ECOLE DE CUISINE MANILLE V. COINTREAU (G.R. NO.
Issue:
185830)
Facts:
Respondent Cointreau, a partnership registered under the laws of
France, applied for the registration of the mark ‘Le Cordon Bleu &
Device.’ Petitioner Ecole De Cuisine opposed on the ground that it is
the owner of the mark ‘Le Cordon Bleu, Ecole De Cuisine Manille’
used in its culinary activities and restaurant business and that the
registration will create confusion to the public. Respondent Cointreau
answered claiming it is the true and lawful owner of the mark and
had long been using it worldwide. The IPO Bureau of Legal Affairs
sustained petitioner’s opposition stating that Cointreau had no prior
use of the mark in the Philippines to be entitled to a proprietary right
over it. The IPO Director General reversed the decision and allowed
the mark’s registration holding that under RA No. 166, actual use in
the Philippines is not necessary to acquire ownership of the mark.
Issue:
Whether or not respondent’s prior use of the mark is a requirement
for its registration.
Ruling: YES.
Under Section 2 of R.A. No. 166, in order to register a trademark,
one must be the owner thereof and must have actually used the mark
in commerce in the Philippines for 2 months prior to the application
for registration. Section 2-A of the same law sets out to define how
one goes about acquiring ownership thereof. Under Section 2-A, it is
clear that actual use in commerce is also the test of ownership but the
provision went further by saying that the mark must not have been so
appropriated by another. Additionally, it is significant to note that
Section 2-A does not require that the actual use of a trademark must
be within the Philippines. Thus, as correctly mentioned by the CA,
under R.A. No. 166, one may be an owner of a mark due to its actual
use but may not yet have the right to register such ownership here
due to the owner’s failure to use the same in the Philippines for 2
months prior to registration. In the instant case, it is undisputed that
Cointreau has been using the subject mark in France, prior to Ecole’s
averred first use of the same in the Philippines, of which the latter
was fully aware thereof. On the other hand, Ecole has no certificate
of registration over the subject mark but only a pending application.
Under the foregoing circumstances, even if Ecole was the first to use
the mark in the Philippines, it cannot be said to have validly
appropriated the same.
In any case, the present law on trademarks, Republic Act No. 8293,
otherwise known as the Intellectual Property Code of the Philippines,
as amended, has already dispensed with the requirement of prior
actual use at the time of registration. Thus, there is more reason to
allow the registration of the subject mark under the name of
Cointreau as its true and lawful owner.
SHANGRI-LA INTERNATIONAL HOTEL MANAGEMENT
V. DEVELOPERS GROUP OF COMPANIES (G.R. NO.
159938)
Facts:
Respondent DGCI applied for and was granted registration of the
‘Shangri-La’ mark and ‘S’ logo in its restaurant business. Petitioner
Shangri-La, chain of hotels and establishments owned by the Kuok
family worldwide, moved to cancel the registration of the mark on
the ground that it was illegally and fraudulently obtained and
appropriated by respondents. Petitioner also moved to register the
mark and logo in its own name. Later, respondent DGCI filed before
the trial court a complaint for infringement against petitioner alleging
that DGCI had been the prior exclusive user and the registered owner
in the Philippines of said mark and logo. Petitioner Shangri-La
argued that respondent had no right to apply for the registration
because it did not have prior actual commercial use thereof. The trial
court found for respondent. CA affirmed.
Whether or not respondent’s prior use of the mark is a requirement
for its registration.
Ruling: YES.
While the present law on trademarks has dispensed with the
requirement of prior actual use at the time of registration, the law in
force at the time of registration must be applied. Under the provisions
of the former trademark law, R.A. No. 166, as amended, hence, the
law in force at the time of respondent’s application for registration of
trademark, the root of ownership of a trademark is actual use in
commerce. Section 2 of said law requires that before a trademark can
be registered, it must have been actually used in commerce and
service for not less than two months in the Philippines prior to the
filing of an application for its registration. Trademark is a creation of
use and therefore actual use is a pre-requisite to exclusive ownership
and its registration with the Philippine Patent Office is a mere
administrative confirmation of the existence of such right.
While the petitioners may not have qualified under Section 2 of R.A.
No. 166 as a registrant, neither did respondent DGCI, since the latter
also failed to fulfill the 2-month actual use requirement. What is
worse, DGCI was not even the owner of the mark. For it to have been
the owner, the mark must not have been already appropriated (i.e.,
used) by someone else. At the time of respondent DGCI’s registration
of the mark, the same was already being used by the petitioners,
albeit abroad, of which DGCI’s president was fully aware.
SOCIETE DES PRODUIT NESTLE , NA vs MARTIN T. DY,
JR.
The Case
This is a petition for review on certiorari under Rule 45 of the Rules
of Court. The petition challenges the 1 September 2005 Decision and
4 April 2006 Resolution of the Court of Appeals in CA-G.R. CV No.
62730, finding respondent Martin T. Dy, Jr. (Dy, Jr.) not liable for
trademark infringement. The Court of Appeals reversed the 18
September 1998 Decision of the Regional Trial Court (RTC), Judicial
Region 7, Branch 9, Cebu City, in Civil Case No. CEB-19345.
The Facts
Petitioner Societe Des Produits Nestle, S.A. (Nestle) is a foreign
corporation organized under the laws of Switzerland. It manufactures
food products and beverages. As evidenced by Certificate of
Registration No. R-14621 issued on 7 April 1969 by the then Bureau
of Patents, Trademarks and Technology Transfer, Nestle owns the
NAN trademark for its line of infant powdered milk products,
consisting of PRE-NAN, NAN-H.A., NAN-1, and NAN-2. NAN is
classified under Class 6 diatetic preparations for infant feeding.
Nestle distributes and sells its NAN milk products all over the
Philippines.
Dy, Jr. owns 5M Enterprises. He imports Sunny Boy powdered milk
from Australia and repacks the powdered milk into three sizes of
plastic packs bearing the name NANNY. The packs weigh 80, 180
and 450 grams and are sold for P8.90, P17.50 and P39.90,
respectively. NANNY is is also classified under Class 6 full cream
milk for adults in [sic] all ages. Dy, Jr. distributes and sells the
powdered milk in Dumaguete, Negros Oriental, Cagayan de Oro, and
parts of Mindanao.
In a letter dated 1 August 1985, Nestle requested Dy, Jr. to refrain
from using NANNY and to undertake that he would stop infringing
the NAN trademark. Dy, Jr. did not act on Nestles request. On 1
March 1990, Nestle filed before the RTC, Judicial Region 7, Branch
31, Dumaguete City, a complaint against Dy, Jr. for infringement.
Dy, Jr. filed a motion to dismiss alleging that the complaint did not
state a cause of action. In its 4 June 1990 order, the trial court
dismissed the complaint. Nestle appealed the 4 June 1990 order to the
Court of Appeals. In its 16 February 1993 Resolution, the Court of
Appeals set aside the 4 June 1990 order and remanded the case to the
trial court for further proceedings.
Nestle filed a motion for reconsideration. In its 4 April 2006
Resolution, the Court of Appeals denied the motion for lack of merit.
Hence, the present petition.
Issue
The issue is whether Dy, Jr. is liable for infringement.
The Courts Ruling
The petition is meritorious.
Section 22 of Republic Act (R.A.) No. 166, as amended, states:
Infringement, what constitutes. Any person who shall use, without
the consent of the registrant, any reproduction, counterfeit, copy or
colorable imitation of any registered mark or trade-name in
connection with the sale, offering for sale, or advertising of any
goods, business or services on or in connection with which such use
is likely to cause confusion or mistake or to deceive purchasers or
others as to the source or origin of such goods or services, or identity
of such business; or reproduce, counterfeit, copy or colorably imitate
any such mark or trade-name and apply such reproduction,
counterfeit, copy, or colorable imitation to labels, signs, prints,
packages, wrappers, receptacles or advertisements intended to be
used upon or in connection with such goods, business or services,
shall be liable to a civil action by the registrant for any or all of the
remedies herein provided.
In accordance with Section 22 of R.A. No. 166, as well as Sections 2,
2-A, 9-A, and 20 thereof, the following constitute the elements of
trademark infringement:
(a) A trademark actually used in commerce in the Philippines and
registered in the principal register of the Philippine Patent Office[;]
(b) [It] is used by another person in connection with the sale,
offering for sale, or advertising of any goods, business or services 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 such
trademark is reproduced, counterfeited, copied or colorably imitated
by another person and such reproduction, counterfeit, copy or
colorable imitation is applied to labels, signs, prints, packages,
wrappers, receptacles or advertisements intended to be used upon or
in connection with such goods, business or services as to likely cause
confusion or mistake or to deceive purchasers[;]
(c) [T]he trademark is used for identical or similar goods[;] and
(d) [S]uch act is done without the consent of the trademark registrant
or assignee.
On the other hand, the elements of infringement under R.A. No. 8293
are as follows:
The trademark being infringed is registered in the Intellectual
Property Office; however, in infringement of trade name, the same
need not be registered;
The trademark or trade name is reproduced, counterfeited, copied, or
colorably imitated by the infringer;
The infringing mark or trade name is used in connection with the
sale, offering for sale, or advertising of any goods, business or
services; or the infringing mark or trade name is applied to labels,
signs, prints, packages, wrappers, receptacles or advertisements
intended to be used upon or in connection with such goods, business
or services;
The use or application of the infringing mark or trade name is likely
to cause confusion or mistake or to deceive purchasers or others as to
the goods or services themselves or as to the source or origin of such
goods or services or the idenity of such business; and
It is without the consent of the trademark or trade name owner or the
assignee thereof.
Among the elements, the element of likelihood of confusion is the
gravamen of trademark infringement. There are two types of
confusion in trademark infringement: confusion of goods and
confusion of business. In Sterling Products International, Inc. v.
Farbenfabriken Bayer Aktiengesellschaft, the Court distinguished the
two types of confusion:
Callman notes two types of confusion. The first is the confusion of
goods in which event the ordinarily prudent purchaser would be
induced to purchase one product in the belief that he was purchasing
the other. In which case, defendants goods are then bought as the
plaintiffs, and the poorer quality of the former reflects adversely on
the plaintiffs reputation. The other is the confusion of business: Here
though the goods of the parties are different, the defendants product
is such as might reasonably be assumed to originate with the plaintiff,
and the public would then be deceived either into that belief or into
the belief that there is some connection between the plaintiff and
defendant which, in fact, does not exist.
There are two tests to determine likelihood of confusion: the
dominancy test and holistic test. The dominancy test focuses on the
similarity of the main, prevalent or essential features of the
competing trademarks that might cause confusion. Infringement takes
place when the competing trademark contains the essential features
of another. Imitation or an effort to imitate is unnecessary. The
question is whether the use of the marks is likely to cause confusion
or deceive purchasers.
The holistic test considers the entirety of the marks, including labels
and packaging, in determining confusing similarity. The focus is not
only on the predominant words but also on the other features
appearing on the labels.
Applying the dominancy test in the present case, the Court finds that
NANNY is confusingly similar to NAN. NAN is the prevalent
feature of Nestles line of infant powdered milk products. It is written
in bold letters and used in all products. The line consists of PRE-
NAN, NAN-H.A., NAN-1, and NAN-2. Clearly, NANNY contains
the prevalent feature NAN. The first three letters of NANNY are
exactly the same as the letters of NAN. When NAN and NANNY are
pronounced, the aural effect is confusingly similar.
In determining the issue of confusing similarity, the Court takes into
account the aural effect of the letters contained in the marks. In
Marvex Commercial Company, Inc. v. Petra Hawpia & Company,
the Court held:
It is our considered view that the trademarks SALONPAS and
LIONPAS are confusingly similar in sound.
Both these words have the same suffix, PAS, which is used to denote
a plaster that adheres to the body with curative powers. PAS, being
merely descriptive, furnishes no indication of the origin of the article
and therefore is open for appropriation by anyone (Ethepa vs.
Director of Patents, L-20635, March 31, 1966) and may properly
become the subject of a trademark by combination with another word
or phrase.
The scope of protection afforded to registered trademark owners is
not limited to protection from infringers with identical goods. The
scope of protection extends to protection from infringers with related
goods, and to market areas that are the normal expansion of business
of the registered trademark owners. Section 138 of R.A. No. 8293
states:
Certificates of Registration. A certificate of registration of a mark
shall be prima facie evidence of validity of the registration, the
registrants ownership of the mark, and of the registrants exclusive
right to use the same in connection with the goods or services and
those that are related thereto specified in the certificate. (Emphasis
supplied)
In Mighty Corporation v. E. & J. Gallo Winery, the Court held that,
Non-competing goods may be those which, though they are not in
actual competition, are so related to each other that it can reasonably
be assumed that they originate from one manufacturer, in which case,
confusion of business can arise out of the use of similar marks. In that
case, the Court enumerated factors in determining whether goods are
related: (1) classification of the goods; (2) nature of the goods; (3)
descriptive properties, physical attributes or essential characteristics
of the goods, with reference to their form, composition, texture or
quality; and (4) style of distribution and marketing of the goods,
including how the goods are displayed and sold.
NANNY and NAN have the same classification, descriptive
properties and physical attributes. Both are classified under Class 6,
both are milk products, and both are in powder form. Also, NANNY
and NAN are displayed in the same section of stores the milk section.
The Court agrees with the lower courts that there are differences
between NAN and NANNY: (1) NAN is intended for infants while
NANNY is intended for children past their infancy and for adults;
and (2) NAN is more expensive than NANNY. However, as the
registered owner of the NAN mark, Nestle should be free to use its
mark on similar products, in different segments of the market, and at
different price levels. In McDonalds Corporation v. L.C. Big Mak
Burger, Inc., the Court held that the scope of protection afforded to
registered trademark owners extends to market areas that are the
normal expansion of business:
The registered trademark owner may use his mark on the same or
similar products, in different segments of the market, and at different
price levels depending on variations of the products for specific
segments of the market. The Court has recognized that the registered
trademark owner enjoys protection in product and market areas that
are the normal potential expansion of his business. Thus, the Court
has declared:
Modern law recognizes that the protection to which the owner of a
trademark is entitled is not limited to guarding his goods or business
from actual market competition with identical or similar products of
the parties, but extends to all cases in which the use by a junior
appropriator of a trade-mark or trade-name is likely to lead to a
confusion of source, as where prospective purchasers would be
misled into thinking that the complaining party has extended his
business into the field (see 148 ALR 56 et sq; 53 Am. Jur. 576) or is
in any way connected with the activities of the infringer; or when it
forestalls the normal potential expansion of his business (v. 148 ALR,
77, 84; 52 Am. Jur. 576, 577). (Emphasis supplied)
WHEREFORE, we GRANT the petition. We SET ASIDE the 1
September 2005 Decision and 4 April 2006 Resolution of the Court
of Appeals in CA-G.R. CV No. 62730 and REINSTATE the 18
September 1998 Decision of the Regional Trial Court, Judicial
Region 7, Branch 9, Cebu City, in Civil Case No. CEB-19345.
SO ORDERED.
LYCEUM OF THE PHILIPPINES V. CA (G.R. NO. 101897)
Facts:
Petitioner Lyceum of the Philippines had commenced before the SEC
a proceeding against the Lyceum of Baguio to change its corporate
name alleging that the 2 names are substantially identical because of
the word ‘Lyceum’. SEC found for petitioner and the SC denied the
consequent appeal of Lyceum of Baguio in a resolution. Petitioner
then basing its ground on the resolution, wrote to all educational
institutions which made use of the word ‘Lyceum’ as part of their
corporate name to discontinue their use. When this recourse failed,
petitioner moved before the SEC to enforce its exclusive use of the
word ‘Lyceum.’ Petitioner further claimed that the word ‘Lyceum’
has acquired a secondary meaning in its favor. The SEC Hearing
Officer found for petitioner. Both SEC En Banc and CA ruled
otherwise.
Issues:
(1) Whether or not ‘Lyceum’ is a generic word which cannot be
appropriated by petitioner to the exclusion of others.
(2) Whether or not the word ‘Lyceum’ has acquired a secondary
meaning in favor of petitioner.
(3) Whether or not petitioner is infringed by respondent institutions’
corporate names.
Ruling:
(1) YES. “Lyceum” is in fact as generic in character as the word
“university.” In the name of the petitioner, “Lyceum” appears to be a
substitute for “university;” in other places, however, “Lyceum,” or
“Liceo” or “Lycee” frequently denotes a secondary school or a
college. It may be that the use of the word “Lyceum” may not yet be
as widespread as the use of “university,” but it is clear that a not
inconsiderable number of educational institutions have adopted
“Lyceum” or “Liceo” as part of their corporate names. Since
“Lyceum” or “Liceo” denotes a school or institution of learning, it is
not unnatural to use this word to designate an entity which is
organized and operating as an educational institution.
(2) NO. Under the doctrine of secondary meaning, a word or phrase
originally incapable of exclusive appropriation with reference to an
article in the market, because geographical or otherwise descriptive
might nevertheless have been used so long and so exclusively by one
producer with reference to this article that, in that trade and to that
group of the purchasing public, the word or phrase has come to mean
that the article was his produce. With the foregoing as a yardstick,
[we] believe the appellant failed to satisfy the aforementioned
requisites. While the appellant may have proved that it had been
using the word ‘Lyceum’ for a long period of time, this fact alone did
not amount to mean that the said word had acquired secondary
meaning in its favor because the appellant failed to prove that it had
been using the same word all by itself to the exclusion of others.
More so, there was no evidence presented to prove that confusion
will surely arise if the same word were to be used by other
educational institutions.
(3) NO. We do not consider that the corporate names of private
respondent institutions are “identical with, or deceptively or
confusingly similar” to that of the petitioner institution. True enough,
the corporate names of private respondent entities all carry the word
“Lyceum” but confusion and deception are effectively precluded by
the appending of geographic names to the word “Lyceum.” Thus, we
do not believe that the “Lyceum of Aparri” can be mistaken by the
general public for the Lyceum of the Philippines, or that the “Lyceum
of Camalaniugan” would be confused with the Lyceum of the
Philippines. We conclude and so hold that petitioner institution is not
entitled to a legally enforceable exclusive right to use the word
“Lyceum” in its corporate name and that other institutions may use
“Lyceum” as part of their corporate names.
FREDCO MANUFACTURING CORPORATION V.
PRESIDENT AND FELLOWS OF HARVARD COLLEGE
(G.R. NO. 185917)
Facts:
Petitioner Fredco Manufacturing filed a petition to cancel the
registration of respondent’s mark ‘Harvard Veritas Shield Symbol’
used in products such as bags and t-shirts. Fredco alleges that the
mark ‘Harvard’ was first used and registered by New York Garments,
a domestic corporation and its predecessor-in-interest, used in its
clothing articles. Respondent Harvard University on the other hand,
alleges that it is the lawful owner of the name and mark in numerous
countries worldwide including in the Philippines which was used in
commerce as early as 1872. Respondent further contend that it never
authorized any person to use its name or mark in connection with any
goods in the Philippines. The IPO Bureau of Legal Affairs cancelled
respondent’s registration of the mark but only over the goods which
are confusingly similar with that of petitioner. IPO reversed the
decision. CA affirmed.
Issue:
Whether or not respondent’s trade name is infringed.
Ruling: YES.
Fredco’s use of the mark “Harvard,” coupled with its claimed origin
in Cambridge, Massachusetts, obviously suggests a false connection
with Harvard University. On this ground alone, Fredco’s registration
of the mark “Harvard” should have been disallowed. Indisputably,
Fredco does not have any affiliation or connection with Harvard
University, or even with Cambridge, Massachusetts. Fredco or its
predecessor New York Garments was not established in 1936, or in
the U.S.A. as indicated by Fredco in its oblong logo.
Under Philippine law, a trade name of a national of a State that is a
party to the Paris Convention, whether or not the trade name forms
part of a trademark, is protected “without the obligation of filing or
registration.” “Harvard” is the trade name of the world famous
Harvard University, and it is also a trademark of Harvard University.
Under Article 8 of the Paris Convention, as well as Section 37 of
R.A. No. 166, Harvard University is entitled to protection in the
Philippines of its trade name “Harvard” even without registration of
such trade name in the Philippines. This means that no educational
entity in the Philippines can use the trade name “Harvard” without
the consent of Harvard University. Likewise, no entity in the
Philippines can claim, expressly or impliedly through the use of the
name and mark “Harvard,” that its products or services are
authorized, approved, or licensed by, or sourced from, Harvard
University without the latter’s consent.
Coffee Partners, Inc. vs. San Francisco Coffee and Roastery, Inc.
G.R. No. 169504, March 3, 2010
Facts:
The petitioner holds a business in maintaining coffee shops in the
Philippines. It is registered with the Securities and Exchange
Commission in January 2001. In its franchise agreement with Coffee
Partners Ltd, it carries the trademark “San Francisco Coffee.”
Respondent is engaged in the wholesale and retail sale of coffee that
was registered in SEC in May 1995 under a registered business name
of “San Francisco Coffee &Roastery, Inc.” It entered into a joint
venture with Boyd Coffee USA to study coffee carts in malls.
When respondent learned that petitioner will open a coffee shop in
Libis, Q.C. they sent a letter to the petitioner demanding them to stop
using the name “San Francisco Coffee” as it causes confusion to the
minds of the public. A complaint was also filed by respondents
before the Bureau of Legal Affairs of the Intellectual Property Office
for infringement and unfair competition with claims for damages.
Petitioners contend that there are distinct differences in the
appearance of their trademark and that respondent abandoned the use
of their trademark when it joined venture with Boyd Coffee USA.
The Bureau of Legal Affairs of the IPO held that petitioner’s
trademark infringed on the respondent’s trade name as it registered its
business name first with the DTI in 1995 while petitioner only
registered its trademark in 2001.
Furthermore, it ruled that the respondent did not abandon the use of
its trade name upon its joint venture with Boyd Coffee USA since in
order for abandonment to exist it must be permanent, intentional and
voluntary. It also held that petitioner’s use of the trademark "SAN
FRANCISCO COFFEE" will likely cause confusion because of the
exact similarity in sound, spelling, pronunciation, and commercial
impression of the words "SAN FRANCISCO" which is the dominant
portion of respondent’s trade name and petitioner’s trademark. Upon
appeal before the office of the Director General of the IPO, the
decision of its legal affairs was reversed declaring there was no
infringement. The Court of Appeals however set aside its decision
and reinstated the IPO legal affairs’ decision. Petitioner contends that
the respondent’s trade name is not registered therefore a suit for
infringement is not available.
Issue:
Whether or not the petitioner’s use of the trademark "SAN
FRANCISCO COFFEE" constitutes infringement of respondent’s
trade name "SAN FRANCISCO COFFEE & ROASTERY, INC.,"
even if the trade name is not registered with the Intellectual Property
Office (IPO).
Ruling:
Registration of a trademark before the IPO is no longer a requirement
to file an action for infringement as provided in Section 165.2 of RA
8293. All that is required is that the trade name is previously used in
trade or commerce in the Philippines. There is no showing that
respondent abandoned the use of its trade name as it continues to
embark to conduct research on retailing coffee, import and sell coffee
machines as among the services for which the use of the business
name has been registered.
The court also laid down two tests to determine similarity and
likelihood of confusion. The dominancy test focuses on similarity of
the prevalent features of the trademarks that could cause deception
and confusion that constitutes infringement. Exact duplication or
imitation is not required. The question is whether the use of the
marks involved is likely to cause confusion or mistake in the mind of
the public or to deceive consumers. the holistic test entails a
consideration of the entirety of the marks as applied to the products,
including the labels and packaging, in determining confusing
similarity.15 The discerning eye of the observer must focus not only
on the predominant words but also on the other features appearing on
both marks in order that the observer may draw his conclusion
whether one is confusingly similar to the other. Applying either the
dominancy test or the holistic test, petitioner’s "SAN FRANCISCO
COFFEE" trademark is a clear infringement of respondent’s "SAN
FRANCISCO COFFEE & ROASTERY, INC." trade name. The
descriptive words "SAN FRANCISCO COFFEE" are precisely the
dominant features of respondent’s trade name. And because both are
involved in coffee business there is always the high chance that the
public will get confused of the source of the coffee sold by the
petitioner. Respondent has acquired an exclusive right to the use of
the trade name "SAN FRANCISCO COFFEE & ROASTERY, INC."
since the registration of the business name with the DTI in 1995.