is a condition
precedent to any finding of liability. xxx xxx xxx
xxx xxx xxx In view of the foregoing jurisprudence and respondents judicial admission that
the actual commercial use of the GALLO wine trademark was subsequent to its
In the case at bench, however, we reverse the findings of the Director of Patents and registration in 1971 and to Tobacco Industries commercial use of the GALLO
the Court of Appeals. After a meticulous study of the records, we observe that cigarette trademark in 1973, we rule that, on this account, respondents never enjoyed
the Director of Patents and the Court of Appeals relied mainly on the the exclusive right to use the GALLO wine trademark to the prejudice of Tobacco
registration certificates as proof of use by private respondent of the trademark Industries and its successors-in-interest, herein petitioners, either under the
LEE which, as we have previously discussed are not sufficient. We cannot give Trademark Law or the Paris Convention.
credence to private respondent's claim that its LEE mark first reached the Respondents GALLO trademark
Philippines in the 1960's through local sales by the Post Exchanges of the U.S. registration is limited to
Military Bases in the Philippines (Rollo, p. 177) based as it was solely on the wines only
self-serving statements of Mr. Edward Poste, General Manager of Lee (Phils.),
Inc., a wholly owned subsidiary of the H.D. Lee, Co., Inc., U.S.A., herein private We also note that the GALLO trademark registration certificates in the
respondent. (Original Records, p. 52) Similarly, we give little weight to the Philippines and in other countries expressly state that they cover wines only, without
numerous vouchers representing various advertising expenses in the any evidence or indication that registrant Gallo Winery expanded or intended to
Philippines for LEE products. It is well to note that these expenses were expand its business to cigarettes.[63]
incurred only in 1981 and 1982 by LEE (Phils.), Inc. after it entered into a
licensing agreement with private respondent on 11 May 1981. (Exhibit E) Thus, by strict application of Section 20 of the Trademark Law, Gallo Winerys
exclusive right to use the GALLO trademark should be limited to wines, the only
On the other hand, petitioner has sufficiently shown that it has been in the product indicated in its registration certificates. This strict statutory limitation on the
business of selling jeans and other garments adopting its STYLISTIC MR. LEE exclusive right to use trademarks was amply clarified in our ruling in Faberge, Inc. vs.
trademark since 1975 as evidenced by appropriate sales invoices to various stores Intermediate Appellate Court:[64]
and retailers. (Exhibit 1-e to 1-o)
Having thus reviewed the laws applicable to the case before Us, it is not difficult to
Our rulings in Pagasa Industrial Corp. v. Court of Appeals (118 SCRA 526 discern from the foregoing statutory enactments that private respondent may be
[1982]) and Converse Rubber Corp. v. Universal Rubber Products, Inc., (147 SCRA permitted to register the trademark BRUTE for briefs produced by it notwithstanding
154 [1987]), respectively, are instructive: petitioner's vehement protestations of unfair dealings in marketing its own set of items
which are limited to: after-shave lotion, shaving cream, deodorant, talcum powder and
toilet soap. Inasmuch as petitioner has not ventured in the production of briefs,
The Trademark Law is very clear. It requires actual commercial use of the mark prior an item which is not listed in its certificate of registration, petitioner cannot and
to its registration. There is no dispute that respondent corporation was the first should not be allowed to feign that private respondent had invaded petitioner's
registrant, yet it failed to fully substantiate its claim that it used in trade or exclusive domain. To be sure, it is significant that petitioner failed to annex in its
business in the Philippines the subject mark; it did not present proof to invest it Brief the so-called eloquent proof that petitioner indeed intended to expand its mark
with exclusive, continuous adoption of the trademark which should consist BRUT to other goods (Page 27, Brief for the Petitioner; page 202, Rollo). Even then,
among others, of considerable sales since its first use. The invoices submitted a mere application by petitioner in this aspect does not suffice and may not vest an
by respondent which were dated way back in 1957 show that the zippers sent to exclusive right in its favor that can ordinarily be protected by the Trademark Law. In
the Philippines were to be used as samples and of no commercial value. The short, paraphrasing Section 20 of the Trademark Law as applied to the
evidence for respondent must be clear, definite and free from documentary evidence adduced by petitioner, the certificate of registration
inconsistencies. Samples are not for sale and therefore, the fact of exporting them to issued by the Director of Patents can confer upon petitioner the exclusive right
the Philippines cannot be considered to be equivalent to the use contemplated by to use its own symbol only to those goods specified in the certificate, subject to
law. Respondent did not expect income from such samples. There were no receipts any conditions and limitations stated therein. This basic point is perhaps the
to establish sale, and no proof were presented to show that they were subsequently unwritten rationale of Justice Escolin in Philippine Refining Co., Inc. vs. Ng
sold in the Philippines. Sam (115 SCRA 472 [1982]), when he stressed the principle enunciated by the
United States Supreme Court in American Foundries vs. Robertson (269 U.S. 372,
xxx xxx xxx 381, 70 L ed 317, 46 Sct. 160) that one who has adopted and used a trademark
on his goods does not prevent the adoption and use of the same trademark by
others for products which are of a different description. Verily, this Court had the
occasion to observe in the 1966 case of George W. Luft Co., Inc. vs. Ngo Guan (18 GOODS OR BUSINESS
SCRA 944 [1966]) that no serious objection was posed by the petitioner therein since
the applicant utilized the emblem Tango for no other product than hair pomade in A crucial issue in any trademark infringement case is the likelihood of confusion,
which petitioner does not deal. mistake or deceit as to the identity, source or origin of the goods or identity of the
business as a consequence of using a certain mark. Likelihood of confusion is
This brings Us back to the incidental issue raised by petitioner which private admittedly a relative term, to be determined rigidly according to the particular (and
respondent sought to belie as regards petitioner's alleged expansion of its business. It sometimes peculiar) circumstances of each case. Thus, in trademark cases, more
may be recalled that petitioner claimed that it has a pending application for than in other kinds of litigation, precedents must be studied in the light of each
registration of the emblem BRUT 33 for briefs (page 25, Brief for the Petitioner; page particular case. [65]
202, Rollo) to impress upon Us the Solomonic wisdom imparted by Justice JBL There are two types of confusion in trademark infringement. The first is
Reyes in Sta. Ana vs. Maliwat (24 SCRA 1018 [1968]), to the effect that confusion of goods when an otherwise prudent purchaser is induced to purchase one
dissimilarity of goods will not preclude relief if the junior user's goods are not product in the belief that he is purchasing another, in which case defendants goods
remote from any other product which the first user would be likely to make or are then bought as the plaintiffs and its poor quality reflects badly on the plaintiffs
sell (vide, at page 1025). Commenting on the former provision of the Trademark Law reputation. The other is confusion of businesswherein the goods of the parties are
now embodied substantially under Section 4(d) of Republic Act No. 166, as amended, different but the defendants product can reasonably (though mistakenly) be assumed
the erudite jurist opined that the law in point does not require that the articles of to originate from the plaintiff, thus deceiving the public into believing that there is
manufacture of the previous user and late user of the mark should possess the same some connection between the plaintiff and defendant which, in fact, does not exist.[66]
descriptive properties or should fall into the same categories as to bar the latter from
registering his mark in the principal register. (supra at page 1026). In determining the likelihood of confusion, the Court must consider: [a] the
resemblance between the trademarks; [b] the similarity of the goods to which the
Yet, it is equally true that as aforesaid, the protective mantle of the Trademark trademarks are attached; [c] the likely effect on the purchaser and [d] the registrants
Law extends only to the goods used by the first user as specified in the express or implied consent and other fair and equitable considerations.
certificate of registration following the clear message conveyed by Section 20. Petitioners and respondents both use GALLO in the labels of their respective
cigarette and wine products. But, as held in the following cases, the use of an
How do We now reconcile the apparent conflict between Section 4(d) which identical mark does not, by itself, lead to a legal conclusion that there is trademark
was relied upon by Justice JBL Reyes in the Sta. Ana case and Section 20? It infringement:
would seem that Section 4(d) does not require that the goods manufactured by
the second user be related to the goods produced by the senior user while (a) in Acoje Mining Co., Inc. vs. Director of Patent,[67] we ordered the approval
Section 20 limits the exclusive right of the senior user only to those goods of Acoje Minings application for registration of the trademark LOTUS for
specified in the certificate of registration. But the rule has been laid down that the its soy sauce even though Philippine Refining Company had prior
clause which comes later shall be given paramount significance over an registration and use of such identical mark for its edible oil which, like
anterior proviso upon the presumption that it expresses the latest and dominant soy sauce, also belonged to Class 47;
purpose. (Graham Paper Co. vs. National Newspapers Asso. (Mo. App.) 193 S.W.
1003; Barnett vs. Merchant's L. Ins. Co., 87 Okl. 42; State ex nel Atty. Gen. vs.
(b) in Philippine Refining Co., Inc. vs. Ng Sam and Director of Patents,[68] we
Toledo, 26 N.E., p. 1061; cited by Martin, Statutory Construction Sixth ed., 1980
upheld the Patent Directors registration of the same trademark CAMIA
Reprinted, p. 144). It ineluctably follows that Section 20 is controlling and,
for Ng Sams ham under Class 47, despite Philippine Refining
therefore, private respondent can appropriate its symbol for the briefs it
Companys prior trademark registration and actual use of such mark on
manufactures because as aptly remarked by Justice Sanchez in Sterling
its lard, butter, cooking oil (all of which belonged to Class 47), abrasive
Products International Inc. vs. Farbenfabriken Bayer (27 SCRA 1214 [1969]):
detergents, polishing materials and soaps;
The same is true in the present case. Wines and cigarettes are non-competing Those decisions, however, must be considered in perspective of the principle
and are totally unrelated products not likely to cause confusion vis--vis the goods or that tobacco products and alcohol products should be considered related only
the business of the petitioners and respondents. in cases involving special circumstances.Schenley Distillers, Inc. v. General
Cigar Co., 57C.C.P.A. 1213, 427 F. 2d 783, 785 (1970). The presence of special
Wines are bottled and consumed by drinking while cigarettes are packed in
circumstances has been found to exist where there is a finding of unfair
cartons or packages and smoked. There is a whale of a difference between their
competition or where a famous or well-known mark is involved and there is a
descriptive properties, physical attributes or essential characteristics like form,
demonstrated intent to capitalize on that mark. For example, in John Walker &
composition, texture and quality.
Sons, the court was persuaded to find a relationship between products, and hence a
GALLO cigarettes are inexpensive items while GALLO wines are not. GALLO likelihood of confusion, because of the plaintiffs long use and extensive advertising of
wines are patronized by middle-to-high-income earners while GALLO cigarettes its mark and placed great emphasis on the fact that the defendant used the trademark
appeal only to simple folks like farmers, fishermen, laborers and other low-income Johnnie Walker with full knowledge of its fame and reputation and with the intention of
workers.[116] Indeed, the big price difference of these two products is an important taking advantage thereof. John Walker & Sons, 124 F. Supp. At 256; see Mckesson
factor in proving that they are in fact unrelated and that they travel in different & Robbins, Inc. v. P. Lorillard Co., 1959 WL 5894, 120 U.S.P.Q. 306, 307 (1959)
channels of trade. There is a distinct price segmentation based on vastly different (holding that the decision in John Walker & Sons was merely the law on the particular
social classes of purchasers.[117] case based upon its own peculiar facts); see also Alfred Dunhill, 350 F. Supp. At
1363 (defendants adoption of Dunhill mark was not innocent). However,
GALLO cigarettes and GALLO wines are not sold through the same channels of in Schenley, the court noted that the relation between tobacco and whiskey products
trade. GALLO cigarettes are Philippine-made and petitioners neither claim nor pass is significant where a widely known arbitrary mark has long been used for diversified
off their goods as imported or emanating from Gallo Winery. GALLO cigarettes are products emanating from a single source and a newcomer seeks to use the same
mark on unrelated goods. Schenley, 427 F.2d. at 785. Significantly, in Schenley, the GALLO wines and GALLO cigarettes are neither the same, identical, similar nor
court looked at the industry practice and the facts of the case in order to determine related goods, a requisite element under both the Trademark Law and the Paris
the nature and extent of the relationship between the mark on the tobacco product Convention.
and the mark on the alcohol product.
Second, the GALLO trademark cannot be considered a strong and distinct mark
in the Philippines. Respondents do not dispute the documentary evidence that aside
The record here establishes conclusively that IDV has never advertised BAILEYS from Gallo Winerys GALLO trademark registration, the Bureau of Patents,
liqueurs in conjunction with tobacco or tobacco accessory products and that IDV has Trademarks and Technology Transfer also issued on September 4, 1992 Certificate
no intent to do so. And, unlike the defendant in Dunhill, S & M Brands does not of Registration No. 53356 under the Principal Register approving Productos
market bar accessories, or liqueur related products, with its cigarettes. The Alimenticios Gallo, S.As April 19, 1990 application for GALLO trademark registration
advertising and promotional materials presented a trial in this action demonstrate a and use for its noodles, prepared food or canned noodles, ready or canned sauces
complete lack of affiliation between the tobacco and liqueur products bearing the for noodles, semolina, wheat flour and bread crumbs, pastry, confectionery, ice
marks here at issue. cream, honey, molasses syrup, yeast, baking powder, salt, mustard, vinegar, species
and ice.[122]
xxx xxx xxx
Third and most important, pursuant to our ruling in Canon Kabushiki Kaisha vs.
Court of Appeals and NSR Rubber Corporation,[123] GALLO cannot be considered a
Of equal significance, it is undisputed that S & M Brands had no intent, by adopting well-known mark within the contemplation and protection of the Paris Convention in
the family name Baileys as the mark for its cigarettes, to capitalize upon the fame of this case since wines and cigarettes are not identical or similar goods:
the BAILEYS mark for liqueurs. See Schenley, 427 F. 2d at 785. Moreover, as will
be discussed below, and as found in Mckesson & Robbins, the survey
We agree with public respondents that the controlling doctrine with respect to the
evidence refutes the contention that cigarettes and alcoholic beverages are so
applicability of Article 8 of the Paris Convention is that established in Kabushi Kaisha
intimately associated in the public mind that they cannot under any
Isetan vs. Intermediate Appellate Court (203 SCRA 59 [1991]). As pointed out by the
circumstances be sold under the same mark without causing confusion. See
BPTTT:
Mckesson & Robbins, 120 U.S.P.Q. at 308.
First, the records bear out that most of the trademark registrations took place in However, the then Minister of Trade and Industry, the Hon. Roberto V. Ongpin,
the late 1980s and the 1990s, that is, after Tobacco Industries use of the GALLO issued a memorandum dated 25 October 1983 to the Director of Patents, a set of
cigarette trademark in 1973 and petitioners use of the same mark in 1984. guidelines in the implementation of Article 6bis of the Treaty of Paris. These
conditions are:
a) the mark must be internationally known; manufactured by him or in which he deals, or his business, or services for those of
the one having established such goodwill, or who commits any acts calculated to
b) the subject of the right must be a trademark, not a patent or produce said result, is guilty of unfair competition. It includes the following acts:
copyright or anything else;
c) the mark must be for use in the same or similar kinds of (a) Any person, who in selling his goods shall give them the general appearance of
goods; and 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
d) the person claiming must be the owner of the mark (The thereon, or in any other feature of their appearance, which would be likely to influence
Parties Convention Commentary on the Paris purchasers to believe that the goods offered are those of a manufacturer or dealer
Convention. Article by Dr. Bogsch, Director General other than the actual manufacturer or dealer, or who otherwise clothes the goods with
of the World Intellectual Property Organization, such appearance as shall deceive the public and defraud another of his legitimate
Geneva, Switzerland, 1985) trade, or any subsequent vendor of such goods or any agent of any vendor engaged
in selling such goods with a like purpose;
From the set of facts found in the records, it is ruled that the Petitioner failed to
comply with the third requirement of the said memorandum that is the mark (b) Any person who by any artifice, or device, or who employs any other means
must be for use in the same or similar kinds of goods. The Petitioner is using calculated to induce the false belief that such person is offering the services of
the mark CANON for products belonging to class 2 (paints, chemical products) another who has identified such services in the mind of the public;
while the Respondent is using the same mark for sandals (class 25).
(c) Any person who shall make any false statement in the course of trade or who shall
Hence, Petitioner's contention that its mark is well-known at the time the commit any other act contrary to good faith of a nature calculated to discredit the
Respondent filed its application for the same mark should fail. (Emphasis goods, business or services of another.
supplied.)
The universal test question is whether the public is likely to be deceived.
Consent of the Registrant and Nothing less than conduct tending to pass off one mans goods or business as that of
Other air, Just and Equitable another constitutes unfair competition. Actual or probable deception and confusion on
Considerations the part of customers by reason of defendants practices must always appear. [125] On
this score, we find that petitioners never attempted to pass off their cigarettes as
Each trademark infringement case presents a unique problem which must be those of respondents. There is no evidence of bad faith or fraud imputable to
answered by weighing the conflicting interests of the litigants.[124] petitioners in using their GALLO cigarette mark.
Respondents claim that GALLO wines and GALLO cigarettes flow through the All told, after applying all the tests provided by the governing laws as well as
same channels of trade, that is, retail trade. If respondents assertion is true, then both those recognized by jurisprudence, we conclude that petitioners are not liable for
goods co-existed peacefully for a considerable period of time. It took respondents trademark infringement, unfair competition or damages.
almost 20 years to know about the existence of GALLO cigarettes and sue petitioners
for trademark infringement. Given, on one hand, the long period of time that WHEREFORE, finding the petition for review meritorious, the same is hereby
petitioners were engaged in the manufacture, marketing, distribution and sale of GRANTED. The questioned decision and resolution of the Court of Appeals in CA-
GALLO cigarettes and, on the other, respondents delay in enforcing their rights (not G.R. CV No. 65175 and the November 26, 1998 decision and the June 24, 1999
to mention implied consent, acquiescence or negligence) we hold that equity, justice order of the Regional Trial Court of Makati, Branch 57 in Civil Case No. 93-850 are
and fairness require us to rule in favor of petitioners. The scales of conscience and hereby REVERSED and SET ASIDE and the complaint against petitioners
reason tip far more readily in favor of petitioners than respondents. DISMISSED.
Moreover, there exists no evidence that petitioners employed malice, bad faith
or fraud, or that they intended to capitalize on respondents goodwill in adopting the
GALLO mark for their cigarettes which are totally unrelated to respondents GALLO
wines. Thus, we rule out trademark infringement on the part of petitioners.
PETITIONERS ARE ALSO NOT LIABLE
FOR UNFAIR COMPETITION
Under Section 29 of the Trademark Law, any person who employs deception or
any other means contrary to good faith by which he passes off the goods
McDONALDS CORPORATION,
Petitioner, G.R. No. 166115 registration of the trademark MACJOY & DEVICE for fried chicken, chicken barbeque,
Present:
burgers, fries, spaghetti, palabok, tacos, sandwiches, halo-halo and steaks under
PUNO, C.J., Chairperson,
SANDOVAL-GUTIERREZ, classes 29 and 30 of the International Classification of Goods.
CORONA,
- versus - AZCUNA,
GARCIA, JJ.
Promulgated: Petitioner McDonalds Corporation, a corporation duly organized and existing under
the laws of the State of Delaware, USA, filed a verified Notice of Opposition[3] against
MACJOY FASTFOOD CORPORATION, the respondents application claiming that the trademark MACJOY & DEVICE so
Respondent. February 2, 2007
resembles its corporate logo, otherwise known as the Golden Arches or M design,
x----------------------------------------------------------------------------------------x
and its marks McDonalds, McChicken, MacFries, BigMac, McDo, McSpaghetti,
DECISION
McSnack, and Mc, (hereinafter collectively known as the MCDONALDS marks) such
GARCIA, J.: that when used on identical or related goods, the trademark applied for would confuse
In this petition for review on certiorari under Rule 45 of the Rules of Court, herein or deceive purchasers into believing that the goods originate from the same source or
petitioner McDonalds Corporation seeks the reversal and setting aside of the origin. Likewise, the petitioner alleged that the respondents use and adoption in bad
faith of the MACJOY & DEVICE mark would falsely tend to suggest a connection or
following issuances of the Court of Appeals (CA) in CA-G.R. SP No. 57247, to wit:
affiliation with petitioners restaurant services and food products, thus, constituting a
1. Decision dated 29 July 2004[1] reversing an earlier decision of
the Intellectual Property Office (IPO) which rejected herein fraud upon the general public and further cause the dilution of the distinctiveness of
respondent MacJoy FastFood Corporations application for
registration of the trademark MACJOY & DEVICE; and petitioners registered and internationally recognized MCDONALDS marks to its
2. Resolution dated 12 November 2004[2] denying the petitioners prejudice and irreparable damage. The application and the opposition
motion for reconsideration.
thereto was docketed as Inter Partes Case No. 3861.
Respondent denied the aforementioned allegations of the petitioner and averred that
On 14 March 1991, respondent MacJoy Fastfood Corporation, a domestic corporation it has used the mark MACJOY for the past many years in good faith and has spent
engaged in the sale of fast food products in Cebu City, filed with the then Bureau of considerable sums of money for said marks extensive promotion in tri-media,
Patents, Trademarks and Technology Transfer (BPTT), now the Intellectual Property especially in Cebu City where it has been doing business long before the petitioner
Office (IPO), an application, thereat identified as Application Serial No. 75274, for the opened its outletthereat sometime in 1992; and that its use of said mark would not
confuse affiliation with the petitioners restaurant services and food products because Finding no confusing similarity between the marks MACJOY and
of the differences in the design and detail of the two (2) marks. MCDONALDS, the CA, in its herein assailed Decision[7] dated July 29, 2004,
reversed and set aside the appealed IPO decision and order, thus:
In a decision[4] dated December 28, 1998, the IPO, ratiocinating that the WHEREFORE, in view of the foregoing, judgment is hereby
rendered by us REVERSING and SETTING ASIDE the Decision of
predominance of the letter M, and the prefixes Mac/Mc in both the MACJOY and the the IPO dated 28 December 1998 and its Order dated 14 January
2000 and ORDERING the IPO to give due course to petitioners
MCDONALDS marks lead to the conclusion that there is confusing similarity between Application Serial No. 75274.
them especially since both are used on almost the same products falling under SO ORDERED.
classes 29 and 30 of the International Classification of Goods, i.e., food and
Explains the CA in its decision:
ingredients of food, sustained the petitioners opposition and rejected the respondents
xxx, it is clear that the IPO brushed aside and rendered useless the
application, viz: glaring and drastic differences and variations in style of the two
WHEREFORE, the Opposition to the registration of the trademarks and even decreed that these pronounced differences
mark MACJOY & DEVICE for use in fried chicken and chicken are miniscule and considered them to have been overshadowed by
barbecue, burgers, fries, spaghetti, palabok, tacos, sandwiches, the appearance of the predominant features such as M, Mc, and
halo-halo, and steaks is, as it is hereby, SUSTAINED. Accordingly, Mac appearing in both MCDONALDS and MACJOY marks. Instead
Application Serial No. 75274 of the herein Respondent-Applicant of taking into account these differences, the IPO unreasonably
is REJECTED. shrugged off these differences in the device, letters and marks in
the trademark sought to be registered.The IPO brushed aside and
Let the filewrapper of MACJOY subject matter of this case ignored the following irrefutable facts and circumstances showing
be sent to the Administrative, Financial and Human Resources differences between the marks of MACJOY and
Development Bureau for appropriate action in accordance with this MCDONALDS. They are, as averred by the petitioner [now
Decision, with a copy to be furnished the Bureau of Trademarks for respondent]:
information and to update its record.
SO ORDERED. 1. The word MacJoy is written in round script
while the word McDonalds is written in
single stroke gothic;
2. The word MacJoy comes with the picture of a
In time, the respondent moved for a reconsideration but the IPO denied the motion in chicken head with cap and bowtie and
wings sprouting on both sides, while the
its Order[5] of January 14, 2000. word McDonalds comes with an arches
M in gold colors, and absolutely without
any picture of a chicken;
Therefrom, the respondent went to the CA via a Petition for Review with
3. The word MacJoy is set in deep pink and white
prayer for Preliminary Injunction[6] under Rule 43 of the Rules of Court, whereat its color scheme while McDonalds is
written in red, yellow and black color
appellate recourse was docketed as CA-G.R. SP No. 57247. combination;
4. The faade of the respective stores of the
parties are entirely different. Exhibits 1
and 1-A, show that [respondents]
restaurant is set also in the same bold, B. The prefix Mc and/or Mac is the dominant
brilliant and noticeable color scheme as portion of both Petitioners McDonalds
that of its wrappers, containers, cups, Marks and the Respondents Macjoy &
etc., while [petitioners] restaurant is in Device mark. As such, the marks are
yellow and red colors, and with the confusingly similar under the Dominancy
mascot of Ronald McDonald being Test.
prominently displayed therein. (Words in
brackets supplied.) C. Petitioners McDonalds Marks are well-known
and world-famous marks which must be
protected under the Paris Convention.
Petitioner promptly filed a motion for reconsideration. However, in its
II.
similarly challenged Resolution[8] of November 12, 2004, the CA denied the motion,
THE COURT OF APPEALS ERRED IN RULING THAT THE
as it further held: DECISION OF THE IPO DATED 28 DECEMBER 1998 AND ITS
ORDER DATED 14 JANUARY 2000 WERE NOT BASED ON
SUBSTANTIAL EVIDENCE.
Whether a mark or label of a competitor resembles
another is to be determined by an inspection of the points of
difference and resemblance as a whole, and not merely the points In its Comment,[9] the respondent asserts that the petition should be
of resemblance. The articles and trademarks employed and used
by the [respondent] Macjoy Fastfood Corporation are so different dismissed outright for being procedurally defective: first, because the person who
and distinct as to preclude any probability or likelihood of confusion
or deception on the part of the public to the injury of the trade or signed the certification against forum shopping in behalf of the petitioner was not
business of the [petitioner] McDonalds Corporation. The Macjoy &
specifically authorized to do so, and second, because the petition does not present a
Device mark is dissimilar in color, design, spelling, size, concept
and appearance to the McDonalds marks. (Words in brackets reviewable issue as what it challenges are the factual findings of the CA. In any
supplied.)
event, the respondent insists that the CA committed no reversible error in finding no
confusing similarity between the trademarks in question.
Hence, the petitioners present recourse on the following grounds:
The petition is impressed with merit.
I.
THE COURT OF APPEALS ERRED IN RULING THAT
RESPONDENTS MACJOY & DEVICE MARK IS NOT Contrary to respondents claim, the petitioners Managing Counsel, Sheila
CONFUSINGLY SIMILAR TO PETITIONERS McDONALDS Lehr, was specifically authorized to sign on behalf of the petitioner the Verification
MARKS.IT FAILED TO CORRECTLY APPLY THE DOMINANCY
TEST WHICH HAS BEEN CONSISTENTLY APPLIED BY THIS and Certification[10] attached to the petition. As can be gleaned from the petitioners
HONORABLE COURT IN DETERMINING THE EXISTENCE OF
CONFUSING SIMILARITY BETWEEN COMPETING MARKS. Board of Directors Resolution dated December 5, 2002, as embodied in the
A. The McDonalds Marks belong to a well-known Certificate of the Assistant Secretary dated December 21, 2004,[11] Sheila Lehr was
and established family of marks one of those authorized and empowered to execute and deliver for and on behalf of
distinguished by the use of the prefix Mc
and/or Mac and the corporate M logo [the petitioner] all documents as may be required in connection with x x x the
design.
protection and maintenance of any foreign patents, trademarks, trade-names, and
Section 4. Registration of trademarks, trade-names and
copyrights owned now or hereafter by [the petitioner], including, but not limited to, service-marks on the principal register. There is hereby established
a register of trademarks, tradenames and service-marks which
x x x documents required to institute opposition or cancellation proceedings against
shall be known as the principal register. The owner of the trade-
conflicting trademarks, and to do such other acts and things and to execute such mark, trade-name or service-mark used to distinguish his goods,
business or services of others shall have the right to register the
other documents as may be necessary and appropriate to effect and carry out the same on the principal register, unless it:
intent of this resolution. Indeed, the afore-stated authority given to Lehr necessarily xxx xxx xxx
includes the authority to execute and sign the mandatorily required certification of
(d) Consists of or comprises a mark or
non-forum shopping to support the instant petition for review which stemmed from trade-name which so resembles a mark or trade-
name registered in the Philippines or a mark or
the opposition proceedings lodged by the petitioner before the IPO. Considering that trade-name previously used in the Philippines by
another and not abandoned, as to be likely, when
the person who executed and signed the certification against forum shopping has the applied to or used in connection with the goods,
authority to do so, the petition, therefore, is not procedurally defective. business or services of the applicant, to cause
confusion or mistake or to deceive purchasers;
As regards the respondents argument that the petition raises only questions
of fact which are not proper in a petition for review, suffice it to say that the
xxx xxx xxx
contradictory findings of the IPO and the CA constrain us to give due course to the
petition, this being one of the recognized exceptions to Section 1, Rule 45 of the
Essentially, the issue here is whether there is a confusing similarity between
Rules of Court. True, this Court is not the proper venue to consider factual issues as it
the MCDONALDS marks of the petitioner and the respondents MACJOY & DEVICE
is not a trier of facts.[12] Nevertheless, when the factual findings of the appellate court
trademark when applied to Classes 29 and 30 of the International Classification of
are mistaken, absurd, speculative, conjectural, conflicting, tainted with grave abuse of
Goods, i.e., food and ingredients of food.
discretion, or contrary to the findings culled by the court of origin,[13] as here, this
Court will review them.
In determining similarity and likelihood of confusion, jurisprudence has
developed two tests, the dominancy test and the holistic test.[15] The dominancy test
The old Trademark Law, Republic Act (R.A.) No. 166, as amended, defines
focuses on the similarity of the prevalent features of the competing trademarks that
a trademark as any distinctive word, name, symbol, emblem, sign, or device, or any
might cause confusion or deception.[16] In contrast, the holistic test requires the court
combination thereof adopted and used by a manufacturer or merchant on his goods
to consider the entirety of the marks as applied to the products, including the labels
to identify and distinguish them from those manufactured, sold, or dealt in by others.
[14] and packaging, in determining confusing similarity.[17] Under the latter test, a
provisions of Section 4 thereof, paragraph (d) of which is pertinent to this case. The Here, the IPO used the dominancy test in concluding that there was
provision reads: confusing similarity between the two (2) trademarks in question as it took note of the
appearance of the predominant features M, Mc and/or Mac in both the marks. In reason why in trademark cases, jurisprudential precedents should be applied only to
reversing the conclusion reached by the IPO, the CA, while seemingly applying the a case if they are specifically in point.[21]
dominancy test, in fact actually applied the holistic test. The appellate court ruled in
this wise: While we agree with the CAs detailed enumeration of differences between
the two (2) competing trademarks herein involved, we believe that the holistic test is
Applying the Dominancy test to the present case, the IPO should
have taken into consideration the entirety of the two marks instead not the one applicable in this case, the dominancy test being the one more suitable.
of simply fixing its gaze on the single letter M or on the
combinations Mc or Mac. A mere cursory look of the subject marks In recent cases with a similar factual milieu as here, the Court has consistently used
will reveal that, save for the letters M and c, no other similarity
exists in the subject marks. and applied the dominancy test in determining confusing similarity or likelihood of
We agree with the [respondent] that it is entirely unwarranted for confusion between competing trademarks.[22]
the IPO to consider the prefix Mac as the predominant feature and
the rest of the designs in [respondents] mark as details.Taking into
account such paramount factors as color, designs, spelling, sound,
concept, sizes and audio and visual effects, the prefix Mc will Notably, in McDonalds Corp. v. LC Big Mak Burger, Inc.,[23] a case where the
appear to be the only similarity in the two completely different
marks; and it is the prefix Mc that would thus appear as the trademark Big Mak was found to be confusingly similar with the Big Mac mark of the
miniscule detail. When pitted against each other, the two marks
reflect a distinct and disparate visual impression that negates any herein the petitioner, the Court explicitly held:
possible confusing similarity in the mind of the buying public.
(Words in brackets supplied.)
This Court, xxx, 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
Petitioner now vigorously points out that the dominancy test should be the confusingly similar. Under the dominancy test, courts give greater
weight to the similarity of the appearance of the product arising
one applied in this case. 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
We agree. market segments.
In trademark cases, particularly in ascertaining whether one trademark is Moreover, in Societe Des Produits Nestle, S.A. v. CA [24] the Court, applying
confusingly similar to another, no set rules can be deduced because each case must the dominancy test, concluded that the use by the respondent therein of the word
be decided on its merits.[19] In such cases, even more than in any other litigation, MASTER for its coffee product FLAVOR MASTER was likely to cause confusion with
precedent must be studied in the light of the facts of the particular case. [20] That is the therein petitioners coffee products MASTER ROAST and MASTER BLEND and
further ruled:
burgers, fries, spaghetti, etc. Likewise, the petitioners trademark registration for the
xxx, the totality or holistic test is contrary to the elementary
postulate of the law on trademarks and unfair competition that MCDONALDS marks in the Philippines covers goods which are similar if not identical
confusing similarity is to be determined on the basis of visual, aural,
connotative comparisons and overall impressions engendered by to those covered by the respondents application.
the marks in controversy as they are encountered in the
marketplace. The totality or holistic test only relies on visual Thus, we concur with the IPOs findings that:
comparisons 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. In the case at bar, the predominant features such as the M, Mc,
and Mac appearing in both McDonalds marks and the MACJOY &
DEVICE easily attract the attention of would-be customers.Even
non-regular customers of their fastfood restaurants would readily
Applying the dominancy test to the instant case, the Court finds that herein notice the predominance of the M design, Mc/Mac prefixes shown
in both marks. Such that the common awareness or perception of
petitioners MCDONALDS and respondents MACJOY marks are confusingly similar customers that the trademarks McDonalds mark and MACJOY &
DEVICE are one and the same, or an affiliate, or under the
with each other such that an ordinary purchaser can conclude an association or sponsorship of the other is not far-fetched.
relation between the marks. The differences and variations in styles as the device depicting a
head of chicken with cap and bowtie and wings sprouting on both
To begin with, both marks use the corporate M design logo and the prefixes sides of the chicken head, the heart-shaped M, and the stylistic
letters in MACJOY & DEVICE; in contrast to the arch-like M and the
Mc and/or Mac as dominant features. The first letter M in both marks puts emphasis one-styled gothic letters in McDonalds marks are of no
moment. These minuscule variations are overshadowed by the
on the prefixes Mc and/or Mac by the similar way in which they are depicted i.e. in an appearance of the predominant features mentioned hereinabove.
arch-like, capitalized and stylized manner.[25] Thus, with the predominance of the letter M, and prefixes Mac/Mc
found in both marks, the inevitable conclusion is there is confusing
similarity between the trademarks Mc Donalds marks and MACJOY
AND DEVICE especially considering the fact that both marks are
For sure, it is the prefix Mc, an abbreviation of Mac, which visually and being used on almost the same products falling under Classes 29
and 30 of the International Classification of Goods i.e. Food and
aurally catches the attention of the consuming public. Verily, the word MACJOY ingredients of food.
attracts attention the same way as did McDonalds, MacFries, McSpaghetti, McDo,
With the existence of confusing similarity between the subject trademarks, the
Big Mac and the rest of the MCDONALDS marks which all use the prefixes Mc and/or
resulting issue to be resolved is who, as between the parties, has the rightful claim of
Mac.
ownership over the said marks.
Besides and most importantly, both trademarks are used in the sale of We rule for the petitioner.
fastfood products. Indisputably, the respondents trademark application for the
MACJOY & DEVICE trademark covers goods under Classes 29 and 30 of the
the Trademark Law. However, once registered, not only the marks validity but also stated earlier, once a trademark has been registered, the validity of the mark is prima
the registrants ownership thereof is prima facie presumed.[26] faciepresumed. In this case, the respondent failed to overcome such
Pursuant to Section 37[27] of R.A. No. 166, as amended, as well as the respondents explanation that the word MACJOY is based on the name of its
provision regarding the protection of industrial property of foreign nationals in this presidents niece, Scarlett Yu Carcell. In the words of the petitioner:
country as embodied in the Paris Convention[28] under which the Philippines and the
First of all, Respondent failed to present evidence to
petitioners domicile, the United States, are adherent-members, the petitioner was support the foregoing claim which, at best, is a mere self-serving
assertion. Secondly, it cannot be denied that there is absolutely no
able to register its MCDONALDS marks successively, i.e., McDonalds in 04 October,
connection between the name Scarlett Yu Carcel and MacJoy to
1971[29]; the corporate logo which is the M or the golden arches design and the merit the coinage of the latter word. Even assuming that the word
MacJoy was chosen as a term of endearment, fondness and
McDonalds with the M or golden arches design both in 30 June 1977 [30]; and so on affection for a certain Scarlett Yu Carcel, allegedly the niece of
Respondents president, as well as to supposedly bring good luck to
and so forth.[31] Respondents business, one cannot help but wonder why out of all
the possible letters or combinations of letters available to
Respondent, its president had to choose and adopt a mark with the
On the other hand, it is not disputed that the respondents application for prefix Mac as the dominant feature thereof. A more plausible
explanation perhaps is that the niece of Respondents president
registration of its trademark MACJOY & DEVICE was filed only on March 14, was fond of the food products and services of the Respondent, but
that is beside the point. [34]
1991 albeit the date of first use in the Philippines was December 7, 1987.[32]
Hence, from the evidence on record, it is clear that the petitioner has duly By reason of the respondents implausible and insufficient explanation as to
established its ownership of the mark/s. how and why out of the many choices of words it could have used for its trade-name
Respondents contention that it was the first user of the mark in and/or trademark, it chose the word MACJOY, the only logical conclusion deducible
the Philippines having used MACJOY & DEVICE on its restaurant business and food therefrom is that the respondent would want to ride high on the established reputation
products since December, 1987 at Cebu City while the first McDonalds outlet of the and goodwill of the MCDONALDs marks, which, as applied to petitioners restaurant
petitioner thereat was opened only in 1992, is downright unmeritorious. For the business and food products, is undoubtedly beyond question.
requirement of actual use in commerce x x x in the Philippines before one may WHEREFORE, the instant petition is GRANTED. Accordingly, the assailed Decision
register a trademark, trade-name and service mark under the Trademark and Resolution of the Court of Appeals in CA-G.R. SP
[33]
Law pertains to the territorial jurisdiction of the Philippines and is not only confined
NO. 57247, are REVERSED and SET ASIDE and the Decision of the Intellectual
to a certain region, province, city or barangay.
Property Office in Inter Partes Case No. 3861 is REINSTATED.
No pronouncement as to costs.
Likewise wanting in merit is the respondents claim that the petitioner cannot
acquire ownership of the word Mac because it is a personal name which may not be
MCDONALDS CORPORATION and G.R. No. 143993 The Case
MCGEORGE FOOD INDUSTRIES, INC.,
Petitioners,
Present:
Davide, Jr., C.J.,
Chairman, This is a petition for review[1] of the Decision dated 26 November 1999 of the Court of
- versus - Quisumbing, Appeals[2] finding respondent L.C. Big Mak Burger, Inc. not liable for trademark
Ynares-Santiago,
infringement and unfair competition and ordering petitioners to pay
Carpio, and
respondents P1,900,000 in damages, and of its Resolution dated 11 July 2000
Azcuna, JJ.
L.C. BIG MAK BURGER, INC., 1994 Decision[3] of the Regional Trial Court of Makati, Branch 137, finding respondent
FRANCIS B. DY, EDNA A. DY,
L.C. Big Mak Burger, Inc. liable for trademark infringement and unfair competition.
RENE B. DY, WILLIAM B. DY,
JESUS AYCARDO, ARACELI Promulgated:
AYCARDO, and GRACE HUERTO,
Respondents. August 18, 2004
The Facts
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x
Petitioner McDonalds Corporation (McDonalds) is a corporation organized
DECISION
under the laws of Delaware, United States. McDonalds operates, by itself or through
its franchisees, a global chain of fast-food restaurants. McDonalds [4] owns a family of
CARPIO, J.:
marks[5] including the Big Mac mark for its double-decker hamburger sandwich.
[6]
McDonalds registered this trademark with the United States Trademark Registry on
16 October 1979.[7] Based on this Home Registration, McDonalds applied respondents) are the incorporators, stockholders and directors of respondent
corporation.[14]
for the registration of the same mark in the Principal Register of the then Philippine
Bureau of Patents, Trademarks and Technology (PBPTT), now the Intellectual
Property Office (IPO). Pendingapproval of its application, McDonalds introduced its On 21 October 1988, respondent corporation applied with the PBPTT
Big Mac hamburger sandwiches in the Philippine market in September 1981. On 18 for the registration of the Big Mak mark for its hamburger sandwiches. McDonalds
July 1985, the PBPTT allowed registration of the Big Mac mark in opposed respondent corporations application on the ground that Big Mak was a
the Principal Register based on its Home Registration in the United States. colorable imitation of its registered Big Mac mark for the same food products.
McDonalds also informed respondent Francis Dy (respondent Dy), the chairman of
Like its other marks, McDonalds displays the Big Mac mark in items [8] and
the Board of Directors of respondent corporation, of its exclusive right to the Big Mac
paraphernalia[9] in its restaurants, and in its outdoor and indoor signages. From 1982
to 1990, McDonalds spent P10.5 million in advertisement for Big Mac hamburger mark and requested him to desist from using the Big Mac mark or any similar mark.
sandwiches alone.[10]
Having received no reply from respondent Dy, petitioners on 6 June 1990
sued respondents in the Regional Trial Court of Makati, Branch 137 (RTC), for
Petitioner McGeorge Food Industries (petitioner McGeorge), a domestic
trademark infringement and unfair competition. In its Order of 11 July 1990, the RTC
corporation, is McDonalds Philippine franchisee.[11]
issued a temporary restraining order (TRO) against respondents enjoining them from
using the Big Mak mark in the operation of their business in the National Capital
Respondent L.C. Big Mak Burger, Inc. (respondent corporation) is a
Region.[15] On 16 August 1990, the RTC issued a writ of preliminary injunction
domestic corporation which operates fast-food outlets and snack vans in Metro
Manila and nearby provinces.[12] Respondent corporations menu includes hamburger replacing the TRO.[16]
sandwiches and other food items.[13] Respondents Francis B. Dy, Edna A. Dy, Rene
B. Dy, William B. Dy, Jesus Aycardo, Araceli Aycardo, and Grace Huerto (private
In their Answer, respondents admitted that they have been using the name Big Mak
Burger for their fast-food business. Respondents claimed, however, that McDonalds The Trial Courts Ruling
does not have an exclusive right to the Big Mac mark or to any other similar mark.
and the counterclaim against petitioners for lack of merit and insufficiency of
1983, prior to McDonalds registration on 18 July 1985. Alternatively, respondents
the Big Mak mark they sought to register does not constitute a colorable imitation of Undeniably, the mark B[ig] M[ac] is a registered trademark
for plaintiff McDonalds, and as such, it is entitled [to] protection
against infringement.
the Big Mac mark. Respondents asserted that they did not fraudulently pass off their
[17]
hamburger sandwiches as those of petitioners Big Mac hamburgers. Respondents
xxxx
sought damages in their counterclaim.
There exist some distinctions between the names B[ig] M[ac] and
B[ig] M[ak] as appearing in the respective signages, wrappers and
In their Reply, petitioners denied respondents claim that McDonalds is not the containers of the food products of the parties. But infringement
goes beyond the physical features of the questioned name and the
original name. There are still other factors to be considered.
exclusive owner of the Big Mac mark. Petitioners asserted that while the Isaiyas
Group and Topacio did register the Big Mac mark ahead of McDonalds, the Isaiyas
xxxx
Group did so only in the Supplemental Register of the PBPTT and such registration
rights to his registration in a Deed of Assignment dated 18 May 1981.[18]
Significantly, the contending parties are both in the business of fast- infringement and an action for unfair competition, however, the law
food chains and restaurants. An average person who is hungry and extends substantially the same relief to the injured party
wants to eat a hamburger sandwich may not be discriminating for both cases. (See Sections 23 and 29 of Republic Act No. 166)
enough to look for a McDonalds restaurant and buy a B[ig] M[ac]
hamburger. Once he sees a stall selling hamburger sandwich, in all
likelihood, he will dip into his pocket and order a B[ig] M[ak]
hamburger sandwich. Plaintiff McDonalds fast-food chain Any conduct may be said to constitute unfair competition if the
has attained wide popularity and acceptance by the consuming effect is to pass off on the public the goods of one man as the
public so much so that its air-conditioned food outlets and goods of another. The choice of B[ig] M[ak] as tradename by
restaurants will perhaps not be mistaken by many to be the same defendant corporation is not merely for sentimental reasons but
as defendant corporations mobile snack vans located along busy was clearly made to take advantage of the reputation, popularity
streets or highways. But the thing is that what is being sold and the established goodwill of plaintiff McDonalds. For, as stated
by both contending parties is a food item a hamburger sandwich in Section 29, a person is guilty of unfair competition who in selling
which is for immediate consumption, so that a buyer may easily be his goods shall give them the general appearance, of goods of
confused or deceived into thinking that the B[ig] M[ak] hamburger another manufacturer or dealer, either as to the goods themselves
sandwich he bought is a food-product of plaintiff McDonalds, or a or in the wrapping of the packages in which they are contained, or
subsidiary or allied outlet thereof. Surely, defendant corporation has the devices or words thereon, or in any other feature of their
its own secret ingredients to make its hamburger sandwiches as appearance, which would likely influence purchasers to believe that
palatable and as tasty as the other brands in the market, the goods offered are those of a manufacturer or dealer other
considering the keen competition among mushrooming hamburger than the actual manufacturer or dealer. Thus, plaintiffs have
stands and multinational fast-food chains and restaurants. Hence, established their valid cause of action against the defendants for
the trademark B[ig] M[ac] has been infringed by defendant trademark infringement and unfair competition and for damages.[19]
corporation when it used the name B[ig] M[ak] in its signages,
wrappers, and containers in connection withits food business. xxxx
The dispositive portion of the RTC Decision provides:
Did the same acts of defendants in using the name B[ig] M[ak] as a
trademark or tradename in their signages, or in causing the name
B[ig] M[ak] to be printed on the wrappers and containers of their WHEREFORE, judgment is rendered in favor of plaintiffs
food products also constitute an act of unfair competition under McDonalds Corporation and McGeorge Food Industries, Inc. and
Section 29 of the Trademark Law? against defendant L.C. Big Mak Burger, Inc., as follows:
The answer is in the affirmative. xxxx 1. The writ of preliminary injunction issued in this case on
[16 August 1990] is made permanent;
The xxx provision of the law concerning unfair competition is
broader and more inclusive than the law concerning the 2. Defendant L.C. Big Mak Burger, Inc. is ordered to pay
infringement of trademark, which is of more limited range, but plaintiffs actual damages in the amount of P400,000.00,
within its narrower range recognizes a more exclusive right derived exemplary damages in the amount of P100,000.00, and attorneys
by the adoption and registration of the trademark by the person fees and expenses of litigation in the amount of P100,000.00;
whose goods or services are first associated therewith.
xxxNotwithstanding the distinction between an action for trademark
3. The complaint against defendants Francis B. Dy, Edna
A. Dy, Rene B. Dy, Wiliam B. Dy, Jesus Aycardo, Araceli Aycardo
and Grace Huerto, as well as all counter-claims, are dismissed for To Our mind, however, this Court is fully convinced that no
lack of merit as well as for insufficiency of evidence.[20] colorable imitation exists. As the definition dictates, it is
not sufficient that a similarity exists in both names, but that more
importantly, the over-all presentation, or in their essential,
substantive and distinctive parts is such as would likely MISLEAD
or CONFUSE persons in the ordinary course of purchasing the
genuine article. A careful comparison of the way the trademark
Respondents appealed to the Court of Appeals. B[ig] M[ac] is being used by plaintiffs-appellees and corporate
name L.C. Big Mak Burger, Inc. by defendants-appellants, would
readily reveal that no confusion could take place, or that the
ordinary purchasers would be misled by it. As pointed out by
defendants-appellants, the plaintiffs-appellees trademark is used to
The Ruling of the Court of Appeals designate only one product, a double decker sandwich sold in a
Styrofoam box with the McDonalds logo. On the other hand, what
the defendants-appellants corporation is using is not a trademark
for its food product but a business or corporate name. They use the
business name L.C. Big Mak Burger, Inc. in their restaurant
On 26 November 1999, the Court of Appeals rendered judgment (Court of Appeals business which serves diversified food items such as siopao,
noodles, pizza, and sandwiches such as hotdog, ham, fish burger
and hamburger. Secondly, defendants-appellants corporate or
Decision) reversing the RTC Decision and ordering McDonalds to pay
business name appearing in the food packages and signages are
written in silhouette red-orange letters with the b and m in upper
respondents P1,600,000 as actual and compensatory damages and P300,000 as case letters. Above the words Big Mak are the upper case letter
L.C.. Below the words Big Mak are the words Burger, Inc. spelled
moral damages. The Court of Appeals held: out in upper case letters. Furthermore, said corporate or business
name appearing in such food packages and signages is always
accompanied by the company mascot, a young chubby boy named
Plaintiffs-appellees in the instant case would like to Maky who wears a red T-shirt with the upper case m
impress on this Court that the use of defendants-appellants of its appearing therein and a blue lower garment. Finally, the
corporate name the whole L.C. B[ig] M[ak] B[urger], I[nc]. which defendants-appellants food packages are made of plastic material.
appears on their food packages, signages and advertisements is an
infringement of their trademark B[ig] M[ac] which they use to
identify [their] double decker sandwich, sold in a Styrofoam box
packaging material with the McDonalds logo of umbrella M xxxx
stamped thereon, together with the printed mark in red bl[o]ck
capital letters, the words being separated by a
single space.Specifically, plaintiffs-appellees argue that
xxx [I]t is readily apparent to the naked eye that there appears a
defendants-appellants use of their corporate name is a colorable
vast difference in the appearance of the product and
imitation of their trademark Big Mac.
the manner that the tradename Big Mak is being used and
presented to the public. As earlier noted, there are glaring
dissimilarities between plaintiffs-appellees trademark and
xxxx defendants-appellants corporate name. Plaintiffs-appellees product
carrying the trademark B[ig] M[ac] is a double decker sandwich
(depicted in the tray mat containing photographs of the various food another has the burden of proving that the latter acted in bad faith
products xxx sold in a Styrofoam box with the McDonalds logo and or with ill motive. [21]
trademark in red, bl[o]ck capital letters printed thereon xxx at a
price which is more expensive than the defendants-appellants
comparable food products. In order to buy a Big Mac, a customer
needs to visit an air-conditioned McDonalds restaurant
usually located in a nearby commercial center, advertised and
identified by its logo - the umbrella M, and its mascot Ronald Petitioners sought reconsideration of the Court of Appeals Decision but the appellate
McDonald. A typical McDonalds restaurant boasts of a playground
for kids, a second floor to accommodate additional customers, a court denied their motion in its Resolution of 11 July 2000.
drive-thru to allow customers with cars to make orders without
alighting from their vehicles, the interiors of the building are well-
lighted, distinctly decorated and painted with pastel colors xxx. In
Hence, this petition for review.
buying a B[ig] M[ac], it is necessary to specify it by its
trademark. Thus, a customer needs to look for a McDonalds and
enter it first before he can find a hamburger sandwich which carry
the mark Big Mac. On the other hand, defendants-appellants sell Petitioners raise the following grounds for their petition:
their goods through snack vans xxxx
I. THE COURT OF APPEALS ERRED IN FINDING THAT
RESPONDENTS CORPORATE NAME L.C. BIG MAK
Anent the allegation that defendants-appellants are guilty of unfair BURGER, INC. IS NOT A COLORABLE IMITATION OF THE
competition, We likewise find the same untenable. MCDONALDS TRADEMARK BIG MAC, SUCH COLORABLE
IMITATION BEING AN ELEMENT OF TRADEMARK
Unfair competition is defined as the employment of deception INFRINGEMENT.
or any other means contrary to good faith by which a
person shall pass off the goods manufactured by him or in which he
deals, or his business, or service, for those of another who has
A. Respondents use the words Big Mak as trademark
already established good will for his similar good, business or
services, or any acts calculated to produce the same result (Sec. for their products and not merely as their business or
29, Rep. Act No. 166, as amended). corporate name.
To constitute unfair competition therefore it must necessarily follow
that there was malice and that the entity concerned was in bad
faith. B. As a trademark, respondents Big Mak is undeniably
and unquestionably similar to petitioners Big Mac
In the case at bar, We find no sufficient evidence adduced trademark based on the dominancy test and the idem
by plaintiffs-appellees that defendants-appellants deliberately tried sonans test resulting inexorably in confusion on the
to pass off the goods manufactured by them for those of plaintiffs- part of the consuming public.
appellees. The mere suspected similarity in the sound of the
defendants-appellants corporate name with the plaintiffs-appellees
trademark is not sufficient evidence to conclude unfair
competition. Defendants-appellants explained that the name M[ak] II. THE COURT OF APPEALS ERRED IN REFUSING TO
in their corporate name was derived from both the first names of CONSIDER THE INHERENT SIMILARITY BETWEEN THE
the mother and father of defendant Francis Dy, whose names are MARK BIG MAK AND THE WORD MARK BIG MAC AS
Maxima and Kimsoy. With this explanation, it is up to the plaintiffs- AN INDICATION OF RESPONDENTS INTENT TO DECEIVE
appellees to prove bad faith on the part of defendants-appellants. It OR DEFRAUD FOR PURPOSES
is a settled rule that the law always presumes good faith such OF ESTABLISHING UNFAIR COMPETITION.[22]
that any person who seeks to be awarded damages due to acts of
their hamburger products, and (b) whether respondent corporation is liable for
Petitioners pray that we set aside the Court of Appeals Decision and reinstate the trademark infringement and unfair competition.[23]
RTC Decision.
The Courts Ruling
In their Comment to the petition, respondents question the propriety of this
petition as it allegedly raises only questions of fact. On the merits, respondents
contend that the Court of Appeals committed no reversible error in finding them not The petition has merit.
liable for trademark infringement and unfair competition and in ordering petitioners to
pay damages.
On Whether the Questions Raised in the Petition are
Proper for a Petition for Review
The Issues
A party intending to appeal from a judgment of the Court of Appeals may file with this
The issues are:
Court a petition for review under Section 1 of Rule 45 (Section 1) [24] raising only
questions of law. A question of law exists when the doubt or difference arises on what
1. Procedurally, whether the questions raised in this petition are proper for a
the law is on a certain state of facts. There is a question of fact when the doubt or
petition for review under Rule 45.
difference arises on the truth or falsity of the alleged facts. [25]
2. On the merits, (a) whether respondents used the words Big Mak not only
as part of the corporate name L.C. Big Mak Burger, Inc. but also as a trademark for Here, petitioners raise questions of fact and law in assailing the Court of Appeals
competition. Ordinarily, the Court can deny due course to such a petition. In view,
however, of the contradictory findings of fact of the RTC and Court of Appeals, the by respondents for their hamburger sandwiches bore the words Big Mak. The other
Court opts to accept the petition, this being one of the recognized exceptions to descriptive words burger and 100% pure beef were set in smaller type, along with the
Section 1.[26] We took a similar course of action in Asia Brewery, Inc. v. Court of locations of branches.[28] Respondents cash invoices simply refer to their hamburger
Appeals[27] which also involved a suit for trademark infringement and unfair sandwiches as Big Mak.[29] It is respondents snack vans that carry the words L.C. Big
competition in which the trial court and the Court of Appeals arrived at conflicting Mak Burger, Inc.[30]
findings.
It was only during the trial that respondents presented in evidence the plastic
wrappers and bags for their hamburger sandwiches relied on by the Court of
On the Manner Respondents Used
petitioners presented during the hearings for the injunctive writ except that the letters
Big Mak in their Business
L.C. and the words Burger, Inc. in respondents evidence were added above and
below the words Big Mak, respectively. Since petitioners complaint was based on
facts existing before and during the hearings on the injunctive writ, the facts
established during those hearings are the proper factual bases for the disposition of
Petitioners contend that the Court of Appeals erred in ruling that the corporate name the issues raised in this petition.
L.C. Big Mak Burger, Inc. appears in the packaging for respondents hamburger
products and not the words Big Mak only.
On the Issue of Trademark Infringement
The contention has merit.
Section 22 (Section 22) of Republic Act No. 166, as amended (RA 166), the law
The evidence presented during the hearings on petitioners motion for the issuance of
applicable to this case,[32] defines trademark infringement as follows:
a writ of preliminary injunction shows that the plastic wrappings and plastic bags used
Infringement, what constitutes. Any person who [1] shall use, On the Validity of the Big MacMark
without the consent of the registrant, any reproduction, counterfeit, and McDonalds Ownership of such Mark
copy or colorable imitation of any registered mark or trade-name in
connection with the sale, offering for sale, or advertising
of any goods, business or services on or in connection with which
such use is likely to cause confusion or mistake or to deceive
purchasers or others as to the source or origin of such goods or
services, or identity of such business; or [2] reproduce, counterfeit,
copy, or colorably imitate any such mark or trade-name and apply A mark is valid if it is distinctive and thus not barred from
such reproduction, counterfeit, copy, or colorable imitation to labels,
signs, prints, packages, wrappers, receptacles or advertisements
intended to be used upon or in connection with such goods, registration under Section 4[36] of RA 166 (Section 4). However, once registered, not
business or services, shall be liable to a civil action by the registrant
for any or all of the remedies herein provided.[33] only the marks validity but also the registrants ownership of the mark is prima
facie presumed.[37]
Petitioners base their cause of action under the first part of Section
Respondents contend that of the two words in the Big Mac mark, it is only
22, i.e. respondents allegedly used, without petitioners consent, a colorable imitation
the word Mac that is valid because the word Big is generic and descriptive
of the Big Mac mark in advertising and selling respondents hamburger sandwiches.
The contention has no merit. The Big Mac mark, which should be treated in its
entirety and not dissected word for word,[39] is neither generic nor descriptive. Generic
To establish trademark infringement, the following elements must be shown:
Lite for beer[41] or Chocolate Fudge for chocolate soda drink. [42] Descriptive marks, on
use ofthe mark or its colorable imitation by the alleged infringer results in likelihood of
product to one who has never seen it or does not know it exists,[43] such as Arthriticare
of trademark infringement.[35]
for arthritis medication.[44] On the contrary, Big Mac falls under the class of fanciful or
had already assigned his rights to McDonalds. The Isaiyas Group, on the other hand, goods only, when the infringing mark is used on goods of a similar kind. [51] Thus, no
registered its trademark only in the Supplemental Register. A mark which is not relief was afforded to the party whose registered mark or its colorable imitation is
On Types of Confusion
there is confusion of goods when the products are competing, confusion of business
Section 22 covers two types of confusion arising from the use of similar or colorable
exists when the products are non-competing but related enough to produce confusion
imitation marks, namely, confusion of goods (product confusion) and confusion of
of affiliation.[53]
business (source or origin confusion). In Sterling Products International,
Incorporated v. Farbenfabriken Bayer Aktiengesellschaft, et al.,[49] the Court On Whether Confusion of Goods and
Confusion of Business are Applicable
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
of defendants food products and incorporated in its signages the
name Big Mak Burger, which is confusingly similar to and/or is a
Petitioners claim that respondents use of the Big Mak mark on respondents
colorable imitation of the plaintiff McDonalds mark B[ig] M[ac],
xxx. Defendant Big Mak Burger has thus unjustly created the
hamburgers results in confusion of goods, particularly with respect to petitioners impression that its business is approved and sponsored by, or
affiliated with, plaintiffs. xxxx
hamburgers labeled Big Mac. Thus, petitioners alleged in their complaint:
1.15. Defendants have unduly prejudiced and clearly
2.2 As a consequence of the acts committed by
infringed upon the property rights of plaintiffs in the McDonalds
defendants, which unduly prejudice and infringe upon the property
Marks, particularly the mark B[ig] M[ac]. Defendants unauthorized
rights of plaintiffs McDonalds and McGeorge as the real owner and
acts are likely, and calculated, to confuse, mislead or deceive the
rightful proprietor, and the licensee/franchisee, respectively, of the
public into believing that the products and services offered by
McDonalds marks, and which are likely to have caused confusion
defendant Big Mak Burger, and the business it is engaged in, are
or deceived the public as to the true source, sponsorship or
approved and sponsored by, or affiliated with, plaintiffs.
[54] affiliation of defendants food products and restaurant
(Emphasis supplied)
business, plaintiffs have suffered and continue to
suffer actual damages in the form of injury to their business
reputation and goodwill, and of the dilution of the distinctive quality
of the McDonalds marks, in particular, the mark B[ig] M[ac].
[55]
(Emphasis supplied)
Since respondents used the Big Mak mark on the same goods, i.e. hamburger
sandwiches, that petitioners Big Mac mark is used, trademark infringement through Respondents admit that their business includes selling hamburger sandwiches, the
confusion of goods is a proper issue in this case. same food product that petitioners sell using the Big Mac mark. Thus, trademark
hamburgers, the same business that petitioners are engaged in, results in confusion Respondents assert that their Big Mak hamburgers cater mainly to the low-
of business.Petitioners alleged in their complaint: income group while petitioners Big Mac hamburgers cater to the middle and upper
1.10. For some period of time, and without the consent of
income groups. Even if this is true, the likelihood of confusion of business remains,
plaintiff McDonalds nor its licensee/franchisee, plaintiff McGeorge,
and in clear violation of plaintiffs exclusive right to
use and/or appropriate the McDonalds marks, defendant Big Mak since the low-income group might be led to believe that the Big Mak hamburgers are
Burger acting through individual defendants, has been operating
Big Mak Burger, a fast food restaurant business dealing in the sale the low-end hamburgers marketed by petitioners. After all, petitioners have the
of hamburger and cheeseburger sandwiches, french fries and other
food products, and has caused to be printed on the wrapper
exclusive right to use the Big Mac mark. On the other hand, respondents would
benefit by associating their low-end hamburgers, through the use of the Big Mak mark on non-hamburger food products cannot excuse their infringement of petitioners
mark, with petitioners high-end Big Mac hamburgers, leading to likelihood of registered mark, otherwise registered marks will lose their protection under the law.
confusion in the identity of business. The registered trademark owner may use his mark on the same or similar
Respondents further claim that petitioners use the Big Mac mark only on products, in different segments of the market, and at different price levels depending
petitioners double-decker hamburgers, while respondents use the Big Mak mark on on variations of the products for specific segments of the market. The Court has
hamburgers and other products like siopao, noodles and pizza. Respondents also recognized that the registered trademark owner enjoys protection in product and
point out that petitioners sell their Big Mac double-deckers in a styrofoam box with the market areas that are the normal potential expansion of his business. Thus, the
McDonalds logo and trademark in red, block letters at a price more expensive than Court has declared:
Modern law recognizes that the protection to which the
the hamburgers of respondents. In contrast, respondents sell their Big Mak
owner of a trademark is entitled is not limited to guarding his goods
or business from actual market competition with identical or similar
hamburgers in plastic wrappers and plastic bags. Respondents further point out that 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
petitioners restaurants are air-conditioned buildings with drive-thru service, compared 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
to respondents mobile vans.
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.
These and other factors respondents cite cannot negate the undisputed fact Jur. 576, 577).[56] (Emphasis supplied)
that respondents use their Big Mak mark on hamburgers, the same food product that
On Whether Respondents Use of the Big Mak
petitioners sell with the use of their registered mark Big Mac. Whether a hamburger is
Mark Results in Likelihood of Confusion
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 In determining likelihood of confusion, jurisprudence has developed two tests, the
dominancy test and the holistic test.[57] The dominancy test focuses on the similarity of
the prevalent features of the competing trademarks that might cause confusion. In give greater weight to the similarity of the appearance of the product arising
contrast, the holistic test requires the court to consider the entirety of the marks as from the adoption of the dominant features of the registered mark,
applied to the products, including the labels and packaging, in determining confusing disregarding minor differences.[59] Courts will consider more the aural and visual
similarity. impressions created by the marks in the public mind, giving little weight to factors like
prices, quality, sales outlets and market segments.
The Court of Appeals, in finding that there is no likelihood of confusion that
could arise in the use of respondents Big Mak mark on hamburgers, relied on the Thus, in the 1954 case of Co Tiong Sa v. Director of Patents,[60] the Court
holistic test. Thus, the Court of Appeals ruled that it is not sufficient that a similarity ruled:
xxx It has been consistently held that the question of
exists in both name(s), but that more importantly, the overall presentation, or in their
infringement of a trademark is to be determined by the test of
dominancy. Similarity in size, form and color, while relevant, is not
essential, substantive and distinctive parts is such as would likely MISLEAD or conclusive. If the competing trademark contains the main or
essential or dominant features of another, and confusion and
CONFUSE persons in the ordinary course of purchasing the genuine article. The 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
holistic test considers the two marks in their entirety, as they appear on the goods
Brewing Co. vs. Independent Brewing Co., 191 F., 489, 495, citing
Eagle White Lead Co. vs. Pflugh (CC) 180 Fed. 579). The question
with their labels and packaging. It is not enough to consider their words and at issue in cases of infringement of trademarks is whether the use
of the marks involved would be likely to cause confusion or
compare the spelling and pronunciation of the words.[58] mistakes in the mind of the public or deceive purchasers. (Auburn
Rubber Corporation vs. Honover Rubber Co., 107 F. 2d 588; xxx)
(Emphasis supplied.)
the same first two letters. In spelling, considering the Filipino language, even the last
of Appeals,[65] the Court explicitly rejected the holistic test in this wise:
letters of both marks are the same.
[T]he 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 Clearly, respondents have adopted in Big Mak not only the dominant
of the marketplace. (Emphasis supplied)
but also almost all the features of Big Mac. Applied to the same food product of
hamburgers, the two marks will likely result in confusion in the public mind.
The test of dominancy is now explicitly incorporated into law in Section 155.1
Applying the dominancy test, the Court finds that respondents use of the Big Commercial Co., Inc. v. Petra Hawpia & Co., et al.,[66] the Court held:
Mak mark results in likelihood of confusion. First, Big Mak sounds exactly the same
The following random list of confusingly similar sounds in
as Big Mac. Second, the first word in Big Mak is exactly the same as the first word in
the matter of trademarks, culled from Nims, Unfair Competition and
Trade Marks, 1947, Vol. 1, will reinforce our view that SALONPAS
Big Mac. Third, the first two letters in Mak are the same as the first two letters in
and LIONPAS are confusingly similar in sound: Gold Dust and Gold
Drop; Jantzen and Jass-Sea; Silver Flash and Supper Flash;
Mac. Fourth, the last letter in Mak while a k sounds the same as c when the word Mak
Cascarete and Celborite; Celluloid and Cellonite; Chartreuse and
Charseurs; Cutex and Cuticlean; Hebe and Meje; Kotex and
is pronounced. Fifth, in Filipino, the letter k replaces c in spelling, thus Caloocan is Femetex; Zuso and Hoo Hoo. Leon Amdur, in his book Trade-Mark
Law and Practice, pp. 419-421, cities, as coming within the purview
spelled Kalookan. of the idem sonans rule, Yusea and U-C-A, Steinway Pianos and
Steinberg Pianos, and Seven-Up and Lemon-Up. In Co Tiong vs.
Director of Patents, this Court unequivocally said that Celdura and
Cordura are confusingly similar in sound; this Court held in Sapolin
In short, aurally the two marks are the same, with the first word Co. vs. Balmaceda, 67 Phil. 795 that the name Lusolin is an
infringement of the trademark Sapolin, as the sound of the two
of both marks phonetically the same, and the second word of both marks also names is almost the same. (Emphasis supplied)
phonetically the same.Visually, the two marks have both two words and six letters,
taken an equal number of letters (i.e., two) from each name, as is
Certainly, Big Mac and Big Mak for hamburgers create even greater confusion, not the more usual thing done. Surely, the more plausible reason
behind Respondents choice of the word M[ak], especially when
only aurally but also visually. taken in conjunction with the word B[ig], was their intent to take
advantage of Petitioners xxx B[ig] M[ac] trademark, with
their alleged sentiment-focused explanation merely thought of as a
Indeed, a person cannot distinguish Big Mac from Big Mak by their convenient, albeit unavailing, excuse or defense for such an unfair
choice of name.[67]
sound. When one hears a Big Mac or Big Mak hamburger advertisement over the
radio, one would not know whether the Mac or Mak ends with a c or a k.
Petitioners aggressive promotion of the Big Mac mark, as borne by their Absent proof that respondents adoption of the Big Mak mark was due
advertisement expenses, has built goodwill and reputation for such mark making it to honest mistake or was fortuitous,[68] the inescapable conclusion is that respondents
one of the easily recognizable marks in the market today. This increases the adopted the Big Mak mark to ride on the coattails of the more established Big Mac
likelihood that consumers will mistakenly associate petitioners hamburgers and mark.[69] This saves respondents much of the expense in advertising to create market
Respondents inability to explain sufficiently how and why they came to choose Big Thus, we hold that confusion is likely to result in the public mind. We sustain
Mak for their hamburger sandwiches indicates their intent to imitate petitioners Big petitioners claim of trademark infringement.
Mac mark. Contrary to the Court of Appeals finding, respondents claim that their Big
Mak mark was inspired by the first names of respondent Dys mother (Maxima) and
On the Lack of Proof of
Actual Confusion
father (Kimsoy) is not credible. As petitioners well noted:
[R]espondents, particularly Respondent Mr. Francis Dy, could have
arrived at a more creative choice for a corporate name by using the
names of his parents, especially since he was allegedly driven by Petitioners failure to present proof of actual confusion does not negate their claim of
sentimental reasons. For one, he could have put his fathers name
ahead of his mothers, as is usually done in this patriarchal society, trademark infringement. As noted in American Wire & Cable Co. v. Director of
and derived letters from said names in that order.Or, he could have
of such goods or any agent of any vendor engaged in selling such
[71] goods with a like purpose;
Patents, Section 22 requires the less stringent standard of likelihood of confusion
(b) Any person who by any artifice, or device, or
only. While proof of actual confusion is the best evidence of infringement, its absence who employs any other means calculated to induce the false belief
that such person is offering the services of another who has
is inconsequential.[72] 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. (Emphasis supplied)
similarity in the general appearance of the goods, and (2) intent to deceive the public
Any person who will employ deception or any other means contrary and defraud a competitor.[74] The confusing similarity may or may not result from
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 similarity in the marks, but may result from other external factors in the packaging or
the one having established such goodwill, or
who shall commit any acts calculated to produce said presentation of the goods. The intent to deceive and defraud may be inferred from the
result, shall be guilty of unfair competition, and shall be subject to
an action therefor. similarity of the appearance of the goods as offered for sale to the public.
In particular, and without in any way limiting the scope of unfair [75]
Actual fraudulent intent need not be shown.[76]
competition, the following shall be deemed guilty of unfair
competition:
Unfair competition is broader than trademark infringement and includes
(a) Any person, who in selling his goods shall give them the
general appearance of goods of another manufacturer or passing off goods with or without trademark infringement. Trademark infringement is
dealer, either as to the goods themselves or in the wrapping of
the packages in which they are contained, or the devices or a form of unfair competition.[77] Trademark infringement constitutes unfair competition
words thereon, or in any feature of their appearance, which would
be likely to influence purchasers to believe that the goods offered when there is not merely likelihood of confusion, but also actual or probable deception
are those of a manufacturer or dealer, other
than the actual manufacturer or dealer, or who otherwise clothes on the public because of the general appearance of the goods. There can be
the goods with such appearance as shall deceive the public and
defraud another of his legitimate trade, or any subsequent vendor trademark infringement without unfair competition as when the infringer discloses on
letter B and M being capitalized and the packaging material
the labels containing the mark that he manufactures the goods, thus preventing the is plastic wrapper. xxxx Further, plaintiffs logo and mascot are the
umbrella M and Ronald McDonalds, respectively, compared to the
public from being deceived that the goods originate from the trademark owner.[78] mascot of defendant Corporation which is a chubby boy called
Macky displayed or printed between the words Big and Mak.
[81]
(Emphasis supplied)
The RTC described the respective marks and the goods of petitioners and and other devices are insignificant compared to the glaring similarity in the words
their goods the general appearance of petitioners Big Mac hamburgers. In such case, the public. Had respondents placed a notice on their plastic wrappers and bags that
there is only trademark infringement but no unfair competition. However, since the hamburgers are sold by L.C. Big Mak Burger, Inc., then they could validly claim
respondents chose to apply the Big Mak mark on hamburgers, just like petitioners use that they did not intend to deceive the public. In such case, there is only trademark
of the Big Mac mark on hamburgers, respondents have obviously clothed their goods infringement but no unfair competition.[82] Respondents, however, did not give such
with the general appearance of petitioners goods. notice. We hold that as found by the RTC, respondent corporation is liable for unfair
competition.
Moreover, there is no notice to the public that the Big Mak hamburgers are
products of L.C. Big Mak Burger, Inc. Respondents introduced during the trial plastic The Remedies Available to Petitioners
wrappers and bags with the words L.C. Big Mak Burger, Inc. to inform the public of
the name of the seller of the hamburgers. However, petitioners introduced during the
injunctive hearings plastic wrappers and bags with the Big Mak mark without the
Under Section 23[83] (Section 23) in relation to Section 29 of RA 166, a plaintiff who
name L.C. Big Mak Burger, Inc. Respondents belated presentation of plastic
successfully maintains trademark infringement and unfair competition claims is
wrappers and bags bearing the name of L.C. Big Mak Burger, Inc. as the seller of the
entitled to injunctive and monetary reliefs. Here, the RTC did not err in issuing the
hamburgers is an after-thought designed to exculpate them from their unfair business
injunctive writ of 16 August 1990 (made permanent in its Decision of 5 September
conduct. As earlier stated, we cannot consider respondents evidence since
1994) and in ordering the payment of P400,000 actual damages in favor of
petitioners complaint was based on facts existing before and during the injunctive
petitioners. The injunctive writ is indispensable to prevent further acts of infringement
hearings.
by respondent corporation. Also, the amount of actual damages is a reasonable
percentage (11.9%) of respondent corporations gross sales for three (1988-1989 and
Thus, there is actually no notice to the public that the Big Mak hamburgers 1991) of the six years (1984-1990) respondents have used the Big Mak mark.[84]
are products of L.C. Big Mak Burger, Inc. and not those of petitioners who have the
The RTC also did not err in awarding exemplary damages by way of
correction for the public good[85] in view of the finding of unfair competition where
intent to deceive the public is essential. The award of attorneys fees and expenses of
dated 26 November 1999 of the Court of Appeals and its Resolution dated 11 July
Court of Makati, Branch 137, finding respondent L.C. Big Mak Burger, Inc. liable for
The trademark or trade name is
In Prosource International, Inc. v. Horphag Research Management SA, the Court laid reproduced, counterfeited, copied,
or colorably imitated by the infringer;
down the elements of infringement under R.A. Nos. 166 and 8293:
In accordance with Section 22 of R.A. No. 166, as well as Sections The infringing mark or trade name is
2, 2-A, 9-A, and 20 thereof, the following constitute the elements of used in connection with the sale, offering for sale,
trademark infringement: or advertising of any goods, business or services;
or the infringing mark or trade name is applied to
labels, signs, prints, packages, wrappers,
(a) A trademark actually used in commerce in the receptacles or advertisements intended to be
Philippines and registered in the principal register used upon or in connection with such goods,
of the Philippine Patent Office[;] business or services;
The holistic test considers the entirety of the marks, including labels and packaging,
The use or application of the infringing
mark or trade name is likely to cause confusion or in determining confusing similarity. The focus is not only on the predominant words
mistake or to deceive purchasers or others as to but also on the other features appearing on the labels.
the goods or services themselves or as to the
source or origin of such goods or services or
the idenity of such business; and 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
It is without the consent of the light of the facts of each particular case. In McDonalds Corporation
trademark or trade name owner or the assignee
thereof. 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
Among the elements, the element of likelihood of confusion is the gravamen of deduced because each case must be decided on its merits. In such
trademark infringement. There are two types of confusion in trademark infringement: 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
confusion of goods and confusion of business. In Sterling Products International, Inc. reason why in trademark cases, jurisprudential precedents should
be applied only to a case if they are specifically in point.
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 In the light of the facts of the present case, the Court holds that the dominancy test is
purchasing the other. In which case, defendants goods are then applicable. In recent cases with similar factual milieus, the Court has consistently
bought as the plaintiffs, and the poorer quality of the former reflects
adversely on the plaintiffs reputation. The other is the confusion of applied the dominancy test. In Prosource International, Inc., the Court applied the
business: Here though the goods of the parties are different, the
defendants product is such as might reasonably be assumed to dominancy test in holding that PCO-GENOLS is confusingly similar to
originate with the plaintiff, and the public would then be deceived PYCNOGENOL. The Court held:
either into that belief or into the belief that there is some connection
between the plaintiff and defendant which, in fact, does not exist.
The trial and appellate courts applied the Dominancy Test in
determining whether there was a confusing similarity between the
marks PYCNOGENOL and PCO-GENOL. Applying the test, the trial
court found, and the CA affirmed, that:
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
Both the word[s] PYCNOGENOL and PCO-
essential features of the competing trademarks that might cause GENOLS have the same suffix GENOL which on
confusion. Infringement takes place when the competing trademark contains the evidence, appears to be merely descriptive and
furnish no indication of the origin of the article and
essential features of another. Imitation or an effort to imitate is unnecessary. The hence, open for trademark registration by the
question is whether the use of the marks is likely to cause confusion or deceive plaintiff through combination with another word or
phrase such as PYCNOGENOL, Exhibits A to A-
purchasers. 3.Furthermore, although the letters Y between P
and C, N between O and C and S after L are
missing in the [petitioners] mark PCO-GENOLS,
nevertheless, when the two words are trademark Sapolin, as the sound of the two
pronounced, the sound effects are confusingly names is almost the same.
similar not to mention that they are both
described by their manufacturers as a food
supplement and thus, identified as such by their
public consumers. And although there were In McDonalds Corporation v. MacJoy Fastfood Corporation, the Court applied the
dissimilarities in the trademark due to the type of
letters used as well as the size, color and design dominancy test in holding that MACJOY is confusingly similar to MCDONALDS. The
employed on their individual packages/bottles,
Court held:
still the close relationship of the competing
products name is sounds as they were
pronounced, clearly indicates that purchasers While we agree with the CAs detailed enumeration of differences
could be misled into believing that they are the between the two (2) competing trademarks herein involved, we
same and/or originates from a common source believe that the holistic test is not the one applicable in this case,
and manufacturer. 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
We find no cogent reason to depart from such conclusion. or likelihood of confusion between competing trademarks.
This is not the first time the Court takes into account the aural x x x x
effects of the words and letters contained in the marks in
determining the issue of confusing
similarity. In Marvex Commercial Co., Inc. v. Petra Hawpia & Co., Applying the dominancy test to the instant case, the Court finds that
et al., cited in McDonalds Corporation v. L.C. Big Mak Burger, Inc., herein petitioners MCDONALDS and respondents MACJOY marks
the Court held: are are confusingly similar with each other that an ordinary
purchaser can conclude an association or relation between the
marks.
The following random list of confusingly similar
sounds in the matter of trademarks, culled
from Nims, Unfair Competition and Trade Marks, To begin with, both marks use the corporate M design logo and the
1947, Vol. 1, will reinforce our view that prefixes Mc and/or Mac as dominant features. x x x
SALONPAS and LIONPAS are confusingly
similar in sound: Gold Dust and Gold
Drop; Jantzen and Jass-Sea; Silver Flash and For sure, it is the prefix Mc, and abbreviation of Mac, which visually
Supper Flash; Cascarete and Celborite; Celluloid and aurally catches the attention of the consuming public. Verily,
and Cellonite; Chartreuse the word MACJOY attracts attention the same way as did
and Charseurs; Cutex and Cuticlean; Hebe McDonalds, MacFries, McSpaghetti, McDo, Big Mac and the rest of
and Meje; Kotex the MCDONALDS marks which all use the prefixes Mc and/or Mac.
and Femetex; Zuso and Hoo Hoo. Leon Amdur,
in his book Trade-Mark Law and Practice, pp.
419-421, cities [sic], as coming within the purview Besides and most importantly, both trademarks are used in the sale
of the idem sonans rule, Yusea and U-C-A, of fastfood products. Indisputably, the respondents trademark
Steinway Pianos and Steinberg Pianos, and application for the MACJOY & DEVICE trademark covers goods
Seven-Up and Lemon-Up.In Co Tiong vs. under Classes 29 and 30 of the International Classification of
Director of Patents, this Court unequivocally said Goods, namely, fried chicken, chicken barbeque, burgers, fries,
that Celdura and Condura are confusingly similar spaghetti, etc. Likewise, the petitioners trademark registration for
in sound; this Court held in Sapolin Co. the MCDONALDS marks in the Philippines covers goods which are
vs. Balmaceda, 67 Phil. 795 that the similar if not identical to those covered by the respondents
name Lusolin is an infringement of the application.
Applying the dominancy test, the Court finds that respondents use
In McDonalds Corporation v. L.C. Big Mak Burger, Inc., the Court applied the of the Big Mak mark results in likelihood of confusion. First,
dominancy test in holding that BIG MAK is confusingly similar to BIG MAC. The Court 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
held: 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
This Court x x x has relied on the dominancy test rather than the as c when the word Mak is pronounced. Fifth, in Filipino, the letter k
holistic test. The dominancy test considers the dominant features in replaces c in spelling, thus Caloocan is spelled Kalookan.
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 In Societe Des Produits Nestle, S.A v. Court of Appeals, the Court applied the
differences. Courts will consider more the aural and visual
impressions created by the marks in the public mind, giving little dominancy test in holding that FLAVOR MASTER is confusingly similar to MASTER
weight to factors like prices, quality, sales outlets and market ROAST and MASTER BLEND. The Court held:
segments.
While this Court agrees with the Court of Appeals detailed
Thus, in the 1954 case of Co Tiong Sa v. Director of Patents, the enumeration of differences between the respective trademarks of
Court ruled: 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.
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 Moreover, the totality or holistic test is contrary to the elementary
conclusive. If the competing trademark contains postulate of the law on trademarks and unfair competition that
the main or essential or dominant features of confusing similarity is to be determined on the basis of visual, aural,
another, and confusion and deception is likely to connotative comparisons and overall impressions engendered by
result, infringement takes place. Duplication or the marks in controversy as they are encountered in the realities of
imitation is not necessary; nor is it necessary that the marketplace. The totality or holistic test only relies on visual
the infringing label should suggest an effort to comparison between two trademarks whereas the dominancy test
imitate. (G. Heilman Brewing Co. vs. relies not only on the visual but also on the aural and connotative
Independent Brewing Co., 191 F., 489, 495, comparisons and overall impressions between the two trademarks.
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 For this reason, this Court agrees with the BPTTT when it applied
the marks involved would be likely to cause the test of dominancy and held that:
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)
x x x x From the evidence at hand, it is sufficiently
established that the word MASTER is the
dominant feature of opposers mark. The word
The test of dominancy is now explicitly incorporated into law in MASTER is printed across the middle portion of
Section 155.1 of the Intellectual Property Code which defines the label in bold letters almost twice the size of
infringement as the colorable imitation of a registered mark x x xor the printed word ROAST. Further, the word
a dominant feature thereof. MASTER has always been given emphasis in the
TV and radio commercials and other
advertisements made in promoting the and may properly become the subject of a trademark by
product. x x x In due time, because of these combination with another word or phrase.
advertising schemes the mind of the buying
public had come to learn to associate the word
MASTER with the opposers goods. x x x x
x x x. It is the observation of this Office that much The following random list of confusingly similar sounds in the matter
of the dominance which the word MASTER has of trademarks, culled from Nims, Unfair Competition and Trade
acquired through Opposers advertising schemes Marks, 1947, Vol. 1, will reinforce our view that SALONPAS and
is carried over when the same is incorporated LIONPAS are confusingly similar in sound: Gold Dust and Gold
into respondent-applicants trademark FLAVOR Drop; Jantzen and Jass-Sea; Silver Flash and Supper
MASTER. Thus, when one looks at the label Flash; Cascarete and Celborite; Celluloid and Cellonite; Chartreuse
bearing the trademark FLAVOR MASTER (exh. and Charseurs; Cutex and Cuticlean; Hebe and Meje; Kotex
4) ones attention is easily attracted to the word and Femetex; Zuso and Hoo Hoo. Leon Amdur, in his book Trade-
MASTER, rather than to the dissimilarities that Mark Law and Practice, pp. 419-421, cities [sic], as
exist. Therefore, the possibility of confusion as to coming within the purview of the idem sonans rule, Yusea and U-C-
the goods which bear the competing marks or as A, Steinway Pianos and Steinberg Pianos, and Seven-Up and
to the origins thereof is not farfetched. Lemon-Up. In Co Tiong vs. Director of Patents, this Court
unequivocally said that Celdura and Condura are confusingly
similar in sound; this Court held in Sapolin Co. vs. Balmaceda, 67
Phil. 795 that the name Lusolin is an infringement of the
Applying the dominancy test in the present case, the Court finds that NANNY is trademark Sapolin, as the sound of the two names is almost the
same.
confusingly similar to NAN. NAN is the prevalent feature of Nestles line of infant
powdered milk products. It is written in bold letters and used in all products. The line
consists of PRE-NAN, NAN-H.A., NAN-1, and NAN-2. Clearly, NANNY contains the The scope of protection afforded to registered trademark owners is not limited to
prevalent feature NAN. The first three letters of NANNY are exactly the same as the protection from infringers with identical goods. The scope of protection extends to
letters of NAN. When NAN and NANNY are pronounced, the aural effect is protection from infringers with related goods, and to market areas that are the normal
confusingly similar. expansion of business of the registered trademark owners. Section 138 of R.A. No.
8293 states:
In determining the issue of confusing similarity, the Court takes into account the aural
effect of the letters contained in the marks. In Marvex Commercial Company, Inc. v. Certificates of Registration. A certificate of registration of a mark
Petra Hawpia & Company, the Court held: shall be prima facie evidence of validity of the registration, the
registrants ownership of the mark, and of the registrants exclusive
right to use the same in connection with the goods or services and
those that are related thereto specified in the
It is our considered view that the trademarks SALONPAS and certificate. (Emphasis supplied)
LIONPAS are confusingly similar in sound.
Both these words have the same suffix, PAS, which is used to In Mighty Corporation v. E. & J. Gallo Winery, the Court held that, Non-competing
denote a plaster that adheres to the body with curative
powers. PAS, being merely descriptive, furnishes no indication of goods may be those which, though they are not in actual competition, are so related
the origin of the article and therefore is open for appropriation by to each other that it can reasonably be assumed that they originate from one
anyone (Ethepa vs. Director of Patents, L-20635, March 31, 1966)
manufacturer, in which case, confusion of business can arise out of the use of similar
limited to guarding his goods or business from
marks. In that case, the Court enumerated factors in determining whether goods are actual market competition with identical or similar
related: (1) classification of the goods; (2) nature of the goods; (3) descriptive products of the parties, but extends to all cases in
which the use by a junior appropriator of a trade-
properties, physical attributes or essential characteristics of the goods, with reference mark or trade-name is likely to lead to a confusion
to their form, composition, texture or quality; and (4) style of distribution and of source, as where prospective purchasers
would be misled into thinking that the complaining
marketing of the goods, including how the goods are displayed and sold. 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
NANNY and NAN have the same classification, descriptive properties and physical infringer; or when it forestalls the normal potential
expansion of his business (v. 148 ALR, 77, 84; 52
attributes. Both are classified under Class 6, both are milk products, and both are in Am. Jur. 576, 577). (Emphasis supplied)
powder form. Also, NANNY and NAN are displayed in the same section of stores the
milk section.
The Court agrees with the lower courts that there are differences between NAN and Decision and 4 April 2006 Resolution of the Court of Appeals in CA-G.R. CV No.
NANNY: (1) NAN is intended for infants while NANNY is intended for children past 62730 and REINSTATE the 18 September 1998 Decision of the Regional Trial Court,
their infancy and for adults; and (2) NAN is more expensive than NANNY. However, Judicial Region 7, Branch 9, Cebu City, in Civil Case No. CEB-19345.
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 McDonalds 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:
x x x
Even respondents use of the Big Mak mark on non-hamburger food
products cannot excuse their infringement of petitioners
registered mark, otherwise registered marks will lose their
protection under the law.
The registered trademark owner may use his mark on the
same or similar products, in different segments of the market,
and at different price levels depending on variations of the
products for specific segments of the market. The Court has
recognized that the registered trademark owner enjoys
protection in product and market areas that are 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