G.R. No.

180073 November 25, 2009

Horphag Research Management SA is a corporation duly organized and existing under the laws of Switzerland and the owner of trademark PYCNOGENOL, a food supplement sold and distributed by Zuellig Pharma Corporation.

Horphag later discovered that petitioner Prosource International, Inc. was also distributing a similar food supplement using the mark PCO-GENOLS since 1996.This prompted respondent to demand that petitioner cease and desist from using the aforesaid mark

Without notifying respondent, petitioner discontinued the use of, and withdrew from the market, the products under the name PCO-GENOLS as of June 19, 2000. It, likewise, changed its mark from PCOGENOLS to PCO-PLUS.

1. Defendant [petitioner] is a corporation duly organized and existing under the laws of the Republic of the Philippines with business address at No. 7 Annapolis Street, Greenhills, San Juan, Metro Manila; 2. The trademark PYCNOGENOL of the plaintiff is duly registered with the Intellectual Property Office but not with the Bureau of Food and Drug (BFAD).

3. The defendants product PCO-GENOLS is duly registered with the BFAD but not with the Intellectual Property Office (IPO). 4. The defendant corporation discontinued the use of and had withdrawn from the market the products under the name of PCO-GENOLS as of June 19, 2000, with its trademark changed from PCO-GENOLS to PCO-PLUS. 5. Plaintiff corporation sent a demand letter to the defendant dated 02 June 2000

1. 2.

If Prosource infringed the trademark of Horphag; and Is the companys respective trademarks PYCNOGENOLS to PCO-GENOL, confusingly similar with one another?

The [petitioners] mark PCO-GENOLS, nevertheless, when the two words are pronounced, the sound effects are confusingly similar not to mention that they are both described by their manufacturers as a food supplement and thus, identified as such by their public consumers.

And although there were dissimilarities in the trademark due to the type of letters used as well as the size, color and design employed on their individual packages/bottles, still the close relationship of the competing products name in sounds as they were pronounced, clearly indicates that purchasers could be misled into believing that they are the same and/or originates from a common source and manufacturer.

The elements of infringement under R.A. No. 8293: (4) 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 identity of such business; and

(5) It is without the consent of the trademark or trade name owner or the assignee thereof

The elements of infringement under RA 166 (a) A trademark actually used in commerce in the Philippines and registered in the principal register of the Philippine Patent Office[;] (b) [It] is used by another person in connection with the sale, offering for sale, or advertising of any goods, business or services or in connection with which such use is likely to cause confusion or mistake or to deceive purchasers or others as to the source or origin of such

goods or services, or identity of such business; or such trademark is reproduced, counterfeited, copied or colorably imitated by another person and such reproduction, counterfeit, copy or colorable imitation is applied to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used upon or in connection with such goods, business or services as to likely cause confusion or mistake or to deceive purchasers[;]

(c) [T]he trademark is used for identical or similar goods[;] and (d) [S]uch act is done without the consent of the trademark registrant or assignee.

Application of RA 16618 and RA 8293 Provisions of Republic Act (R.A.) No. 16618 for the acts committed until December 31, 1997, and R.A. No. 829319 for those committed from January 1, 1998 until June 19, 2000.

Both the word[s] PYCNOGENOL and PCOGENOLS have the same suffix "GENOL" which on evidence, appears to be merely descriptive and furnish no indication of the origin of the article and hence, open for trademark registration by the plaintiff thru combination with another word or phrase such as PYCNOGENOL, Exhibits "A" to "A-3."

Furthermore, although the letters "Y" between P and C, "N" between O and C and "S" after L are missing in the [petitioners] mark PCO-GENOLS, nevertheless, when the two words are pronounced, the sound effects are confusingly similar not to mention that they are both described by their manufacturers as a food supplement and thus, identified as such by their public consumers.

And although there were dissimilarities in the trademark due to the type of letters used as well as the size, color and design employed on their individual packages/bottles, still the close relationship of the competing products name in sounds as they were pronounced, clearly indicates that purchasers could be misled into believing that they are the same and/or originates from a common source and manufacturer.

G.R. No. 169504 March 3, 2010

PETITIONER
A local corporation engaged in the business of

establishing and maintaining coffee shops in the country. Registered with SEC in Jan. 2001. Has franchise agreement with Coffee Partners Ltd. (CPL): a business entity organized under the existing laws of British Virgin Islands. (For a non-exclusive right to operate coffee shops in the Philippines using TMs designed by CPL, like SAN FRANCISCO COFFEE.

RESPONDENT
A local corporation engaged in the wholesale and

retail sale of coffee. Registered with SEC in May 1995 Registered business name of SAN FRANCISCO COFFEE & ROASTERY, INC. with the DTI in June 1995.

 They have a customer base which includes:

Figaro, Tagaytay Highlands, Fat Willys and etc. 1998: Formed a joint venture company with Boyd Coffee USA, under the company name: Boyd Coffee Company Philippines, Inc. (BCCPI).
The BCCPI is engaged in the processing, roasting, and wholesale selling of coffee. Later on embarked on a project study of setting up coffee carts in malls and other commercial establishments in Metro Manila.

June 2001: respondent found out that the petitioner was planning to open a coffee shop in Libis, Quezon City, under the name, San Francisco Coffee. Respondent: Petitioners shop caused CONFUSION in the minds of the public, because they had similar name, and the same line of business.

Respondent sent a letter to the petitioner demanding the latters shop to stop using their name. Respondent also filed a complaint to the Bureau of Legal AffairsIntellectual Property Office (BLA-IPO)

ANSWER (PETITIONER): Allegations? DENIED! They said that their applications for registration of their mark were for Class 42 (Scientific and technological services and research and design relating thereto; industrial analysis and research services; design and development of computer hardware and software) in 1999 and 35 (Advertising; business management; business administration; office functions) in 2000.

The petitioner didnt stop using the mark because they said that it will not be confused with the respondents mark because of the notable distinctions in their appearances. They also said that since the joint venture with the company BOYD COFFEE USA, they stopped operating by the name SAN FRANCISCO COFFEE. They also contended that there were no specific acts that would lead the one person, even the petitioner that the mark is not in use anymore.

Mr. David Puyat (Petitioner) testified that the coffee shop in Libis opened in June 2001, and another in Glorietta will open soon. The coffee shop was put up in pursuant to a franchise agreement executed in Jan. 2001 w/ CPL, owned by ROBERT BOXWELL. He also said that he was only involved because of one ARTHUR GINDANG, who invited him to invest in a coffee shop and introduced him to BOXWELL.

BOXWELL said that there were branches of SAN FRANCISCO COFFEE in Malaysia & Singapore. He also formed the CPL in 1997 with Miller John & Leah Warren (former managers of Starbucks Coffee Shop, USA). Also, he stated that the name was adopted from a famous coffee shop in California, where he and his colleagues used to live in and where special coffee roasts came from.

Petitioners trademark infringed on respondents trade name. THE RIGHT TO EXCLUSIVE USE OF A TRADE NAME WITH FREEDOM FROM INFRINGEMENT BY SIMILARITY IS DETERMINED FROM PRIORITY OF ADOPTION.

Since the respondent registered its business name with DTI in 1995 and petitioner registered it with IPO in 2001 in the Philippines, and 1997 in other countries, THE RESPONDENT MUST BE PROTECTED FROM INFRINGEMENT OF TRADE NAME.

Respondent did not abandon the use of its trade name as substantial evidence indicated respondent continuously use its trade name in connection with the purpose for which it was organized.

Though the respondent was no longer involved with blending, roasting, and distribution of coffee because of the BCCPI, IT CONTINUED MAKING PLANS AND DOING RESEARCH ON THE RETAILING OF COFFEE AND SETTING UP OF COFFEE CARTS.

MORAL: For the abandonment to EXIST, the DISUSE must be PERMANENT, INTENTIONAL, and VOLUNTARY. The use of the trademark by the petitioner CAUSES CONFUSION, because of the EXACT SIMILARITY IN SOUND, SPELLING, PRONUNCIATION, AND COMMERCIAL IMPRESSION OF THE WORDS. (Which was the dominant portion of respondents trade name and petitioners trademark)

Even though there were significant differences like: DIAMOND-SHAPED FIGURE IN THE CENTER (PETITIONER), there is GREATER WEIGHT in the words. UNFAIR COMPETITION: Petitioner is absolved from liability. Petitioner was granted by franchisor to use the trademark. Also, no evidence to show intention to defraud in the part of the petitioner. Claim for actual damages and moral damages: DISMISSED.

The decision of the BLA-IPO is set aside. The petitioners use is not an infringement. Respondent stopped the use of the trade name went they entered to the joint venture BCCPI.

The decision of the ODG-IPO is REVERSED. Respondents claim for actual damages: DENIED. Petitioners motion for reconsideration and respondents motion for partial reconsideration: DENIED.

The use of the trademark (petitioner) constitutes infringement of the trade name (respondent) even if the trade name is not registered in the IPO.

The petitioner has no merit, thus there is INFRINGEMENT.

Petitioner Alleges that when a trade name is not registered, suit for infringement is not available

Respondent Claims RA 8293 dispensed with the registration of trade name with the IPO as a requirement for the filing for an action for infringement Requirement: Trade name is previously used in trade or commerce in Philippines

Respondents registration of business name expired June 16, 2000 and it was only in 2001 (petitioner opened its coffee shop in Libis, Quezon City in June 2001) when respondent renewed its business registration

Never abandoned the use of trade name Evidence: Letter to petitioner demanding immediate discontinuation of the use of its trademark And by filing the infringement

Respondents failure to continue No abandonment of trade name: the use of its trade name negates BLA IPO found respondent any allegation of infringement continued to make plans and do research about coffee shops and coffee carts (which negates abandonment) CA found that while respondent stopped using the trade name in its business of selling coffee, it continued importing and selling coffee machines (which is one of the services registered by the respondent with the use of its business name)

No confusion is likely to occur Wide divergence in the channels of trade o Petitioner: ready made coffee o Respondent: wholesale blending, roasting, and distribution of coffee

Petitioners trademark is confusingly similar to respondents trade name Ordinarily prudent consumers are likely to be mislead about the source, affiliation or sponsorship of petitioners coffee

Proper noun San Francisco and generic word coffee not capable of exclusive appropriation

The binding effect of the factual findings of CA applies with greater force when BLA IPO (quasi-judicial body) and CA are in complete agreement and without any circumstance requiring the reversal of the factual conclusion made, by the quas-judicial body and was affirmed by the CA, the court necessarily upholds such findings of fact

The trademark being infringed is registered in IPO, however, in infringement of trade name, the same need not be registered. Trademark or trade name is reproduced, counterfeited, copied, or colorably imitated by the infringer

used in connection with the sale, offering for sale applied to labels, signs, prints, packages, wrappers, intended to be used upon or in connection with such goods, business, or services likely to cause confusion or mistake or to deceive purchasers Without consent of the trademark or trade name owner or the assignee

 required registration as a condition for the

institution of an infringement suit shall be liable to a civil action by the registrant Registration is not a necessity before filing a suit by the owner, all that is required is it is previously used in trade or commerce in the Philippines

(a) Notwithstanding any laws or regulations providing for any obligation to register trade names, such names shall be protected, even prior to or without registration, against any unlawful act committed by third parties (b) subsequent use likely to mislead the public, shall be deemed unlawful Thus: REGISTRATION REQUIREMENT IS DISPENSED.

Applying either dominancy or holistic test, petitioners San Francisco Coffee trademark is clearly an infringement of respondents San Francisco Coffee & Roastery Inc., trade name
Descriptive words San Francisco are dominant

features

 Engaged in same business of selling coffee

(whether whole sale or retail)

Consuming public will likely to be confused as to the source of the coffee being sold

San Francisco as a Proper Name and coffee as

a Generic Term is untenable

 Respondent acquired exclusive right to use the trade name since 1995 registration of the business to DTI
From then on, must be free from any infringement by similarity But does not have exclusive use of the geographic or generic word San Francisco and coffee The combination of the words is being protected against infringement to avoid confusing or deceiving the public

Court held that a corporation has an exclusive right to the use of its name
Not allow someone to profit from an established

name and act to deceive the public that they are dealing with the same corporation which has given reputation to the name

Not only the law but equity consideration hold petitioner liable for infringement of respondents trade name Court ruled that CA is correct in setting aside decision of ODG-IPO and reinstating decision of BLA-IPO (which is the petitioner has committed infringement).