CASE DIGESTS [Law on Intellectual Property] 1
INTELLECTUAL PROPERTY RIGHTS The Court finds and declares that the President’s ratification is
TOPIC:
DECLARATION OF STATE POLICY (Section 2 of the
Intellectual Property Code)
INTELLECTUAL PROPERTY ASSOCIATION OF THE
PHILIPPINES v. HON. PAQUITO OCHOA
G.R. No. 204605, July 19, 2016
FACTS
The Madrid System for the International Registration of Marks
(Madrid System), which is the centralized system providing a
one-stop solution for registering and managing marks
worldwide, allows the trademark owner to file one application in
one language, and to pay one set of fees to protect his mark in
the territories of up to 97 member-states. The Madrid System is
governed by the Madrid Agreement, concluded in 1891, and the
Madrid Protocol, concluded in 1989. The Madrid Protocol has
two objectives, namely:
(1) to facilitate securing protection for marks; and
(2) to make the management of the registered marks easier
in different countries.
In 2004, the Intellectual Property Office of the Philippines
(IPOPHL), began considering the country's accession to the
Madrid Protocol. After a campaign for information
dissemination, and a series of consultations with stakeholders,
IPOPHL ultimately arrived at the conclusion that accession
would benefit the country and help raise the level of
competitiveness for Filipino brands. Hence, it recommended to
the DFA that the Philippines should accede to the Madrid
Protocol. After its own review, the DFA endorsed to the
President the country's accession to the Madrid Protocol. The
DFA determined that the Madrid Protocol was an executive
agreement.
On March 27, 2012, President Benigno C. Aquino III ratified the
Madrid Protocol through an instrument of accession, which was
deposited with the Director General of the World Intellectual
Property Organization (WIPO) on April 25, 2012. The Madrid
Protocol entered into force in the Philippines on July 25, 2012.
Thus, the Intellectual Property Association of the Philippines
(IPAP) commenced this special civil action for certiorari and
prohibition to challenge the validity of the President's accession
to the Madrid Protocol without the concurrence of the Senate.
According to the IPAP, the Madrid Protocol is a treaty, not an
executive agreement; hence, respondent DFA Secretary Albert
Del Rosario acted with grave abuse of discretion in determining
the Madrid Protocol as an executive agreement. Also, the IPAP
has argued that the implementation of the Madrid Protocol in the
Philippines; specifically the processing of foreign trademark
applications, conflicts with the Intellectual Property Code of the
Philippines.
ISSUE
Is the Madrid Protocol unconstitutional for lack of concurrence
by the Senate?
RULING
NO.
JB Suarez @therainsantiago © 2018
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valid and constitutional because the Madrid Protocol, being an
executive agreement as determined by the Department of
Foreign Affairs, does not require the concurrence of the Senate.
Under prevailing jurisprudence, the registration of trademarks
and copyrights have been the subject of executive agreements
entered into without the concurrence of the Senate. Some
executive agreements have been concluded in conformity with
the policies declared in the acts of Congress with respect to the
general subject matter.
Accordingly, DFA Secretary Del Rosario’s determination and
treatment of the Madrid Protocol as an executive agreement;
being in apparent contemplation of the express state policies on
intellectual property as well as within his power under Executive
Order No. 459, are upheld.
The Court observed that there are no hard and fast rules on the
propriety of entering into a treaty or an executive agreement on
a given subject as an instrument of international relations. The
primary consideration in the choice of the form of agreement is
the parties’ intent and desire to craft their international agreement
in the form they so wish to further their respective interests. The
matter of form takes a back seat when it comes to effectiveness
and binding effect of the enforcement of a treaty or an executive
agreement; inasmuch as all the parties; regardless of the form,
become obliged to comply conformably with the time-honored
principle of pacta sunt servanda. The principle binds the parties
to perform in good faith their parts in the agreements.
The act of entering into international agreements operate
under this wider context of separation of powers and checks and
balances among the three branches of government. Without
doubt, the President has the sole authority over, and is the
country's chief representative in the conduct of foreign affairs,
This authority includes the negotiation and ratification of
international agreements: the President has full discretion
(subject to the limits found in the Constitution) to negotiate and
enter into international agreements in behalf of the Philippine
government. But this discretion is subject to a check and balance
from the legislative branch of government, that is, the Senate has
to give its concurrence with an international agreement before it
may be considered valid and effective in the Philippines.
The Philippine government operates under the complementary
principles of separation of powers and checks and balances. The
three functions of government are concentrated in its three great
branches, with each branch supreme in its own sphere: the
Legislature possesses the power to create laws that are binding
in the Philippines, which the Executive has the duty to implement
and enforce. The Judiciary, on the other hand, resolves conflicts
that may arise from the implementation of these laws and, on
occasion, nullifies acts of government (whether legislative or
executive) that have been made with grave abuse of discretion
under the Court's expanded jurisdiction in Article VIII, Section
1 of the 1987 Constitution.
That each branch of government is supreme in its own sphere
does not, however, mean that they no longer interact with or are
isolated from one another in the exercise of their respective
duties.
 CASE DIGESTS [Law on Intellectual Property] 2

To be sure, one branch cannot usurp the power of another TRADEMARKS

without violating the principle of separation of powers, but this
is not an absolute rule; rather, it is a rule that operates hand in TOPIC:
hand with arrangements that allow the participation of one ACQUISITION OF OWNERSHIP OF MARKS
branch in another branch's action under the system of checks and
balances that the Constitution itself provides. The Constitution
BIRKENSTOCK ORTHOPAEDIE GMBH AND CO. KG.
in fact imposes such joint action so that one branch can check
v. PHILIPPINE SHOW EXPO MARKETING
and balance the actions of the other, to ensure public
CORPORATION
accountability and guard against the tyrannical concentration of
G.R. No. 194307, November 20, 2013
power.
FACTS
Thus, Congress, while supreme in its authority to enact laws, is Petitioner, a corporation duly organized and existing under the
checked and balanced in this authority through the President's laws of Germany, applied for various trademark registrations
veto power. Congress possesses, save for the limitations found before the IPO, namely:
in the Constitution, the full discretion to decide the subject matter
and content of the laws it passes, but this bill, once passed by (a) "BIRKENSTOCK" under Trademark Application
both houses of Congress, would have to be signed by the Serial No. (TASN) 4-1994-091508;
President. If the President does not approve of the bill, he can (b) "BIRKENSTOCK BAD HONNEF-RHEIN &
veto it and send the bill back to Congress with reasons for his DEVICE COMPRISING OF ROUND COMPANY
disapproval. Congress, in turn, can either override the veto or SEAL AND REPRESENTATION OF A FOOT,
simply accept the President's disapproval. CROSS AND SUNBEAM" under TASN 4-1994-
091509 for goods; and
(c) "BIRKENSTOCK BAD HONNEF-RHEIN &
DEVICE COMPRISING OF ROUND COMPANY
SEAL AND REPRESENTATION OF A FOOT,
CROSS AND SUNBEAM" under TASN 4-1994-
095043.

However, registration proceedings of the subject applications

were suspended in view of an existing registration of the mark
"BIRKENSTOCK AND DEVICE" under Registration No.
56334 in the name of Shoe Town International and Industrial
Corporation, the predecessor-in-interest of respondent
Philippine Shoe Expo Marketing Corporation.

In this regard, petitioner filed a petition for cancellation of

Registration No. 56334 on the ground that it is the lawful and
rightful owner of the Birkenstock marks (Cancellation Case).

During its pendency, however, respondent and/or its

predecessor-in-interest failed to file the required 10th Year
Declaration of Actual Use (10th Year DAU) for Registration No.
56334 on or before October 21, 2004, thereby resulting in the
cancellation of such mark. Accordingly, the cancellation case
was dismissed for being moot and academic.

The aforesaid cancellation of Registration No. 56334 paved the

way for the publication of the subject applications in the IPO e-
Gazette on February 2, 2007. In response, respondent filed three
(3) separate verified notices of oppositions to the subject
applications.

The Bureau of Legal Affairs (BLA) of the IPO issued Order No.
2007-2051 consolidating the aforesaid inter partes cases
(Consolidated Opposition Cases).

In its Decision, the BLA of the IPO sustained respondent's

opposition, thus, ordering the rejection of the subject
applications. It ruled that the competing marks of the parties are
confusingly similar since they contained the word
"BIRKENSTOCK" and are used on the same and related goods.
It found respondent and its predecessor-in- interest as the prior
user and adopter of "BIRKENSTOCK" in the Philippines, while

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on the other hand, petitioner failed to present evidence of actual
use in the trade and business in this country.
the IPO Director General reversed and set aside the ruling of the
BLA, thus allowing the registration of the subject applications.
He held that with the cancellation of Registration No. 56334 for
respondent's failure to file the 10th Year DAU, there is no more
reason to reject the subject applications on the ground of prior
registration by another proprietor.
In its Decision, the CA reversed and set aside the ruling of the
IPO Director General and reinstated that of the BLA.
ISSUE
Whether or not the subject marks should be allowed registration
in the name of petitioner.
RULING
YES.
A. Admissibility of Petitioner's Documentary Evidence.
In the case at bar, while petitioner submitted mere photocopies
as documentary evidence in the Consolidated Opposition Cases,
it should be noted that the IPO had already obtained the originals
of such documentary evidence in the related Cancellation Case
earlier filed before it.
B. Registration and ownership of "BIRKENSTOCK."
RA No 166, the governing law for Registration No. 56334,
requires the filing of a DAU on specified periods.
The failure to file the DAU within the requisite period results in
the automatic cancellation of registration of a trademark. In turn,
such failure is tantamount to the abandonment or withdrawal of
any right or interest the registrant has over his trademark.
In this case, respondent admitted that it failed to file the 10th
Year DAU for Registration No. 56334 within the requisite
period, or on or before October 21, 2004. As a consequence, it
was deemed to have abandoned or withdrawn any right or
interest over... the mark "BIRKENSTOCK." Neither can it
invoke Section 236 of the IP Code which pertains to intellectual
property rights obtained under previous intellectual property
laws, e.g., RA 166, precisely because it already lost any right or
interest over... the said mark.
Besides, petitioner has duly established its true and lawful
ownership of the mark "BIRKENSTOCK."
Under Section 2 of RA 166, which is also the law governing the
subject applications, in order to register a trademark, one must
be the owner thereof and must have actually used the mark in
commerce in the Philippines for two (2) months prior to the
application for registration.
Section 2-A of the same law sets out to define how one goes about
acquiring ownership thereof. Under the same section, it is clear
that actual use in commerce is also the test of ownership but the
provision went further by saying that the mark must not have
been so appropriated by another.
Significantly, to be an owner, Section 2-A does not require that
the actual use of a trademark must be within the Philippines.
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CASE DIGESTS [Law on Intellectual Property] 3
Thus, under RA 166, one may be an owner of a mark due to its
actual use but may not yet have the right to register such
ownership here due to the owner's failure to use the same in the
Philippines for two (2) months prior to registration.
It must be emphasized that registration of a trademark, by itself,
is not a mode of acquiring ownership. If the applicant is not the
owner of the trademark, he has no right to apply for its
registration. Registration merely creates a prima facie
presumption of the validity of the registration, of the
registrant's ownership of the trademark, and of the exclusive
right to the use thereof. Such presumption, just like the
presumptive regularity in the performance of official functions,
is rebuttable and must give way to evidence to the contrary.
Clearly, it is not the application or registration of a trademark
that vests ownership thereof, but it is the ownership of a
trademark that confers the right to register the same. A trademark
is an industrial property over which its owner is entitled to
property rights which cannot be appropriated by unscrupulous
entities that, in one way or another, happen to register such
trademark ahead of its true and lawful owner. The presumption
of ownership accorded to a registrant must then necessarily yield
to superior evidence of actual and real ownership... of a
trademark.
In the instant case, petitioner was able to establish that it is the
owner of the mark "BIRKENSTOCK." It submitted evidence
relating to the origin and history of "BIRKENSTOCK" and its
use in commerce long before respondent was able to register the
same here in the Philippines.
It has sufficiently proven that "BIRKENSTOCK" was first
adopted in Europe in 1774 by its inventor, Johann Birkenstock,
a shoemaker, on his line of quality footwear and thereafter,
numerous generations of his kin continuously engaged in the
manufacture and sale of shoes and... sandals bearing the mark
"BIRKENSTOCK" until it became the entity now known as the
petitioner. Petitioner also submitted various certificates of
registration of the mark "BIRKENSTOCK" in various countries
and that it has used such mark in different countries worldwide,
including... the Philippines.
On the other hand, aside from Registration No. 56334 which had
been cancelled, respondent only presented copies of sales
invoices and advertisements, which are not conclusive evidence
of its claim of ownership of the mark "BIRKENSTOCK" as
these merely show the transactions made by respondent
involving the same.
In view of the foregoing circumstances, the Court finds the
petitioner to be the true and lawful owner of the mark
"BIRKENSTOCK" and entitled to its registration, and that
respondent was in bad faith in having it registered in its name.
 CASE DIGESTS [Law on Intellectual Property] 4

public of the goods or business of one person as the goods or

SUPERIOR COMMERCIAL ENTERPRISES, INC. v.
KUNNAN ENTERPRISES LTD. AND SPORTS
CONCEPT & DISTRIBUTOR, INC.
G.R. No. 169974, April 20, 2010
FACTS
SUPERIOR filed a complaint for trademark infringement and
unfair competition with preliminary injunction against
KUNNAN and SPORTS CONCEPT.
In support of its complaint, SUPERIOR first claimed to be the
owner of the trademarks, trading styles, company names and
business names "KENNEX", "KENNEX & DEVICE","PRO
KENNEX" and "PRO-KENNEX" (disputed trademarks).
business of another with the end and probable effect of deceiving
the public.
The essential elements of unfair competition are
(1) confusing similarity in the general appearance of the
goods; and
(2) intent to deceive the public and defraud a competitor.
In the present case, no evidence exists showing that KUNNAN
ever attempted to pass off the goods it sold (i.e. sportswear,
sporting goods and equipment) as those of SUPERIOR. In
addition, there is no evidence of bad faith or fraud imputable to
KUNNAN in using the disputed trademarks.

In its defense, KUNNAN disputed SUPERIOR's claim of

ownership and maintained that SUPERIOR - as mere distributor
from October 6, 1982 until December 31, 1991 - fraudulently
registered the trademarks in its name. KUNNAN alleged that it
was incorporated in 1972 under the name KENNEX Sports
Corporation for the purpose of manufacturing and selling
sportswear and sports equipment; it commercially marketed its
products in different countries, including the Philippines since
1972.

It created and first used "PRO KENNEX," derived from its

original corporate name, as a distinctive trademark for its
products in 1976. KUNNAN also alleged that it registered the
"PRO KENNEX" trademark not only in the Philippines but also
in 31 other countries, and widely promoted the "KENNEX" and
"PRO KENNEX" trademarks through worldwide advertisements
in print media and sponsorships of known tennis players.

ISSUE
WHETHER OR NOT THE COURT OF APPEALS ERRED IN
HOLDING THAT PETITIONER SUPERIOR IS NOT THE
TRUE AND RIGHTFUL OWNER OF THE TRADEMARKS
"KENNEX" AND "PRO-KENNEX" IN THE PHILIPPINES.

RULING
On the Issue of Trademark Infringement
The CA decided that the registration of the "KENNEX" and
"PRO KENNEX" trademarks should be cancelled because
SUPERIOR was not the owner of, and could not in the first place
have validly registered these trademarks.

Thus, as of the finality of the CA decision on December 3, 2007,

these trademark registrations were effectively cancelled and
SUPERIOR was no longer the registrant of the disputed
trademarks.

Essentially, Section 22 of RA 166 states that only a registrant of

a mark can file a case for infringement.

Thus, we have previously held that the cancellation of

registration of a trademark has the effect of depriving the
registrant of protection from infringement from the moment
judgment or order of cancellation has become final.

On the Issue of Unfair Competition

From jurisprudence, unfair competition has been defined as the
passing off (or palming off) or attempting to pass off upon the

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TOPIC:
ACQUISITION OF OWNERSHIP OF TRADE NAME
(Section 165)
ECOLE DE CUISINE MANILLE (Cordon Blue of the
Philippines), INC. v. RENAUS COINTREAU & CIE AND
LE CORDON BLUE INT’L, B.V.
G.R. No. 185830, June 5, 2013
FACTS
Cointreau, a partnership registered under the laws of France,
filed before the (now defunct) BPTTT of the Department of
Trade and Industry a trademark application for the mark "LE
CORDON BLEU & DEVICE".
petitioner Ecole De Cuisine Manille, Inc. (Ecole) filed an
opposition to the subject application, averring that:
(a) it is the owner of the mark "LE CORDON BLEU,
ECOLE DE CUISINE MANILLE," which it has been
using since 1948 in cooking and other culinary
activities, including in its restaurant business; and
(b) it has earned immense and invaluable goodwill such
that Cointreau's use of the subject mark will actually
create confusion, mistake, and deception to the buying
public as to the origin and sponsorship of the goods,
and cause great and irreparable injury and damage to
Ecole's business reputation and goodwill as a senior
user of the same.
Cointreau filed its answer claiming to be the true and lawful
owner of the subject mark. It averred that:
(a) it has filed applications for the subject mark's
registration in various jurisdictions, including the
Philippines;
(b) Le Cordon Bleu is a culinary school of worldwide
acclaim which was established in Paris, France in 1895;
(c) Le Cordon Bleu was the first cooking school to have
set the standard for the teaching of classical French
cuisine and pastry making; and
(d) it has trained students from more than eighty (80)
nationalities, including Ecole's directress, Ms. Lourdes
L. Dayrit.
Thus, Cointreau concluded that Ecole's claim of being the
exclusive owner of the subject mark is a fraudulent
misrepresentation.
The Bureau of Legal Affairs (BLA) of the IPO sustained Ecole's
opposition to the subject mark, necessarily resulting in the
rejection of Cointreau's application.
It emphasized that the adoption and use of trademark must be in
commerce in the Philippines and not abroad. It then concluded
that Cointreau has not established any proprietary right entitled
to protection in the Philippine jurisdiction because the law on
trademarks rests upon the doctrine of nationality or territoriality.
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CASE DIGESTS [Law on Intellectual Property] 5
The IPO Director General reversed and set aside the BLA's
decision, thus, granting Cointreau's appeal and allowing the
registration of the subject mark.
He held that while Section 2 of R.A. No. 166 requires actual use
of the subject mark in commerce in the Philippines for at least
two (2) months before the filing date of the application, only the
owner thereof has the right to register the same, explaining that
the user of a mark in the Philippines is not ipso facto its owner.
Moreover, Section 2-A of the same law does not require actual
use in the Philippines to be able to acquire ownership of a mark.
The CA affirmed the IPO Director General's Decision in toto.
ISSUE
Whether or not the CA was correct in upholding the IPO
Director General's ruling that Cointreau is the true and lawful
owner of the subject mark and thus, entitled to have the same
registered under its name.
RULING
YES.
In the petition, Ecole argues that it is the rightful owner of the
subject mark, considering that it was the first entity that used the
same in the Philippines. Hence, it is the one entitled to its
registration and not Cointreau.
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 two (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 two (2) months prior
to registration.
Nevertheless, foreign marks which are not registered are still
accorded protection against infringement and/or unfair
competition. At this point, it is worthy to emphasize that the
Philippines and France, Cointreau's country of origin, are both
signatories to the Paris Convention for the Protection of
Industrial Property (Paris Convention).
ARTICLE 8
A trade name shall be protected in all the countries of the Union
without the obligation of filing or registration, whether or not it
forms part of a trademark.
In view of the foregoing obligations under the Paris Convention,
the Philippines is obligated to assure nationals of the signatory-
countries that they are afforded an effective protection against

violation of their intellectual property rights in the Philippines in
the same way... that their own countries are obligated to accord
similar protection to Philippine nationals." Thus, under
Philippine law, a trade name of a national of a State that is a party
to the Paris Convention, whether or not the trade name forms part
of a... trademark, is protected "without the obligation of filing or
registration.'"
In the instant case, it is undisputed that Cointreau has been
using the subject mark in France since 1895, prior to Ecole's
averred first use of the same in the Philippines in 1948, of which
the latter was fully aware thereof. In fact, Ecole's present
directress, Ms. Lourdes L. Dayrit (and even its foundress, Pat
Limjuco Dayrit), had trained in Cointreau's Le Cordon Bleu
culinary school in Paris, France.
On the other hand, Ecole has no certificate of registration over
the subject mark but only a pending application covering
services limited to Class 41 of the Nice Classification, referring
to the operation of a culinary school. Its application was filed
only on February 24, 1992, or after Cointreau filed its trademark
application for goods and services falling under different classes
in 1990.
It is thus clear that at the time Ecole started using the subject
mark, the same was already being used by Cointreau, albeit
abroad, of which Ecole's directress was fully aware, being an
alumna of the latter's culinary school in Paris, France.
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CASE DIGESTS [Law on Intellectual Property] 6
TOPIC:
TESTS TO DETERMINE CONFUSING SIMILARITY
BETWEEN MARKS (Dominancy Test)
ASIA BREWERY, INC. v. THE HON. COURT OF
APPEALS
G.R. No. 103543, July 5, 1993
FACTS
San Miguel Corporation (SMC) filed a complaint against Asia
Brewery Inc. (ABI) for infringement of trademark and unfair
competition on account of the latter's BEER PALE PILSEN or
BEER NA BEER product which has been competing with SMC's
SAN MIGUEL PALE PILSEN for a share of the local beer
market.
The RTC dismissed SMC's complaint because ABI "has not
committed trademark infringement or unfair competition
against" SMC. Upon appeal, the CA reversed the trial court.
Upon a motion for reconsideration filed by ABI, the Decision
was modified by the separate opinions of the Special Sixth
Division. Asia Brewery Incorporated was found GUILTY of
infringement of trademark and unfair competition.
ISSUE
Whether or not ABI infringes SMC’s trademark San Miguel
Pale Pilsen with Rectangular Hops and Malt Design, and
thereby commits unfair competition against the latter.
RULING
NO.
In the present case, there is no concurrence between the trial
court and the Court of Appeals on the lone factual issue of
whether ABI, by manufacturing and selling its BEER PALE
PILSEN in amber colored steinie bottles of 320 ml. capacity with
a white painted rectangular label has committed trademark
infringement and unfair competition against SMC.
Infringement of trademark is a form of unfair competition.
Sec. 22 of RA No. 166, otherwise known as the Trademark Law,
defines what constitutes infringement.
Sec. 22. 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.
This definition implies that only registered trade marks, trade
names and service marks are protected against infringement or
unauthorized use by another or others. The use of someone else's
registered trademark, trade name or service mark is

unauthorized, hence, actionable, if it is done "without the consent
of the registrant."
Infringement is determined by the "test of dominancy" rather
than by differences or variations in the details of one trademark
and of another.
Citing Co Tiong Sa v. Director of Patents:
It has been consistently held that the question of infringement of
a trademark is to be determined by the test of dominancy.
Similarity in size, form and color, while relevant, is not
conclusive. If the competing trademark contains the main or
essential or dominant features of another, and confusion and
deception is likely to result, infringement takes place.
Duplication or imitation is not necessary; nor it is necessary that
the infringing label should suggest an effort to imitate.
The question at issue in cases of infringement of trademarks
is whether the use of the marks involved would be likely to cause
confusion or mistakes in the mind of the public or deceive
purchasers.
Dominant feature of SMC’s trademark
The name of the product: SAN MIGUEL PALE PILSEN, written
in white Gothic letters with elaborate serifs at the beginning and
end of the letters "S" and "M" on an amber background across
the upper portion of the rectangular design.
Dominant feature of ABI’s trademark
The name: BEER PALE PILSEN, with the word "Beer" written
in large amber letters, larger than any of the letters found in the
SMC label.
The trial court perceptively observed that the word "BEER" does
not appear in SMC's trademark, just as the words "SAN
MIGUEL" do not appear in ABI's trademark. Hence, there is
absolutely no similarity in the dominant features of both
trademarks.
Neither in sound, spelling or appearance can BEER PALE
PILSEN be said to be confusingly similar to SAN MIGUEL
PALE PILSEN. No one who purchases BEER PALE PILSEN
can possibly be deceived that it is SAN MIGUEL PALE
PILSEN. No evidence whatsoever was presented by SMC
proving otherwise.
Besides the dissimilarity in their names, the following other
dissimilarities in the trade dress or appearance of the
competing products abound:
SAN MIGUEL PALE BEER PALE PILSEN
PILSEN
bottle has a slender tapered bottle has a fat, bulging neck
neck
The words "pale pilsen" on the words "pale pilsen" on
SMC's label are printed in ABI's bottle are half the size
bold and laced letters along and printed in slender block
a diagonal band letters on a
straight horizontal band.
SAN MIGUEL PALE BEER PALE PILSEN is
PILSEN is "Bottled by the "Especially brewed and
San Miguel Brewery, bottled by Asia Brewery
Philippines" Incorporated, Philippines"
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CASE DIGESTS [Law on Intellectual Property] 7
SMC's bottle carries no On the back of ABI's bottle
slogan. is printed in big, bold letters,
under a row of flower buds
and leaves, its copyrighted
slogan:
"BEER NA BEER!"
The back of the SAN BEER PALE PILSEN bottle
MIGUEL PALE PILSEN has no logo.
bottle carries the SMC logo.
The SAN MIGUEL PALE The BEER PALE PILSEN
PILSEN bottle cap is bottle cap is stamped with
stamped with a coat of arms the name "BEER" in the
and the words "San Miguel center, surrounded by the
Brewery Philippines" words "Asia Brewery
encircling the same. Incorporated Philippines."
currently at P7.00 per bottle currently at P4.25 per bottle
The fact that the words pale pilsen are part of ABI's trademark
does not constitute an infringement of SMC's trademark: SAN
MIGUEL PALE PILSEN, for "pale pilsen" are generic words
descriptive of the color ("pale"), of a type of beer ("pilsen"),
which is a light bohemian beer with a strong hops flavor that
originated in the City of Pilsen in Czechoslovakia and became
famous in the Middle Ages.
"Pilsen" is a "primarily geographically descriptive word," (Sec.
4, subpar. [e] Republic Act No. 166, as inserted by Sec. 2 of R.A.
No. 638) hence, non-registerable and not appropriable by any
beer manufacturer.
The words "pale pilsen" may not be appropriated by SMC for its
exclusive use even if they are part of its registered trademark:
SAN MIGUEL PALE PILSEN, any more than such descriptive
words as "evaporated milk," "tomato ketchup," "cheddar
cheese," "corn flakes" and "cooking oil" may be appropriated by
any single manufacturer of these food products, for no other
reason than that he was the first to use them in his registered
trademark.
Discussion on Unfair Competition
The fact that BEER PALE PILSEN like SAN MIGUEL PALE
PILSEN is bottled in amber-colored steinie bottles of 320 ml.
capacity and is also advertised in print, broadcast, and television
media, does not necessarily constitute unfair competition.
Unfair competition is the employment of deception or any other
means contrary to good faith by which a person shall pass off the
goods manufactured by him or in which he deals, or his business,
or services, for those of another who has already established
goodwill for his similar goods, business or services, or any acts
calculated to produce the same result. (Sec. 29, Republic Act No.
166, as amended.)
The use of ABI of the steinie bottle, similar but not identical to
the SAN MIGUEL PALE PILSEN bottle, is not unlawful. As
pointed out by ABI's counsel, SMC did not invent but merely
borrowed the steinie bottle from abroad and it claims neither
patent nor trademark protection for that bottle shape and design.
the names of the competing products are clearly different and
their respective sources are prominently printed on the label and
on other parts of the bottle, mere similarity in the shape and size
of the container and label, does not constitute unfair competition.

The record does not bear out SMC's apprehension that BEER
PALE PILSEN is being passed off as SAN MIGUEL PALE
PILSEN. This is unlikely to happen for consumers or buyers of
beer generally order their beer by brand. As pointed out by ABI's
counsel, in supermarkets and tiendas, beer is ordered by brand,
and the customer surrenders his empty replacement bottles or
pays a deposit to guarantee the return of the empties. If his
empties are SAN MIGUEL PALE PILSEN, he will get SAN
MIGUEL PALE PILSEN as replacement. In sari-sari stores, beer
is also ordered from the tindera by brand. The same is true in
restaurants, pubs and beer gardens — beer is ordered from the
waiters by brand.
Considering further that SAN MIGUEL PALE PILSEN has
virtually monopolized the domestic beer market for the past
hundred years, those who have been drinking no other beer but
SAN MIGUEL PALE PILSEN these many years certainly know
their beer too well to be deceived by a newcomer in the market.
There is no confusing similarity between the competing beers for
the name of one is "SAN MIGUEL" while the competitor is plain
"BEER" and the points of dissimilarity between the two
outnumber their points of similarity.
In comparison with Del Monte Corporation v. CA:
The Del Monte case involved catsup, a common household item
which is bought off the store shelves by housewives and house
help who, if they are illiterate and cannot identify the product by
name or brand, would very likely identify it by mere recollection
of its appearance. Since the competitor, Sunshine Sauce Mfg.
Industries, not only used recycled Del Monte bottles for its
catsup (despite the warning embossed on the bottles: "Del Monte
Corporation. Not to be refilled.") but also used labels which were
"a colorable imitation" of Del Monte's label, we held that there
was infringement of Del Monte's trademark and unfair
competition by Sunshine.
Our ruling in Del Monte would not apply to beer which is not
usually picked from a store shelf but ordered by brand by the
beer drinker himself from the storekeeper or waiter in a pub or
restaurant.
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CASE DIGESTS [Law on Intellectual Property] 8
MCDONALDS CORPORATION v. L.C. BIG MAK
CURGER, INC.
G.R. No. 143993, August 18, 2004
FACTS
McDonalds is a corporation organized under the laws of
Delaware, US. McDonalds owns a family of marks including the
Big Mac mark for its double-decker hamburger sandwich.
McDonalds registered this trademark with the US Trademark
Registry. Based on this Home Registration, McDonalds applied
for the registration of the same mark in the Principal Register of
the then Philippine Bureau of Patents, Trademarks and
Technology (PBPTT), now the Intellectual Property Office
(IPO).
On 18 July 1985, the PBPTT allowed registration of the Big Mac
mark in the Principal Register based on its Home Registration in
the United States. From 1982 to 1990, McDonalds spent P10.5
million in advertisement for Big Mac hamburger sandwiches
alone.
Petitioner McGeorge Food Industries, a domestic corporation, is
McDonalds Philippine franchisee.
Respondent L.C. Big Mak Burger, Inc. is a domestic corporation
which operates fast-food outlets and snack vans in Metro Manila
and nearby provinces. Respondent corporations menu includes
hamburger sandwiches and other food items.
Respondent corporation applied with the PBPTT
for the registration of the Big Mak mark for its hamburger
sandwiches. McDonalds opposed respondent corporations
application on the ground that Big Mak was a colorable imitation
of its registered Big Mac mark for the same food products.
McDonalds also informed respondent Francis Dy, the chairman
of the Board of Directors of respondent corporation, of its
exclusive right to the Big Mac mark.
Having received no reply from respondent Dy, petitioners sued
respondents for trademark infringement and unfair
competition. The RTC issued a temporary restraining order
(TRO) against respondents enjoining them from using the Big
Mak mark. The RTC then issued a writ of preliminary injunction
replacing the TRO.
In their ANSWER, respondents admitted that they have been
using the name Big Mak Burger for their fast-food business.
Respondents claimed, however, that McDonalds does not have
an exclusive right to the Big Mac mark or to any other similar
mark.
Respondents point out that the Isaiyas Group of Corporations
registered the same mark for hamburger sandwiches with the
PBPTT on 31 March 1979. One Rodolfo Topacio similarly
registered the same mark on 24 June 1983, prior to McDonalds
registration on 18 July 1985. Alternatively, respondents claimed
that they are not liable for trademark infringement or for unfair
competition, as the Big Mak mark they sought to register does
not constitute a colorable imitation of the Big Mac mark.

In their REPLY, petitioners denied respondents claim that
McDonalds is not the exclusive owner of the Big Mac mark.
McDonalds disclosed that it had acquired Topacio’s rights to his
registration in a Deed of Assignment dated 18 May 1981.
ISSUES
(1) Whether or not respondents used the words Big Mak
not only as part of the corporate name L.C. Big Mak
Burger, Inc. but also as a trademark for their hamburger
products.
(2) Whether or not respondent corporation is liable for
trademark infringement and unfair competition.
RULING NO. 1
The evidence presented during the hearings on petitioners
motion for the issuance of a writ of preliminary injunction shows
that the plastic wrappings and plastic bags used by respondents
for their hamburger sandwiches bore the words Big Mak. The
other descriptive words burger and 100% pure beef were set in
smaller type, along with the locations of branches. Respondents
cash invoices simply refer to their hamburger sandwiches as Big
Mak. It is respondents snack vans that carry the words L.C. Big
Mak Burger, Inc.
Respondents plastic wrappers and bags were identical with
those petitioners presented during the hearings for the injunctive
writ except that the letters L.C. and the words Burger, Inc. in
respondents evidence were added above and below the words
Big Mak, respectively.
RULING NO. 2
On the Issue of Trademark Infringement
The Court finds that petitioners have duly established
McDonald’s exclusive ownership of the Big Mac mark.
To establish trademark infringement, the following elements
must be shown:
(1) the validity of plaintiff’s mark;
(2) the plaintiff’s ownership of the mark; and
(3) the use of the mark or its colorable imitation by
the alleged infringer results in likelihood of confusion.
Of these, it is the element of likelihood of confusion that is the
gravamen of trademark infringement.
On the validy of the Big Mac Mark and McDonald’s
Ownership of such Mark
A mark is valid if it is distinctive and thus not barred from
registration under Section 4 of RA 166. HOWEVER, once
registered, not only the marks validity but also the registrant’s
ownership of the mark is prima facie presumed.
The Big Mac mark, which should be treated in its entirety and
not dissected word for word, is neither generic nor descriptive.
Generic marks are commonly used as the name or description
of a kind of goods, such as Lite for beer or Chocolate Fudge for
chocolate soda drink.
Descriptive marks, on the other hand, convey the
characteristics, functions, qualities or ingredients of a product to
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CASE DIGESTS [Law on Intellectual Property] 9
one who has never seen it or does not know it exists, such as
Arthriticare for arthritis medication.
On the contrary, Big Mac falls under the class of fanciful or
arbitrary marks as it bears no logical relation to
the actual characteristics of the product it represents. As such, it
is highly distinctive and thus valid.
Although Topacio and the Isaiyas Group registered the Big Mac
mark ahead of McDonalds, Topacio, as petitioners disclosed, had
already assigned his rights to McDonalds. The Isaiyas Group, on
the other hand, registered its trademark only in the Supplemental
Register. A mark which is not registered in
the Principal Register, and thus not distinctive, has no real
protection. Indeed, we have held that registration in the
Supplemental Register is not even a prima facie evidence of the
validity of the registrants exclusive right to use the mark on the
goods specified in the certificate.
On Types of Confusion
Section 22 covers two types of confusion arising from the use
of similar or colorable imitation marks, namely,
(a) confusion of goods (product confusion) and
(b) confusion of business (source or origin confusion).
Confusion of goods refers to the event when an ordinarily
prudent purchaser would be induced to purchase one product in
the belief that he was purchasing the other.
In confusion of business, 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.
On whether Confusion of Goods and Confusion of Business
are applicable
Petitioners claim that respondents use of the Big Mak mark on
respondents hamburgers results in confusion of goods,
particularly with respect to petitioners hamburgers labeled Big
Mac.
Petitioners also claim that respondents use of the Big Mak mark
in the sale of hamburgers, the same business that petitioners are
engaged in, results in confusion of business.
Respondents assert that their Big Mak hamburgers
cater mainly to the low-income group while petitioners Big Mac
hamburgers cater to the middle and upper income groups. Even
if this is true, the likelihood of confusion of business remains,
since the low-income group might be led to believe that the Big
Mak hamburgers are the low-end hamburgers marketed by
petitioners. After all, petitioners have the exclusive right to use
the Big Mac mark. On the other hand, respondents would benefit
by associating their low-end hamburgers, through the use of the
Big Mak mark, with petitioners high-end Big Mac hamburgers,
leading to likelihood of confusion in the identity of business.
These and other factors respondents cite cannot negate the
undisputed fact that respondents use their Big Mak mark on
hamburgers, the same food product that petitioners sell with the
use of their registered mark Big Mac. Whether a hamburger is

single, double or triple-decker, and whether wrapped in plastic
or styrofoam, it remains the same hamburger food product. Even
respondents use of the Big Mak mark on non-hamburger food
products cannot excuse their infringement of petitioners
registered mark, otherwise registered marks will lose their
protection under the law.
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.
On whether Respondent’s use of the Big Mak Mark results
in likelihood of confusion
In determining likelihood of confusion, jurisprudence has
developed two tests,
(a) the dominancy test and
(b) the holistic test.
The dominancy test focuses on the similarity of
the prevalent features of the competing trademarks that might
cause confusion.
The holistic test requires the court to consider the entirety of the
marks as applied to the products, including the labels and
packaging, in determining confusing similarity.
This Court has relied on the dominancy test rather than the
holistic test. The dominancy test considers the dominant features
in the competing marks in determining whether they are
confusingly similar.
Under the dominancy test, courts give greater weight to the
similarity of the appearance of the product arising
from the adoption of the dominant features of the registered
mark, disregarding minor differences. Courts will consider more
the aural and visual impressions created by the marks in the
public mind, giving little weight to factors like prices, quality,
sales outlets and market segments.
The test of dominancy is now explicitly incorporated into law in
Section 155.1 of the Intellectual Property Code which defines
infringement as the colorable imitation of a registered mark xxx
or a dominant feature thereof.
Applying the dominancy test, the Court finds that respondents
use of the Big Mak mark results in likelihood of confusion.
(1) Big Mak sounds exactly the same as Big Mac.
(2) The first word in Big Mak is exactly the same as the
first word in Big Mac.
(3) The first two letters in Mak are the same as the first two
letters in Mac.
(4) The last letter in Mak while a k sounds the same as c
when the word Mak is pronounced.
(5) In Filipino, the letter k replaces c in spelling, thus
Caloocan is spelled Kalookan.
In short, aurally the two marks are the same, with the first word
of both marks phonetically the same, and the second word
of both marks also phonetically the same.Visually, the two
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CASE DIGESTS [Law on Intellectual Property] 10
marks have both two words and six letters, with the first word
of both marks having the same letters and the second word
having the same first two letters. In spelling, considering the
Filipino language, even the last letters of both marks are the
same.
Clearly, respondents have adopted in Big Mak not only the
dominant but also almost all the features of Big Mac. Applied
to the same food product of hamburgers, the two marks will
likely result in confusion in the public mind.
The Court has taken into account the aural effects of the words
and letters contained in the marks in determining the issue
of confusing similarity.
Certainly, Big Mac and Big Mak for hamburgers create even
greater confusion, not only aurally but also visually.
Indeed, a person cannot distinguish Big Mac from Big Mak by
their sound. When one hears a Big Mac or Big Mak hamburger
advertisement over the radio, one would not know whether the
Mac or Mak ends with a c or a k.
On the Issue of Unfair Competition
The essential elements of an action for unfair competition are
(1) confusing similarity in the general appearance of the
goods, and
(2) intent to deceive the public and defraud a competitor.
The confusing similarity may or may not result from similarity
in the marks, but may result from other external factors
in the packaging or presentation of the goods.
The intent to deceive and defraud may be inferred from the
similarity of the appearance of the goods as offered for sale to
the public. Actual fraudulent intent need not be shown.
Unfair competition is broader than trademark infringement and
includes passing off goods with or without trademark
infringement. Trademark infringement is a form of unfair
competition.
The dissimilarities in the packaging are minor compared to
the stark similarities in the words that give respondents Big
Mak hamburgers the general appearance of petitioners Big Mac
hamburgers. Section 29(a) expressly provides that the similarity
in the general appearance of the goods may be in the devices
or words used on the wrappings. Respondents have applied on
their plastic wrappers and bags almost the same words that
petitioners use on their styrofoam box. What attracts the attention
of the buying public are the words Big Mak which are almost the
same, aurally and visually, as the words Big Mac. The
dissimilarities in the material and other devices are insignificant
compared to the glaring similarity in the words used in the
wrappings.
Section 29(a) also provides that the defendant gives his goods
the general appearance of goods of another
manufacturer. Respondents goods are hamburgers which are also
the goods of petitioners. If respondents sold egg sandwiches
only instead of hamburger sandwiches, their use of the Big Mak
mark would not give their goods the general appearance of
petitioners Big Mac hamburgers. In such case, there is only

trademark infringement but no unfair competition. However,
since respondents chose to apply the Big Mak mark on
hamburgers, just like petitioners use of the Big Mac mark on
hamburgers, respondents have obviously clothed their goods
with the general appearance of petitioners goods.
There is actually no notice to the public that the Big Mak
hamburgers are products of L.C. Big Mak Burger, Inc. and not
those of petitioners who have the exclusive right to the Big Mac
mark. This clearly shows respondents intent to deceive the
public. Had respondents placed a notice on their plastic wrappers
and bags that the hamburgers are sold by L.C. Big Mak Burger,
Inc., then they could validly claim that they did not intend to
deceive the public. In such case, there is only trademark
infringement but no unfair competition. Respondents, however,
did not give such notice. We hold that as found by the RTC,
respondent corporation is liable for unfair competition.
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CASE DIGESTS [Law on Intellectual Property] 11
SOCIETE DES PRODUITS NESTLE, S.A. and NESTLE
PHILIPPINES, INC. v. COURT OF APPEALS
G.R. No. 112012, April 4, 2001
FACTS
Private respondent CFC Corporation filed with the BPTTT an
application for the registration of the trademark "FLAVOR
MASTER" for instant coffee. The application, as a matter of due
course, was published in the July 18, 1988 issue of the BPTTT’s
Official Gazette.
Petitioner Societe Des Produits Nestle, S.A., a Swiss company
registered under Swiss laws and domiciled in Switzerland, filed
an unverified Notice of Opposition, claiming that the trademark
of private respondent’s product is "confusingly similar to its
trademarks for coffee and coffee extracts, to wit: MASTER
ROAST and MASTER BLEND."
Likewise, a verified Notice of Opposition was filed by Nestle
Philippines, Inc., a Philippine corporation and a licensee of
Societe Des Produits Nestle S.A., against CFC’s application for
registration of the trademark FLAVOR MASTER.
Nestle claimed that the use, if any, by CFC of the trademark
FLAVOR MASTER and its registration would likely cause
confusion in the trade; or deceive purchasers and would falsely
suggest to the purchasing public a connection in the business of
Nestle, as the dominant word present in the three (3) trademarks
is "MASTER"; or that the goods of CFC might be mistaken as
having originated from the latter.
CFC argued that its trademark, FLAVOR MASTER, is not
confusingly similar with the former’s trademarks, MASTER
ROAST and MASTER BLEND, alleging that, "except for the
word MASTER (which cannot be exclusively appropriated by
any person for being a descriptive or generic name), the other
words that are used respectively with said word in the three
trademarks are very different from each other – in meaning,
spelling, pronunciation, and sound". CFC further argued that its
trademark, FLAVOR MASTER, "is clearly very different from
any of Nestle’s alleged trademarks MASTER ROAST and
MASTER BLEND, especially when the marks are viewed in
their entirety, by considering their pictorial representations, color
schemes and the letters of their respective labels."
The Court of Appeals ordered the Director of Patents to approve
CFC’s application.
ISSUE
Whether or not the CA erred in holding that the Totality Rule,
rather than the Test of Dominancy, applies to the case.
RULING
YES.
A trademark has been generally defined as "any word, name,
symbol or device adopted and used by a manufacturer or
merchant to identify his goods and distinguish them from those
manufactured and sold by others."

The law prescribes a more stringent standard in that there should
not only be confusing similarity but that it should not likely cause
confusion or mistake or deceive purchasers.
The issue is whether the trademark FLAVOR MASTER is a
colorable imitation of the trademarks MASTER ROAST and
MASTER BLEND.
Colorable imitation denotes such a close or ingenious imitation
as to be calculated to deceive ordinary persons, or such a
resemblance to the original as to deceive an ordinary purchaser
giving such attention as a purchaser usually gives, as to cause
him to purchase the one supposing it to be the other.
In determining if colorable imitation exists, jurisprudence has
developed two kinds of tests –
(a) the Dominancy Test and
(b) the Holistic Test.
The test of dominancy focuses on the similarity of the prevalent
features of the competing trademarks which might cause
confusion or deception and thus constitute infringement.
The holistic test mandates that the entirety of the marks in
question must be considered in determining confusing similarity.
The Court of Appeals held that the test to be applied should be
the totality or holistic test reasoning, since what is of paramount
consideration is the ordinary purchaser who is, in general,
undiscerningly rash in buying the more common and less
expensive household products like coffee, and is therefore less
inclined to closely examine specific details of similarities and
dissimilarities between competing products.
This Court cannot agree with the above reasoning. If the ordinary
purchaser is "undiscerningly rash" in buying such common and
inexpensive household products as instant coffee, and would
therefore be "less inclined to closely examine specific details of
similarities and dissimilarities" between the two competing
products, then it would be less likely for the ordinary purchaser
to notice that CFC’s trademark FLAVOR MASTER carries the
colors orange and mocha while that of Nestle’s uses red and
brown. The application of the totality or holistic test is improper
since the ordinary purchaser would not be inclined to notice the
specific features, similarities or dissimilarities, considering that
the product is an inexpensive and common household item.
While this Court agrees with the Court of Appeals’ detailed
enumeration of differences between the respective trademarks of
the two coffee products, this Court cannot agree that totality test
is the one applicable in this case. Rather, this Court believes that
the dominancy test is more suitable to this case in light of its
peculiar factual milieu.
Moreover, the totality or holistic test is contrary to the
elementary postulate of the law on trademarks and unfair
competition that confusing similarity is to be determined on the
basis of visual, aural, connotative comparisons and overall
impressions engendered by the marks in controversy as they are
encountered in the realities of the marketplace. The totality or
holistic test only relies on visual comparison between two
trademarks whereas the dominancy test relies not only on the
visual but also on the aural and connotative comparisons and
overall impressions between the two trademarks.
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CASE DIGESTS [Law on Intellectual Property] 12
For this reason, this Court agrees with the BPTTT when it
applied the test of dominancy.
In addition, the word "MASTER" is neither a generic nor a
descriptive term. As such, said term can not be invalidated as a
trademark and, therefore, may be legally protected.
Generic terms are those which constitute "the common
descriptive name of an article or substance," or comprise the
"genus of which the particular product is a species," or are
"commonly used as the name or description of a kind of goods,"
or "imply reference to every member of a genus and the
exclusion of individuating characters," or "refer to the basic
nature of the wares or services provided rather than to the more
idiosyncratic characteristics of a particular product," and are not
legally protectable.
On the other hand, a term is descriptive and therefore invalid as
a trademark if, as understood in its normal and natural sense, it
"forthwith conveys the characteristics, functions, qualities or
ingredients of a product to one who has never seen it and does
not know what it is," or "if it forthwith conveys an immediate
idea of the ingredients, qualities or characteristics of the goods,"
or if it clearly denotes what goods or services are provided in
such a way that the consumer does not have to exercise powers
of perception or imagination.
Rather, the term "MASTER" is a suggestive term brought about
by the advertising scheme of Nestle. Suggestive terms are those
which, in the phraseology of one court, require "imagination,
thought and perception to reach a conclusion as to the nature of
the goods." Such terms, "which subtly connote something about
the product," are eligible for protection in the absence of
secondary meaning.
While suggestive marks are capable of shedding "some light"
upon certain characteristics of the goods or services in dispute,
they nevertheless involve "an element of incongruity,"
"figurativeness," or "imaginative effort on the part of the
observer."
This is evident from the advertising scheme adopted by Nestle in
promoting its coffee products. In this case, Nestle has, over time,
promoted its products as "coffee perfection worthy of masters
like Robert Jaworski and Ric Puno Jr.
The term "MASTER", therefore, has acquired a certain
connotation to mean the coffee products MASTER ROAST and
MASTER BLEND produced by Nestle. As such, the use by CFC
of the term "MASTER" in the trademark for its coffee product
FLAVOR MASTER is likely to cause confusion or mistake or
even to deceive the ordinary purchasers.

McDONALDS CORPORATION v. MACJOY FASTFOOD
CORPORATION
G.R. No. 166115, February 2, 2007
FACTS
Respondent MacJoy Fastfood Corporation filed with the
then BPTT, now the IPO, an application for the registration of
the trademark MACJOY & DEVICE for fried chicken, chicken
barbeque, burgers, fries, spaghetti, palabok, tacos, sandwiches,
halo-halo and steaks under classes 29 and 30 of the International
Classification of Goods.
Petitioner McDonalds Corporation filed a verified Notice of
Opposition against the respondents application claiming that
the trademark MACJOY & DEVICE so resembles its corporate
logo, otherwise known as the Golden Arches or M design, and
its marks McDonalds, McChicken, MacFries, BigMac, McDo,
McSpaghetti, McSnack, and Mc, (hereinafter collectively known
as the MCDONALDS marks) 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.
Likewise, the petitioner alleged that the respondents use and
adoption in bad faith of the MACJOY & DEVICE mark would
falsely tend to suggest a connection or affiliation with petitioners
restaurant services and food products, thus, constituting a fraud
upon the general public and further cause the dilution of the
distinctiveness of petitioner’s registered and internationally
recognized MCDONALDS marks to its prejudice and
irreparable damage.
Respondent denied the aforementioned allegations of the
petitioner and averred that it has used the mark MACJOY for the
past many years in good faith and has spent considerable sums
of money for said marks extensive promotion in tri-media,
especially in Cebu City where it has been doing business long
before the petitioner opened its outlet thereat sometime in 1992;
and that its use of said mark would not confuse affiliation with
the petitioners restaurant services and food products because of
the differences in the design and detail of the two (2) marks.
The IPO ruled that there is confusing similarity between them
especially and sustained the petitioner’s opposition and rejected
the respondent’s application.
Finding no confusing similarity between the marks MACJOY
and MCDONALDS, the CA reversed and set aside the appealed
IPO decision. CA denied the motion for reconsideration.
ISSUE
Whether or not the CA committed reversible error in finding no
confusing similarity between the trademarks in question.
RULING
YES.
The old Trademark Law, RA No. 166, as amended, defines a
trademark as any distinctive word, name, symbol, emblem,
sign, or device, or any combination thereof adopted and used by
a manufacturer or merchant on his goods to identify and
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CASE DIGESTS [Law on Intellectual Property] 13
distinguish them from those manufactured, sold, or dealt in by
others.
Under the same law, the registration of a trademark is subject to
the provisions of Section 4 thereof, paragraph (d) of which is
pertinent to this case.
Section 4. Registration of trademarks, trade-names and
service-marks on the principal register. There is hereby
established a register of trademarks, tradenames and service-
marks which shall be known as the principal register. The owner
of the trade-mark, trade-name or service-mark used to distinguish
his goods, business or services of others shall have the right to
register the same on the principal register, unless it:
xxx xxx xxx
(d) Consists of or comprises a mark or trade-name which so
resembles a mark or trade-name registered in the Philippines or a
mark or trade-name 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;
Here, the IPO used the dominancy test in concluding that there
was confusing similarity between the two (2) trademarks in
question as it took note of the appearance of the predominant
features M, Mc and/or Mac in both the marks. In reversing the
conclusion reached by the IPO, the CA applied the holistic test.
In trademark cases, particularly in ascertaining whether one
trademark is confusingly similar to another, no set rules can be
deduced because each case must be decided on its merits. In such
cases, even more than in any other litigation, precedent must be
studied in the light of the facts of the particular case. That is the
reason why in trademark cases, jurisprudential precedents should
be applied only to a case if they are specifically in point.
In recent cases with a similar factual milieu as here, the Court
has consistently used and applied the dominancy test in
determining confusing similarity or likelihood of confusion
between competing trademarks.
Applying the dominancy test to the instant case, the Court finds
that herein petitioners MCDONALDS and respondents
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.

SKECHERS, USA, INC. v. INTER PACIFIC
INDUSTRIAL TRADING CORP
G.R. No. 164321, March 23, 2011
FACTS
The present controversy arose when petitioner filed with RTC an
application for the issuance of search warrants against an
outlet and warehouse operated by respondents for infringement
of trademark under Section 155, in relation to Section 170 of
Republic Act No. 8293, otherwise known as the Intellectual
Property Code of the Philippines. In the course of its business,
petitioner has registered the trademark "SKECHERS" and the
trademark "S" (within an oval design) with the IPO.
As a result of the raid, more than 6,000 pairs of shoes bearing the
"S" logo were seized.
Later, respondents moved to quash the search warrants, arguing
that there was no confusing similarity between petitioner’s
"Skechers" rubber shoes and its "Strong" rubber shoes.
The RTC issued an Order quashing the search warrants and
directing the NBI to return the seized goods. The CA affirmed.
ISSUE
Whether or not the respondent is guilty of trademark
infringement.
RULING
YES.
The basic law on trademark, infringement, and unfair
competition is RA No. 8293. Specifically, Section 155.
The essential element of infringement under R.A. No. 8293 is
that the infringing mark is likely to cause confusion.
Two Tests to determine similarity and likelihood of confusion
In determining similarity and likelihood of confusion,
jurisprudence has developed tests
(a) The Dominancy Test focuses on the similarity of the
prevalent or dominant features of the competing
trademarks that might cause confusion, mistake, and
deception in the mind of the purchasing public.
NOTE: Duplication or imitation is not necessary; neither is it
required that the mark sought to be registered suggests an effort
to imitate. Given more consideration are the aural and visual
impressions created by the marks on the buyers of goods, giving
little weight to factors like prices, quality, sales outlets, and
market segments.
(b) Holistic or Totality Test necessitates a consideration of
the entirety of the marks as applied to the products,
including the labels and packaging, in determining
confusing similarity.
Two types of confusion of marks and trade names
Relative to the question on confusion of marks and trade names,
jurisprudence has noted two (2) types of confusion, viz.:
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CASE DIGESTS [Law on Intellectual Property] 14
(a) confusion of goods (product confusion), where the
ordinarily prudent purchaser would be induced to
purchase one product in the belief that he was
purchasing the other; and
(b) confusion of business (source or origin confusion),
where, although the goods of the parties are different,
the product, the mark of which registration is applied
for by one party, is such as might reasonably be
assumed to originate with the registrant of an earlier
product, and the public would then be deceived either
into that belief or into the belief that there is some
connection between the two parties, though inexistent.
Applying the Dominancy Test to the case at bar, this Court
cannot agree with the observation of the CA that the use of the
letter "S" could hardly be considered as highly identifiable to the
products of petitioner alone. The CA even supported its
conclusion by stating that the letter "S" has been used in so many
existing trademarks, the most popular of which is the trademark
"S" enclosed by an inverted triangle, which the CA says is
identifiable to Superman.
Such reasoning, however, misses the entire point, which is that
respondent had used a stylized "S," which is the
same stylized "S" which petitioner has a registered trademark
for. The letter "S" used in the Superman logo, on the other hand,
has a block-like tip on the upper portion and a round elongated
tip on the lower portion. Accordingly, the comparison made by
the CA of the letter "S" used in the Superman trademark with
petitioner’s stylized "S" is not appropriate to the case at bar.
Furthermore, respondent did not simply use the letter "S," but it
appears to this Court that based on the font and the size of the
lettering, the stylized "S" utilized by respondent is the very same
stylized "S" used by petitioner; a stylized "S" which is unique
and distinguishes petitioner’s trademark.
While there may be dissimilarities between the appearances of
the shoes, to this Court’s mind such dissimilarities do not
outweigh the stark and blatant similarities in their general
features.
Neither can the difference in price be a complete defense in
trademark infringement.
Withal, the protection of trademarks as intellectual property is
intended not only to preserve the goodwill and reputation of the
business established on the goods bearing the mark through
actual use over a period of time, but also to safeguard the public
as consumers against confusion on these goods. While
respondent’s shoes contain some dissimilarities with petitioner’s
shoes, this Court cannot close its eye to the fact that for all intents
and purpose, respondent had deliberately attempted to copy
petitioner’s mark and overall design and features of the shoes.
Let it be remembered, that defendants in cases of infringement
do not normally copy but only make colorable changes. The most
successful form of copying is to employ enough points of
similarity to confuse the public, with enough points of difference
to confuse the courts.

SOCIETE DES PRODUITS NESTLE, S.A. v. MARTIN T.
DY, JR.
G.R. No. 172276, August 8, 2010
FACTS
Nestle is a foreign corporation organized under the laws of
Switzerland. It manufactures food products and beverages.
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.
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. Nestle filed before the RTC a
complaint for infringement.
Dy, Jr. filed a motion to dismiss alleging that the complaint did
not state a cause of action. RTC dismissed the complaint. The
CA remanded the case to the trial court for further proceedings.
Pursuant to Supreme Court Administrative Order No. 113-95,
Nestle filed with the RTC, Judicial Region 7, Branch
9, Cebu City, which was designated as a special court for
intellectual property rights.
RTC: Found Dy, Jr. liable for infringement.
CA: Reversed the RTC Decision.
ISSUE
Whether or not Dy, Jr. is liable for infringement.
RULING
In Prosource International, Inc. v. Horphag Research
Management SA, the Court laid down the elements of
infringement under R.A. Nos. 166 and 8293.
(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,
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CASE DIGESTS [Law on Intellectual Property] 15
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 the light of the facts of the present case, the Court holds that
the dominancy test is applicable. In recent cases with similar
factual milieus, the Court has consistently applied the dominancy
test.
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.
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.

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.
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CASE DIGESTS [Law on Intellectual Property] 16
TOPIC:
TESTS TO DETERMINE CONFUSING SIMILARITY
BETWEEN MARKS (Holistic Test)
EMERALD GARMENT MANUFACTURING
CORPORATION v. HON. COURT OF APPEALS
G.R. No. 100098, December 29, 1995
FACTS
Private respondent H.D. Lee Co., Inc., a foreign corporation
organized under the laws of Delaware, U.S.A., filed with the
BPTTT a Petition for Cancellation of Registration
(Supplemental Register) for the trademark "STYLISTIC MR.
LEE" used on skirts, jeans, blouses, socks, briefs, jackets,
jogging suits, dresses, shorts, shirts and lingerie in the name of
petitioner Emerald Garment Manufacturing Corporation, a
domestic corporation organized and existing under Philippine
laws.
Private respondent, invoking Sec. 37 of R.A. No. 166 (Trademark
Law) and Art. VIII of the Paris Convention for the Protection of
Industrial Property, averred that petitioner's trademark "so
closely resembled its own trademark, 'LEE' as previously
registered and used in the Philippines, and not abandoned, as to
be likely, when applied to or used in connection with petitioner's
goods, to cause confusion, mistake and deception on the part of
the purchasing public as to the origin of the goods."
Petitioner contended that its trademark was entirely and
unmistakably different from that of private respondent and that
its certificate of registration was legally and validly granted.
Petitioner caused the publication of its application for
registration of the trademark "STYLISTIC MR. LEE" in the
Principal Register."
Private respondent filed a notice of opposition to petitioner's
application for registration also on grounds that petitioner's
trademark was confusingly similar to its "LEE" trademark.
The Director of Patents granted private respondent's petition for
cancellation and opposition to registration. Moreover, the
Director of Patents, using the test of dominancy, declared that
petitioner's trademark was confusingly similar to private
respondent's mark because "it is the word 'Lee' which draws the
attention of the buyer and leads him to conclude that the goods
originated from the same manufacturer. It is undeniably the
dominant feature of the mark."
Petitioner appealed to the CA. It filed with the BPTTT a Motion
to Stay Execution on grounds that the same would cause it great
and irreparable damage and injury.
BPTTT granted petitioner's motion to stay execution. The CA
then promulgated its decision affirming the decision of the
Director of Patents.
ISSUE
Whether or not there is a presence of confusing similarity
between the two trademarks in question.
RULING
NONE.
 CASE DIGESTS [Law on Intellectual Property] 17

In the history of trademark cases in the Philippines, particularly
in ascertaining whether one trademark is confusingly similar to
or is a colorable imitation of another, no set rules can be deduced.
Each case must be decided on its own merits.
Proceeding to the task at hand, the essential element of
infringement is colorable imitation. This term has been defined
as "such a close or ingenious imitation as to be calculated to
deceive ordinary purchasers, or such resemblance of the
infringing mark to the original as to deceive an ordinary
purchaser giving such attention as a purchaser usually gives, and
to cause him to purchase the one supposing it to be the other."
In this case, we considered the trademarks involved as a whole
and rule that petitioner's "STYLISTIC MR. LEE" is not
confusingly similar to private respondent's "LEE" trademark.
Petitioner's trademark is the whole "STYLISTIC MR. LEE."
Although on its label the word "LEE" is prominent, the
trademark should be considered as a whole and not piecemeal.
The dissimilarities between the two marks become conspicuous,
noticeable and substantial enough to matter especially in the light
of the following variables that must be factored in.
First, the products involved in the case at bar are, in the main,
various kinds of jeans. Maong pants or jeans are not inexpensive.
Accordingly, the casual buyer is predisposed to be more cautious
and discriminating in and would prefer to mull over his purchase.
Confusion and deception, then, is less likely.
shall be known as the principal register. The owner of a trade-
mark, trade-name 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:
xxx xxx xxx
(e) Consists of a mark or trade-name which, when applied to or
used in connection with the goods, business or services of the
applicant is merely descriptive or deceptively misdescriptive of
them, or when applied to or used in connection with the goods,
business or services of the applicant is primarily geographically
descriptive or deceptively misdescriptive of them, or is primarily
merely a surname;
"LEE" is primarily a surname. Private respondent cannot acquire
exclusive ownership over and singular use of said term.
In addition to the foregoing, we are constrained to agree with
petitioner's contention that private respondent failed to prove
prior actual commercial use of its "LEE" trademark in the
Philippines before filing its application for registration with the
BPTTT and hence, has not acquired ownership over said mark.
Actual use in commerce in the Philippines is an essential
prerequisite for the acquisition of ownership over a trademark
pursuant to Sec. 2 and 2-A of the Philippine Trademark Law
(R.A. No. 166).

Second, like his beer, the average Filipino consumer generally

buys his jeans by brand. He does not ask the sales clerk for
generic jeans but for, say, a Levis, Guess, Wrangler or even an
Armani. He is, therefore, more or less knowledgeable and
familiar with his preference and will not easily be distracted.

Finally, more credit should be given to the "ordinary purchaser."

Cast in this particular controversy, the ordinary purchaser is not
the "completely unwary consumer" but is the "ordinarily
intelligent buyer" considering the type of product involved.

"Ordinary purchaser" was defined as one "accustomed to buy,

and therefore to some extent familiar with, the goods in question.

The test of fraudulent simulation is to be found in the

likelihood of the deception of some persons in some measure
acquainted with an established design and desirous of purchasing
the commodity with which that design has been associated.

The simulation, in order to be objectionable, must be such as

appears likely to mislead the ordinary intelligent buyer who has
a need to supply and is familiar with the article that he seeks to
purchase.

Another way of resolving the conflict is to consider the marks

involved from the point of view of what marks are registrable
pursuant to Sec. 4 of R.A. No. 166, particularly paragraph 4 (e).

CHAPTER II-A.— The Principal Register

(Inserted by Sec. 2, Rep. Act No. 638.)

Sec. 4. Registration of trade-marks, trade-names and service-

marks on the principal register. — There is hereby established a
register of trade-marks, trade-names and service-marks which

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 CASE DIGESTS [Law on Intellectual Property] 18

Accordingly, taken as they will appear to a prospective customer,

the trademark in question are not apt to confuse. Furthermore,
BRISTOL MYERS COMPANY v. THE DIRECTOR OF
the product of the applicant is expressly stated as dispensable
PATENTS and UNITED AMERICAN
only upon doctor's prescription, while that of oppositor does not
PHARMACEUTICALS, INC.
require the same. The chances of being confused into purchasing
G.R. No. L-21587, May 19, 1966
one for the other are therefore all the more rendered negligible.
FACTS Although oppositor avers that some drugstores sell "BIOFERIN"
A petition for registration in the Principal Register of the without asking for a doctor's prescription, the same if true would
Patent Office of the trademark "BIOFERIN" was filed on by be an irregularity not attributable to the applicant, who has
United American Pharmaceuticals, Inc. It covers "a medicinal already clearly stated the requirement of a doctor's prescription
preparation of antihistamic, analgesic, antipyritic with vitamin C upon the face of the label of its product.
and Bioflavenoid used in the treatment of common colds,
influenza and other febrile diseases with capillary hemmorrhagic
tendencies."

Bristol Myers Co., a corporation of the State of Delaware,

U.S.A., filed an opposition to the application. Said oppositor is
the owner in the Philippines of the trademark "BUFFERIN". Its
trademark is also registered in the United States.

The thrust of oppositor's contention was that the registration of

the applicant's trademark "BIOFERIN would violate its rights
and interests in its registered trademark "BUFFERIN" as well as
mislead and confuse the public as to the source and origin of the
goods covered by the respective marks, in view of the allegedly
practically the same spelling, pronunciation and letter-type
design of the two trademarks covering goods of the same class.

The parties thereafter filed a joint petition stipulating as to the

facts and submitting the case upon the issue of whether or not,
considering all the factors involved, in both trademarks — as the
parties would discuss in their memoranda,— there will be such
confusing similarity between the two trademarks as will be likely
to deceive the purchasing public.

The Director of Patents rendered a decision granting the petition

for registration and dismissing the opposition, on the ground that,
all factors considered the trademarks in question are not
confusingly similar, so that the damage feared by the oppositor
will not result. From said decision the oppositor appealed to this
Court.

ISSUE
Whether or not the trademarks “BIOFERIN” and
“BUFFERIN”, as presented to the public in their respective
labels, confusingly similar.

RULING
NO. In determining whether two trademarks are confusingly
similar, the test is not simply to take their words and compare the
spelling and pronunciation of said words. Rather, it is to consider
the two marks in their entirety, as they appear in the respective
labels, in relation to the goods to which they are attached.

Applying this test to the trademarks involved in this case, it is at

once evident that the Director of Patents did not err in finding no
confusing similarity. For though the words "BIOFERIN" and
"BUFFERIN" have the same suffix and similar sounding
prefixes, they appear in their respective labels with strikingly
different backgrounds and surroundings, as to color , size and
design.

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VICTORIO P. DIAZ v. PEOPLE OF THE PHILIPPINES
G.R. No. 180677, February 18, 2013
FACTS
The Department of Justice filed two informations charging Diaz
with violation of Section 155, in relation to Section 170, of RA
No. 8293, also known as the Intellectual Property Code of the
Philippines (Intellectual Property Code).
The accused, with criminal intent to defraud Levi’s Strauss
(Phil.) Inc. (hereinafter referred to as LEVI’S) intentionally
engaged in commerce by reproducing, counterfeiting, copying
and colorably imitating Levi’s registered trademarks or
dominant features thereof such as the ARCUATE DESIGN,
TWO HORSE BRAND, TWO HORSE PATCH, TWO HORSE
LABEL WITH PATTERNED ARCUATE DESIGN, TAB AND
COMPOSITE ARCUATE/TAB/TWO HORSE PATCH, and in
connection thereto, sold, offered for sale, manufactured,
distributed counterfeit patches and jeans, including other
preparatory steps necessary to carry out the sale of said patches
and jeans, which likely caused confusion, mistake, and /or
deceived the general consuming public, without the consent,
permit or authority of the registered owner, LEVI’S; thus,
depriving and defrauding the latter of its right to the exclusive
use of its trademarks and legitimate trade, to the damage and
prejudice of LEVI’S.
The cases were consolidated for a joint trial. Diaz entered his
pleas of not guilty to each information.
RTC: Found Diaz guilty as charged.
CA: Dismissed the appeal on the ground that Diaz had not filed
his appellant’s brief on time despite being granted his requested
several extension periods.
ISSUE
Whether or not Diaz committed infringement.
RULING
The elements of the offense of trademark infringement under
the Intellectual Property Code are, therefore, the following:
(1) The trademark being infringed is registered in the IPO;
(2) The trademark is reproduced, counterfeited, copied, or
colorably imitated by the infringer;
(3) The infringing mark is used in connection with the sale,
offering for sale, or advertising of any goods, business
or services; or the infringing mark 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;
(4) The use or application of the infringing mark 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
identity of such business; and
(5) The use or application of the infringing mark is without
the consent of the trademark owner or the assignee
thereof.
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CASE DIGESTS [Law on Intellectual Property] 19
As can be seen, the likelihood of confusion is the gravamen of
the offense of trademark infringement. There are two tests to
determine likelihood of confusion, namely: the dominancy test,
and the holistic test.
Diaz used the trademark "LS JEANS TAILORING" for the jeans
he produced and sold in his tailoring shops. His trademark was
visually and aurally different from the trademark "LEVI
STRAUSS & CO" appearing on the patch of original jeans under
the trademark LEVI’S 501. The word "LS" could not be
confused as a derivative from "LEVI STRAUSS" by virtue of the
"LS" being connected to the word "TAILORING", thereby
openly suggesting that the jeans bearing the trademark "LS
JEANS TAILORING" came or were bought from the tailoring
shops of Diaz, not from the malls or boutiques selling original
LEVI’S 501 jeans to the consuming public.
There were other remarkable differences between the two
trademarks that the consuming public would easily perceive.
Diaz aptly noted such differences, as follows:
 The prosecution alleged that the accused copied the
"two horse design" of the petitioner-private
complainant but the evidence will show that the design
was a "buffalo design."
 The prosecution further alleged that the red tab was
copied by the accused. However, evidence will show
that the red tab used by the private complainant
indicates the word "LEVI’S" while that of the accused
indicates the letters "LSJT" which means LS JEANS
TAILORING.
In terms of classes of customers and channels of trade, the jeans
products of the private complainant and the accused cater to
different classes of customers and flow through the different
channels of trade. The customers of the private complainant are
mall goers belonging to class A and B market group – while that
of the accused are those who belong to class D and E market who
can only afford Php 300 for a pair of made-to-order pants.
Moreover, based on the certificate issued by the Intellectual
Property Office, "LS JEANS TAILORING" was a registered
trademark of Diaz. He had registered his trademark prior to the
filing of the present cases. The IPO would certainly not have
allowed the registration had Diaz’s trademark been confusingly
similar with the registered trademark for LEVI’S 501 jeans.

PHILIP MORRIS, INC. v. FORTUNE TOBACCO
CORPORATION
G.R. No. 158589, June 27, 2006
FACTS
Petitioner Philip Morris, Inc., a corporation organized under the
laws of the State of Virginia, USA, is the registered owner of the
trademark MARK VII for cigarettes. Similarly, petitioner
Benson & Hedges (Canada), Inc., a subsidiary of Philip Morris,
Inc., is the registered owner of the trademark MARK TEN for
cigarettes. Another subsidiary of Philip Morris, Inc., the Swiss
company Fabriques de Tabac Reunies, S.A., is the assignee of
the trademark LARK, which was originally registered in 1964 by
Ligget and Myers Tobacco Company.
On the other hand, respondent Fortune Tobacco Corporation, a
company organized in the Philippines, manufactures and sells
cigarettes using the trademark MARK.
The legal dispute between the parties started when the herein
petitioners, on the claim that an infringement of their respective
trademarks had been committed, filed a Complaint for
Infringement of Trademark and Damages against respondent
Fortune Tobacco Corporation.
The CA, in its Decision dated January 21, 2003, while ruling
for petitioners on the matter of their legal capacity to sue in this
country for trademark infringement, nevertheless affirmed the
trial court’s decision on the underlying issue of respondent’s
liability for infringement.
ISSUE
Whether or not respondent has committed trademark
infringement against petitioners by its use of the mark MARK
for its cigarettes, hence liable for damages.
RULING
NO.
A trademark is any distinctive word, name, symbol, emblem,
sign, or device, or any combination thereof adopted and used by
a manufacturer or merchant on his goods to identify and
distinguish them from those manufactured, sold, or dealt in by
others. Inarguably, a trademark deserves protection.
Petitioners assert that, as corporate nationals of member-
countries of the Paris Union, they can sue before Philippine
courts for infringement of trademarks, or for unfair
competition, without need of obtaining registration or a
license to do business in the Philippines, and without
necessity of actually doing business in the Philippines. To
petitioners, these grievance right and mechanism are accorded
not only by Section 21-A of Republic Act (R.A.) No. 166, as
amended, or the Trademark Law, but also by Article 2 of
the Paris Convention for the Protection of Industrial
Property, otherwise known as the Paris Convention.
It must be emphasized that their standing to sue in Philippine
courts had been recognized, and rightly so, by the CA. It ought
to be pointed out, however, that the appellate court qualified its
holding.
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CASE DIGESTS [Law on Intellectual Property] 20
With the foregoing perspective, it may be stated right off that the
registration of a trademark unaccompanied by actual use thereof
in the country accords the registrant only the standing to sue for
infringement in Philippine courts. Entitlement to protection of
such trademark in the country is entirely a different matter.
This brings us to the principal issue of infringement.
Upon consideration of the foregoing in the light of the peculiarity
of this case, we rule against the likelihood of confusion
resulting in infringement arising from the respondents use of the
trademark MARK for its particular cigarette product.
For one, as rightly concluded by the CA after comparing the
trademarks involved in their entirety as they appear on the
products, the striking dissimilarities are significant enough to
warn any purchaser that one is different from the other. Indeed,
although the perceived offending word MARK is itself
prominent in petitioner’s trademarks MARK VII and MARK
TEN, the entire marking system should be considered as a whole
and not dissected, because a discerning eye would focus not only
on the predominant word but also on the other features appearing
in the labels. Only then would such discerning observer draw his
conclusion whether one mark would be confusingly similar to
the other and whether or not sufficient differences existed
between the marks.
This said, the CA then, in finding that respondents goods cannot
be mistaken as any of the three cigarette brands of the petitioners,
correctly relied on the holistic test.
But, even if the dominancy test were to be used, the likelihood
of confusion tantamount to infringement appears to be
farfetched. The reason for the origin and/or ownership angle is
that unless the words or devices do so point out the origin or
ownership, the person who first adopted them cannot be injured
by any appropriation or imitation of them by others, nor can the
public be deceived.
Since the word MARK, be it alone or in combination with the
word TEN and the Roman numeral VII, does not point to the
origin or ownership of the cigarettes to which they apply, the
local buying public could not possibly be confused or deceived
that respondents MARK is the product of petitioners and/or
originated from the U.S.A., Canada or Switzerland. And lest it
be overlooked, no actual commercial use of petitioner’s marks in
local commerce was proven. There can thus be no occasion for
the public in this country, unfamiliar in the first place with
petitioner’s marks, to be confused.
It cannot be over-emphasized that the products involved are
addicting cigarettes purchased mainly by those who are already
predisposed to a certain brand. Accordingly, the ordinary buyer
thereof would be all too familiar with his brand
and discriminating as well.
As already found herein, while petitioners have registered
the trademarks MARK VII, MARK TEN and LARK for
cigarettes in the Philippines, prior actual commercial use thereof
had not been proven. In fact, petitioners judicial admission of not
doing business in this country effectively belies any pretension
to the contrary.

DEL MONTE CORPORATION v. COURT OF APPEALS
G.R. No. L-78325, January 25, 1990
FACTS
Petitioner Del Monte Corporation is a foreign company
organized under the laws of the US and not engaged in business
in the Philippines. Both the Philippines and the US are
signatories to the Convention of Paris of September 27, 1965,
which grants to the nationals of the parties rights and advantages
which their own nationals enjoy for the repression of acts of
infringement and unfair competition.
Petitioner Philippine Packing Corporation (Philpack) is a
domestic corporation. Del Monte granted Philpack the right to
manufacture, distribute and sell in the Philippines various
agricultural products, including catsup, under the Del Monte
trademark and logo.
Del Monte authorized Philpack to register with the Philippine
Patent Office the Del Monte catsup bottle configuration, for
which it was granted Certificate of Trademark Registration No.
SR-913. Del Monte also obtained two registration certificates for
its trademark "DEL MONTE" and its logo.
Respondent Sunshine Sauce Manufacturing Industries was
issued a Certificate of Registration by the Bureau of Domestic
Trade, to engage in the manufacture, packing, distribution and
sale of various kinds of sauce, identified by the logo Sunshine
Fruit Catsup.
This logo was registered in the Supplemental Register.
The product itself was contained in various kinds of bottles,
including the Del Monte bottle, which the private respondent
bought from the junk shops for recycling.
Philpack and Del Monte filed a complaint against the private
respondent for infringement of trademark and unfair
competition, with a prayer for damages and the issuance of a writ
of preliminary injunction.
In its answer, Sunshine alleged that it had long ceased to use the
Del Monte bottle and that its logo was substantially different
from the Del Monte logo and would not confuse the buying
public to the detriment of the petitioners.
RTC dismissed the complaint. The decision was affirmed in toto
by the CA.
ISSUE
Whether or not there is infringement or unfair competition.
RULING
YES.
It has been correctly held that side-by-side comparison is not the
final test of similarity. Such comparison requires a careful
scrutiny to determine in what points the labels of the products
differ, as was done by the trial judge. The ordinary buyer does
not usually make such scrutiny nor does he usually have the time
to do so. The average shopper is usually in a hurry and does not
inspect every product on the shelf as if he were browsing in a
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CASE DIGESTS [Law on Intellectual Property] 21
library. Where the housewife has to return home as soon as
possible to her baby or the working woman has to make quick
purchases during her off hours, she is apt to be confused by
similar labels even if they do have minute differences. The male
shopper is worse as he usually does not bother about such
distinctions.
The question is whether the general confusion made by the
article upon the eye of the casual purchaser who is
unsuspicious and off his guard, is such as to likely result in
his confounding it with the original.
It has been held that in making purchases, the consumer must
depend upon his recollection of the appearance of the product
which he intends to purchase. The buyer having in mind the
mark/label of the respondent must rely upon his memory of the
petitioner's mark. Unlike the judge who has ample time to
minutely examine the labels in question in the comfort of his
sala, the ordinary shopper does not enjoy the same opportunity.
A number of courts have held that to determine whether a
trademark has been infringed, we must consider the mark as a
whole and not as dissected. If the buyer is deceived, it is
attributable to the marks as a totality, not usually to any part of
it. The court therefore should be guided by its first impression,
for a buyer acts quickly and is governed by a casual glance, the
value of which may be dissipated as soon as the court assumes
to analyze carefully the respective features of the mark.
It has also been held that it is not the function of the court in cases
of infringement and unfair competition to educate purchasers but
rather to take their carelessness for granted, and to be ever
conscious of the fact that marks need not be identical. A
confusing similarity will justify the intervention of equity.
At that, even if the labels were analyzed together it is not difficult
to see that the Sunshine label is a colorable imitation of the Del
Monte trademark. The predominant colors used in the Del Monte
label are green and red-orange, the same with Sunshine. The
word "catsup" in both bottles is printed in white and the style of
the print/letter is the same. Although the logo of Sunshine is not
a tomato, the figure nevertheless approximates that of a tomato.
As previously stated, the person who infringes a trade mark does
not normally copy out but only makes colorable changes,
employing enough points of similarity to confuse the public with
enough points of differences to confuse the courts. What is
undeniable is the fact that when a manufacturer prepares to
package his product, he has before him a boundless choice of
words, phrases, colors and symbols sufficient to distinguish his
product from the others. When as in this case, Sunshine chose,
without a reasonable explanation, to use the same colors and
letters as those used by Del Monte though the field of its
selection was so broad, the inevitable conclusion is that it was
done deliberately to deceive.
It can be inferred from the foregoing that although Del Monte
has actual use of the bottle's configuration, the petitioners cannot
claim exclusive use thereof because it has not been registered in
the Principal Register. However, we find that Sunshine, despite
the many choices available to it and notwithstanding that the
caution "Del Monte Corporation, Not to be Refilled" was
embossed on the bottle, still opted to use the petitioners' bottle to
market a product which Philpack also produces. This clearly
 CASE DIGESTS [Law on Intellectual Property] 22

shows the private respondent's bad faith and its intention to

capitalize on the latter's reputation and goodwill and pass off its
own product as that of Del Monte.

As Sunshine's label is an infringement of the Del Monte's

trademark, law and equity call for the cancellation of the private
respondent's registration and withdrawal of all its products
bearing the questioned label from the market. With regard to the
use of Del Monte's bottle, the same constitutes unfair
competition; hence, the respondent should be permanently
enjoined from the use of such bottles.

JB Suarez @therainsantiago © 2018

That in all things God may be glorified!