Mirpuri vs.

CA
GR 114508

Facts:
Barbizon Corp (foreign corp) has adopted the trademark Barbizon. Thus, upon finding that Mirpuri (domiciled in the
Phil) seeks to register the same trademark in the Philippines, Barbizon Corp filed its opposition. Barbizon Corp alleges its
trademark is qualified as well-known and is therefore protected by the Convention of Paris for the Protection of
Intellectual Property which the Philippines has bound to enforce. The Director of Patents rendered a decision giving due
course to the patent application of Mirpuri. The CA, however, reversed this decision.

Issue: Whether or not the Convention of Paris for the Protection of Intellectual Property affords protection to a foreign
corporation against a Philippine applicant for the registration of a similar trademark.

Held: Affirmative. The Philippines and the United States of America have acceded to the WTO Agreement x x x
Conformably, the State must reaffirm its commitment to the global community and take part in evolving a new
international economic order at the dawn of the new millennium.
Thus, the first paragraph of Article 6bis of the Paris Convention is applicable in the instant case:
This Article governs protection of well-known trademarks. Under the first paragraph, each country of the Union bound
itself to undertake to refuse or cancel the registration, and prohibit the use of a trademark which is a reproduction,
imitation or translation, or any essential part of which trademark constitutes a reproduction, liable to create confusion,
of a mark considered by the competent authority of the country where protection is sought, to be well-known in the
country as being already the mark of a person entitled to the benefits of the Convention, and used for identical or similar
goods.
It is a self-executing provision and does not require legislative enactment to give it effect in the member country.

*****************
Trademark in R.A. No. 8293, the Intellectual Property Code of the Philippines: defines as any visible sign capable of
distinguishing goods. In Philippine jurisprudence, the function of a trademark is to point out distinctly the origin or
ownership of the goods to which it is affixed; to secure to him, who has been instrumental in bringing into the market a
superior article of merchandise, the fruit of his industry and skill; to assure the public that they are procuring the
genuine article; to prevent fraud and imposition; and to protect the manufacturer against substitution and sale of an
inferior and different article as his product.

FIRST DIVISION
[G.R. No. 114508. November 19, 1999]
PRIBHDAS J. MIRPURI, petitioner, vs. COURT OF APPEALS, DIRECTOR
OF PATENTS and the BARBIZON CORPORATION, respondents.
D E C I S I O N
PUNO, J .:
The Convention of Paris for the Protection of Industrial Property is a multi-lateral treaty
which the Philippines bound itself to honor and enforce in this country. As to whether or not the
treaty affords protection to aforeign corporation against a Philippine applicant for the
registration of a similar trademark is the principal issue in this case.
On June 15, 1970, one Lolita Escobar, the predecessor-in-interest of petitioner Pribhdas J.
Mirpuri, filed an application with the Bureau of Patents for the registration of the trademark
"Barbizon" for use in brassieres and ladies undergarments. Escobar alleged that she had been
manufacturing and selling these products under the firm name "L & BM Commercial" since
March 3, 1970.
Private respondent Barbizon Corporation, a corporation organized and doing business under
the laws of New York, U.S.A., opposed the application. It claimed that:
"The mark BARBIZON of respondent-applicant is confusingly similar to the
trademark BARBIZON which opposer owns and has not abandoned.
That opposer will be damaged by the registration of the mark BARBIZON and
its business reputation and goodwill will suffer great and irreparable injury.
That the respondent-applicant's use of the said mark BARBIZON which resembles the trademark
used and owned by opposer, constitutes an unlawful appropriation of a mark previously used in
the Philippines and not abandoned and therefore a statutory violation of Section 4 (d) of
Republic Act No. 166, as amended."
[1]

This was docketed as Inter Partes Case No. 686 (IPC No. 686). After filing of the
pleadings, the parties submitted the case for decision.
On June 18, 1974, the Director of Patents rendered judgment dismissing the opposition and
giving due course to Escobar's application, thus:
"WHEREFORE, the opposition should be, as it is hereby, DISMISSED. Accordingly,
Application Serial No. 19010 for the registration of the trademark BARBIZON, of
respondent Lolita R. Escobar, is given due course.
IT IS SO ORDERED."
[2]

This decision became final and on September 11, 1974, Lolita Escobar was issued
a certificate of registration for the trademark "Barbizon." The trademark was "for use in
"brassieres and lady's underwear garments like panties."
[3]

Escobar later assigned all her rights and interest over the trademark to petitioner Pribhdas J.
Mirpuri who, under his firm name then, the "Bonito Enterprises," was the sole and exclusive
distributor of Escobar's "Barbizon" products.
In 1979, however, Escobar failed to file with the Bureau of Patents the Affidavit of Use of
the trademark required under Section 12 of Republic Act (R.A.) No. 166, the
Philippine Trademark Law. Due to this failure, the Bureau of Patents cancelled Escobar's
certificate of registration.
On May 27, 1981, Escobar reapplied for registration of the cancelled trademark. Mirpuri
filed his own application for registration of Escobar's trademark. Escobar later assigned her
application to herein petitioner and this application was opposed by private respondent. The case
was docketed as Inter Partes Case No. 2049 (IPC No. 2049).
In its opposition, private respondent alleged that:
"(a) The Opposer has adopted the trademark BARBIZON (word), sometime in June
1933 and has then used it on various kinds of wearing apparel. On August 14, 1934,
Opposer obtained from the United States PatentOffice a more recent registration of
the said mark under Certificate of Registration No. 316,161. On March 1, 1949,
Opposer obtained from the United States Patent Office a more recent registration for
the said trademark under Certificate of Registration No. 507,214, a copy of which is
herewith attached as Annex `A.' Said Certificate of Registration covers the following
goods-- wearing apparel: robes, pajamas, lingerie, nightgowns and slips;
(b) Sometime in March 1976, Opposer further adopted the trademark BARBIZON
and Bee design and used the said mark in various kinds of wearing apparel. On
March 15, 1977, Opposer secured from the United States Patent Office a registration
of the said mark under Certificate of Registration No. 1,061,277, a copy of which is
herein enclosed as Annex `B.' The said Certificate of Registration covers the
following goods: robes, pajamas, lingerie, nightgowns and slips;
(c) Still further, sometime in 1961, Opposer adopted the trademark BARBIZON and a
Representation of a Woman and thereafter used the said trademark on various kinds of
wearing apparel. Opposer obtained from the United States Patent Office registration
of the said mark on April 5, 1983 under Certificate of Registration No. 1,233,666 for
the following goods: wearing apparel: robes, pajamas, nightgowns and lingerie. A
copy of the said certificate of registration is herewith enclosed as Annex `C.'
(d) All the above registrations are subsisting and in force and Opposer has not
abandoned the use of the said trademarks. In fact, Opposer, through a wholly-owned
Philippine subsidiary, the Philippine Lingerie Corporation, has been manufacturing
the goods covered by said registrations and selling them to various countries, thereby
earning valuable foreign exchange for the country. As a result of respondent-
applicant's misappropriation of Opposer's BARBIZON trademark, Philippine Lingerie
Corporation is prevented from selling its goods in the local market, to the damage and
prejudice of Opposer and its wholly-owned subsidiary.
(e) The Opposer's goods bearing the trademark BARBIZON have been used in many
countries, including the Philippines, for at least 40 years and has enjoyed
international reputation and good will for their quality. To protect its registrations in
countries where the goods covered by the registrations are being sold, Opposer has
procured the registration of the trademark BARBIZON in the following
countries: Australia, Austria, Abu Dhabi, Argentina, Belgium, Bolivia, Bahrain,
Canada, Chile, Colombia, Denmark, Ecuador, France, West Germany, Greece,
Guatemala, Hongkong, Honduras, Italy, Japan, Jordan, Lebanon, Mexico, Morocco,
Panama, New Zealand, Norway, Sweden, Switzerland, Syria, El Salvador, South
Africa, Zambia, Egypt, and Iran, among others;
(f) To enhance its international reputation for quality goods and to further promote
goodwill over its name, marks and products, Opposer has extensively advertised its
products, trademarks and name in various publications which are circulated in the
United States and many countries around the world, including the Philippines;
(g) The trademark BARBIZON was fraudulently registered in the Philippines by one
Lolita R. Escobar under Registration No. 21920, issued on September 11, 1974, in
violation of Article 189 (3) of the Revised Penal Code and Section 4 (d) of the
Trademark Law. Herein respondent applicant acquired by assignment the `rights' to
the said mark previously registered by Lolita Escobar, hence respondent-applicant's
title is vitiated by the same fraud and criminal act. Besides, Certificate of Registration
No. 21920 has been cancelled for failure of either Lolita Escobar or herein
respondent-applicant, to seasonably file the statutory affidavit of use. By applying for
a re-registration of the mark BARBIZON subject of this opposition, respondent-
applicant seeks to perpetuate the fraud and criminal act committed by Lolita Escobar.
(h) Opposer's BARBIZON as well as its BARBIZON and Bee Design and BARBIZON and
Representation of a Woman trademarks qualify as well-known trademarks entitled to protection
under Article 6bis of the Convention of Paris for the Protection of Industrial Property and further
amplified by the Memorandum of the Minister of Trade to the Honorable Director of Patents
dated October 25, 1983 [sic],
[4]
Executive Order No. 913 dated October 7, 1963 and the
Memorandum of the Minister of Trade and Industry to the Honorable Director of Patents dated
October 25, 1983.
(i) The trademark applied for by respondent applicant is identical to Opposer's BARBIZON
trademark and constitutes the dominant part of Opposer's two other marks namely, BARBIZON
and Bee design and BARBIZON and a Representation of a Woman. The continued use by
respondent-applicant of Opposer's trademark BARBIZON on goods belonging to Class 25
constitutes a clear case of commercial and criminal piracy and if allowed registration will violate
not only the Trademark Law but also Article 189 of the Revised Penal Code and the commitment
of the Philippines to an international treaty."
[5]

Replying to private respondent's opposition, petitioner raised the defense of res judicata.
On March 2, 1982, Escobar assigned to petitioner the use of the business name "Barbizon
International." Petitioner registered the name with the Department of Trade and Industry (DTI)
for which a certificate of registration was issued in 1987.
Forthwith, private respondent filed before the Office of Legal Affairs of the DTI a petition
for cancellation of petitioner's business name.
On November 26, 1991, the DTI, Office of Legal Affairs, cancelled petitioner's certificate of
registration, and declared private respondent the owner and prior user of the business name
"Barbizon International." Thus:
"WHEREFORE, the petition is hereby GRANTED and petitioner is declared the owner and prior
user of the business name "BARBIZON INTERNATIONAL" under Certificate of Registration
No. 87-09000 dated March 10, 1987 and issued in the name of respondent, is [sic] hereby
ordered revoked and cancelled. x x x."
[6]

Meanwhile, in IPC No. 2049, the evidence of both parties were received by the Director of
Patents. On June 18, 1992, the Director rendered a decision declaring private respondent's
opposition barred by res judicata and giving due course to petitioner's application for
registration, to wit:
"WHEREFORE, the present Opposition in Inter Partes Case No. 2049 is hereby
DECLARED BARRED by res judicata and is hereby DISMISSED. Accordingly,
Application Serial No. 45011 for trademark BARBIZON filed by Pribhdas J. Mirpuri
is GIVEN DUE COURSE.
SO ORDERED."
[7]

Private respondent questioned this decision before the Court of Appeals in CA-G.R. SP No.
28415. On April 30, 1993, the Court of Appeals reversed the Director of Patents finding that
IPC No. 686 was not barred by judgment in IPC No. 2049 and ordered that the case be remanded
to the Bureau of Patents for further proceedings, viz:
"WHEREFORE, the appealed Decision No. 92-13 dated June 18, 1992 of the Director of Patents
in Inter Partes Case No. 2049 is hereby SET ASIDE; and the case is hereby remanded to the
Bureau of Patents for further proceedings, in accordance with this pronouncement. No costs."
[8]

In a Resolution dated March 16, 1994, the Court of Appeals denied reconsideration of its
decision.
[9]
Hence, this recourse.
Before us, petitioner raises the following issues:
"1. WHETHER OR NOT THE DECISION OF THE DIRECTOR OF PATENTS IN
INTER PARTES CASE NO. 686 RENDERED ON JUNE 18, 1974, ANNEX C
HEREOF, CONSTITUTED RES JUDICATA IN SO FAR AS THE CASE BEFORE
THE DIRECTOR OF PATENTS IS CONCERNED;
2. WHETHER OR NOT THE DIRECTOR OF PATENTS CORRECTLY APPLIED
THE PRINCIPLE OF RES JUDICATA IN DISMISSING PRIVATE RESPONDENT
BARBIZON'S OPPOSITION TO PETITIONER'S APPLICATION FOR
REGISTRATION FOR THE TRADEMARK BARBIZON, WHICH HAS SINCE
RIPENED TO CERTIFICATE OF REGISTRATION NO. 53920 ON NOVEMBER
16, 1992;
3. WHETHER OR NOT THE REQUISITE THAT A 'JUDGMENT ON THE
MERITS' REQUIRED A 'HEARING WHERE BOTH PARTIES ARE SUPPOSED
TO ADDUCE EVIDENCE' AND WHETHER THE JOINT SUBMISSION OF THE
PARTIES TO A CASE ON THE BASIS OF THEIR RESPECTIVE PLEADINGS
WITHOUT PRESENTING TESTIMONIAL OR DOCUMENTARY EVIDENCE
FALLS WITHIN THE MEANING OF 'JUDGMENT ON THE MERITS' AS ONE
OF THE REQUISITES TO CONSTITUTE RES JUDICATA;
4. WHETHER A DECISION OF THE DEPARTMENT OF TRADE AND
INDUSTRY CANCELLING PETITIONER'S FIRM NAME 'BARBIZON
INTERNATIONAL' AND WHICH DECISION IS STILL PENDING
RECONSIDERATION NEVER OFFERED IN EVIDENCE BEFORE THE
DIRECTOR OF PATENTS IN INTER PARTES CASE NO. 2049 HAS THE RIGHT
TO DECIDE SUCH CANCELLATION NOT ON THE BASIS OF THE BUSINESS
NAME LAW (AS IMPLEMENTED BY THE BUREAU OF DOMESTIC TRADE)
BUT ON THE BASIS OF THE PARIS CONVENTION AND THE TRADEMARK
LAW (R.A. 166) WHICH IS WITHIN THE ORIGINAL AND EXCLUSIVE
JURISDICTION OF THE DIRECTOR OF PATENTS."
[10]

Before ruling on the issues of the case, there is need for a brief background on the function
and historical development of trademarks and trademark law.
A "trademark" is defined under R.A. 166, the Trademark Law, as including "any word,
name, symbol, emblem, sign or device or any combination thereof adopted and used by a
manufacturer or merchant to identify his goods and distinguish them from those manufactured,
sold or dealt in by others."
[11]
This definition has been simplified in R.A. No. 8293, the
Intellectual Property Code of the Philippines, which defines a "trademark" as "any visible sign
capable of distinguishing goods."
[12]
In Philippine jurisprudence, the function of a trademark is to
point out distinctly the origin or ownership of the goods to which it is affixed; to secure to him,
who has been instrumental in bringing into the market a superior article of merchandise, the fruit
of his industry and skill; to assure the public that they are procuring the genuine article; to
prevent fraud and imposition; and to protect the manufacturer against substitution and sale of an
inferior and different article as his product.
[13]

Modern authorities on trademark law view trademarks as performing three distinct
functions: (1) they indicate origin or ownership of the articles to which they are attached; (2)
they guarantee that those articles come up to a certain standard of quality; and (3) they advertise
the articles they symbolize.
[14]

Symbols have been used to identify the ownership or origin of articles for several
centuries.
[15]
As early as 5,000 B.C., markings on pottery have been found by
archaeologists. Cave drawings in southwestern Europe show bison with symbols on their
flanks.
[16]
Archaeological discoveries of ancient Greek and Roman inscriptions on sculptural
works, paintings, vases, precious stones, glassworks, bricks, etc. reveal some features which are
thought to be marks or symbols. These marks were affixed by the creator or maker of the article,
or by public authorities as indicators for the payment of tax, for disclosing state monopoly, or
devices for the settlement of accounts between an entrepreneur and his workmen.
[17]

In the Middle Ages, the use of many kinds of marks on a variety of goods was
commonplace. Fifteenth century England saw the compulsory use of identifying marks in
certain trades. There were the baker's mark on bread, bottlemaker's marks, smith's marks,
tanner's marks, watermarks on paper, etc.
[18]
Every guild had its own mark and every master
belonging to it had a special mark of his own. The marks were not trademarks but police marks
compulsorily imposed by the sovereign to let the public know that the goods were not "foreign"
goods smuggled into an area where the guild had a monopoly, as well as to aid in tracing
defective work or poor craftsmanship to the artisan.
[19]
For a similar reason, merchants also used
merchants' marks. Merchants dealt in goods acquired from many sources and the marks enabled
them to identify and reclaim their goods upon recovery after shipwreck or piracy.
[20]

With constant use, the mark acquired popularity and became voluntarily adopted. It was not
intended to create or continue monopoly but to give the customer an index or guarantee of
quality.
[21]
It was in the late 18th century when the industrial revolution gave rise to mass
production and distribution of consumer goods that the mark became an important
instrumentality of trade and commerce.
[22]
By this time, trademarks did not merely identify the
goods; they also indicated the goods to be of satisfactory quality, and thereby stimulated further
purchases by the consuming public.
[23]
Eventually, they came to symbolize the goodwill and
business reputation of the owner of the product and became a property right protected by
law.
[24]
The common law developed the doctrine of trademarks and tradenames "to prevent a
person from palming off his goods as another's, from getting another's business or injuring his
reputation by unfair means, and, from defrauding the public."
[25]
Subsequently, England and the
United States enacted national legislation on trademarks as part of the law regulating unfair
trade.
[26]
It became the right of the trademark owner to exclude others from the use of his mark, or
of a confusingly similar mark where confusion resulted in diversion of trade or
financial injury. At the same time, the trademark served as a warning against the imitation or
faking of products to prevent the imposition of fraud upon the public.
[27]

Today, the trademark is not merely a symbol of origin and goodwill; it is often the most
effective agent for the actual creation and protection of goodwill. It imprints upon the public
mind an anonymous and impersonal guaranty of satisfaction, creating a desire for further
satisfaction. In other words, the mark actually sells the goods.
[28]
The mark has become the
"silent salesman," the conduit through which direct contact between the trademark owner and the
consumer is assured. It has invaded popular culture in ways never anticipated that it has become
a more convincing selling point than even the quality of the article to which it refers.
[29]
In the last
half century, the unparalleled growth of industry and the rapid development of communications
technology have enabled trademarks, tradenames and other distinctive signs of a product to
penetrate regions where the owner does not actually manufacture or sell the product
itself. Goodwill is no longer confined to the territory of actual market penetration; it extends to
zones where the marked article has been fixed in the public mind through advertising.
[30]
Whether
in the print, broadcast or electronic communications medium, particularly on the
Internet,
[31]
advertising has paved the way for growth and expansion of the product by creating
and earning a reputation that crosses over borders, virtually turning the whole world into one vast
marketplace.
This is the mise-en-scene of the present controversy. Petitioner brings this action claiming
that "Barbizon" products have been sold in the Philippines since 1970. Petitioner developed this
market by working long hours and spending considerable sums of money on advertisements and
promotion of the trademark and its products. Now, almost thirty years later, private respondent,
a foreign corporation, "swaggers into the country like a conquering hero," usurps the trademark
and invades petitioner's market.
[32]
Justice and fairness dictate that private respondent be
prevented from appropriating what is not its own. Legally, at the same time, private respondent
is barred from questioning petitioner's ownership of the trademark because of res judicata.
[33]

Literally, res judicata means a matter adjudged, a thing judicially acted upon or decided; a
thing or matter settled by judgment.
[34]
In res judicata, the judgment in the first action is
considered conclusive as to every matter offered and received therein, as to any other admissible
matter which might have been offered for that purpose, and all other matters that could have
been adjudged therein.
[35]
Res judicata is an absolute bar to a subsequent action for the same
cause; and its requisites are: (a) the former judgment or order must be final; (b) the judgment or
order must be one on the merits; (c) it must have been rendered by a court having jurisdiction
over the subject matter and parties; (d) there must be between the first and second actions,
identity of parties, of subject matter and of causes of action.
[36]

The Solicitor General, on behalf of respondent Director of Patents, has joined cause with
petitioner. Both claim that all the four elements of res judicata have been complied with: that
the judgment in IPC No. 686 was final and was rendered by the Director of Patents who had
jurisdiction over the subject matter and parties; that the judgment in IPC No. 686 was on the
merits; and that the lack of a hearing was immaterial because substantial issues were raised by
the parties and passed upon by the Director of Patents.
[37]

The decision in IPC No. 686 reads as follows:
"x x x.
Neither party took testimony nor adduced documentary evidence. They submitted the
case for decision based on the pleadings which, together with the pertinent records,
have all been carefully considered.
Accordingly, the only issue for my disposition is whether or not the herein opposer
would probably be damaged by the registration of the trademark BARBIZON sought
by the respondent-applicant on the ground that it so resembles the trademark
BARBIZON allegedly used and owned by the former to be `likely to cause confusion,
mistake or to deceive purchasers.'
On record, there can be no doubt that respondent-applicant's sought-to-be-registered
trademark BARBIZON is similar, in fact obviously identical, to opposer's alleged
trademark BARBIZON, in spelling and pronunciation. The only appreciable but very
negligible difference lies in their respective appearances or manner of
presentation. Respondent-applicant's trademark is in bold letters (set against a black
background), while that of the opposer is offered in stylish script letters.
It is opposer's assertion that its trademark BARBIZON has been used in trade or
commerce in the Philippines prior to the date of application for the registration of the
identical mark BARBIZON by the respondent-applicant. However, the allegation of
facts in opposer's verified notice of opposition is devoid of such material
information. In fact, a reading of the text of said verified opposition reveals an
apparent, if not deliberate, omission of the date (or year) when opposer's alleged
trademark BARBIZON was first used in trade in the Philippines (see par. No. 1, p. 2,
Verified Notice of Opposition, Rec.). Thus, it cannot here and now be ascertained
whether opposer's alleged use of the trademark BARBIZON could be prior to the use
of the identical mark by the herein respondent-applicant, since the opposer attempted
neither to substantiate its claim of use in local commerce with any proof or
evidence. Instead, the opposer submitted the case for decision based merely on the
pleadings.
On the other hand, respondent-applicant asserted in her amended application for
registration that she first used the trademark BARBIZON for brassiere (or 'brasseire')
and ladies underwear garments and panties as early as March 3, 1970. Be that as it
may, there being no testimony taken as to said date of first use, respondent-applicant
will be limited to the filing date, June 15, 1970, of her application as the date of first
use (Rule 173, Rules of Practice in Trademark Cases).
From the foregoing, I conclude that the opposer has not made out a case of probable
damage by the registration of the respondent-applicant's mark BARBIZON.
WHEREFORE, the opposition should be, as it is hereby, DISMISSED. Accordingly,
Application Serial No. 19010, for the registration of the trademark BARBIZON of respondent
Lolita R. Escobar, is given due course."
[38]

The decision in IPC No. 686 was a judgment on the merits and it was error for the Court of
Appeals to rule that it was not. A judgment is on the merits when it determines the rights and
liabilities of the parties based on the disclosed facts, irrespective of formal, technical or dilatory
objections.
[39]
It is not necessary that a trial should have been conducted. If the court's judgment
is general, and not based on any technical defect or objection, and the parties had a full legal
opportunity to be heard on their respective claims and contentions, it is on the merits although
there was no actual hearing or arguments on the facts of the case.
[40]
In the case at bar, the
Director of Patents did not dismiss private respondent's opposition on a sheer
technicality. Although no hearing was conducted, both parties filed their respective pleadings
and were given opportunity to present evidence. They, however, waived their right to do so and
submitted the case for decision based on their pleadings. The lack of evidence did not deter the
Director of Patents from ruling on the case, particularly on the issue of prior use, which goes into
the very substance of the relief sought by the parties. Since private respondent failed to prove
prior use of its trademark, Escobar's claim of first use was upheld.
The judgment in IPC No. 686 being on the merits, petitioner and the Solicitor General allege
that IPC No. 686 and IPC No. 2049 also comply with the fourth requisite of res judicata, i.e.,
they involve the same parties and the same subject matter, and have identical causes of action.
Undisputedly, IPC No. 686 and IPC No. 2049 involve the same parties and the same subject
matter. Petitioner herein is the assignee of Escobar while private respondent is the same
American corporation in the first case. The subject matter of both cases is the trademark
"Barbizon." Private respondent counter-argues, however, that the two cases do not have identical
causes of action. New causes of action were allegedly introduced in IPC No. 2049, such as the
prior use and registration of the trademark in the United States and other countries worldwide,
prior use in the Philippines, and the fraudulent registration of the mark in violation of Article 189
of the Revised Penal Code. Private respondent also cited protection of the trademark under the
Convention of Paris for the Protection of Industrial Property, specifically Article 6bis thereof,
and the implementation of Article 6bis by two Memoranda dated November 20, 1980 and
October 25, 1983 of the Minister of Trade and Industry to the Director of Patents, as well as
Executive Order (E.O.) No. 913.
The Convention of Paris for the Protection of Industrial Property, otherwise known as the
Paris Convention, is a multilateral treaty that seeks to protect industrial property consisting of
patents, utility models, industrial designs, trademarks, service marks, trade names and indications
of source or appellations of origin, and at the same time aims to repress unfair
competition.
[41]
The Convention is essentially a compact among various countries which, as
members of the Union, have pledged to accord to citizens of the other member countries
trademark and other rights comparable to those accorded their own citizens by their
domestic laws for an effective protection against unfair competition.
[42]
In short, foreign nationals
are to be given the same treatment in each of the member countries as that country makes
available to its own citizens.
[43]
Nationals of the various member nations are thus assured of a
certain minimum of international protection of their industrial property.
[44]

The Convention was first signed by eleven countries in Paris on March 20, 1883.
[45]
It
underwent several revisions-- at Brussels in 1900, at Washington in 1911, at The Hague in 1925,
at London in 1934, at Lisbon in 1958,
[46]
and at Stockholm in 1967. Both the Philippines and the
United States of America, herein private respondent's country, are signatories to the
Convention. The United States acceded on May 30, 1887 while the Philippines, through its
Senate, concurred on May 10, 1965.
[47]
The Philippines' adhesion became effective on September
27, 1965,
[48]
and from this date, the country obligated itself to honor and enforce the provisions of
the Convention.
[49]

In the case at bar, private respondent anchors its cause of action on the first paragraph of
Article 6bis of the Paris Convention which reads as follows:
"Article 6bis
(1) The countries of the Union undertake, either administratively if their
legislation so permits, or at the request of an interested party, to refuse or to
cancel the registration and to prohibit the use, of a trademark which constitutes
a reproduction, an imitation, or a translation, liable to create confusion, of a
mark considered by the competent authority of the country of registration or use
to be well-known in that country as being already the mark of a person entitled
to the benefits of this Convention and used for identical or similar goods. These
provisions shall also apply when the essential part of the mark constitutes a
reproduction of any such well-known mark or an imitation liable to create
confusion therewith.
(2) A period of at least five years from the date of registration shall be allowed for
seeking the cancellation of such a mark. The countries of the Union may provide for
a period within which the prohibition of use must be sought.
(3) No time limit shall be fixed for seeking the cancellation or the prohibition of the use of
marks registered or used in bad faith."
[50]

This Article governs protection of well-known trademarks. Under the first paragraph,
each country of the Union bound itself to undertake to refuse or cancel the registration, and
prohibit the use of a trademark which is a reproduction, imitation or translation, or any essential
part of which trademark constitutes a reproduction, liable to create confusion, of a mark
considered by the competent authority of the country where protection is sought, to be well-
known in the country as being already the mark of a person entitled to the benefits of the
Convention, and used for identical or similar goods.
Article 6bis was first introduced at The Hague in 1925 and amended in Lisbon in 1952.
[51]
It
is a self-executing provision and does not require legislative enactment to give it effect in the
member country.
[52]
It may be applied directly by the tribunals and officials of each member
country by the mere publication or proclamation of the Convention, after its ratification
according to the public law of each state and the order for its execution.
[53]

The essential requirement under Article 6bis is that the trademark to be protected must be
"well-known" in the country where protection is sought. The power to determine whether a
trademark is well-known lies in the "competent authority of the country of registration or use."
This competent authority would be either the registering authority if it has the power to decide
this, or the courts of the country in question if the issue comes before a court.
[54]

Pursuant to Article 6bis, on November 20, 1980, then Minister Luis Villafuerte of the
Ministry of Trade issued a Memorandum to the Director of Patents. The Minister ordered the
Director that:
"Pursuant to the Paris Convention for the Protection of Industrial Property to which
the Philippines is a signatory, you are hereby directed to reject all pending
applications for Philippine registration of signature and other world-famous
trademarks by applicants other than its original owners or users.
The conflicting claims over internationally known trademarks involve such name
brands as Lacoste, Jordache, Vanderbilt, Sasson, Fila, Pierre Cardin, Gucci, Christian
Dior, Oscar de la Renta, Calvin Klein, Givenchy, Ralph Lauren, Geoffrey Beene,
Lanvin and Ted Lapidus.
It is further directed that, in cases where warranted, Philippine registrants of such
trademarks should be asked to surrender their certificates of registration, if any, to
avoid suits for damages and other legal action by the trademarks' foreign or local
owners or original users.
You are also required to submit to the undersigned a progress report on the matter.
For immediate compliance."
[55]

Three years later, on October 25, 1983, then Minister Roberto Ongpin issued another
Memorandum to the Director of Patents, viz:
"Pursuant to Executive Order No. 913 dated 7 October 1983 which strengthens the rule-making
and adjudicatory powers of the Minister of Trade and Industry and provides inter alia, that `such
rule-making and adjudicatory powers should be revitalized in order that the Minister of Trade
and Industry can x x x apply more swift and effective solutions and remedies to old and new
problems x x x such as infringement of internationally-known tradenames and trademarks x x x'
and in view of the decision of the Intermediate Appellate Court in the case of LA CHEMISE
LACOSTE, S.A., versus RAM SADWHANI [AC-G.R. SP NO. 13359 (17) June 1983]
[56]
which
affirms the validity of the MEMORANDUM of then Minister Luis R. Villafuerte dated 20
November 1980 confirming our obligations under the PARIS CONVENTION FOR THE
PROTECTION OF INDUSTRIAL PROPERTY to which the Republic of the Philippines is a
signatory, you are hereby directed to implement measures necessary to effect compliance with
our obligations under said Convention in general, and, more specifically, to honor our
commitment under Section 6bis
[57]
thereof, as follows:
1. Whether the trademark under consideration is well-known in the Philippines or
is a mark already belonging to a person entitled to the benefits of the CONVENTION,
this should be established, pursuant to Philippine Patent Office procedures in inter
partes and ex parte cases, according to any of the following criteria or any
combination thereof:
(a) a declaration by the Minister of Trade and Industry that the trademark being
considered is already well-known in the Philippines such that permission for its use by
other than its original owner will constitute a reproduction, imitation, translation or
other infringement;
(b) that the trademark is used in commerce internationally, supported by proof
that goods bearing the trademark are sold on an international scale, advertisements,
the establishment of factories, sales offices, distributorships, and the like, in different
countries, including volume or other measure of international trade and commerce;
(c) that the trademark is duly registered in the industrial property office(s) of
another country or countries, taking into consideration the date of such registration;
(d) that the trademark has long been established and obtained goodwill and
international consumer recognition as belonging to one owner or source;
(e) that the trademark actually belongs to a party claiming ownership and has the
right to registration under the provisions of the aforestated PARIS CONVENTION.
2. The word trademark, as used in this MEMORANDUM, shall include
tradenames, service marks, logos, signs, emblems, insignia or other similar devices
used for identification and recognition by consumers.
3. The Philippine Patent Office shall refuse all applications for, or cancel the
registration of, trademarks which constitute a reproduction, translation or imitation of
a trademark owned by a person, natural or corporate, who is a citizen of a country
signatory to the PARIS CONVENTION FOR THE PROTECTION OF
INDUSTRIAL PROPERTY.
4. The Philippine Patent Office shall give due course to the Opposition in cases
already or hereafter filed against the registration of trademarks entitled to protection
of Section 6 bis of said PARIS CONVENTION as outlined above, by remanding
applications filed by one not entitled to such protection for final disallowance by the
Examination Division.
5. All pending applications for Philippine registration of signature and other
world-famous trademarks filed by applicants other than their original owners or users
shall be rejected forthwith. Where such applicants have already obtained registration
contrary to the abovementioned PARIS CONVENTION and/or Philippine Law, they
shall be directed to surrender their Certificates of Registration to the Philippine Patent
Office for immediate cancellation proceedings.
x x x."
[58]

In the Villafuerte Memorandum, the Minister of Trade instructed the Director of Patents to
reject all pending applications for Philippine registration of signature and other world-famous
trademarks by applicants other than their original owners or users. The Minister enumerated
several internationally-known trademarks and ordered the Director of Patents to require
Philippine registrants of such marks to surrender their certificates of registration.
In the Ongpin Memorandum, the Minister of Trade and Industry did not enumerate well-
known trademarks but laid down guidelines for the Director of Patents to observe in determining
whether a trademark is entitled to protection as a well-known mark in the Philippines under
Article 6bis of the Paris Convention. This was to be established through Philippine Patent Office
procedures in inter partes and ex parte cases pursuant to the criteria enumerated therein. The
Philippine Patent Office was ordered to refuse applications for, or cancel the registration of,
trademarks which constitute a reproduction, translation or imitation of a trademark owned by a
person who is a citizen of a member of the Union. All pending applications for registration of
world-famous trademarks by persons other than their original owners were to be rejected
forthwith. The Ongpin Memorandum was issued pursuant to Executive Order No. 913 dated
October 7, 1983 of then President Marcos which strengthened the rule-making and adjudicatory
powers of the Minister of Trade and Industry for the effective protection of consumers and the
application of swift solutions to problems in trade and industry.
[59]

Both the Villafuerte and Ongpin Memoranda were sustained by the Supreme Court in the
1984 landmark case of La Chemise Lacoste, S.A. v. Fernandez.
[60]
This court ruled therein that
under the provisions of Article 6bis of the Paris Convention, the Minister of Trade and Industry
was the "competent authority" to determine whether a trademark is well-known in this country.
[61]

The Villafuerte Memorandum was issued in 1980, i.e., fifteen (15) years after the adoption
of the Paris Convention in 1965. In the case at bar, the first inter partes case, IPC No. 686, was
filed in 1970, before the Villafuerte Memorandum but five (5) years after the effectivity of the
Paris Convention. Article 6bis was already in effect five years before the first case was
instituted. Private respondent, however, did not cite the protection of Article 6bis, neither did it
mention the Paris Convention at all. It was only in 1981 when IPC No. 2049 was instituted that
the Paris Convention and the Villafuerte Memorandum, and, during the pendency of the case, the
1983 Ongpin Memorandum were invoked by private respondent.
The Solicitor General argues that the issue of whether the protection of Article 6bis of the
Convention and the two Memoranda is barred by res judicata has already been answered
in Wolverine Worldwide, Inc. v. Court of Appeals.
[62]
In this case, petitioner Wolverine, a foreign
corporation, filed with the Philippine Patent Office a petition for cancellation of the registration
certificate of private respondent, a Filipino citizen, for the trademark "Hush Puppies" and "Dog
Device." Petitioner alleged that it was the registrant of the internationally-known trademark in
the United States and other countries, and cited protection under the Paris Convention and the
Ongpin Memorandum. The petition was dismissed by the Patent Office on the ground of res
judicata. It was found that in 1973 petitioner's predecessor-in-interest filed two petitions for
cancellation of the same trademark against respondent's predecessor-in-interest. The Patent
Office dismissed the petitions, ordered the cancellation of registration of petitioner's trademark,
and gave due course to respondent's application for registration. This decision was sustained by
the Court of Appeals, which decision was not elevated to us and became final and executory.
[63]

Wolverine claimed that while its previous petitions were filed under R.A. No. 166, the
Trademark Law, its subsequent petition was based on a new cause of action, i.e., the Ongpin
Memorandum and E.O. No. 913 issued in 1983, after finality of the previous decision. We held
that the said Memorandum and E.O. did not grant a new cause of action because it did "not
amend the Trademark Law," x x x "nor did it indicate a new policy with respect to the
registration in the Philippines of world-famous trademarks."
[64]
This conclusion was based on the
finding that Wolverine's two previous petitions and subsequent petition dealt with the same issue
of ownership of the trademark.
[65]
In other words, since the first and second cases involved the
same issue of ownership, then the first case was a bar to the second case.
In the instant case, the issue of ownership of the trademark "Barbizon" was not raised in IPC
No. 686. Private respondent's opposition therein was merely anchored on:
(a) "confusing similarity" of its trademark with that of Escobar's;
(b) that the registration of Escobar's similar trademark will cause damage to private
respondent's business reputation and goodwill; and
(c) that Escobar's use of the trademark amounts to an unlawful appropriation of a
mark previously used in the Philippines which act is penalized under Section 4 (d) of
the Trademark Law.
In IPC No. 2049, private respondent's opposition set forth several issues summarized as
follows:
(a) as early as 1933, it adopted the word "BARBIZON" as trademark on its products
such as robes, pajamas, lingerie, nightgowns and slips;
(b) that the trademark "BARBIZON" was registered with the United States Patent
Office in 1934 and 1949; and that variations of the same trademark, i.e.,
"BARBIZON" with Bee design and "BARBIZON" with the representation of a
woman were also registered with the U.S. Patent Office in 1961 and 1976;
(c) that these marks have been in use in the Philippines and in many countries all over
the world for over forty years. "Barbizon" products have been advertised in
international publications and the marks registered in 36 countries worldwide;
(d) Escobar's registration of the similar trademark "BARBIZON" in 1974 was based
on fraud; and this fraudulent registration was cancelled in 1979, stripping Escobar of
whatsoever right she had to the said mark;
(e) Private respondent's trademark is entitled to protection as a well-known mark
under Article 6bis of the Paris Convention, Executive Order No. 913, and the two
Memoranda dated November 20, 1980 and October 25, 1983 of the Minister of Trade
and Industry to the Director of Patents;
(f) Escobar's trademark is identical to private respondent's and its use on the same
class of goods as the latter's amounts to a violation of the Trademark Law and Article
189 of the Revised Penal Code.
IPC No. 2049 raised the issue of ownership of the trademark, the first registration and use of the
trademark in the United States and other countries, and the international recognition and
reputation of the trademark established by extensive use and advertisement of private
respondent's products for over forty years here and abroad. These are different from the issues of
confusing similarity and damage in IPC No. 686. The issue of prior use may have been raised in
IPC No. 686 but this claim was limited to prior use in the Philippines only. Prior use in IPC No.
2049 stems from private respondent's claim as originator of the word and symbol
"Barbizon,"
[66]
as the first and registered user of the mark attached to its products which have
been sold and advertised worldwide for a considerable number of years prior to petitioner's first
application for registration of her trademark in the Philippines. Indeed, these are substantial
allegations that raised new issues and necessarily gave private respondent a new cause of
action. Res judicata does not apply to rights, claims or demands, although growing out of the
same subject matter, which constitute separate or distinct causes of action and were not put in
issue in the former action.
[67]

Respondent corporation also introduced in the second case a fact that did not exist at the
time the first case was filed and terminated. The cancellation of petitioner's certificate of
registration for failure to file the affidavit of use arose only after IPC No. 686. It did not and
could not have occurred in the first case, and this gave respondent another cause to oppose the
second application. Res judicata extends only to facts and conditions as they existed at the time
judgment was rendered and to the legal rights and relations of the parties fixed by the facts so
determined.
[68]
When new facts or conditions intervene before the second suit, furnishing a new
basis for the claims and defenses of the parties, the issues are no longer the same, and the former
judgment cannot be pleaded as a bar to the subsequent action.
[69]

It is also noted that the oppositions in the first and second cases are based on different
laws. The opposition in IPC No. 686 was based on specific provisions of the Trademark Law,
i.e., Section 4 (d)
[70]
on confusing similarity of trademarks and Section 8
[71]
on the requisite
damage to file an opposition to a petition for registration. The opposition in IPC No. 2049
invoked the Paris Convention, particularly Article 6bis thereof, E.O. No. 913 and the two
Memoranda of the Minister of Trade and Industry. This opposition also invoked Article 189 of
the Revised Penal Code which is a statute totally different from the Trademark Law.
[72]
Causes of
action which are distinct and independent from each other, although arising out of the same
contract, transaction, or state of facts, may be sued on separately, recovery on one being no bar
to subsequent actions on others.
[73]
The mere fact that the same relief is sought in the subsequent
action will not render the judgment in the prior action operative as res judicata, such as where
the two actions are based on different statutes.
[74]
Res judicatatherefore does not apply to the
instant case and respondent Court of Appeals did not err in so ruling.
Intellectual and industrial property rights cases are not simple property cases. Trademarks
deal with the psychological function of symbols and the effect of these symbols on the public at
large.
[75]
Trademarks play a significant role in communication, commerce and trade, and serve
valuable and interrelated business functions, both nationally and internationally. For this reason,
all agreements concerning industrial property, like those on trademarks and tradenames, are
intimately connected with economic development.
[76]
Industrial property encourages investments
in new ideas and inventions and stimulates creative efforts for the satisfaction of human
needs. They speed up transfer of technology and industrialization, and thereby bring about social
and economic progress.
[77]
These advantages have been acknowledged by the Philippine
government itself. The Intellectual Property Code of the Philippines declares that "an effective
intellectual and industrial property system is vital to the development of domestic and creative
activity, facilitates transfer of technology, it attracts foreign investments, and ensures market
access for our products."
[78]
The Intellectual Property Code took effect on January 1, 1998 and by
its express provision,
[79]
repealed the Trademark Law,
[80]
the Patent Law,
[81]
Articles 188 and 189
of the Revised Penal Code, the Decree on Intellectual Property,
[82]
and the Decree on Compulsory
Reprinting of Foreign Textbooks.
[83]
The Code was enacted to strengthen the intellectual and
industrial property system in the Philippines as mandated by the country's accession to the
Agreement Establishing the World Trade Organization (WTO).
[84]

The WTO is a common institutional framework for the conduct of trade relations among its
members in matters related to the multilateral and plurilateral trade agreements annexed to the
WTO Agreement.
[85]
The WTO framework ensures a "single undertaking approach" to the
administration and operation of all agreements and arrangements attached to the WTO
Agreement. Among those annexed is the Agreement on Trade-Related Aspects of Intellectual
Property Rights or TRIPs.
[86]
Members to this Agreement "desire to reduce distortions and
impediments to international trade, taking into account the need to promote effective and
adequate protection of intellectual property rights, and to ensure that measures and procedures to
enforce intellectual property rights do not themselves become barriers to legitimate trade." To
fulfill these objectives, the members have agreed to adhere to minimum standards of protection
set by several Conventions.
[87]
These Conventions are: the Berne Convention for the Protection
of Literary and Artistic Works (1971), the Rome Convention or the International Convention for
the Protection of Performers, Producers of Phonograms and Broadcasting Organisations, the
Treaty on Intellectual Property in Respect of Integrated Circuits, and the Paris Convention
(1967), as revised in Stockholm on July 14, 1967.
[88]

A major proportion of international trade depends on the protection of intellectual property
rights.
[89]
Since the late 1970's, the unauthorized counterfeiting of industrial property and
trademarked products has had a considerable adverse impact on domestic and international trade
revenues.
[90]
The TRIPs Agreement seeks to grant adequate protection of intellectual property
rights by creating a favorable economic environment to encourage the inflow of foreign
investments, and strengthening the multi-lateral trading system to bring about economic, cultural
and technological independence.
[91]
The Philippines and the United States of America have
acceded to the WTO Agreement. This Agreement has revolutionized international business and
economic relations among states, and has propelled the world towards trade liberalization and
economic globalization.
[92]
Protectionism and isolationism belong to the past. Trade is no longer
confined to a bilateral system. There is now "a new era of global economic cooperation,
reflecting the widespread desire to operate in a fairer and more open multilateral trading
system."
[93]
Conformably, the State must reaffirm its commitment to the global community and
take part in evolving a new international economic order at the dawn of the new millenium.
IN VIEW WHEREOF, the petition is denied and the Decision and Resolution of the Court
of Appeals in CA-G.R. SP No. 28415 are affirmed.
SO ORDERED.
Davide, Jr., C.J., (Chairman), Kapunan, Pardo, and Ynares-Santiago, JJ., concur.



[1]

Decision No. 804 dated June 18, 1974 of the Director of Patents, Rollo, p. 36.
[2]

Rollo, p. 38.
[3]

Certificate of Registration No. 21920, Annex "E" to Memorandum of Petitioner, Rollo, p. 211.
[4]

The Memorandum of the Minister of Trade to the Honorable Director of Patents should have been dated 20
November 1980-- Memorandum of the Private Respondent, p. 11, Rollo, p. 227.
[5]

Comment of the Solicitor General, pp. 5-8, Rollo, pp. 116-119.
[6]

CA Decision, p. 4, Rollo, p. 27.
[7]

Id.
[8]

CA Decision, p. 31. The decision was penned by Justice Fidel Purisima, now a member of this Court, and
concurred in by Justices Jesus M. Elbinias and Angelina S. Gutierrez.
[9]

Rollo, pp. 34-35.
[10]

Petitioner, pp. 5-6, Rollo, pp. 11-12.
[11]

Sec. 38, par. 2, R.A. 166.
[12]

Sec. 121.1, Part III, R.A. 8293.
[13]

Gabriel v. Perez, 55 SCRA 406, 417 [1974] citing 52 Am Jur, p. 508; Etepha v. Director of Patents, 16 SCRA
495, 497 [1966]; see also Phil. Refining Co., Inc. v. Ng Sam, 115 SCRA 472, 476-477 [1982]; also cited in Agpalo,
Trademark Law and Practice in the Philippines, p. 5 [1990].
[14]

Dissenting Opinion of Justice Florentino Feliciano in Philip Morris, Inc. v. Court of Appeals, 224 SCRA 576,
624 [1993]; see William Jay Gross, The Territorial Scope of Trademark Rights, Univ. of Miami Law Review, vol
44:1075 [March 1990]; see also Rudolf Callmann, The Law of Unfair Competition and Trademarks, vol. 2, pp. 804-
814 [1945].
[15]

Harry D. Nims, The Law of Unfair Competition and Trademarks, 4th ed., pub. by Baker, Voorhis & Co., Inc.,
vol. 1, p. 509 [1947].
[16]

Frank H. Foster and Robert L. Shook, Patents, Copyrights, and Trademarks, pub. by John Wiley & Sons, Inc., 2d
ed. p. 19 [1993].1
[17]

Stephen P. Ladas, Patents, Trademarks, and Related Rights, National and International Protection (Harvard
University Press), vol. 1, pp. 3-4 [1975].
[18]

Foster and Shook, supra, at 20.
[19]

Id., at 20-21; Ladas, supra, vol. 1, at 4-5; see Frank I. Schechter, The Rational Basis of Trademark Protection, 40
Harvard Law Review, 813, 814 [1927]; Callmann, supra, vol. 2, p. 807; see also Richard Wincor and Irving
Mandell, Copyright, Patents and Trademarks: The Protection of Intellectual and Industrial Property, at 72 [1980].
[20]

Foster and Shook, supra, at 20; Schechter, supra, at 814.
[21]

Callmann, supra, vol. 2, at 808.
[22]

Foster and Shook, supra, at 22-23; Nims, supra, at 511.
[23]

Callmann, supra, vol. 2, at 809-910.
[24]

Foster and Shook, supra, at 21-22.
[25]

Justice Holmes in Chadwick v. Covell, 151 Man 190, 23 NE 1068, 1069 [1890]; also cited in Nims, supra, at 37.
[26]

Ladas, supra, vol. 1, at 8.
[27]

See also Dissenting Opinion of Justice Feliciano in Philip Morris, supra, at 624-625.
[28]

Schechter, supra. Trademarks have become products in their own right, valued as status symbols and indicators
of the preferences and aspirations of those who use them - Alex Kozinski, Trademarks Unplugged, New York
University Law Review, vol. 68: 960, 965-966 [Oct. 1993].
[29]

Kozinski, supra, at 965-966; Callmann, supra, vol. 2, at 881-812 [1945], citing Schechter, The Historical
Foundations of the Law Relating to Trademarks [1925], Note 15, p. 64.
[30]

Gross, supra, at 1099-1100; see also Dissenting opinion of Justice Feliciano in Philip Morris, supra, at 625-626.
[31]

The Internet is a decentralized computer network linked together through routers and communications protocols
that enable anyone connected to it to communicate with others likewise connected, regardless of physical
location. Users of the Internet have a wide variety of communication methods available to them and a tremendous
wealth of information that they may access. The growing popularity of the Net has been driven in large part by the
World Wide Web, i.e., a system that facilitates use of the Net by sorting through the great mass of information
available on it. Advertising on the Net and cybershopping are turning the Internet into a commercial marketplace.--
Maureen O'Rourke, Fencing Cyberspace: Drawing Borders in a Virtual World, Minnesota Law Review, vol. 82:
609-611, 615-618 [Feb. 1998].
[32]

Petition, pp. 9-10, Rollo, pp. 15-16.
[33]

Id.
[34]

46 Am Jur 2d, "Judgments," Sec. 394 [1969 ed.].
[35]

Section 49 (b), Rule 39 of the Revised Rules of Court-- now Section 47 (b), Rule 39 of the 1997 Rules of Civil
Procedure; Gabuya v. Layug, 250 SCRA 218, 221 [1995]; Vda. de Cruzo v. Carriaga, Jr., 174 SCRA 330, 338
[1989].
[36]

De Knecht v. Court of Appeals, 290 SCRA 223, 237-238 [1998]; De Ramos v. Court of Appeals, 213 SCRA
207, 214-215 [1992]; American Inter-Fashion Corp. v. Office of the President, 197 SCRA 409, 417 [1991];
Wolverine Worldwide, Inc. v. Court of Appeals, 169 SCRA 627, 630 [1989].
[37]

Petition, pp. 8-10, Rollo, pp. 14-16; Comment of the Solicitor General, pp. 15-19, Rollo, pp. 126-130.
[38]

Rollo, pp. 37-38.
[39]

Mendiola v. Court of Appeals, 258 SCRA 492, 500 [1996].
[40]

Mendiola v. Court of Appeals, supra, at 500-501; Nabus v. Court of Appeals, 193 SCRA 732, 740 [1991] citing
50 C.J.S. 51-53.
[41]

Article 1, Paris Convention, 61 O.G. 8010 [1965].
[42]

R. Agpalo, Trademark Law and Practice in the Philippines, p. 200 [1990].
[43]

Agpalo, supra, at 200-201.
[44]

Rudolf Callmann, The Law of Unfair Competition and Trade-Marks, vol. 2, p. 1723 [1945].
[45]

Belgium, Brazil, France, Guatemala, Italy, the Netherlands, Portugal, Salvador, Serbia, Spain and Switzerland.
[46]

61 O.G. 8011.
[47]

Note 18, Dissenting Opinion of Justice Florentino Feliciano in Philip Morris, Inc. v. Court of Appeals, 224
SCRA 599, 615 [1993]. The President of the Philippines signed the instrument of adherence on July 21, 1965--
Agpalo, supra, at 201.
[48]

Id; see also Note 9, Smith Kline & French Laboratories, Ltd. v. Court of Appeals, 276 SCRA 224, 236 [1997];
Converse Rubber Corp. v. Universal Rubber Products, 147 SCRA 154, 165 [1987].
[49]

La Chemise Lacoste, S.A. v. Fernandez, 129 SCRA 373, 389 [1984].
[50]

As revised under the Lisbon Act of 1958. At the time the Philippines ratified the Paris Convention in 1965, the
last revision was the Lisbon Act. At present, the latest revision is the Stockholm Act passed on July 14, 1967 and
amended on October 2, 1979. The Philippines acceded to the Stockholm Act on March 25, 1980 but only with
respect to Articles 13-30. The Stockholm Act took effect in the Philippines on July 16, 1980, except as to its
Articles 1-12-- Esteban B. Bautista, The TRIPS Agreement and the Philippines' Existing Treaty Obligations on
Intellectual Property, The World Bulletin, pub. by the Institute of International and Legal Studies, UP Law Center,
vol. 12:50 [Jan-June 1996]; Intellectual Property in the Phil., A Compilation of Phil. Laws and International
Documents Pertaining to Intellectual Property, ed. by Aniano L. Luzung, pub. by Rex Bookstore, p. 416
[1995]. With the Philippines' adhesion to the WTO and the TRIPS Agreement in 1995, however, the country
obligated itself to comply with Articles 1-12 and 19 of the Paris Convention-- Article 2(1), TRIPs Agreement.
[51]

Stephen P. Ladas, Patents, Trademarks, and Related Rights, National and International Protection, pub. by the
Harvard University Press, vol. 2, at 1251-1252 [1975].
[52]

The Paris Convention has 3 classes of provisions: (1) provisions obligating members of the Union to create and
maintain certain national law or regulations; (2) provisions merely referring to the national law of each country and
making it applicable or permitting each country to pass such legislation as it may choose; and (3) provisions
establishing common legislation for all members of the Union and obligating them to grant to persons entitled to the
benefits of the Convention the rights and advantages specified in such provisions, notwithstanding anything in their
national law to the contrary-- Ladas, supra, at 209; see also Callman, supra, vol. 2, at 1723-1724. Provisions under
the third class are self-executing and Article 6bis is one of them-- Ladas, supra, vol. 1, at 209.
[53]

Ladas, supra, vol.1, p. 233.
[54]

Ladas, supra, vol. 2, pp. 1252-1254.
[55]

Also quoted in La Chemise Lacoste, S.A. v. Fernandez, supra, at 389-390.
[56]

This CA decision, penned by then CA Justice Vicente V. Mendoza, now a member of this Court, was the same
decision affirmed by the Supreme Court in La Chemise Lacoste v. Fernandez, G.R. Nos. L-63796-97 and L-65659,
129 SCRA 373 [1984].
[57]

Should have been "Article" 6bis.
[58]

Also quoted in La Chemise Lacoste, S.A. v. Fernandez, supra, at 401-403.
[59]

E.O. No. 913 is entitled "Strengthening the Rule-Making and Adjudicatory Powers of the Minister of Trade and
Industry in Order to Further Protect Consumers."
[60]

129 SCRA 373 [1984].
[61]

Id. at 396; see also Ignacio S. Sapalo, Background Reading Material on the Intellectual Property System of the
Philippines, revised ed., pub. by World Intellectual Property Office (WIPO), p. 76 [1994]. I. Sapalo was the
Director of the Bureau of Patents, Trademarks and Technology Transfer (BPTTT), Department of Trade and
Industry (DTI) from 1987 to 1996.
[62]

169 SCRA 627 [1989].
[63]

Id. at 631.
[64]

Id. at 633.
[65]

Id. at 634.
[66]

Private respondent presented evidence before the Director of Patents showing that the word "Barbizon" was
derived from the name of a village in France. In this village, a mid-19th century school of French painting
developed an art style depicting landscape and rural genre subjects from a direct observation of nature, with much
attention to the expression of light and atmosphere. "Barbizon" was appropriated as a trademark in 1933 by
Garfinkle and Ritter, private respondent's predecessor, to identify its goods with the same soft and warm atmosphere
depicted in the barbizon style of painting-- Exhibits "B" and "I," see Petition for Review, Court of Appeals Rollo, p.
3.
[67]

Caina v. Court of Appeals, 239 SCRA 252, 264 [1994] citing Lord v. Garland, 168 P. 2d 5 [1946]; see also
Martinez v. Court of Appeals, 139 SCRA 558, 564 [1985].
[68]
Caina v. Court of Appeals, supra, at 263 [1994]; see also Guevara v. Benito, 247 SCRA 570, 573 [1995].
[69]

Id., citing Lord v. Garland, 168 P. 2d [1946]; Rhodes v. Van Steenberg, 225 F. Supp. 113 [1963]; Cowan v. Gulf
City Fisheries, Inc., 381 So. 2d 158 [1980]; see also 46 Am Jur 2d, "Judgments," Secs. 443, 444 [1969 ed.]
[70]
Section 4 (d), R.A. 166 reads:
"Sec. 4. Registration of trademarks, tradenames and servicemarks on the principal register.-- There is hereby
established a register of trademarks, tradenames and servicemarks which shall be known as the principal
register. The owner of a trademark, tradename or servicemark used to distinguish his goods, business or services
from the goods, business or services of others shall have the right to register the same on the principal register,
unless it:
x x x
(d) Consists of or comprises a mark or tradename which so resembles a mark or tradename registered in the
Philippines or a mark or tradename previously used in the Philippines by another and not abandoned, as to be likely,
when applied to or used in connection with the goods, business or services of the applicant, to cause confusion or
mistake or to deceive purchasers; x x x."
[71]

Section 8, R.A. 166 reads:
"Sec. 8. Opposition.-- Any person who believes that he would be damaged by the registration of a mark or
tradename may, upon payment of the required fee and within thirty days after the publication under the first
paragraph of section 7 hereof, file with the Director an opposition to the application. x x x."
[72]

The Paris Convention became part of the Trademark Law only by reference in Section 37 of the latter. Of and
by itself, the Paris Convention is a separate legal covenant.
[73]

Nabus v. Court of Appeals, 193 SCRA 732, 743, 746 [1991]; see also 50 C.J.S. "Judgments, Sec. 674-- also cited
in Nabus, at 743.
[74]

Nabus, supra, at 743; see also 50 C.J.S. "Judgments," Secs. 649, 655-- also cited in Nabus.
[75]
Mishawaka R. & W. Mfg. Co. v. S. S. Kresge Co., 86 L ed 1381, 316 U.S. 203, 205 [1942]; see also Gordon
V. Smith, Trademark Valuation, pub. by John Wiley & Sons, Inc., pp. 38-39 [1997].
[76]

Ladas, supra, vol. 1, at 13.
[77]

Id.
[78]

Section 2, R.A. 8293, the Intellectual Property Code of 1998.
[79]

Section 239, R.A. No. 8293.
[80]

R.A. No. 166.
[81]

R.A. No. 165.
[82]

Presidential Decree (P.D.) No. 49.
[83]

P.D. No. 285.
[84]

Emma C. Francisco, The Policy of Intellectual Property Protection in the Philippines, The World Bulletin, pub.
by the UP Law Center, vol. 12:1 [Jan-June 1996]-- Ms. Francisco was the Director of the BPTTT in 1996.
[85]

Michael Blakeney, Trade Related Aspects of Intellectual Property Rights: A Concise Guide to the TRIPs
Agreement, pub. by Sweet & Maxwell Ltd, at 37 [1996]; The WTO was created at the Uruguay Round of
multilateral trade negotiations sponsored by the General Agreement on Tariffs and Trade (GATT) in 1994. The
GATT was established in 1947 to promote a multilateral trading system among countries through non-
discriminatory trade liberalization, and through fair and effective rules and disciplines. The GATT was composed
of 120 contracting parties and observers that account for about 90% of the world trade. It, however, dealt with trade
in tangible goods alone. As successor of the GATT, the WTO also covers trade in services, intellectual property
rights and provides for an effective mechanism for dispute settlement-- Growth Opportunities Into the 21st Century,
A Question and Answer Primer Prepared by the Bureau of International Trade Relations, Department of Trade and
Industry, pp. 1, 37 [1994], hereinafter referred to as DTI-BITR Primer ; see News of the Uruguay Round of
Multilateral Trade Negotiations, issued by the Information and Media Relations division of the GATT, Geneva, p. 5
[5 April 1994]; see also Tanada v. Angara, 272 SCRA 18 [1997].
[86]

The TRIPS Agreement is said to be the most comprehensive multilateral agreement on intellectual property. It
addresses not only and more explicitly the primary regimes of intellectual property, viz., patent including the
protection of new varieties of plants, trademarks including service marks, and copyright and its related rights; but
also the non-traditional categories of geographical indications including appellations of origin, industrial design, lay-
out design of integrated circuits, and undisclosed information including trade secrets. It also establishes standards of
protection and rules of enforcement and provides for the uniform applicability of the WTO dispute settlement
mechanism to resolve disputes among member states. -- Anita S. Regalado, WTO Dispute Settlement Procedure: Its
Impact on Copyright Protection, The Court Systems Journal, vol. 3: 67, 78 [March 1998].
[87]

Ma. Rowena R. Gonzales, Optimizing Rome in TRIPs: Finding the Appian Way, World Bulletin, pub. by the
UP Law Center, vol. 12: 13, 18 [Jan.-June 1996].
[88]

TRIPS Agreement, Article 1, par. 3.
[89]

As acknowledged in the Uruguay Round of the GATT-- DTI-BITR Primer, supra, at p. 34.
[90]

Id.; Blakeney, supra, at 1; Investors abandoned or postponed their investments in countries that did not afford
protection from intellectual piracy (DTI-BITR Primer, supra, at 34); Worse, inadequate intellectual protection in
certain countries gave rise to trade retaliation unilaterally imposed by rich trading partners--DTI-BITR
Primer, supra, at 36; Blakeney, supra, at 4-6. The United States, in the 1984 amendment to Section 301 of the
Trade Act of 1974, and later, Special 301 of the Omnibus Trade and Competitiveness Act of 1988, authorized the
U.S. Trade Representative (USTR) to identify priority foreign countries which deny adequate protection of
intellectual property rights to U.S. traders. Those countries were placed on a watchlist, with a view to fast-track
investigation, followed by trade retaliation in the form of increased duties and import restrictions. Trade restrictions
were imposed on Korea and Brazil in 1985, Brazil again in 1988 and India in 1992 --Blakeney, supra, at 4-6. By
these acts, any trading partner of the U.S. became vulnerable to unilateral pressure-- The GATT, the Uruguay Round
and the Philippines, Speech of J. Antonio Buencamino, Director, Bureau of International Trade Relations, DTI, p. 4.
[91]

Speech of J. Antonio Buencamino, Director, DTI-BITR, supra, at 4-5; DTI-BITR Primer, supra, at 34-36.

[92]

Tanada v. Angara, 272 SCRA 18, 28 [1997].
[93]

Blakeney, supra, at 36-37-- citing The Marrakesh Declaration of 15 April 1995, par. 2.
FIRST DIVISION
G.R. No. 184850 : October 20, 2010
E.Y. INDUSTRIAL SALES, INC. and ENGRACIO YAP, Petitioners, v. SHEN DAR ELECTRICITY AND
MACHINERY CO., LTD., Respondent.cralaw
D E C I S I O N
VELASCO, JR., J.:
The Case
This Petition for Review on Certiorari under Rule 45 seeks to nullify and reverse the February 21, 2008
Decision
1
cra1aw and the October 6, 2008 Resolution
2
cra1aw rendered by the Court of Appeals (CA) in CA-G.R. SP No.
99356 entitled Shen Dar Electricity and Machinery Co., Ltd. v. E.Y. Industrial Sales, Inc. and Engracio Yap.
The assailed decision reversed the Decision dated May 25, 2007
3
cra1aw issued by the Director General of
the Intellectual Property Office (IPO) in Inter Partes Case No. 14-2004-00084. The IPO Director General
upheld Certificate of Registration (COR) No. 4-1999-005393 issued by the IPO for the trademark "VESPA" in
favor of petitioner E.Y. Industrial Sales, Inc. (EYIS), but ordered the cancellation of COR No. 4-1997-
121492, also for the trademark "VESPA," issued in favor of respondent Shen Dar Electricity and Machinery
Co., Ltd. (Shen Dar). The Decision of the IPO Director General, in effect, affirmed the Decision dated May
29, 2006
4
cra1aw issued by the Director of the Bureau of Legal Affairs (BLA) of the IPO.
The Facts
EYIS is a domestic corporation engaged in the production, distribution and sale of air compressors and other
industrial tools and equipment.
5
cra1aw Petitioner Engracio Yap is the Chairman of the Board of Directors of
EYIS.
6
chanroblesvi rtual lawlibrary
Respondent Shen Dar is a Taiwan-based foreign corporation engaged in the manufacture of air
compressors.
7
chanroblesvirtuallawlibrary
Both companies claimed to have the right to register the trademark "VESPA" for air compressors.
From 1997 to 2004, EYIS imported air compressors from Shen Dar through sales contracts. In the Sales
Contract dated April 20, 2002,
8
cra1aw for example, Shen Dar would supply EYIS in one (1) year with 24 to 30
units of 40-ft. containers worth of air compressors identified in the Packing/Weight Lists simply as SD-23,
SD-29, SD-31, SD-32, SD-39, SD-67 and SD-68. In the corresponding Bill of Ladings, the items were
described merely as air compressors.
9
cra1aw There is no documentary evidence to show that such air compressors
were marked "VESPA."
On June 9, 1997, Shen Dar filed Trademark Application Serial No. 4-1997-121492 with the IPO for the mark
"VESPA, Chinese Characters and Device" for use on air compressors and welding machines.
10
chanroblesvirtuallawl ibrary
On July 28, 1999, EYIS filed Trademark Application Serial No. 4-1999-005393, also for the mark "VESPA,"
for use on air compressors.
11
cra1aw On January 18, 2004, the IPO issued COR No. 4-1999-005393 in favor of
EYIS.
12
cra1aw Thereafter, on February 8, 2007, Shen Dar was also issued COR No. 4-1997-121492.
13
chanroblesvi rtual lawlibrary
In the meantime, on June 21, 2004, Shen Dar filed a Petition for Cancellation of EYIS COR with the
BLA.
14
cra1aw In the Petition, Shen Dar primarily argued that the issuance of the COR in favor of EYIS violated
Section 123.1 paragraphs (d), (e) and (f) of Republic Act No. (RA) 8293, otherwise known as the Intellectual
Property Code (IP Code), having first filed an application for the mark. Shen Dar further alleged that EYIS
was a mere distributor of air compressors bearing the mark "VESPA" which it imported from Shen Dar. Shen
Dar also argued that it had prior and exclusive right to the use and registration of the mark "VESPA" in the
Philippines under the provisions of the Paris Convention.
15
chanroblesvirtuallawlibrary
In its Answer, EYIS and Yap denied the claim of Shen Dar to be the true owners of the mark "VESPA" being
the sole assembler and fabricator of air compressors since the early 1990s. They further alleged that the air
compressors that Shen Dar allegedly supplied them bore the mark "SD" for Shen Dar and not "VESPA."
Moreover, EYIS argued that Shen Dar, not being the owner of the mark, could not seek protection from the
provisions of the Paris Convention or the IP Code.
16
chanroblesvirtual lawlibrary
Thereafter, the Director of the BLA issued its Decision dated May 29, 2006 in favor of EYIS and against Shen
Dar, the dispositive portion of which reads:chanroblesvi rtualawlibrary
WHEREFORE, premises considered, the Petition for Cancellation is, as it is hereby, DENIED. Consequently,
Certificate of Registration No. 4-1999-[005393] for the mark "VESPA" granted in the name of E.Y. Industrial
Sales, Inc. on 9 January 2007 is hereby upheld.
Let the filewrapper of VESPA subject matter of this case be forwarded to the Administrative, Financial and
Human Resource Development Services Bureau for issuance and appropriate action in accordance with this
DECISION and a copy thereof furnished to the Bureau of Trademarks for information and update of its
records.
SO ORDERED.
17
chanroblesvirtuallawl ibrary
Shen Dar appealed the decision of the BLA Director to the Director General of the IPO. In the appeal, Shen
Dar raised the following issues:chanroblesvirtualawl ibrary
1. Whether the BLA Director erred in ruling that Shen Dar failed to present evidence;
2. Whether the registration of EYIS application was proper considering that Shen Dar was the first to file an
application for the mark; and
3. Whether the BLA Director correctly ruled that EYIS is the true owner of the mark.
18
chanroblesvirtuallawlibrary
Later, the IPO Director General issued a Decision dated May 25, 2007 upholding the COR issued in favor of
EYIS while cancelling the COR of Shen Dar, the dispositive portion of which reads:chanroblesvirtualawl ibrary
WHEREFORE, premises considered, the appeal is DENIED. Certificate of Registration No. 4-1999-005393 for
the mark VESPA for air compressor issued in favor of Appellee is hereby upheld. Consequently, Certificate of
Registration No. 4-1997-121492 for the mark VESPA, Chinese Characters & Device for goods air compressor
and spot welding machine issued in favor of Appellant is hereby ordered cancelled.
Let a copy of this Decision as well as the records of this case be furnished and returned to the Director of
Bureau of Legal Affairs for appropriate action. Further, let also the Directors of the Bureau of Trademarks,
the Administrative, Financial and Human Resources Development Services Bureau, and the Documentation,
Information and Technology Transfer Bureau be furnished a copy of this Decision for information, guidance,
and records purposes.
19
chanroblesvirtual lawlibrary
Shen Dar appealed the above decision of the IPO Director General to the CA where Shen Dar raised the
following issues:chanroblesvirtualawl ibrary
1. Whether Shen Dar is guilty of forum shopping;
2. Whether the first-to-file rule applies to the instant case;
3. Whether Shen Dar presented evidence of actual use;
4. Whether EYIS is the true owner of the mark "VESPA";
5. Whether the IPO Director General erred in cancelling Shen Dars COR No. 4-1997-121492 without a
petition for cancellation; and
6. Whether Shen Dar sustained damages.
20
chanroblesvi rtual lawlibrary
In the assailed decision, the CA reversed the IPO Director General and ruled in favor of Shen Dar. The
dispositive portion states:chanroblesvirtualawl ibrary
WHEREFORE, premises considered, the petition is GRANTED. Consequently, the assailed decision of the
Director General of the Intellectual Property Office dated May 25, 2007 is hereby REVERSED and SET ASIDE.
In lieu thereof, a new one is entered: a) ordering the cancellation of Certificate of Registration No. 4-1999-
005393 issued on January 19, 2004 for the trademark VESPA in favor of E.Y. Industrial Sales, Inc.; b)
ordering the restoration of the validity of Certificate of Registration No. 4-1997-121492 for the trademark
VESPA in favor of Shen Dar Electricity and Machinery Co., Ltd. No pronouncement as to costs.
SO ORDERED.
21
chanroblesvirtuallawl ibrary
In ruling for Shen Dar, the CA ruled that, despite the fact that Shen Dar did not formally offer its evidence
before the BLA, such evidence was properly attached to the Petition for Cancellation. As such, Shen Dars
evidence may be properly considered. The CA also enunciated that the IPO failed to properly apply the
provisions of Sec. 123.1(d) of RA 8293, which prohibits the registration of a trademark in favor of a party
when there is an earlier filed application for the same mark. The CA further ruled that Shen Dar should be
considered to have prior use of the mark based on the statements made by the parties in their respective
Declarations of Actual Use. The CA added that EYIS is a mere importer of the air compressors with the mark
"VESPA" as may be gleaned from its receipts which indicated that EYIS is an importer, wholesaler and
retailer, and therefore, cannot be considered an owner of the mark.
22
chanroblesvirtual lawlibrary
EYIS filed a motion for reconsideration of the assailed decision which the CA denied in the assailed
resolution.
Hence, the instant appeal.
Issues
EYIS and Yap raise the following issues in their petition:chanroblesvirtualawl ibrary
A. Whether the Director General of the IPO correctly upheld the rights of Petitioners over the trademark
VESPA.
B. Whether the Director General of the IPO can, under the circumstances, order the cancellation of
Respondents certificate of registration for VESPA, which has been fraudulently obtained and erroneously
issued.
C. Whether the Honorable Court of Appeals was justified in reversing the findings of fact of the IPO, which
affirm the rights of Petitioner EYIS over the trademark VESPA and when such findings are supported by the
evidence on record.
D. Whether this Honorable Court may review questions of fact considering that the findings of the Court of
Appeals and the IPO are in conflict and the conclusions of the appellee court are contradicted by the
evidence on record.
23
chanroblesvirtuallawlibrary
The Ruling of the Court
The appeal is meritorious.
First Issue:chanroblesvirtualawlibrary
Whether this Court may review the questions of fact presented
Petitioners raise the factual issue of who the true owner of the mark is. As a general rule, this Court is not a
trier of facts. However, such rule is subject to exceptions.
In New City Builders, Inc. v. National Labor Relations Commission,
24
cra1aw the Court ruled that:chanroblesvirtualawl ibrary
We are very much aware that the rule to the effect that this Court is not a trier of facts admits of
exceptions. As we have stated in Insular Life Assurance Company, Ltd. vs. CA:chanroblesvirtualawli brary
[i]t is a settled rule that in the exercise of the Supreme Courts power of review, the Court is not a trier of
facts and does not normally undertake the re-examination of the evidence presented by the contending
parties during the trial of the case considering that the findings of facts of the CA are conclusive and binding
on the Court. However, the Court had recognized several exceptions to this rule, to wit: (1) when the
findings are grounded entirely on speculation, surmises or conjectures; (2) when the inference made is
manifestly mistaken, absurd or impossible; (3) when there is grave abuse of discretion; (4) when the
judgment is based on a misapprehension of facts; (5) when the findings of facts are conflicting; (6) when in
making its findings the Court of Appeals went beyond the issues of the case, or its findings are contrary to
the admissions of both the appellant and the appellee; (7) when the findings are contrary to the trial
court; (8) when the findings are conclusions without citation of specific evidence on which they are based;
(9) when the facts set forth in the petition as well as in the petitioners main and reply briefs are not
disputed by the respondent; (10) when the findings of fact are premised on the supposed absence of
evidence and contradicted by the evidence on record; and (11) when the Court of Appeals manifestly
overlooked certain relevant facts not disputed by the parties, which, if properly considered, would justify a
different conclusion. (Emphasis supplied.)
In the instant case, the records will show that the IPO and the CA made differing conclusions on the issue of
ownership based on the evidence presented by the parties. Hence, this issue may be the subject of this
Courts review.
Second Issue:
Whether evidence presented before the BLA must be formally offered
Preliminarily, it must be noted that the BLA ruled that Shen Dar failed to adduce evidence in support of its
allegations as required under Office Order No. 79, Series of 2005, Amendments to the Regulations on Inter
Partes Proceedings, having failed to formally offer its evidence during the proceedings before it. The BLA
ruled:chanroblesvirtualawli brary
At the outset, we note petitioners failure to adduce any evidence in support of its allegations in the Petition
for Cancellation. Petitioner did not file nor submit its marked evidence as required in this Bureaus Order No.
2006-157 dated 25 January 2006 in compliance with Office Order No. 79, Series of 2005, Amendments to
the Regulations on Inter Partes Proceedings.
25
cra1aw x x x
In reversing such finding, the CA cited Sec. 2.4 of BLA Memorandum Circular No. 03, Series of 2005, which
states:chanroblesvi rtualawlibrary
Section 2.4. In all cases, failure to file the documentary evidences in accordance with Sections 7 and 8 of
the rules on summary proceedings shall be construed as a waiver on the part of the parties. In such a case,
the original petition, opposition, answer and the supporting documents therein shall constitute the entire
evidence for the parties subject to applicable rules.
The CA concluded that Shen Dar needed not formally offer its evidence but merely needed to attach its
evidence to its position paper with the proper markings,
26
cra1aw which it did in this case.
The IP Code provides under its Sec. 10.3 that the Director General of the IPO shall establish the procedure
for the application for the registration of a trademark, as well as the opposition to it:chanroblesvi rtualawlibrary
Section 10. The Bureau of Legal Affairs.The Bureau of Legal Affairs shall have the following functions:chanroblesvi rtualawlibrary
x x x x
10.3. The Director General may by Regulations establish the procedure to govern the implementation of this
Section.
Thus, the Director General issued Office Order No. 79, Series of 2005 amending the regulations on Inter
Partes Proceedings, Sec. 12.1 of which provides:chanroblesvi rtualawlibrary
Section 12. Evidence for the Parties
12.1. The verified petition or opposition, reply if any, duly marked affidavits of the witnesses, and the
documents submitted, shall constitute the entire evidence for the petitioner or opposer. The verified answer,
rejoinder if any, and the duly marked affidavits and documents submitted shall constitute the evidence for
the respondent. Affidavits, documents and other evidence not submitted and duly marked in accordance
with the preceding sections shall not be admitted as evidence.
The preceding sections referred to in the above provision refer to Secs. 7.1, 8.1 and 9 which, in turn,
provide:chanroblesvirtualawl ibrary
Section 7. Filing of Petition or Opposition
7.1. The petition or opposition, together with the affidavits of witnesses and originals of the documents and
other requirements, shall be filed with the Bureau, provided, that in case of public documents, certified
copies shall be allowed in lieu of the originals. The Bureau shall check if the petition or opposition is in due
form as provided in the Regulations particularly Rule 3, Section 3; Rule 4, Section 2; Rule 5, Section 3; Rule
6, Section 9; Rule 7, Sections 3 and 5; Rule 8, Sections 3 and 4. For petition for cancellation of layout
design (topography) of integrated circuits, Rule 3, Section 3 applies as to the form and requirements. The
affidavits, documents and other evidence shall be marked consecutively as "Exhibits" beginning with the
letter "A".
Section 8. Answer
8.1. Within three (3) working days from receipt of the petition or opposition, the Bureau shall issue an order
for the respondent to file an answer together with the affidavits of witnesses and originals of documents,
and at the same time shall notify all parties required to be notified in the IP Code and these Regulations,
provided, that in case of public documents, certified true copies may be submitted in lieu of the originals.
The affidavits and documents shall be marked consecutively as "Exhibits" beginning with the number "1".
Section 9. Petition or Opposition and Answer must be verified Subject to Rules 7 and 8 of these regulations,
the petition or opposition and the answer must be verified. Otherwise, the same shall not be considered as
having been filed.
In other words, as long as the petition is verified and the pieces of evidence consisting of the affidavits of
the witnesses and the original of other documentary evidence are attached to the petition and properly
marked in accordance with Secs. 7.1 and 8.1 abovementioned, these shall be considered as the evidence of
the petitioner. There is no requirement under the abovementioned rules that the evidence of the parties
must be formally offered to the BLA.
In any case, as a quasi-judicial agency and as stated in Rule 2, Sec. 5 of the Regulations on Inter Partes
Proceedings, the BLA is not bound by technical rules of procedure. The evidence attached to the petition
may, therefore, be properly considered in the resolution of the case.
Third Issue:
Whether the IPO Director General can
validly cancel Shen Dars Certificate of Registration
In his Decision, the IPO Director General stated that, despite the fact that the instant case was for the
cancellation of the COR issued in favor of EYIS, the interests of justice dictate, and in view of its findings,
that the COR of Shen Dar must be cancelled. The Director General explained:chanroblesvirtualawl ibrary
Accordingly, while the instant case involves a petition to cancel the registration of the Appellees trademark
VESPA, the interest of justice requires that Certificate of Registration No. 4-1997-121492 be cancelled.
While the normal course of proceedings should have been the filing of a petition for cancellation of
Certificate of Registration No. 4-1997-121492, that would involve critical facts and issues that have already
been resolved in this case. To allow the Applicant to still maintain in the Trademark Registry Certificate of
Registration No. 4-1997-121492 would nullify the exclusive rights of Appellee as the true and registered
owner of the mark VESPA and defeat the purpose of the trademark registration system.
27
chanroblesvirtuallawl ibrary
Shen Dar challenges the propriety of such cancellation on the ground that there was no petition for
cancellation as required under Sec. 151 of RA 8293.
Office Order No. 79, Series of 2005, provides under its Sec. 5 that:chanroblesvi rtualawlibrary
Section 5. Rules of Procedure to be followed in the conduct of hearing of Inter Partes cases.The rules of
procedure herein contained primarily apply in the conduct of hearing of Inter Partes cases. The Rules of
Court may be applied suppletorily. The Bureau shall not be bound by strict technical rules of procedure and
evidence but may adopt, in the absence of any applicable rule herein, such mode of proceedings which is
consistent with the requirements of fair play and conducive to the just, speedy and inexpensive disposition
of cases, and which will give the Bureau the greatest possibility to focus on the contentious issues before it.
(Emphasis supplied.)
The above rule reflects the oft-repeated legal principle that quasi-judicial and administrative bodies are not
bound by technical rules of procedure. Such principle, however, is tempered by fundamental evidentiary
rules, including due process. Thus, we ruled in Aya-ay, Sr. v. Arpaphil Shipping Corp.:
28
chanroblesvi rtual lawlibrary
That administrative quasi-judicial bodies like the NLRC are not bound by technical rules of procedure in the
adjudication of cases does not mean that the basic rules on proving allegations should be entirely dispensed
with. A party alleging a critical fact must still support his allegation with substantial evidence. Any decision
based on unsubstantiated allegation cannot stand as it will offend due process.
x x x The liberality of procedure in administrative actions is subject to limitations imposed by basic
requirements of due process. As this Court said in Ang Tibay v. CIR, the provision for flexibility in
administrative procedure "does not go so far as to justify orders without a basis in evidence having rational
probative value." More specifically, as held in Uichico v. NLRC:chanroblesvirtualawl ibrary
It is true that administrative and quasi-judicial bodies like the NLRC are not bound by the technical rules of
procedure in the adjudication of cases. However, this procedural rule should not be construed as a license to
disregard certain fundamental evidentiary rules.
This was later reiterated in Lepanto Consolidated Mining Company v. Dumapis:
29
chanroblesvirtuallawl ibrary
While it is true that administrative or quasi-judicial bodies like the NLRC are not bound by the technical rules
of procedure in the adjudication of cases, this procedural rule should not be construed as a license to
disregard certain fundamental evidentiary rules. The evidence presented must at least have a modicum of
admissibility for it to have probative value. Not only must there be some evidence to support a finding or
conclusion, but the evidence must be substantial. Substantial evidence is more than a mere scintilla. It
means such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.
Thus, even though technical rules of evidence are not strictly complied with before the LA and the NLRC,
their decision must be based on evidence that must, at the very least, be substantial.
The fact that no petition for cancellation was filed against the COR issued to Shen Dar does not preclude the
cancellation of Shen Dars COR. It must be emphasized that, during the hearing for the cancellation of EYIS
COR before the BLA, Shen Dar tried to establish that it, not EYIS, was the true owner of the mark "VESPA"
and, thus, entitled to have it registered. Shen Dar had more than sufficient opportunity to present its
evidence and argue its case, and it did. It was given its day in court and its right to due process was
respected. The IPO Director Generals disregard of the procedure for the cancellation of a registered mark
was a valid exercise of his discretion.
Fourth Issue:
Whether the factual findings of the IPO are binding on the CA
Next, petitioners challenge the CAs reversal of the factual findings of the BLA that Shen Dar and not EYIS is
the prior user and, therefore, true owner of the mark. In arguing its position, petitioners cite numerous
rulings of this Court where it was enunciated that the factual findings of administrative bodies are given
great weight if not conclusive upon the courts when supported by substantial evidence.
We agree with petitioners that the general rule in this jurisdiction is that the factual findings of
administrative bodies deserve utmost respect when supported by evidence. However, such general rule is
subject to exceptions.
In Fuentes v. Court of Appeals,
30
cra1aw the Court established the rule of conclusiveness of factual findings of the
CA as follows:chanroblesvi rtualawlibrary
Jurisprudence teaches us that "(a)s a rule, the jurisdiction of this Court in cases brought to it from the Court
of Appeals x x x is limited to the review and revision of errors of law allegedly committed by the appellate
court, as its findings of fact are deemed conclusive. As such this Court is not duty-bound to analyze and
weigh all over again the evidence already considered in the proceedings below. This rule, however, is not
without exceptions." The findings of fact of the Court of Appeals, which are as a general rule deemed
conclusive, may admit of review by this Court:chanroblesvirtualawli brary
(1) when the factual findings of the Court of Appeals and the trial court are contradictory;
(2) when the findings are grounded entirely on speculation, surmises, or conjectures;
(3) when the inference made by the Court of Appeals from its findings of fact is manifestly mistaken,
absurd, or impossible;
(4) when there is grave abuse of discretion in the appreciation of facts;
(5) when the appellate court, in making its findings, goes beyond the issues of the case, and such findings
are contrary to the admissions of both appellant and appellee;
(6) when the judgment of the Court of Appeals is premised on a misapprehension of facts;
(7) when the Court of Appeals fails to notice certain relevant facts which, if properly considered, will justify a
different conclusion;
(8) when the findings of fact are themselves conflicting;
(9) when the findings of fact are conclusions without citation of the specific evidence on which they are
based; and
(10) when the findings of fact of the Court of Appeals are premised on the absence of evidence but such
findings are contradicted by the evidence on record. (Emphasis supplied.)
Thereafter, in Villaflor v. Court of Appeals,
31
cra1aw this Court applied the above principle to factual findings of
quasi-judicial bodies, to wit:chanroblesvirtualawl ibrary
Proceeding by analogy, the exceptions to the rule on conclusiveness of factual findings of the Court of
Appeals, enumerated in Fuentes vs. Court of Appeals, can also be applied to those of quasi-judicial bodies x
x x. (Emphasis supplied.)
Here, the CA identified certain material facts that were allegedly overlooked by the BLA and the IPO Director
General which it opined, when correctly appreciated, would alter the result of the case. An examination of
the IPO Decisions, however, would show that no such evidence was overlooked.
First, as to the date of first use of the mark by the parties, the CA stated:chanroblesvirtualawl ibrary
To begin with, when respondents-appellees filed its application for registration of the VESPA trademark on
July 28, 1999, they stated under oath, as found in their DECLARATION OF ACTUAL USE, that their first use
of the mark was on December 22, 1998. On the other hand, [Shen Dar] in its application dated June 09,
1997 stated, likewise under oath in their DECLARATION OF ACTUAL USE, that its first use of the mark was in
June 1996. This cannot be made any clearer. [Shen Dar] was not only the first to file an application for
registration but likewise first to use said registrable mark.
32
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Evidently, the CA anchors its finding that Shen Dar was the first to use the mark on the statements of the
parties in their respective Declarations of Actual Use. Such conclusion is premature at best. While a
Declaration of Actual Use is a notarized document, hence, a public document, it is not conclusive as to the
fact of first use of a mark. The declaration must be accompanied by proof of actual use as of the date
claimed. In a declaration of actual use, the applicant must, therefore, present evidence of such actual use.
The BLA ruled on the same issue, as follows:chanroblesvi rtualawlibrary
More importantly, the private respondents prior adoption and continuous use of the mark VESPA on air
compressors is bolstered by numerous documentary evidence consisting of sales invoices issued in the name
of E.Y. Industrial and Bill of Lading (Exhibits 4 to 375). Sales Invoice No. 12075 dated March 27, 1995
antedates petitioners date of first use on January 1, 1997 indicated in its trademark application filed on June
9, 1997 as well as the date of first use in June of 1996 as indicated in the Declaration of Actual Use
submitted on December 3, 2001 (Exhibit 385). The use by respondent registrant in the concept of owner is
shown by commercial documents, sales invoices unambiguously describing the goods as "VESPA" air
compressors. Private respondents have sold the air compressors bearing the "VESPA" to various locations in
the Philippines, as far as Mindanao and the Visayas since the early 1990s. We carefully inspected the
evidence consisting of three hundred seventy-one (371) invoices and shipment documents which show that
VESPA air compressors were sold not only in Manila, but to locations such as Iloilo City, Cebu City,
Dumaguete City, Zamboanga City, Cagayan de Oro City, Davao City, to name a few. There is no doubt that
it is through private respondents efforts that the mark "VESPA" used on air compressors has gained
business goodwill and reputation in the Philippines for which it has validly acquired trademark rights.
Respondent E.Y. Industrials right has been preserved until the passage of RA 8293 which entitles it to
register the same.
33
chanroblesvi rtuallawlibrary
Comparatively, the BLAs findings were founded upon the evidence presented by the parties. An example of
such evidence is Invoice No. 12075 dated March 29, 1995
34
cra1aw where EYIS sold four units of VESPA air
compressors to Veteran Paint Trade Center. Shen Dar failed to rebut such evidence. The truth, as supported
by the evidence on record, is that EYIS was first to use the mark.
Moreover, the discrepancy in the date provided in the Declaration of Actual Use filed by EYIS and the proof
submitted was appropriately considered by the BLA, ruling as follows:chanroblesvirtualawli brary
On the contrary, respondent EY Industrial was able to prove the use of the mark "VESPA" on the concept of
an owner as early as 1991. Although Respondent E.Y. indicated in its trademark application that its first use
was in December 22, 1998, it was able to prove by clear and positive evidence of use prior to such date.
In Chuang Te v. Ng Kian-Guiab and Director of Patents, L-23791, 23 November 1966, the High Court
clarified: Where an applicant for registration of a trademark states under oath the date of his earliest use,
and later on he wishes to carry back his first date of use to an earlier date, he then takes on the greater
burden of presenting "clear and convincing evidence" of adoption and use as of that earlier date. (B.R. Baker
Co. vs. Lebrow Bros., 150 F. 2d 580.)
35
chanroblesvirtual lawlibrary
The CA further found that EYIS is not a manufacturer of air compressors but merely imports and sells them
as a wholesaler and retailer. The CA reasoned:chanroblesvi rtualawlibrary
Conversely, a careful perusal of appellees own submitted receipts shows that it is not manufacturer but an
importer, wholesaler and retailer. This fact is corroborated by the testimony of a former employee of
appellees. Admittedly too, appellees are importing air compressors from [Shen Dar] from 1997 to 2004.
These matters, lend credence to [Shen Dars] claim that the letters SD followed by a number inscribed in the
air compressor is only to describe its type, manufacturer business name and capacity. The VESPA mark is in
the sticker which is attached to the air compressors. The ruling of the Supreme Court, in the case of UNNO
Commercial Enterprises, Inc. vs. General Milling Corporation et al., is quite enlightening, thus We quote:chanroblesvi rtualawlibrary
"The term owner does not include the importer of the goods bearing the trademark, trade name, service
mark, or other mark of ownership, unless such importer is actually the owner thereof in the country from
which the goods are imported. Thus, this Court, has on several occasions ruled that where the applicants
alleged ownership is not shown in any notarial document and the applicant appears to be merely an
importer or distributor of the merchandise covered by said trademark, its application cannot be
granted."
36
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This is a non sequitur. It does not follow. The fact that EYIS described itself in its sales invoice as an
importer, wholesaler and retailer does not preclude its being a manufacturer. Sec. 237 of the National
Internal Revenue Code states:chanroblesvirtualawli brary
Section 237. Issuance of Receipts or Sales or Commercial Invoices.All persons subject to an internal revenue
tax shall, for each sale and transfer of merchandise or for services rendered valued at Twenty-five pesos
(P25.00) or more, issue duly registered receipts or sale or commercial invoices, prepared at least in
duplicate, showing the date of transaction, quantity, unit cost and description of merchandise or nature of
service: Provided, however, That where the receipt is issued to cover payment made as rentals,
commissions, compensation or fees, receipts or invoices shall be issued which shall show the name,
business style, if any, and address of the purchaser, customer or client.
The original of each receipt or invoice shall be issued to the purchaser, customer or client at the time the
transaction is effected, who, if engaged in business or in the exercise of profession, shall keep and preserve
the same in his place of business for a period of three (3) years from the close of the taxable year in which
such invoice or receipt was issued, while the duplicate shall be kept and preserved by the issuer, also in his
place of business, for a like period.
The Commissioner may, in meritorious cases, exempt any person subject to an internal revenue tax from
compliance with the provisions of this Section. (Emphasis supplied.)
Correlatively, in Revenue Memorandum No. 16-2003 dated May 20, 2003, the Bureau of Internal Revenue
defined a Sales Invoice and identified its required information as follows:chanroblesvi rtualawlibrary
Sales Invoices (SI)/Cash Invoice (CI) is written account of goods sold or services rendered and the prices
charged therefor used in the ordinary course of business evidencing sale and transfer or agreement to sell or
transfer of goods and services. It contains the same information found in the Official Receipt.
Official Receipt (OR) is a receipt issued for the payment of services rendered or goods sold. It contains the
following information:chanroblesvirtualawl ibrary
a. Business name and address;
b. Taxpayer Identification Number;
c. Name of printer (BIR Permit No.) with inclusive serial number of booklets and date of issuance of receipts.
There is no requirement that a sales invoice should accurately state the nature of all the businesses of the
seller. There is no legal ground to state that EYIS "declaration" in its sales invoices that it is an importer,
wholesaler and retailer is restrictive and would preclude its being a manufacturer.
From the above findings, there was no justifiable reason for the CA to disregard the factual findings of the
IPO. The rulings of the IPO Director General and the BLA Director were supported by clear and convincing
evidence. The facts cited by the CA and Shen Dar do not justify a different conclusion from that of the IPO.
Hence, the findings of the BLA Director and the IPO Director General must be deemed as conclusive on the
CA.
Fifth Issue:
Whether EYIS is the true owner of the mark "VESPA"
In any event, given the length of time already invested by the parties in the instant case, this Court must
write finis to the instant controversy by determining, once and for all, the true owner of the mark "VESPA"
based on the evidence presented.
RA 8293 espouses the "first-to-file" rule as stated under Sec. 123.1(d) which states:chanroblesvi rtualawlibrary
Section 123. Registrability. - 123.1. A mark cannot be registered if it:chanroblesvi rtualawlibrary
x x x x
(d) Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or
priority date, in respect of:chanroblesvirtualawlibrary
(i) The same goods or services, or
(ii) Closely related goods or services, or
(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion. (Emphasis supplied.)
Under this provision, the registration of a mark is prevented with the filing of an earlier application for
registration. This must not, however, be interpreted to mean that ownership should be based upon an
earlier filing date. While RA 8293 removed the previous requirement of proof of actual use prior to the filing
of an application for registration of a mark, proof of prior and continuous use is necessary to establish
ownership of a mark. Such ownership constitutes sufficient evidence to oppose the registration of a mark.
Sec. 134 of the IP Code provides that "any person who believes that he would be damaged by the
registration of a mark x x x" may file an opposition to the application. The term "any person" encompasses
the true owner of the markthe prior and continuous user.
Notably, the Court has ruled that the prior and continuous use of a mark may even overcome the
presumptive ownership of the registrant and be held as the owner of the mark. As aptly stated by the Court
in Shangri-la International Hotel Management, Ltd. v. Developers Group of Companies, Inc.:
37
chanroblesvirtual lawlibrary
Registration, without more, does not confer upon the registrant an absolute right to the registered mark.
The certificate of registration is merely a prima facie proof that the registrant is the owner of the registered
mark or trade name. Evidence of prior and continuous use of the mark or trade name by another can
overcome the presumptive ownership of the registrant and may very well entitle the former to be declared
owner in an appropriate case.
x x x x
Ownership of a mark or trade name may be acquired not necessarily by registration but by adoption and use
in trade or commerce. As between actual use of a mark without registration, and registration of the mark
without actual use thereof, the former prevails over the latter. For a rule widely accepted and firmly
entrenched, because it has come down through the years, is that actual use in commerce or business is a
pre-requisite to the acquisition of the right of ownership.
x x x x
By itself, registration is not a mode of acquiring ownership. When the applicant is not the owner of the
trademark being applied for, he has no right to apply for registration of the same. Registration merely
creates a prima facie presumption of the validity of the registration, of the registrants ownership of the
trademark and of the exclusive right to the use thereof. Such presumption, just like the presumptive
regularity in the performance of official functions, is rebuttable and must give way to evidence to the
contrary.
Here, the incontrovertible truth, as established by the evidence submitted by the parties, is that EYIS is the
prior user of the mark. The exhaustive discussion on the matter made by the BLA sufficiently addresses the
issue:chanroblesvi rtualawl ibrary
Based on the evidence, Respondent E.Y. Industrial is a legitimate corporation engaged in buying, importing,
selling, industrial machineries and tools, manufacturing, among others since its incorporation in 1988.
(Exhibit "1"). Indeed private respondents have submitted photographs (Exhibit "376", "377", "378", "379")
showing an assembly line of its manufacturing or assembly process.
More importantly, the private respondents prior adoption and continuous use of the mark "VESPA" on air
compressors is bolstered by numerous documentary evidence consisting of sales invoices issued in the name
of respondent EY Industrial and Bills of Lading. (Exhibits "4" to "375"). Sales Invoice No. 12075 dated March
27, 1995 antedates petitioners date of first use in January 1, 1997 indicated in its trademark application
filed in June 9, 1997 as well as the date of first use in June of 1996 as indicated in the Declaration of Actual
Use submitted on December 3, 2001 (Exhibit "385"). The use by respondent-registrant in the concept of
owner is shown by commercial documents, sales invoices unambiguously describing the goods as "VESPA"
air compressors. Private respondents have sold the air compressors bearing the "VESPA" to various locations
in the Philippines, as far as Mindanao and the Visayas since the early 1990s. We carefully inspected the
evidence consisting of three hundred seventy one (371) invoices and shipment documents which show that
"VESPA" air compressors were sold not only in Manila, but to locations such as Iloilo City, Cebu City,
Dumaguete City, Zamboanga City, Cagayan de Oro City, Davao City to name a few. There is no doubt that it
is through private respondents efforts that the mark "VESPA" used on air compressors has gained business
goodwill and reputation in the Philippines for which it has validly acquired trademark rights. Respondent EY
Industrials right has been preserved until the passage of RA 8293 which entitles it to register the same. x x
x
38
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On the other hand, Shen Dar failed to refute the evidence cited by the BLA in its decision. More importantly,
Shen Dar failed to present sufficient evidence to prove its own prior use of the mark "VESPA." We cite with
approval the ruling of the BLA:chanroblesvi rtualawlibrary
[Shen Dar] avers that it is the true and rightful owner of the trademark "VESPA" used on air compressors.
The thrust of [Shen Dars] argument is that respondent E.Y. Industrial Sales, Inc. is a mere distributor of the
"VESPA" air compressors. We disagree.
This conclusion is belied by the evidence. We have gone over each and every document attached as
Annexes "A", "A" 1-48 which consist of Bill of Lading and Packing Weight List. Not one of these documents
referred to a "VESPA" air compressor. Instead, it simply describes the goods plainly as air compressors
which is type "SD" and not "VESPA". More importantly, the earliest date reflected on the Bill of Lading was
on May 5, 1997. (Annex "A"-1). [Shen Dar] also attached as Annex "B" a purported Sales Contract with
respondent EY Industrial Sales dated April 20, 2002. Surprisingly, nowhere in the document does it state
that respondent EY Industrial agreed to sell "VESPA" air compressors. The document only mentions air
compressors which if genuine merely bolsters respondent Engracio Yaps contention that [Shen Dar]
approached them if it could sell the "Shen Dar" or "SD" air compressor. (Exhibit "386") In its position paper,
[Shen Dar] merely mentions of Bill of Lading constituting respondent as consignee in 1993 but never
submitted the same for consideration of this Bureau. The document is also not signed by [Shen Dar]. The
agreement was not even drafted in the letterhead of either [Shen Dar] nor [sic] respondent registrant. Our
only conclusion is that [Shen Dar] was not able to prove to be the owner of the VESPA mark by
appropriation. Neither was it able to prove actual commercial use in the Philippines of the mark VESPA prior
to its filing of a trademark application in 9 June 1997.
39
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As such, EYIS must be considered as the prior and continuous user of the mark "VESPA" and its true owner.
Hence, EYIS is entitled to the registration of the mark in its name.
WHEREFORE, the petition is hereby GRANTED. The CAs February 21, 2008 Decision and October 6, 2008
Resolution in CA-G.R. SP No. 99356 are hereby REVERSED and SET ASIDE. The Decision dated May 25,
2007 issued by the IPO Director General in Inter Partes Case No. 14-2004-00084 and the Decision dated
May 29, 2006 of the BLA Director of the IPO are hereby REINSTATED.
No costs.
SO ORDERED.
Kho vs Court of Appeals
on February 9, 2012
Intellectual Property Law on Copyright Proper Subjects of Copyright
Elidad Kho is the owner of KEC Cosmetics Laboratory and she was also the holder of copyrights
over Chin Chun Su and its OvalFacial Cream Container/Case. She also bought the patent rights over
the Chin Chun Su & Device and Chin Chun Su for medicated cream from one Quintin Cheng, who was
the assignee of Shun Yi Factory a Taiwanese factory actually manufacturing Chin Chun Su products.
Kho filed a petition for injunction against Summerville General Merchandising and Company to enjoin the
latter from advertising and selling Chin Chun Su products, in similar containers as that of Kho, for this is
misleading the public and causing Kho to lose income; the petition is also to enjoin Summerville from
infringing upon Khos copyrights.
Summerville in their defense alleged that they are the exclusive and authorized importer, re-packer and
distributor of Chin Chun Su products; that Shun Yi even authorized Summerville to register its trade name
Chin Chun Su Medicated Cream with the Philippine Patent Office; that Quintin Cheng, from home Kho
acquired her patent rights, had been terminated by Shun Yi.
ISSUE: Whether or not Kho has the exclusive right to use the trade name and its container.
HELD: No. Kho has no right to support her claim for the exclusive use of the subject trade name and its
container. The name and container of a beauty cream product are proper subjects of a trademark (not
copyright like what she registered for) inasmuch as the same falls squarely within its definition. In order
to be entitled to exclusively use the same in the sale of the beauty cream product, the user must
sufficiently prove that she registered or used it before anybody else did. Khos copyright and
patentregistration of the name and container would not guarantee her the right to the exclusive use of
the same for the reason that they are not appropriate subjects of the said intellectual rights.
Consequently, a preliminary injunction order cannot be issued for the reason that the petitioner has not
proven that she has a clear right over the said name and container to the exclusion of others, not having
proven that she has registered a trademark thereto or used the same before anyone did.

Republic of the Philippines
SUPREME COURT
Manila
SECOND DIVISION
G.R. No. 115758 March 19, 2002
ELIDAD C. KHO, doing business under the name and style of KEC COSMETICS LABORATORY, petitioner,
vs.
HON. COURT OF APPEALS, SUMMERVILLE GENERAL MERCHANDISING and COMPANY, and ANG TIAM
CHAY, respondents.
DE LEON, JR., J.:
Before us is a petition for review on certiorari of the Decision
1
dated May 24, 1993 of the Court
of Appeals setting aside and declaring as null and void the Orders
2
dated February 10, 1992 and March
19, 1992 of the Regional Trial Court, Branch 90, of Quezon City granting the issuance of a writ of
preliminary injunction.
The facts of the case are as follows:
On December 20, 1991, petitioner Elidad C. Kho filed a complaint for injunction and damages with a
prayer for the issuance of a writ of preliminary injunction, docketed as Civil Case No. Q-91-10926,
against the respondents Summerville General Merchandising and Company (Summerville, for brevity) and
Ang Tiam Chay.
The petitioners complaint alleges that petitioner, doing business under the name andstyle of KEC
Cosmetics Laboratory, is the registered owner of the copyrights Chin Chun Su and Oval Facial
Cream Container/Case, as shown by Certificates of Copyright Registration No. 0-1358 and No. 0-3678;
that she also has patent rights on Chin Chun Su & Device and Chin Chun Su for medicated cream after
purchasing the same from Quintin Cheng, the registered owner thereof in the Supplemental Register of
the Philippine Patent Office on February 7, 1980 under Registration Certificate No. 4529; that respondent
Summerville advertised and sold petitioners cream products under the brand name Chin Chun Su, in
similar containers that petitioner uses, thereby misleading the public, and resulting in the decline in the
petitioners business sales and income; and, that the respondents should be enjoined from allegedly
infringing on the copyrights and patents of the petitioner.
The respondents, on the other hand, alleged as their defense that Summerville is the exclusive and
authorized importer, re-packer and distributor of Chin Chun Su products manufactured by Shun Yi Factory
of Taiwan; that the said Taiwanese manufacturing company authorized Summerville to register its trade
name Chin Chun Su Medicated Cream with the Philippine Patent Office and other
appropriate governmental agencies; that KEC Cosmetics Laboratory of the petitioner obtained the
copyrights through misrepresentation and falsification; and, that the authority of Quintin Cheng, assignee
of the patent registration certificate, to distribute and market Chin Chun Su products in the Philippines
had already been terminated by the said Taiwanese ManufacturingCompany.
After due hearing on the application for preliminary injunction, the trial court granted the same in an
Order dated February 10, 1992, the dispositive portion of which reads:
ACCORDINGLY, the application of plaintiff Elidad C. Kho, doing business under the style of KEC Cosmetic
Laboratory, for preliminary injunction, is hereby granted. Consequentially, plaintiff is required to file with
the Court a bond executed to defendants in the amount of five hundred thousand pesos (P500,000.00) to
the effect that plaintiff will pay to defendants all damages which defendants may sustain by reason of the
injunction if the Court should finally decide that plaintiff is not entitled thereto.
SO ORDERED.
3

The respondents moved for reconsideration but their motion for reconsideration was denied by the trial
court in an Order dated March 19, 1992.
4

On April 24, 1992, the respondents filed a petition for certiorari with the Court of Appeals, docketed as
CA-G.R. SP No. 27803, praying for the nullification of the said writ of preliminary injunction issued by the
trial court. After the respondents filed their reply and almost a month after petitioner submitted her
comment, or on August 14 1992, the latter moved to dismiss the petition for violation of Supreme Court
Circular No. 28-91, a circular prohibiting forum shopping. According to the petitioner, the respondents
did not state the docket number of the civil case in the caption of their petition and, more significantly,
they did not include therein a certificate of non-forum shopping. The respondents opposed the petition
and submitted to the appellate court a certificate of non-forum shopping for their petition.
On May 24, 1993, the appellate court rendered a Decision in CA-G.R. SP No. 27803 ruling in favor of the
respondents, the dispositive portion of which reads:
WHEREFORE, the petition is hereby given due course and the orders of respondent court dated February
10, 1992 and March 19, 1992 granting the writ of preliminary injunction and denying petitioners motion
for reconsideration are hereby set aside and declared null and void. Respondent court is directed to
forthwith proceed with the trial of Civil Case No. Q-91-10926 and resolve the issue raised by the parties
on the merits.
SO ORDERED.
5

In granting the petition, the appellate court ruled that:
The registration of the trademark or brandname Chin Chun Su by KEC with the supplemental register of
the Bureau of Patents, Trademarks and Technology Transfer cannot be equated with registration in the
principal register, which is duly protected by the Trademark Law.
xxx xxx xxx
As ratiocinated in La Chemise Lacoste, S.S. vs. Fernandez, 129 SCRA 373, 393:
Registration in the Supplemental Register, therefore, serves as notice that the registrant is using or has
appropriated the trademark. By the very fact that the trademark cannot as yet be on guard and there are
certain defects, some obstacles which the use must still overcome before he can claim legal ownership of
the mark or ask the courts to vindicate his claims of an exclusive right to the use of the same. It would be
deceptive for a party with nothing more than a registration in the Supplemental Register to posture before
courts of justice as if the registration is in the Principal Register.
The reliance of the private respondent on the last sentence of the Patent office action on application Serial
No. 30954 that registrants is presumed to be the owner of the mark until after the registration is declared
cancelled is, therefore, misplaced and grounded on shaky foundation. The supposed presumption not
only runs counter to the precept embodied in Rule 124 of the Revised Rules of Practice before the
Philippine Patent Office in Trademark Cases but considering all the facts ventilated before us in the four
interrelated petitions involving the petitioner and the respondent, it is devoid of factual basis. As even in
cases where presumption and precept may factually be reconciled, we have held that the presumption is
rebuttable, not conclusive, (People v. Lim Hoa, G.R. No. L-10612, May 30, 1958, Unreported). One may be
declared an unfair competitor even if his competing trademark is registered (Parke, Davis & Co. v. Kiu Foo
& Co., et al., 60 Phil 928; La Yebana Co. v. chua Seco & Co., 14 Phil 534).
6

The petitioner filed a motion for reconsideration. This she followed with several motions to declare
respondents in contempt of court for publishing advertisements notifying the public of the promulgation
of the assailed decision of the appellate court and stating that genuine Chin Chun Su products could be
obtained only from Summerville General Merchandising and Co.
In the meantime, the trial court went on to hear petitioners complaint for final injunction and damages.
On October 22, 1993, the trial court rendered a Decision
7
barring the petitioner from using the trademark
Chin Chun Su and upholding the right of the respondents to use the same, but recognizing the copyright
of the petitioner over the oval shaped container of her beauty cream. The trial court did not award
damages and costs to any of the parties but to their respective counsels were awarded Seventy-Five
Thousand Pesos (P75,000.00) each as attorneys fees. The petitioner duly appealed the said decision to
the Court of Appeals.
On June 3, 1994, the Court of Appeals promulgated a Resolution
8
denying the petitioners motions for
reconsideration and for contempt of court in CA-G.R. SP No. 27803.
Hence, this petition anchored on the following assignment of errors:
I
RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OF JURISDICTION IN FAILING TO RULE ON PETITIONERS MOTION TO DISMISS.
II
RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OF JURISDICTION IN REFUSING TO PROMPTLY RESOLVE PETITIONERS MOTION FOR
RECONSIDERATION.
III
IN DELAYING THE RESOLUTION OF PETITIONERS MOTION FOR RECONSIDERATION, THE HONORABLE
COURT OF APPEALS DENIED PETITIONERS RIGHT TO SEEK TIMELY APPELLATE RELIEF AND VIOLATED
PETITIONERS RIGHT TO DUE PROCESS.
IV
RESPONDENT HONORABLE COURT OF APPEALS COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO
LACK OF JURISDICTION IN FAILING TO CITE THE PRIVATE RESPONDENTS IN CONTEMPT.
9

The petitioner faults the appellate court for not dismissing the petition on the ground of violation of
Supreme Court Circular No. 28-91. Also, the petitioner contends that the appellate court violated Section
6, Rule 9 of the Revised Internal Rules of the Court of Appeals when it failed to rule on her motion for
reconsideration within ninety (90) days from the time it is submitted for resolution. The appellate court
ruled only after the lapse of three hundred fifty-four (354) days, or on June 3, 1994. In delaying the
resolution thereof, the appellate court denied the petitioners right to seek the timely appellate relief.
Finally, petitioner describes as arbitrary the denial of her motions for contempt of court against the
respondents.
We rule in favor of the respondents.
Pursuant to Section 1, Rule 58 of the Revised Rules of Civil Procedure, one of the grounds for the issuance
of a writ of preliminary injunction is a proof that the applicant is entitled to the relief demanded, and the
whole or part of such relief consists in restraining the commission or continuance of the act or acts
complained of, either for a limited period or perpetually. Thus, a preliminary injunction order may be
granted only when the application for the issuance of the same shows facts entitling the applicant to the
relief demanded.
10
This is the reason why we have ruled that it must be shown that the invasion of the
right sought to be protected is material and substantial, that the right of complainant is clear and
unmistakable, and, that there is an urgent and paramount necessity for the writ to prevent serious
damage.
11

In the case at bar, the petitioner applied for the issuance of a preliminary injunctive order on the ground
that she is entitled to the use of the trademark on Chin Chun Su and its container based on her copyright
and patent over the same. We first find it appropriate to rule on whether the copyright and patent over the
name and container of a beauty cream product would entitle the registrant to the use and ownership over
the same to the exclusion of others.
Trademark, copyright and patents are different intellectual property rights that cannot be interchanged
with one another. A trademark is any visible sign capable of distinguishing the goods (trademark) or
services (service mark) of an enterprise and shall include a stamped or marked container of goods.
12
In
relation thereto, a trade name means the name or designation identifying or distinguishing an
enterprise.
13
Meanwhile, the scope of a copyright is confined to literary and artistic works which are
original intellectual creations in the literary and artistic domain protected from the moment of their
creation.
14
Patentable inventions, on the other hand, refer to any technical solution of a problem in any
field of human activity which is new, involves an inventive step and is industrially applicable.
15

Petitioner has no right to support her claim for the exclusive use of the subject trade name and its
container. The name and container of a beauty cream product are proper subjects of a trademark
inasmuch as the same falls squarely within its definition. In order to be entitled to exclusively use the
same in the sale of the beauty cream product, the user must sufficiently prove that she registered or used
it before anybody else did. The petitioners copyright and patent registration of the name and container
would not guarantee her the right to the exclusive use of the same for the reason that they are not
appropriate subjects of the said intellectual rights. Consequently, a preliminary injunction order cannot be
issued for the reason that the petitioner has not proven that she has a clear right over the said name and
container to the exclusion of others, not having proven that she has registered a trademark thereto or
used the same before anyone did.
We cannot likewise overlook the decision of the trial court in the case for final injunction and damages.
The dispositive portion of said decision held that the petitioner does not have trademark rights on the
name and container of the beauty cream product. The said decision on the merits of the trial court
rendered the issuance of the writ of a preliminary injunction moot and academic notwithstanding the fact
that the same has been appealed in the Court of Appeals. This is supported by our ruling in La Vista
Association, Inc. v. Court of Appeals
16
, to wit:
Considering that preliminary injunction is a provisional remedy which may be granted at any time after the
commencement of the action and before judgment when it is established that the plaintiff is entitled to
the relief demanded and only when his complaint shows facts entitling such reliefs xxx and it appearing
that the trial court had already granted the issuance of a final injunction in favor of petitioner in its
decision rendered after trial on the merits xxx the Court resolved to Dismiss the instant petition having
been rendered moot and academic. An injunction issued by the trial court after it has already made a clear
pronouncement as to the plaintiffs right thereto, that is, after the same issue has been decided on the
merits, the trial court having appreciated the evidence presented, is proper, notwithstanding the fact that
the decision rendered is not yet final xxx. Being an ancillary remedy, the proceedings for preliminary
injunction cannot stand separately or proceed independently of the decision rendered on the merit of the
main case for injunction. The merit of the main case having been already determined in favor of the
applicant, the preliminary determination of its non-existence ceases to have any force and effect. (italics
supplied)
La Vista categorically pronounced that the issuance of a final injunction renders any question on the
preliminary injunctive order moot and academic despite the fact that the decision granting a final
injunction is pending appeal. Conversely, a decision denying the applicant-plaintiffs right to a final
injunction, although appealed, renders moot and academic any objection to the prior dissolution of a writ
of preliminary injunction.
The petitioner argues that the appellate court erred in not dismissing the petition for certiorari for non-
compliance with the rule on forum shopping. We disagree. First, the petitioner improperly raised the
technical objection of non-compliance with Supreme Court Circular No. 28-91 by filing a motion to
dismiss the petition for certiorari filed in the appellate court. This is prohibited by Section 6, Rule 66 of
the Revised Rules of Civil Procedure which provides that (I)n petitions for certiorari before the Supreme
Court and the Court of Appeals, the provisions of Section 2, Rule 56, shall be observed. Before giving due
course thereto, the court may require the respondents to file their comment to, and not a motion to
dismiss, the petition xxx (italics supplied). Secondly, the issue was raised one month after petitioner had
filed her answer/comment and after private respondent had replied thereto. Under Section 1, Rule 16 of
the Revised Rules of Civil Procedure, a motion to dismiss shall be filed within the time for but before filing
the answer to the complaint or pleading asserting a claim. She therefore could no longer submit a motion
to dismiss nor raise defenses and objections not included in the answer/comment she had earlier
tendered. Thirdly, substantial justice and equity require this Court not to revive a dissolved writ of
injunction in favor of a party without any legal right thereto merely on a technical infirmity. The granting
of an injunctive writ based on a technical ground rather than compliance with the requisites for the
issuance of the same is contrary to the primary objective of legal procedure which is to serve as a means
to dispense justice to the deserving party.
The petitioner likewise contends that the appellate court unduly delayed the resolution of her motion for
reconsideration. But we find that petitioner contributed to this delay when she filed successive contentious
motions in the same proceeding, the last of which was on October 27, 1993, necessitating counter-
manifestations from private respondents with the last one being filed on November 9, 1993. Nonetheless,
it is well-settled that non-observance of the period for deciding cases or their incidents does not render
such judgments ineffective or void.
17
With respect to the purported damages she suffered due to the
alleged delay in resolving her motion for reconsideration, we find that the said issue has likewise been
rendered moot and academic by our ruling that she has no right over the trademark and, consequently, to
the issuance of a writ of preliminary injunction.
Finally, we rule that the Court of Appeals correctly denied the petitioners several motions for contempt of
court. There is nothing contemptuous about the advertisements complained of which, as regards the
proceedings in CA-G.R. SP No. 27803 merely announced in plain and straightforward language the
promulgation of the assailed Decision of the appellate court. Moreover, pursuant to Section 4 of Rule 39 of
the Revised Rules of Civil Procedure, the said decision nullifying the injunctive writ was immediately
executory.
WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated May 24,
1993 and June 3, 1994, respectively, are hereby AFFIRMED. With costs against the petitioner.
SO ORDERED.
Republic of the Philippines
SUPREME COURT
Manila
EN BANC
G.R. No. L-23023 August 31, 1968
JOSE P. STA. ANA, petitioner,
vs.
FLORENTINO MALIWAT and TIBURCIO S. EVALLE, in his capacity as Director of
Patents, respondents.
Rodolfo A. Francisco for petitioner.
Catalino S. Maravilla for respondent Florentino Maliwat.
Office of the Solicitor General for respondent Tiburcio S. Evalle.
REYES, J.B.L., J .:
Petition for review of the decision of the respondent Director of Patents in an interference
proceeding
1
(Inter Partes Case No. 291), finding for the senior party applicant, Florentino Maliwat,
the herein private respondent, and against the junior party applicant
2
Jose P. Sta. Ana, the herein
petitioner.
On 21 June 1962, Florentino Maliwat filed with the Patent Office an application for registration of the
trademark FLORMANN, which is used on shirts, pants, jackets and shoes for ladies, men, and
children, claiming first use in commerce of the said mark on 15 January 1962. The claim of first use
was subsequently amended to 6 July 1955.
On 18 September 1962, Jose P. Sta. Ana filed an application for the registration of the tradename
FLORMEN SHOE MANUFACTURERS (SHOE MANUFACTURERS disclaimed),
3
which is used in
the business of manufacturing ladies' and children's shoes. His claim of first use in commerce of the
said tradename is 8 April 1959.
In view of the admittedly confusing similarity between the trademark FLORMANN and the
tradename FLORMEN, the Director of Patents declared an interference. After trial, the respondent
Director gave due course to Maliwat's application and denied that of Sta. Ana. The latter, not
satisfied with the decision, appealed to this Court.
The petitioner assigned the following errors:
I. The Director of Patents erred in not finding that respondent (senior party-applicant) failed
to establish by clear and convincing evidence earlier date of use of his mark FLORMANN
than that alleged in his application for registration, hence, respondent is not entitled to carry
back the date of first use to a prior date.
II. The Director erred in holding that respondent is the prior adopter and user of his mark and
in concluding that this is strengthened with documentary evidence that respondent has been
using his mark since 1953 as tailor and haberdasher.
III. The Director of Patents erred in not finding false
and fabricated respondent's testimonial and documentary evidence and Director should
have applied the rule "Falsus in uno, falsus in omnibus" and should have disregarded them.
IV. The Director of Patents erred in declaring that Maliwat has the prior right to the use of his
trademark on shoes and such right may be carried back to the year 1953 when respondent
started his tailoring and haberdashery business and in holding that the manufacture of shoes
is within the scope of natural expansion of the business of a tailor and haberdasher.
V. The Director of Patents erred in failing to apply the stricture that parties should confine
use of their respective marks to their corresponding fields of business, and should have
allowed the concurrent use of tradename FLORMEN SHOE MANUFACTURERS and the
trademark FLORMANN provided it is not used on shoes.
The findings of the Director that Maliwat was the prior adopter and user of the mark can not be
contradicted, since his findings were based on facts stipulated in the course of the trial in the
interference proceedings. The recorded stipulation is as follows:
ATTY. FRANCISCO: Your Honor please, with the mutual understanding of the counsel for
the Junior Party and the counsel for the Senior Party in their desire to shorten the
proceedings of this case, especially on matters that are admitted and not controverted by
both parties, they have agreed and admitted that Mr. Jose P. Sta. Ana, the Junior Party
Applicant in this case, is engaged solely in the manufacture of shoes under the firm name
FLORMEN SHOE MANUFACTURERS since April 1959; that the name FLORMEN SHOE
MANUFACTURERS is registered with the Bureau of Commerce on April 8, 1959, as shown
by Exhibits "A" and "A-2". That Mr. Florentino Maliwat has been engaged in the manufacture
and sale of menswear shirts, polo shirts, and pants, since 1953, using FLORMANN as its
trademark. That Mr. Florentino Maliwat began using the trademark FLORMANN on shoes on
January 1962 and the firm name FLORMANN SHOES under which these shoes with the
trademark FLORMANN were manufactured and sold was first used on January 1962, having
also been registered with the Bureau of Commerce on January 1962 and with other
departments of the government, like the Bureau of Labor, the Social Security System and the
Workmen's Compensation in 1962.
ATTY. MARAVILLA: On behalf of the Senior Party Applicant, represented by this humble
representation, I respectfully concur and admit all those stipulations above mentioned.
HEARING OFFICER: The court reserves the resolution on those stipulations. We can
proceed now with the redirect examination. (T.s.n., 9 August 1963, pp. 33-34).
And the Rules of Court provide:1wph 1. t
Sec. 2. Judicial admissions. Admission made by the parties in the pleadings, or in the
course of the trial or other proceedings do not require proof and can not be contradicted
unless previously shown to have been made through palpable mistake." (Rule 129, Revised
Rules of Court).
Since the aforequoted stipulation of facts has not been shown to have been made through palpable
mistake, it is vain for the petitioner to allege that the evidence for respondent Maliwat is false,
fabricated, inconsistent, indefinite, contradictory, unclear, unconvincing, and unsubstantial.
The rule on judicial admissions was not found or provided for in the old Rules but can be culled from
rulings laid down by this Court previous to its revision (Irlanda v. Pitargue, 22 Phil. 383; 5 Moran 57-
59, 1963 Ed.). It was the law, then and now, being an application of the law on estoppel.
To be true, petitioner Sta. Ana, through counsel, filed with this Court, on 24 December 1964, a
motion entitled "MOTION TO ORDER STENOGRAPHER TO PRODUCE STENOGRAPHIC NOTES
AND TO CORRECT TRANSCRIPT OF STENOGRAPHIC NOTES; TO ALLOW PETITIONER TO
WITHDRAW FROM STIPULATION OF FACTS AND BE ALLOWED TO PRESENT ADDITIONAL
EVIDENCE; AND TO SUSPEND PERIOD FOR FILING PETITIONER'S BRIEF." The reason given
was that "counsel for Mr. Jose P. Sta. Ana does not recall making any stipulation or agreement of
facts with the counsel of Mr. Florentino Maliwat on 9 August 1963." Opposition thereto was filed by
Maliwat, asserting that the stenographer took down notes on those things which were stated and
uttered by the parties; that movant should have moved for reconsideration in the Patent Office,
instead of here in the Supreme Court, which is both untimely and unhonorable.
Upon requirement by this Court, stenographer Cleofe Rosales commented on petitioner's motion
that what she had taken down were actually uttered by counsel for Sta. Ana, no more, no less; that it
was practically and highly impossible for her to have intercalated into the records the questioned
stipulation of facts because of the length of counsel's manifestations and the different subject
matters of his statements, aside from the concurrence of Maliwat's counsel and the reservation on
the resolution made by the hearing officer; and that despite her length of service, since 1958, as
stenographic reporter, there had been no complaint against her, except this one.
Counsel for Sta. Ana replied to the foregoing comments, alleging, among others, that after his
receipt of the decision, after 5 May 1964, he bought the transcript and requested the stenographer to
verify the contents of pages 33 and 34 of her transcript but, despite several requests, and for a
period of seven (7) months, for her to produce the stenographic notes, she has failed to produce
said notes.
On 2 April 1965, stenographer Rosales sent to the clerk of this Court the transcript of stenographic
notes.
This Court, on 2 February 1965, denied, for being late the motion to present additional testimonial
and documentary evidence, and, on 8 April 1965, deferred action on the objection to a portion of the
transcript until after hearing.
We find no substantiation of the charge that the stipulation of facts appearing on pages 33 to 34 of
the transcript of stenographic notes taken on 9 August 1963 had been intercalated; hence, the
presumption that the stenographer regularly performed her duty stands. The integrity of the record
being intact, the petitioner is bound by it. We can not overlook that even if his charges were true, it
was plain and inexcusable negligence on his part not to discover earlier the defect he now complains
of, if any, and in not taking steps to correct it before the records were elevated to this Court.
An application for registration is not bound by the date of first use as stated by him in his application,
but is entitled to carry back said stated date of first use to a prior date by proper evidence; but in
order to show an earlier date of use, he is then under a heavy burden, and his proof must be clear
and convincing (Anchor Trading Co., Inc. vs. The Director of Patents, et al., L-8004, 30 May 1956;
Chung Te vs. Ng Kian Giab, et al.,
L-23791, 23 November 1966). In the case at bar, the proof of date of first use (1953), earlier than
that alleged in respondent Maliwat's application (1962), can be no less than clear and convincing
because the fact was stipulated and no proof was needed.
Petitioner would confine the respondent to the use of the mark FLORMANN to tailoring and
haberdashery only, but not on shoes, on the ground that petitioner had used the name FLORMEN
on shoes since 1959, while the respondent used his mark on shoes only in 1962; but the Director
ruled:
. . . I believe that it is now the common practice among local tailors and haberdashers to
branch out into articles of manufacture which have, one way or another, some direct
relationship with or appurtenance to garments or attire to complete one's wardrobe such as
belts, shoes, handkerchiefs, and the like, . . . It goes without saying that shoes on one hand
and shirts, pants and jackets on the other, have the same descriptive properties for
purposes of our Trademark Law.
Modern law recognizes that the protection to which the owner of a trademark mark is entitled is not
limited to guarding his goods or business from actual market competition with identical or similar
products of the parties, but extends to all cases in which the use by a junior appropriator of a
trademark or tradename is likely to lead to a confusion of source, as where prospective purchasers
would be misled into thinking that the complaining party has extended his business into the field (see
148 ALR 56 et seq; 52 Am. Jur. 576) or is in any way connected with the activities of the infringer; or
when it forestalls the normal potential expansion of his business (v. 148 ALR, 77, 84; 52 Am. Jur.
576, 577). It is on this basis that the respondent Director of Patents adverted to the practice "among
local tailors and haberdashers to branch out into articles of manufacture which have some direct
relationship" . . . "to garments or attire to complete one's wardrobe". Mere dissimilarity of goods
should not preclude relief where the junior user's goods are not too different or remote from any that
the owner would be likely to make or sell; and in the present case, wearing apparel is not so far
removed from shoes as to preclude relief, any more than the pancake flour is from syrup or sugar
cream (Aunt Jemima Mills Co. vs. Rigney & Co., LRA 1918 C 1039), or baking powder from baking
soda (Layton Pure Food Co. vs. Church & Co., 182 Fed. 35), or cosmetics and toilet goods from
ladies' wearing apparel and costume jewelry (Lady Esther Ltd. vs. Lady Esther Corset Shoppe, 148
ALR 6). More specifically, manufacturers of men's clothing were declared entitled to protection
against the use of their trademark in the sale of hats and caps [Rosenberg Bros. vs. Elliott, 7 Fed.
(2d) 962] and of ladies shoes (Forsythe & Co. vs. Forsythe Shoe Corp., 254 NYS 584). In all these
cases, the courts declared the owner of a trademark from the first named goods entitled to exclude
use of its trademark on the related class of goods above-referred to.
It may be that previously the respondent drew a closer distinction among kinds of goods to which the
use of similar marks could be applied; but it can not be said that the present ruling under appeal is
so devoid of basis in law as to amount to grave abuse of discretion warranting reversal.
Republic Act No. 166, as amended, provides:
Sec. 4. . . . The owner of a trademark, tradename or service-mark used to distinguish his
goods, business or services from the goods, business or services of others shall have the
right to register the same on the principal register, unless it:
x x x x x x x x x
x x x x x x x x x
(d) Consists of or comprises a mark or tradename which resembles a mark or tradename
registered in the Philippines or a mark or tradename previously used in the Philippines by
another and not abandoned, as to be likely, when applied to or used in connection with the
goods, business or services of the applicant, to cause confusion or mistake or to deceive
purchasers;
x x x x x x x x x
Note that the provision does not require that the articles of manufacture of the previous user and the
late user of the mark should possess the same descriptive properties or should fall into the same
categories as to bar the latter from registering his mark in the principal register (Chua Che vs. Phil.
Patent Office, et al., L-18337, 30 Jan. 1965.
4
citing Application of Sylvan Sweets Co., 205 F. 2nd,
207).
5
Therefore, whether or not shirts and shoes have the same descriptive properties, or whether
or not it is the prevailing practice or the tendency of tailors and haberdashers to expand their
business into shoes making, are not controlling. The meat of the matter is the likelihood of confusion,
mistake or deception upon purchasers of the goods of the junior user of the mark and the goods
manufactured by the previous user. Here, the resemblance or similarity of the mark FLORMANN and
the name FLORMEN and the likelihood of confusion, one to the other, is admitted; therefore, the
prior adopter, respondent Maliwat, has the better right to the use of the mark.
FOR THE FOREGOING REASONS, the appealed decision is hereby affirmed, with costs against
the petitioner.
Concepcion, C.J., Dizon, Makalintal, Zaldivar, Sanchez, Castro, Angeles and Fernando, JJ.,
concur.1wph1.t
Footnotes
1
"An interference is a proceeding instituted for the purpose of determining the question of
priority of adoption and use of a trademark, tradename, or service-mark between two or
more parties claimingownership of the same or substantially similar trademark, tradename or
service-mark." (Sec. 10-A, Republic Act No. 166, as amended).
2
"The party whose application or registration involved in the interference has the latest filing
date is the junior party . . ." (Rule 184, Rev. Rules of Practice in the Philippines Patent
Office)
"Any junior party in an interference proceeding, . . ., shall be deemed to be in the
position of plaintiff, and the other parties to such proceedings, in the position of
defendants, with respect thereto . . ." (Rule 167, Ibid.).
3"At any time, upon application of the registrant and payment of the required fee, the
Director may permit any registration to be surrendered, cancelled, or for good cause shown
to be amended, and he may permit any registered mark or tradename to be disclaimed in
whole or in part: . . ." (Sec. 14, Republic Act No. 166, as amended) .
4
Between toiletries and laundry soap.1wph 1. t
5
Between candies and cigarettes.
G.R. No. L-14761 January 28, 1961
ARCE SONS AND COMPANY, petitioner,
vs.
SELECTA BISCUIT COMPANY, INC., ET AL., respondents.
x---------------------------------------------------------x
G.R. No. L-17981 January 28, 1961
ARCE SONS AND COMPANY, plaintiff-appellee,
vs.
SELECTA BISCUIT COMPANY, INC., defendant-appellant.
Manuel O. Chan and Ramon S. Ereeta for plaintiff-appellee.
E. Voltaire Garcia for defendant-appellant.
BAUTISTA ANGELO, J .:
On August 31, 1955, Selecta Biscuit Company, Inc., hereinafter referred to as respondent, filed with
the PhilippinePatent Office a petition for the registration of the word "SELECTA" as trade-mark to be
use in its bakery products alleging that it is in actual use thereof for not less than two months before
said date and that "no other persons, partnership, corporation or association ... has the right to use
said trade-mark in the Philippines, either in the identical form or in any such near resemblance
thereto, as might be calculated to deceive." Its petition was referred to an examiner for study who
found that the trade-mark sought to be registered resembles the word "SELECTA" used by the Acre
and Sons and Company, hereinafter referred to as petitioner, in its milk and icecream products so
that its use by respondent will cause confusion as to the origin of their respective goods.
Consequently, he recommended that the application be refused. However, upon reconsideration, the
Patent Office ordered the publication of the application for purposes of opposition.
In due time, petitioner filed its opposition thereto on several grounds, among which are: (1) that the
mark "SELECTA" had been continuously used by petitioner in the manufacture and sale of its
products, including cakes, bakery products, milk and ice cream from the time of its organization and
even prior thereto by its predecessor-in-interest, Ramon Arce; (2) that the mark "SELECTA" has
already become identified with name of the petitioner and its business; (3) that petitioner had warned
respondent not to use said mark because it was already being used by the former, but that the latter
ignored said warning; (4) that respondent is using the word "SELECTA" as a trade-mark as bakery
products in unfair competition with the products of petitioner thus resulting in confusion in trade; (5)
that the mark to which the application of respondent refers has striking resemblance, both in
appearance and meaning, to petitioner's mark as to be mistaken therefor by the public and cause
respondent's goods to be sold as petitioner's; and (6) that actually a complaint has been filed by the
petitioner against respondent for unfair competition in the Court of First Instance of Manila asking for
damages and for the issuance of a writ of injunction against respondent enjoining the latter for
continuing with the use of said mark.
On September 28, 1958, the Court of First Instance of Manila rendered decision in the unfair
competition caseperpetually enjoining respondent from using the name "SELECTA" as a trade-mark
on the goods manufactured and/or sold by it and ordering it to pay petitioner by way of damages all
the profits it may have realized by the use of said name, plus the sum of P5,000.00 as attorney's fee
and costs of suit. From this decision, respondent brought the matter on appeal to the Court of
Appeals wherein the case was docketed as CA-G.R. No. 24017-R.
Inasmuch as the issues of the facts in the case of unfair competition are substantially identical with
those raised before the Patent Office, the parties at the hearing thereof, agreed to submit the
evidence they introduced before the Court of First Instance of Manila to said office, and on the
strength thereof, the Director of Patents, on December 7, 1958, rendered decision dismissing
petitioner's opposition and stating that the registration of the trade-mark "SELECTA" in favor of
applicant Selecta Biscuits Company, Inc. will not cause confusion or mistake nor will deceive the
purchasers as to the cause damage to petitioner. Hence, petitioner interposed the present petition
for review.
On September 7, 1960, this Court issued a resolution of the following tenor:
In G.R. No. L-14761 (Arce Sons and Company vs. Selecta Biscuits Company, Inc., et al.),
considering that the issue raised and evidence presented in this appeal are the same as
those involved and presented in Civil Case No. 32907, entitled Arce Sons and Company vs.
Selecta Biscuit Company, Inc. of the Court of First Instance of Manila, presently pending
appeal in the Court of Appeals, docketed as CA-G.R. No. 24017-R, the Court resolved to
require the parties, or their counsel, to inform this Court why the appeal pending before the
Court of Appeals should not be forwarded to this Court in order that the two cases may be
consolidated and jointly decided, to avoid any conflicting decision, pursuant to the provisions
of section 17, paragraph 5, of the Judiciary Act of 1948 (Republic Act No. 296).
And having both petitioner and respondent manifested in writing that they do not register any
objection that the case they submitted on appeal to the Court of Appeals be certified to this Court so
that it may be consolidated with the present case, the two cases are now before us for consolidated
decision.
The case for petitioner is narrated in the decision of the court a quo as follows: .
"In 1933, Ramon Arce, predecessor in interest of the plaintiff, started a milk business in
Novaliches, Rizal, using the name 'SELECTA' as a trade-name as well as a trade-mark. He
begun selling and distributing his products to different residences, restaurants and offices, in
bottles on the caps of which were inscribed the words 'SELECTA FRESH MILK.' As his
business prospered, he thought of expanding and, in facts, he expanded his business by
establishing a store at Nos. 711-713 Lepanto Street. While there, he began to cater, in
addition to milk, ice cream, sandwiches and other food products. As his catering and ice
cream business prospered in a big way, he placed a sign signboard in his establishment with
the name 'SELECTA' inscribed thereon. This signboard was place right in front of the said
store. For the sake of efficiency, the Novaliches place was made the pasteurizing plant and
its products were distributed through the Lepanto store. Special containers made of tin cans
with the words 'SELECTA' written on their covers and 'embossed or blown' on the bottles
themselves were used. Similarly, exclusive bottles for milk products were ordered from Getz
Brothers with the word 'SELECTA 'blown on them. The sandwiches which were sold and
distributed were wrapped in carton boxes with covers bearing the name 'SELECTA.' To the
ordinary cars being used for the delivery of his products to serve outside orders were added
to a fleet of five (5) delivery trucks with the word 'SELECTA ' prominently painted on them.
Sales were made directly at the Lepanto store or by means of deliveries to specified
addresses, restaurants and offices inside Manila and its suburbs and sometimes to
customers in the provinces. As time passed, new products were produced for sale, which as
cheese (cottage cheese) with special containers especially ordered from the Philippine
Education Company with the 'SELECTA ' written on their covers.
The war that broke out on December 8, 1941, did not stop Ramon Arce from continuing with
his business. After a brief interruption of about a mouth, that is, during the end of January,
1942, and early February, 1942, he resumed his business using the same trade-name and
trade-mark, but this time, on a large scale. He entered the restaurant business. Dairy
products ice cream, milk, sandwiches continued to be sold and distributed by him. However,
Ramon Arce was again forced to discontinue the business on October, 1944, because time
was beginning to be precarious. American planes started to bomb Manila and one of his
sons, Eulalio Arce, who was managing the business, was seized by the Japanese. Liberation
came and immediately thereafter. Ramon Arce once more resumed his business, even more
actively, by adding another store located at the corner of Lepanto and Azcarraga Streets.
Continuing to use the name 'Selecta,' he added bakery products to his line of business. With
a firewood type of oven, about one-half the size of the courtroom, he made his own bread,
cookies, pastries and assorted bakery products. Incidentally, Arce's bakery was transferred
to Balintawak, Quezon City another expansion of his business where the bakery
products are now being baked thru the use of firewood, electric and gas oven. These bakery
products, like his other products, are being sold the store itself and /or delivered to people
ordering them in Manila and even Baguio. Like the other products, special carton boxes in
different sizes, according to the bakery products, with the name 'Selecta' on top of the covers
are provided for these bakery products. For the cakes, special boxes and labels reading
'Selecta Cakes for all occasions' are made. For the milk products, special bottle caps and
bottles with the colored words 'Quality Always Selecta Fresh Milk, One Pint' inscribed and
blown on the sides of the bottles - an innovation from the old bottles and caps used formerly.
Similar, special boxes with the name 'Selecta 'are provided for fried chicken sold to
customers.
Business being already well established, Ramon Arce decided to retire, so that his children
can go on with the business. For this purpose, he transferred and leased to them all his
rights, interest and participations in the business, including the use of the name of 'Selecta,'
sometime in the year 1950, at a monthly rental of P10,000.00, later reduced to P6,500.00.
He further wrote the Bureau of Commerce letter dated February 10, 1950, requesting
cancellation of the business name 'Selecta Restaurant' to give way to the registration of the
same 'Selecta' and asked that the same be registered in the name of Arce Sons & Company,
a co-partnership entered into by and among his children on February 10, 1950. Said co-
partnership was organized, so its articles of co-partnership state, 'conduct a first class
restaurant business; to engage in the manufacture and sale of ice cream, milk, cakes and
other dairy and bakery products; and to carry on such other legitimate business as may
produce profit'; Arce Sons & Company has thus continued the lucrative business of their
predecessor in interest. It is now, and has always been, engaged in the restaurant business,
the sale of milk, and the production and sale of cakes, dairy products and bakery products.
Arce Sons & Company are now making bakery products like bread rolls, pan de navaro, pan
de sal, and other types, of cookies and biscuit of the round, hard and other types, providing
thereof special boxes with the same "Selecta'.
Pursuing the policy of expansion adopted by their predecessor, Arce Sons & Company
established another store the now famous 'Selecta Dewey Boulevard', with seven (7)
delivery trucks with the 'Selecta ' conspicuously painted on them, to serve, deliver, and cater
to customers in and outside of Manila." .
The case for respondent on the other hand, is expressed as follows:
Defendant was organized and registered as a corporation under the name and style of
Selecta Biscuit Company, Inc. on March 2, 1955 (Exhibit 2-A; p. 3, April 17, 1958) but started
operation as a biscuit factory on June 20 1955 (t.s.n. p.3, id). The name 'Selecta' was
chosen by the organizers of defendant who are Chinese citizens as a translation of the
Chinese word 'Ching Suan' which means 'mapili' in Tagalog, and Selected' in English (t.s.n.
p, id.). Thereupon, the Articles of Incorporation of Selecta Biscuit Company, Inc. were
registered with the Securities and Exchange Commission (t.s.n. P.5. id.), and at the same
time registered as a business name with the Bureau of Commerce which issued certificate of
registration No. 55594 (Exhibit 3; Exhibit 3-A). The same name Selecta Biscuit Company,
Inc. was also subsequently registered with the Bureau of Internal Revenue which issued
Registration Certificate No. 35764 (Exhibit 4, t.s.n., p. id.). Inquiries were also made with the
Patent Office of 'Selecta'; after an official of the Patent referred to index cards information
was furnished to the effect that defendant could register the name 'Selecta' with the Bureau
of Patents (t.s.n. ,p.7, id). Accordingly, the corresponding petition for registration of trade-
mark was filed (Exhs. 5,5-A, Exhibit 5-B). Defendant actually operated its business factory on
June 20, 1955, while the petition for registration of trade-mark 'Selecta' was filed with
the Philippine Patent Office only on September 1, 1955, for the Philippine Patent Office
informed the defendant that the name should first be used before registration (t.s.n. p.8 ,id.).
The factory of defendant is located at Tuazon Avenue, Northern Hills, Malabon, Rizal,
showing plainly on its wall facing the streets the name 'SELECTA BISCUIT COMPANY, INC.'
(Exhs. 6, 6-a 6-B, t.s.n., p. 9, id.). It is significant to note that Eulalio Arce, Managing Partner
of the plaintiff resided and resides near the defendant's factory, only around 150 meters
away ; in fact, Arce use to pass in front of the factory of defendant while still under
construction and up to the present time (t.s.n., pp. 9, 10, id.). Neither Eulalio Arce nor any
other person in representation of the plaintiff complained to the defendant about the use of
the name 'Selecta Biscuit' until of the present complaint.
There are other factories using 'Selecta as trade-mark for biscuit (t.s.n., p. 12; Exhs. 7, 7-
A,7-B; Exhibit 8, 8-A, 8-B; Exhibits Exhibit 9, 9-A, 9-B); defendant in fact uses different kinds
of trade-mark (Exhibit 10, 10-A, to 10-W, t.s.n., p. 17).
The biscuits, cookies, and crackers manufactured and sold by defendant are wrapped in
cellophane pouches and place inside tin can (Exh. 11; t.s.n. p. 19); the products of defendant
are sold through the length and breadth of the Philippines through agents with more than one
hundred 600 stores as customers buying on credit (t.s.n.) pp. 19, 20, Exh. 12; t.s.n., p. 10,
June 20, 1958). Defendant employs more than one hundred (100) laborers and employees
presently although it started with around seventy (70) employees and laborers (t.s.n. p. 24);
its present capitalization fully paid is Two Hundred Thirty Four Thousand Pesos
(P234,000.00.)additional capitalization's were duly authorized by the Securities and
Exchange Commission (Exhs. 13, 13-A) there was no complaint whatsoever from plaintiff
saw defendant's business growing bigger and bigger and flourishing (t.s.n., p. 21); when
plaintiff filed its complaint.
Defendant advertises its products through radio broadcast and spot announcement (Exhs.
14, 14-A to 14-L; inclusive Exhs. 15, 15-A, 15-B, 15-C; Exh. 16, 16-A, 16-B to 16-E,
inclusive; Exhs. 17, 17-B to 17-L, inclusive); the broadcasts scripts announced therein
through the radio clearly show, among others, that Selecta Biscuit are manufactured by
Selecta Company, Inc. at Tuazon Avenue, Northern Hills, Malabon, Rizal, with Telephone
]No. 2-13-27 (Exhs. 23-A 23-B, 23-D, 23-E, 23-F).
Besides the signboard, 'Selecta Biscuit Company, Inc.' on the building itself, defendant has
installed signboard along the highways to indicate the location of the factory of defendant
(Exhs. 18, 18-A); delivery trucks defendant are plainly carrying signboards Selecta Biscuit
Company, Inc., Tuazon Avenue, Northern Hills Malabon, Rizal, Telephone No. 2-13-27
(Exhs. 19, 19-A, 19-B, 19-C 19-D,19-E,19-F). Defendant is using modern machineries in its
biscuit factory (Exhs. 20, 20-A, 20-B, 19-C, 20-D, 20-E). The defendant sells its products
thoughout 20-C, 20-D,20-E). The defendant sells its product throughout the Philippines,
including Luzon , Visayas, Mindanao; its customers count, among others, 600 stores buying
on credit; its stores buying on cash number around 50 (t.s.n.), p. 10). Sales in Manila and
suburbs are minimal, (Exh. 12). Defendant is a wholesaler and not a retailer of biscuits,
cookies and crackers. This is the nature of the operation of the business of the defendant."
At the outset one cannot but note that in the two cases appealed before us which involve the
same parties and the same issues of fact and law, the Court a quo and the Director of Patents have
rendered contradictory decisions. While the former is of the opinion that the word 'SELECTA' has
been used by the petitioner, or its predecessor-in-interest, as a trade-mark in the sale and
distribution of its dairy and bakery products as early as 1933 to the extent that it has acquired a
proprietary connotation so that to allow respondent to use it now as a trade-mark in its business
would be an usurpation of petitioner's goodwill and an infringement of its property right, the Director
of Patents entertained a contrary opinion. He believes that the word as used by the petitioner
functions only to point to the place of business or location of its restaurant while the same word as
used by respondent points to the origin of the products its manufactures and sells and he predicates
this distinction upon the fact that while the goods of petitioner are only served within its restaurant or
sold only on special orders in the City of Manila, respondent's goods are ready-made and are for
sale throughout the length and breadth of the country. He is of the opinion that the use of said trade-
mark by respondent has not resulted in confusion in trade contrary to the finding of the court a quo.
Which of this opinions is correct is the issue now for determination.
It appears that Ramon Arce, predecessor-in-interest of petitioner, started his milk business as early
as 1933. Hesold his milk products in bottles covered with caps on which the words 'SELECTA
FRESH MILK' were inscribed. Expanding his business, he established a store at Lepanto Street, City
of Manila, where he sold, in addition to his products, ice cream, sandwiches and other food products,
placing right in front of his establishment a signboard with the name 'SELECTA' inscribed thereon.
Special containers made of tin cans with the word 'SELECTA' written on their covers were used for
his products. Bottle with the same word embossed on their sides were used for his milk products.
The sandwiches he sold and distributed were wrapped in carton boxes with covers bearing the same
name. He used several cars and trucks for delivery purposes on the sides of which were written the
same word. As new products were produced for sale, the same were placed in containers with the
same name written on their covers. After the war, he added to his business such items as cakes,
bread, cookies, pastries, and assorted bakery products. Then his business was acquired by
petitioner, a co-partnership organized by his sons, the purposes of which are "to conduct a first class
restaurant business; to engage in the manufacture and sale of ice cream, milk, cakes and other
products; and to carry on such other legitimate business as may produce profit."
The foregoing unmistakably show that petitioner, through its predecessor-in-interest, had made use
of the word "SELECTA" not only as a trade-name indicative of the location of the restaurant where it
manufactures and sells its products, but as trade-mark is used. This is not only in accordance with
its general acceptation but with our law on the matter. "
Trade-mark' or trade-name', distinction being highly technical, is sign, device, or mark by
which articles produced are dealt in by particular person or organization are distinguished or
distinguishable from those produced or dealt in by other." (Church of God v. Tomlinson
Church of God, 247 SW 2d, 63,64)"
A 'trade-mark' is a distinctive mark of authenticity through which the merchandise of a
particular producer or manufacturer may be distinguished from that of others, and its sole
function is to designate distinctively the origin of the products to which it is attached."
(Reynolds & Reynolds Co. v. Nordic, et. al., 114F 2d, 278) "
The term 'trade-mark' includes any word, name, symbol, emblem, sign or device or any
combination thereof adopted and used by a manufacturer or merchant to identify his goods
and distinguish them from those manufactured, sold or dealt in by others." (Section 38,
Republic Act No. 166).
Verily, the word 'SELECTA' has been chosen by petitioner and has been inscribed on all its products
to serve not only as a sign or symbol that may indicate that they are manufactured and sold by it but
as a mark of authenticity that may distinguish them from the products manufactured and sold by
other merchants or businessmen. The Director of Patents, therefore, erred in holding that petitioner
made use of that word merely as a trade-name and not as a trade-mark within the meaning of the
law.
1

The word 'SELECTA', it is true, may be an ordinary or common word in the sense that may be used
or employed by any one in promoting his business or enterprise, but once adopted or coined in
connection with one's business as an emblem, sign or device to characterize its products, or as a
badge of authenticity, it may acquire a secondary meaning as to be exclusively associated with its
products and business.
2
In this sense, its used by another may lead to confusion in trade and cause
damage to its business. And this is the situation of petitioner when it used the word 'SELECTA' as a
trade-mark. In this sense, the law gives its protection and guarantees its used to the exclusion of all
others a (G. & C. Merriam Co. v. Saalfield, 198 F. 369, 373). And it is also in the sense that the law
postulates that "The ownership or possession of a trade-mark, . . . shall be recognized and protected
in the same manner and to the same extent, as are other property rights known to the law," thereby
giving to any person entitled to the exclusive use of such trade-mark the right to recover damages in
a civil action from any person who may have sold goods of similar kind bearing such trade-mark
(Sections 2-A and 23, Republic Act No. 166, as amended).
The term 'SELECTA' may be placed at par with the words "Ang Tibay" which this Court has
considered not merely as a descriptive term within the meaning of the Trade-mark Law but as a
fanciful or coined phrase, or a trade-mark. In that case, this Court found that respondent has
constantly used the term "Ang Tibay" , both as a trade-mark and a trade-name, in the manufacture
and sale of slippers, shoes and indoor baseballs for twenty-two years before petitioner registered it
as a trade-name for pants and shirts so that it has performed during that period the function of a
trade-mark to point distinctively, or by its own meaning or by association, to the origin or ownership
of the wares to which it applies. And holding that respondent was entitled to protection in the use of
that trade-mark, this Court made the following comment:
The function of a trade-mark is to point distinctively, either by its own meaning or by
association, to the origin or ownership of the wares to which it is applied. 'Ang Tibay' as used
by the respondent to designate his wares, had exactly performed that function for twenty-two
years before the petitioner adopted it as a trade-mark in her own business. 'Ang Tibay' shoes
and slippers are, by association, known throughout the Philippines as products of the 'Ang
Tibay" factory owned and operated by the respondent. Even if 'AngTibay', therefore, were
not capable of exclusive appropriation as a trade-mark, the application of the doctrine of
secondary meaning could nevertheless be fully sustained because, in any event, by
respondent's long and exclusive appropriation with reference to an article on the market,
because geographically or otherwise descriptive, might nevertheless have been used so long
and exclusively by one producer with reference to his article that, in that trade and to that
branch of the purchasing public, the word or phrase has come to mean that article was his
product." (Ang v. Teodoro, supra.).
The rationale in the Ang Tibay case applies on all fours to the case of petitioner.
But respondent claims that it adopted the trade-mark 'SELECTA' in good faith and not precisely to
engage in unfair competition with petitioner. It tried to establish that respondent was organized as a
corporation under the name of Selecta Biscuit Company, Inc. on March 2, 1955 and started
operations as a biscuit factory on June 20, 1955; that the name 'SELECTA' was chosen by the
organizers of respondent who are Chinese citizens as a translation of the Chinese word "Ching
Suan" which means "mapili" in Tagalog, and "Selected" in English; that , thereupon, it registered its
articles of incorporation with the Securities and Exchange Commission and the name 'SELECTA' as
a business name with the Bureau of Commerce which issued to it Certificate of Registration No.
55594; and that it also registered the same trade-name with the Bureau of Internal Revenue and
took steps to obtain a patent from the Patent Office by filing with it as application for the registration
of said trade-name.
The suggestion that the name 'SELECTA' was chosen by the organizers of respondent merely as a
translation from a Chinese word "Ching Suan" meaning "mapili" in the dialect is betrayed by the very
manner of its selection, for if the only purpose is to make an English translation of that word and not
to compete with the business of petitioner, why chose the word 'SELECTA', a Spanish word, and not
"Selected", the English equivalent thereof, as was done by other well-known enterprises? In the
words of petitioner's counsel, "Why with all the words in the English dictionary and all the words in
the Spanish dictionary and all the phrases that could be coined, should defendant-appellant
(respondent) choose 'SELECTA' if its purpose was not and is not to fool the people and to damage
plaintiff-appellee?" In this respect, we find appropriate the following comment of the trial court:
Eventually, like the plaintiff, one is tempted to ask as to why with the richness in words of the
English language and with the affluence of the Spanish vocabulary or, for that matter, of our
own dialects, should the defendant choose the controverted word "Selecta", which has
already acquired a secondary meaning by virtue of plaintiff's prior and continued use of the
same as a trade-mark or trade-name of its products? The explanation given by Sy Hap,
manager of the defendant, that the word 'Selecta' was chosen for its bakery products by the
organizers of said company from the Chinese word 'Ching Suan' meaning 'mapili', which in
English translation , is to say the least, very weak and untenable. Sy Hap himself admitted
that he had known Eulalio Arce, the person managing plaintiff's business, since 1954; that
since he began to reside at 10th Avenue, Grace Park, he had known the Selecta Restaurant
on Azcarraga Street and Dewey Blvd. and that he even had occasion to eat in one of the
restaurants of the plaintiff. All of these circumstances tend to conspire in inducing one to
doubt defendant's motive for using the same word "Selecta" for its bakery products. To allow
the defendant here to use the word "Selecta" in spite of the fact that this word has already
been adopted and exploited by Ramon Arce and by his family thru the organization of Arce
Sons and Company, for the maintenance of its goodwill, for which said plaintiff and its
predecessor have spent time, effort and fortune, is to permit business pirates and
buccaneers to appropriate for themselves and to their profit and advantage the trade names
and trade marks of well established merchants with all their attendant good will and
commercial benefit. Certainly, this cannot be allowed, and it becomes the duty of the court to
protect the legitimate owners of said trade-names and trade-marks, for under the law, the
same constitute one kind of property right entitled to the necessary legal protection.
Other points raised by respondent to show that the trial court erred in holding that the adoption by it
of the word 'SELECTA' is tantamount to unfair competition are: (1) that its products are biscuits,
crackers, and cookies, wrapped in cellophane packages, place in tin containers, and that its
products may last a year with out spoilage, while the ice cream, milk, cakes and other bakery
products which petitioner manufactures last only for two or three days; (2) that the sale and
distribution of petitioner's products are on retail basis, limited to the City of Manila and suburbs, and
its place of business is localized at Azcarraga, corner of Lepanto Street and at Dewey Blvd., Manila,
while that of respondent is on a wholesale basis, extending throughout the length and breadth of the
Philippines; (3) that petitioner's signboard on its place of business reads 'SELECTA' and on its
delivery trucks "Selecta, Quality Always, Restaurant and Caterer, Azcarraga, Dewey Blvd.,
Balintawak and Telephone number," in contrast with respondent's signboard on its factory which
reads "Selecta Biscuit Company, Inc.," and on its delivery trucks "Selecta Biscuit Company, Inc.,
Tuason Avenue, Malabon, Rizal, Telephone No. 2-13-27; (4) that the business name of petitioner is
different from the business name of respondent; (5) that petitioner has only a capital investment of
P25,000.00 whereas respondent has a fully paid-up stock in the amount of P234,000.00 out of the
P500,000.00 authorized capital, (6) that the use of the name 'SELECTA' by respondent cannot lead
to confusion in the business operation of the parties.
We have read carefully the reasons advanced in support of the points raised by counsel in an effort
to make inroads into the findings of the court a quo on unfair competition, but we believe them to be
substantial and untenable. They appear to be well answered and refuted by counsel for petitioner in
his brief, which refutation we do not need to repeat here. Suffice it to state that we agree with the
authorities and reasons advanced therein which incidentally constitute the best support of the
decision of the court a quo.
With regard to the claim that petitioner failed to present sufficient evidence on the contract of lease
of the business from its predecessor-in-interest, we find that under the circumstances secondary
evidence is admissible.
In view of the foregoing, we hold that the Director of Patents committed an error in dismissing the
opposition of petitioner and in holding that the registration of the trade-mark 'SELECTA' in favor of
respondent will not cause damage to petitioner, and consequently, we hereby reverse his decision.
Consistently with this finding, we hereby affirm the decision of the court a quo rendered in G.R. No.
L-17981. No costs.
Paras, C.J., Bengzon, Labrador, Reyes, J.B.L. Barrera, Gutierrez David, Paredes and Dizon.,
JJ., concur.
Padilla, and Concepcion, JJ., took no part.


Footnotes
1
A trade-mark is generally described as a sign , device, or mark by which the articles
produced or dealt in by a particular person or organization are distinguished or
distinguishable from those produced or dealt in by others,and must be affixed to the goods or
articles, while a trade-name is descriptive of the manufacturer or dealer himself as much as
his own name is and frequently includes the name of the placewhere the business is located;
it involves the individuality of the maker or dealer for protection in trade, and to avoid
confusion in business, and to secure the advantages of a good reputation; it is more
popularly applied to the good will of a business,and need not be affixed to the goods sold. In
other words it is not regarded as a trade-mark in the strict technical sense. 52 Am. Jur., p.
507, et seq, 63 C.J., p.322, et seq." (Katz Drug Co. V. Katz, 217 2d. 286,289)
2
This doctrine is to the effect that a word or phrase originally incapable of exclusive
appropriation with reference to an article on the market, because geographically or otherwise
descriptive, might nevertheless have been used so long and so exclusively by one producer
with reference to his article that , in that trade and to that branch of the purchasing public, the
word or phrase has come to mean that the article was his product. (G& C Merriam Co. vs.
Saalfield, 198 F. 369, 373.) (Ang v. Teodoro, 74 Phil. 50, 53)
McDonalds Corporation vs Macjoy Fastfood
Corporation
on February 5, 2012
Intellectual Property Law Law on Trademarks, Service Marks and Trade Names Dominancy Test vs
Holistic Test
Since 1987, MacJoy Devices had been operating in Cebu. MacJoy is a fast food restaurant which sells
fried chicken, chicken barbeque, burgers, fries, spaghetti, palabok, tacos, sandwiches, halo-halo and
steaks. In 1991, MacJoy filed its application for trademark before the Intellectual Property Office (IPO).
McDonalds opposed the application as it alleged that MacJoy closely resembles McDonalds corporate
logo such that when used on identical or related goods, the trademark applied for would confuse or
deceive purchasers into believing that the goods originate from the same source or origin that the use
and adoption in bad faith of the MacJoy and Device mark would falsely tend to suggest a connection or
affiliation with McDonalds restaurant services and food products, thus, constituting a fraud upon the
general public and further cause the dilution of the distinctiveness of McDonalds registered and
internationally recognized McDonaldS marks to its prejudice and irreparable damage.
The IPO ruled in favor of McDonalds. MacJoy appealed before the Court of Appeals and the latter ruled
in favor of MacJoy. The Court of Appeals, in ruling over the case, actually used the holistic test (which is
a test commonly used in infringement cases). The holistic test looks upon the visual comparisons
between the two trademarks. In this case, the Court of Appeals ruled that other than the letters M and
C in the words MacJoy and McDonalds, there are no real similarities between the two trademarks.
MacJoy is written in round script while McDonalds is written in thin gothic. MacJoy is accompanied
by a picture of a (cartoonish) chicken while McDonalds is accompanied by the arches M. The color
schemes between the two are also different. MacJoy is in deep pink while McDonalds is in gold color.
ISSUE: Whether or not MacJoy infringed upon the trademark of McDonalds.
HELD: Yes. The Supreme Court ruled that the proper test to be used is the dominancy test. The
dominancy test not only looks at the visual comparisons between two trademarks but also the aural
impressions created by the marks in the public mind as well as connotative comparisons, giving little
weight to factors like prices, quality, sales outlets and market segments. In the case at bar, the Supreme
Court ruled that McDonalds and MacJoy marks are confusingly similar with each other such that an
ordinary purchaser can conclude an association or relation between the marks. To begin with, both marks
use the corporate M design logo and the prefixes Mc and/or Mac as dominant features. The first
letter M in both marks puts emphasis on the prefixes Mc and/or Mac by the similar way in which
they are depicted i.e. in an arch-like, capitalized and stylized manner. For sure, it is the prefix Mc, an
abbreviation of Mac, which visually and aurally catches the attention of the consuming public. Verily,
the word MACJOY attracts attention the same way as did McDonalds, MacFries, McSpaghetti,
McDo, Big Mac and the rest of the MCDONALDS marks which all use the prefixes Mc and/or Mac.
Besides and most importantly, both trademarks are used in the sale of fastfood products.
Further, the owner of MacJoy provided little explanation why in all the available names for
a restaurant he chose the prefix Mac to be the dominant feature of the trademark. The prefix Mac
and Macjoy has no relation or similarity whatsoever to the name Scarlett Yu Carcel, which is the name
of the niece of MacJoys president whom he said was the basis of the trademark MacJoy. By reason of
the MacJoys implausible and insufficient explanation as to how and why out of the many choices of
words it could have used for its trade-name and/or trademark, it chose the word Macjoy, the only
logical conclusion deducible therefrom is that the MacJoy would want to ride high on the established
reputation and goodwill of the McDonalds marks, which, as applied to its restaurant business and food
products, is undoubtedly beyond question.

G.R. No. L-29971 August 31, 1982
ESSO STANDARD EASTERN, INC., petitioner,
vs.
THE HONORABLE COURT OF APPEALS ** and UNITED CIGARETTE
CORPORATION, respondents.
&
TEEHANKEE, J .:1wph1.t
The Court affirms on the basis of controlling doctrine the appealed decision of the Court of
Appeals reversing that of the Court of First Instance of Manila and dismissing the complaint filed by
herein petitioner against private respondent for trade infringement for using petitioner's trademark
ESSO, since it clearly appears that the goods on which the trademark ESSO is used by respondent
is non-competing and entirely unrelated to the products of petitioner so that there is no likelihood of
confusion or deception on the part of the purchasing public as to the origin or source of the goods.
Petitioner Esso Standard Eastern, Inc.,
1
then a foreign corporation duly licensed to do business in
the Philippines, is engaged in the sale of petroleum products which are Identified with its trademark
ESSO (which as successor of the defunct Standard Vacuum Oil Co. it registered as a business
name with the Bureaus of Commerce and Internal Revenue in April and May, 1962). Private
respondent in turn is a domestic corporation then engaged in the manufacture and sale of cigarettes,
after it acquired in November, 1963 the business, factory and patent rights of its predecessor La
Oriental Tobacco Corporation, one of the rights thus acquired having been the use of the trademark
ESSO on its cigarettes, for which a permit had been duly granted by the Bureau of Internal Revenue.
Barely had respondent as such successor started manufacturing cigarettes with the trademark
ESSO, when petitioner commenced a case for trademark infringement in the Court of First Instance
of Manila. The complaint alleged that the petitioner had been for many years engaged in the sale of
petroleum products and its trademark ESSO had acquired a considerable goodwill to such an extent
that the buying public had always taken the trademark ESSO as equivalent to high quality petroleum
products. Petitioner asserted that the continued use by private respondent of the same trademark
ESSO on its cigarettes was being carried out for the purpose of deceiving the public as to its quality
and origin to the detriment and disadvantage of its own products.
In its answer, respondent admitted that it used the trademark ESSO on its own product of cigarettes,
which was not Identical to those produced and sold by petitioner and therefore did not in any
way infringe on or imitate petitioner's trademark. Respondent contended that in order that there may
be trademark infringement, it is indispensable that the mark must be used by one person in
connection or competition with goods of the same kind as the complainant's.
The trial court, relying on the old cases of Ang vs. Teodoro
2
and Arce & Sons, Inc. vs. Selecta
Biscuit Company,
3
referring to related products, decided in favor of petitioner and ruled that
respondent was guilty of infringement of trademark.
On appeal, respondent Court of Appeals found that there was no trademark infringement and
dismissed the complaint. Reconsideration of the decision having been denied, petitioner appealed to
this Court by way of certiorari to reverse the decision of the Court of Appeals and to reinstate the
decision of the Court of First Instance of Manila. The Court finds no ground for granting the petition.
The law defines infringement as the use without consent of the trademark owner of any
"reproduction, counterfeit, copy or colorable limitation of any registered mark or tradename 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
reproduce, counterfeit, copy or colorably imitate any such mark or tradename and apply such
reproduction, counterfeit, copy or colorable limitation to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used upon or in connection with such goods, business
or services."
4
Implicit in this definition is the concept that the goods must be so related that there is a
likelihood either of confusion of goods or business.
5
But likelihood of confusion is a relative concept;
to be determined only according to the particular, and sometimes peculiar, circumstances of each
case.
6
It is unquestionably true that, as stated in Coburn vs. Puritan Mills, Inc.
7
"In trademark cases,
even more than in other litigation, precedent must be studied in the light of the facts of the particular
case.
It is undisputed that the goods on which petitioner uses the trademark ESSO, petroleum products,
and the product of respondent, cigarettes, are non-competing. But as to whether trademark
infringement exists depends for the most part upon whether or not the goods are so related that the
public may be, or is actually, deceived and misled that they came from the same maker or
manufacturer. For non-competing goods may be those which, though they are not in actual
competition, are so related to each other that it might reasonably be assumed that they originate
from one manufacturer. Non-competing goods may also be those which, being entirely unrelated,
could notreasonably be assumed to have a common source. in the former case of related goods,
confusion of business could arise out of the use of similar marks; in the latter case of non-related
goods, it could not.
8
The vast majority of courts today follow the modern theory or concept of
"related goods"
9
which the Court has likewise adopted and uniformly recognized and applied.
10

Goods are related when they belong to the same class or have the same descriptive properties;
when they possess the same physical attributes or essential characteristics with reference to their
form, composition, texture or quality. They may also be related because they serve the same
purpose or are sold in grocery stores.
11
Thus, biscuits were held related to milk because they are
both food products.
12
Soap and perfume, lipstick and nail polish are similarly related because they
are common household items now a days.
13
The trademark "Ang Tibay" for shoes and slippers was
disallowed to be used for shirts and pants because they belong to the same general class of
goods.
14
Soap and pomade although non- competitive, were held to be similar or to belong to the
same class, since both are toilet articles.
15
But no confusion or deception can possibly result or arise
when the name "Wellington" which is the trademark for shirts, pants, drawers and other articles of
wear for men, women and children is used as a name of a department store.
16

Thus, in Acoje Mining Co., Inc. vs. Director of Patents,
17
the Court, through now Chief Justice
Fernando, reversed the patent director's decision on the question of "May petitioner Acoje Mining
Company register for the purpose of advertising its product, soy sauce, the trademark LOTUS, there
being already in existence one such registered in favor of the Philippine Refining Company for its
product, edible oil, it being further shown that the trademark applied for is in smaller type, colored
differently, set on a background which is dissimilar as to yield a distinct appearance?" and ordered
the granting of petitioner's application for registration ruling that "there is quite a difference between
soy sauce and edible oil. If one is in the market for the former, he is not likely to purchase the latter
just because of the trademark LOTUS" and "when regard is had for the principle that the two
trademarks in their entirety as they appear in their respective labels should be considered in relation
to the goods advertised before registration could be denied, the conclusion is inescapable that
respondent Director ought to have reached a different conclusion. "
By the same token, in the recent case of Philippine Refining Co., Inc. vs. Ng Sam and Director of
Patents,
18
the Court upheld the patent director's registration of the same trademark CAMIA for
therein respondent's product of ham notwithstanding its already being used by therein petitioner for a
wide range of products: lard butter, cooking oil, abrasive detergents, polishing materials and soap of
all kinds. The Court, after noting that the same CAMIA trademark had been registered by two other
companies, Everbright Development Company and F. E. Zuellig, Inc. for their respective products of
thread and yarn (for the former) and textiles, embroideries and laces (for the latter) ruled that "while
ham and some of the products of petitioner are classified under Class 47 (Foods and Ingredients of
Food), this alone cannot serve as the decisive factor in the resolution of whether or not they are
related goods. Emphasis should be on the similarity of the products involved and not on the arbitrary
classification or general description of their properties or characteristics." The Court, therefore,
concluded that "In fine, We hold that the businesses of the parties are non-competitive and their
products so unrelated that the use of Identical trademarks is not likely to give rise to confusion, much
less cause damage to petitioner."
In the situation before us, the goods are obviously different from each other with "absolutely no iota
of similitude"
19
as stressed in respondent court's judgment. They are so foreign to each other as to
make it unlikely that purchasers would think that petitioner is the manufacturer of respondent's
goods.t@lF The mere fact that one person has adopted and used a trademark on his goods does not
prevent the adoption and use of the same trademark by others on unrelated articles of a different
kind.
20

Petitioner uses the trademark ESSO and holds certificate of registration of the trademark for
petroleum products, including aviation gasoline, grease, cigarette lighter fluid and other various
products such as plastics, chemicals, synthetics, gasoline solvents, kerosene, automotive and
industrial fuel, bunker fuel, lubricating oil, fertilizers, gas, alcohol, insecticides and the ESSO Gasul"
burner, while respondent's business is solely for the manufacture and sale of the unrelated product
of cigarettes. The public knows too well that petitioner deals solely with petroleum products that
there is no possibility that cigarettes with ESSO brand will be associated with whatever good name
petitioner's ESSO trademark may have generated. Although petitioner's products are numerous,
they are of the same class or line of merchandise which are non-competing with respondent's
product of cigarettes, which as pointed out in the appealed judgment is beyond petitioner's "zone of
potential or natural and logical expansion"
21
When a trademark is used by a party for a product in
which the other party does not deal, the use of the same trademark on the latter's product cannot be
validly objected to.
22

Another factor that shows that the goods involved are non-competitive and non-related is the
appellate court's finding that they flow through different channels of trade, thus: "The products of
each party move along and are disposed through different channels of distribution. The (petitioner's)
products are distributed principally through gasoline service and lubrication stations, automotive
shops and hardware stores. On the other hand, the (respondent's) cigarettes are sold in sari-sari
stores, grocery stores, and other small distributor outlets. (Respondent's) cigarettes are even
peddled in the streets while (petitioner's) 'gasul' burners are not. Finally, there is a marked distinction
between oil and tobacco, as well as between petroleum and cigarettes. Evidently, in kind and nature
the products of (respondent) and of (petitioner) are poles apart."
23

Respondent court correctly ruled that considering the general appearances of each mark as a whole,
the possibility of any confusion is unlikely. A comparison of the labels of the samples of the goods
submitted by the parties shows a great many differences on the trademarks used. As pointed out by
respondent court in its appealed decision, "(A) witness for the plaintiff, Mr. Buhay, admitted that the
color of the "ESSO" used by the plaintiff for the oval design where the blue word ESSO is contained
is the distinct and unique kind of blue. In his answer to the trial court's question, Mr. Buhay informed
the court that the plaintiff never used its trademark on any product where the combination of colors is
similar to the label of the Esso cigarettes," and "Another witness for the plaintiff, Mr. Tengco, testified
that generally, the plaintiff's trademark comes all in either red, white, blue or any combination of the
three colors. It is to be pointed out that not even a shade of these colors appears on the trademark
of the appellant's cigarette. The only color that the appellant uses in its trademark is green."
24

Even the lower court, which ruled initially for petitioner, found that a "noticeable difference between
the brand ESSO being used by the defendants and the trademark ESSO of the plaintiff is that the
former has a rectangular background, while in that of the plaintiff the word ESSO is enclosed in an
oval background."
In point of fact and time, the Court's dismissal of the petition at bar was presaged by its Resolution of
May 21, 1979 dismissing by minute resolution the petition for review for lack of merit in the Identical
case of Shell Company of the Philippines, Ltd vs. Court of Appeals
25
, wherein the Court thereby
affirmed the patent office's registration of the trademark SHELL as used in the cigarettes
manufactured by therein respondent Fortune Tobacco Corporation notwithstanding the therein
petitioner Shell Company's opposition thereto as the prior registrant of the same trademark for its
gasoline and other petroleum trademarks, on the strength of the controlling authority of Acoje Mining
Co. vs. Director of Patents, Supra, and the same rationale that "(I)n the Philippines, where buyers of
appellee's (Fortune Corp.'s) cigarettes, which are low cost articles, can be more numerous
compared to buyers of the higher priced petroleum and chemical products of appellant (Shell Co.)
and where appellant (Shell) is known to be in the business of selling petroleum and petroleum-based
chemical products, and no others, it is difficult to conceive of confusion in the minds of the buying
public in the sense it can be thought that appellant (Shell) is the manufacturer of appellee's
(Fortune's) cigarettes, or that appellee (Fortune) is the manufacturer or processor of appellant's
(Shell's) petroleum and chemical products."
26

ACCORDINGLY, the petition is dismissed and the decision of respondent Court of Appeals is hereby
affirmed.
Melencio-Herrera, Plana, Relova and Gutierrez, Jr., JJ., concur.1wph 1. t
Makasiar, J., is on leave.
Vasquez, J., took no part.