LIP 2013-2014 Case Digests Set1 Case Title: TANDUAY DISTILLERS, INC. vs. GINE RA SAN !IGUEL, INC.

Petiti"#e$%s Clai&s: Tanduay argues that San Miguel cannot claim the exclusive right to use the generic word "Ginebra" for its gin products based on its registration of the composite marks "Ginebra San Miguel", "Ginebra S. Miguel !", and ""a Tonde#a $li%& Ginebra Mix", because in all of these registrations, San Miguel disclaimed any exclusive right to use the non'registrable word "Ginebra" for gin products. Tanduay explains that the word "Ginebra", which is disclaimed by San Miguel in all of its registered trademarks, is an unregistrable component of the composite mark "Ginebra San Miguel". Tanduay argues that this disclaimer further means that San Miguel does not have an exclusive right to the generic word "Ginebra". Tanduay states that the word "Ginebra" does not indicate the source of the product, but it is merely descriptive of the name of the product itself and not the manufacturer thereof. Res'"#(e#t%s Clai&s( San Miguel alleges that although "Ginebra", the Spanish word for "gin", may be a term originally incapable of exclusive appropriation, )urisprudence dictates that the mark has become distinctive of San Miguel*s products due to its substantially exclusive and continuous use as the dominant feature of San Miguel*s trademarks since +,-.. /ence, San Miguel is entitled to a finding that the mark is deemed to have ac%uired a secondary meaning. San Miguel states that Tanduay failed to present any evidence to disprove its claims0 thus, there is no basis to set aside the grant of the T12 and writ of preliminary in)unction. Iss)e*s( 3+45hether a word like "Ginebra" can ac%uire a secondary meaning for gin products so as to prohibit the use of the word "Ginebra" by other gin manufacturers or sellers. 364 5hether the word "Ginebra" is a generic mark that is incapable of appropriation by gin manufacturers. R)li#g: 7n Asia Brewery, Inc. v. Court of Appeals, the $ourt ruled that "pale pilsen" are generic words, "pale" being the actual name of the color and "pilsen" being the type of beer, a light bohemian beer with a strong hops flavor that originated in 8ilsen $ity in $9echoslovakia and became famous in the Middle :ges, and hence incapable of appropriation by any beer manufacturer. Moreover, Section +6-.+ 3h4 of the 78 $ode states that a mark cannot be registered if it "consists exclusively of signs that are generic for the goods or services that they seek to identify". 7n this case, a cloud of doubt exists over San Miguel*s exclusive right relating to the word "Ginebra". San Miguel*s claim to the exclusive use of the word "Ginebra" is clearly still in dispute because of Tanduay*s claim that it has, as others have, also registered the word "Ginebra" for its gin products. This issue can be resolved only after a full' blown trial. 7n Ong Ching Kian Chuan v. Court of Appeals, we held that in the absence of proof of a legal right and the in)ury sustained by the movant, the trial court*s order granting the issuance of an in)unctive writ will be set aside, for having been issued with grave abuse of discretion. 5e find that San Miguel*s right to in)unctive relief has not been clearly and unmistakably demonstrated. The right to the exclusive use of the word "Ginebra" has yet to be determined in the main case. The trial court*s grant of the writ of preliminary in)unction in favor of San Miguel, despite the lack of a clear and unmistakable right on its part, constitutes grave abuse of discretion amounting to lack of )urisdiction. Case Title: !a#)el Es'i$it) et.al., +s. PETR,N C,RP,RATI,N a#( CAR!EN -. D,L,IRAS, ("i#g .)si#ess )#(e$ t/e #a&e 01RISTINA PATRICIA ENTERPRISES0 Petiti"#e$%s Clai&: The provincial prosecutor ruled that there was probable cause only for violation of 1.:. 63unlawfully filling up registered tanks4 and that only the four ;icol Gas employees, Mirabena, Misal, "eorena, and

petitioner "lona, could be charged. The charge against the other petitioners who were the stockholders and directors of the company was dismissed. Res'"#(e#t%s Clai&: 7n the course of trade and competition, any given distributor of "8Gs at times ac%uired possession of "8G cylinder tanks belonging to other distributors operating in the same area. They called these "captured cylinders". :ccording to <ose, =8>*s manager, in :pril 6??+ ;icol Gas agreed with =8> for the swapping of "captured cylinders" since one distributor could not refill captured cylinders with its own brand of "8G. :t one time, in the course of implementing this arrangement, =8>*s <ose visited the ;icol Gas refilling plant. 5hile there, he noticed several Gasul tanks in ;icol Gas* possession. /e re%uested a swap but :udie "lona of ;icol Gas replied that he first needed to ask the permission of the ;icol Gas owners. That permission was given and they had a swap involving around -? Gasul tanks held by ;icol Gas in exchange for assorted tanks held by =8>. T$:S7/ =8>*s <ose noticed, however, that ;icol Gas still had a number of Gasul tanks in its yard. /e offered to make a swap for these but "lona declined, saying the ;icol Gas owners wanted to send those tanks to ;atangas. "ater ;icol Gas told <ose that it had no more Gasul tanks left in its possession. <ose observed on almost a daily basis, however, that ;icol Gas* trucks which plied the streets of the province carried a load of Gasul tanks. /e noted that =8>*s volume of sales dropped significantly from <une to <uly 6??+. 2n :ugust ., 6??+ =8>*s <ose saw a particular ;icol Gas truck on the Maharlika /ighway. 5hile the truck carried mostly ;icol Savers "8G tanks, it had on it one unsealed !?'kg Gasul tank and one !?'kg Shellane tank. <ose followed the truck and when it stopped at a store, he asked the driver, <un "eorena, and the ;icol Gas sales representative, <erome Misal, about the Gasul tank in their truck. They said it was empty but, when <ose turned open its valve, he noted that it was not. Misal and "eorena then admitted that the Gasul and Shellane tanks on their truck belonged to a customer who had them filled up by ;icol Gas. Misal then mentioned that his manager was a certain 1olly Mirabena. Iss)e*s: 52@ there were( Trademark infringement consisting in ;icol Gas* use of a trademark that is confusingly similar to 8etron*s registered "Gasul" trademark in violation of section +!! also of 1.:. ,6A-0 and Bnfair competition consisting in passing off ;icol Gas'produced "8Gs for 8etron'produced Gasul "8G in violation of Section + ,.- of 1.:. ,6A-. R)li#gs: +. =8> and 8etron have to show that the alleged infringer, the responsible officers and staff of ;icol Gas, used 8etron*s Gasul trademark or a confusingly similar trademark on ;icol Gas tanks with intent to deceive the public and defraud its competitor as to what it is selling. >xamples of this would be the acts of an underground shoe manufacturer in Malabon producing "@ike" branded rubber shoes or the acts of a local shirt company with no connection to "a $oste, producing and selling shirts that bear the stitched logos of an open')awed alligator. /ere, however, the allegations in the complaint do not show that ;icol Gas painted on its own tanks 8etron*s Gasul trademark or a confusingly similar version of the same to deceive its customers and cheat 8etron. 7ndeed, in this case, the one tank bearing the mark of 8etron Gasul found in a truck full of ;icol Gas tanks was a genuine 8etron Gasul tank, more of a captured cylinder belonging to competition. @o proof has been shown that ;icol Gas has gone into the business of distributing imitation 8etron Gasul "8Gs. 6 . There is no showing that ;icol Gas has been giving its "8G tanks the general appearance of the tanks of 8etron*s Gasul. :s already stated, the truckfull of ;icol Gas tanks that the =8> manager arrested on a road in Sorsogon )ust happened to have mixed up with them one authentic Gasul tank that belonged to 8etron.

The only point left is the %uestion of the liability of the stockholders and members of the board of directors of ;icol Gas with respect to the charge of unlawfully filling up a steel cylinder or tank that belonged to 8etron. The $ourt of :ppeals ruled that they should be charged along with the ;icol Gas employees who were pointed to as directly involved in overt acts constituting the offense. ;icol Gas is a corporation. :s such, it is an entity separate and distinct from the persons of its officers, directors, and stockholders. 7t has been held, however, that corporate officers or employees, through whose act, default or omission the corporation commits a crime, may themselves be individually held answerable for the crime. The "owners" of a corporate organi9ation are its stockholders and they are to be distinguished from its directors and officers. The petitioners here, with the exception of :udie "lona, are being charged in their capacities as stockholders of ;icol Gas. ;ut the $ourt of :ppeals forgets that in a corporation, the management of its business is generally vested in its board of directors, not its stockholders. Stockholders are basically investors in a corporation. They do not have a hand in running the day'to'day business operations of the corporation unless they are at the same time directors or officers of the corporation. ;efore a stockholder may be held criminally liable for acts committed by the corporation, therefore, it must be shown that he had knowledge of the criminal act committed in the name of the corporation and that he took part in the same or gave his consent to its commission, whether by action or inaction. The finding of the $ourt of :ppeals that the employees "could not have committed the crimes without the consent, CabetmentD, permission, or participation of the owners of ;icol Gas" is a sweeping speculation especially since, as demonstrated above, what was involved was )ust one 8etron Gasul tank found in a truck filled with ;icol Gas tanks. :lthough the =8> manager heard petitioner "lona say that he was going to consult the owners of ;icol Gas regarding the offer to swap additional captured cylinders, no indication was given as to which ;icol Gas stockholders "lona consulted. 7t would be unfair to charge all the stockholders involved, some of whom were proved to be minors. @o evidence was presented establishing the names of the stockholders who were charged with running the operations of ;icol Gas. The complaint even failed to allege who among the stockholders sat in the board of directors of the company or served as its officers. The $ourt of :ppeals of course specifically mentioned petitioner stockholder Manuel $. >spiritu, <r. as the registered owner of the truck that the =8> manager brought to the police for investigation because that truck carried a tank of 8etron Gasul. ;ut the act that 1.:. 6- punishes is the unlawful filling up of registered tanks of another. 7t does not punish the act of transporting such tanks. :nd the complaint did not allege that the truck owner connived with those responsible for filling up that Gasul tank with ;icol Gas "8G. Case Title: ARNEL U. TY, !ARIE ANT,NETTE TY, -AS,N ,NG, 2ILLY DY, a#( AL3IN TY vs. N I SUPER3ISING AGENT !AR3IN E. DE -E!IL, PETR,N GASUL DEALERS ASS,CIATI,N, a#( T,TALGA4 DEALERS ASS,CIATI,N Petiti"#e$%s Clai&: 8etitioners contend that there is no probable cause that 2mni violated Sec. 6 3a4, in relation to Secs. - 3c4 and . of ;8 --, as amended, prohibiting the refilling of another company*s or firm*s "8G cylinders without its written authori9ation. First, the branded "8G cylinders sei9ed were not traded by 2mni as its representative annotated in the @;7 receipt of sei9ed items that the filled "8G cylinders came from customers* trucks and the empty ones were taken from the warehouse or swapping section of the refilling plant and not from the refilling section. Second, the branded "8G cylinders are owned by end'user customers and not by the ma)or petroleum companies, i.e., 8etron, 8ilipinas Shell and Total. :nd even granting arguendo that 2mni is selling these "8G cylinders, still there cannot be a prima faciecase of violation since there is no proof that the refilled branded "8G cylinders are owned by another company or firm. hird, granting that 8etron, Total and 8ilipinas Shell still own their respective branded "8G cylinders already sold to consumers, still such fact will not bind third persons, like 2mni, who is not privy to the agreement between the

buying consumers and said ma)or petroleum companies. Thus, a subse%uent transfer by the customers of 8etron, Total and 8ilipinas Shell of the duly marked or stamped "8G cylinders through swapping, for example, will effectively transfer ownership of the "8G cylinders to the transferee, like 2mni. Fourth, "8G cylinder exchange or swapping is a common industry practice that the E2> recogni9es. They point to a series of meetings conducted by the E2> for institutionali9ing the validity of swapping of all and any kind of "8G cylinders among the industry players. The meetings resulted in a draft Memorandum of :greement 3M2:4 which unfortunately was not signed due to the withdrawal of petroleum ma)or players 8etron, Total and 8ilipinas Shell. @onetheless, the non'signing of the M2: does not diminish the fact of the recogni9ed industry practice of cylinder exchange or swapping. 1elying on 1epublic :ct @o. 31:4 ,.FA, petitioners maintain that said law promotes and encourages the entry of new participants in the petroleum industry such as 2mni. :nd in furtherance of this mandate is the valid practice of cylinder exchange or swapping in the "8G industry. 1espondentGs $laim( 1espondents claim that the $ircular is not confiscatory in providing penalties on a per cylinder basis. Iss)e*s: 52@ there is probable cause that 2mni violated Sec. 6 3a4, in relation to Secs. - 3c4 and . of ;8 --, as amended, prohibiting the refilling of another company*s or firm*s "8G cylinders without its written authori9ation. R)li#g: P$".a.le +i"lati"# "5 Se6. 2 7a8 "5 P 33, a&e#(e( 9i$st. The test'buy conducted on :pril +!, 6??. by the @;7 agents, as attested to by their respective affidavits, tends to show that 2mni illegally refilled the eight branded "8G cylinders for 8h8+,!,6. This is a clear violation of Sec. 6 3a4, in relation to Secs. - 3c4 and . of ;8 --, as amended. 7t must be noted that the criminal complaints, as clearly shown in the complaint'affidavits of :gent Ee <emil, are not based solely on the sei9ed items pursuant to the search warrants but also on the test'buy earlier conducted by the @;7 agents. Se6"#(. The written certifications from 8ilipinas Shell, 8etron and Total show that 2mni has no written authority to refill "8G cylinders, embossed, marked or stamped Shellane, !etron "asul, otalga# and Super$alan "a#. 7n fact, petitioners neither dispute this nor claim that 2mni has authority to refill these branded "8G cylinders. T/i$(. ;elying petitioners* contention, the sei9ed items during the service of the search warrants tend to show that 2mni illegally refilled branded "8G cylinders without authority. 2n :pril 6A, 6??., the @;7 agents who served the search warrants on 2mni sei9ed the following( HuantityIBnitEescription F "8G cylinders otalga#, ++.? kg CfilledD + "8G cylinder!etron "asul, ++.? kg CfilledD + "8G cylinderShellane, ++.? kg CfilledD 6A "8G cylindersSuper$alan "a#, 6.F kg CemptyD +F "8G cylinders!etron "asul, ++.? kg CemptyD , "8G cylindersMarked as Omnigas with Shell emboss, ++.? kg CemptyD

! "8G cylindersMarked as Omnigas with otalga# emboss, ++.? kg CemptyD 6- "8G cylindersShellane, ++.? kg CemptyD - "8G cylindersMarked as Omnigas with "asul emboss, ++.? kg CemptyD 6+ "8G cylinders otalga#, ++.? kg CemptyD The foregoing list is embodied in the @;7*s 1eceiptI7nventory of 8ropertyI7tem Sei9ed signed by @;7 :gent >dwin <. 1oble who served and implemented the search warrants. :nd a copy thereof was duly received by :tty. :llan B. Ty, representative of 2mni, who signed the same "under protest" and made the annotation at the bottom part thereon( "The above itemsIcylinders were taken at customers* trucks and the empty cylinders taken at the warehouse 3swapping section4 of the company." >ven considering that the filled "8G cylinders were indeed already loaded on customers* trucks when confiscated, yet the fact that these refilled "8G cylinders consisting of nine branded "8G cylinders, specifically otalga#, !etron "asul and Shellane, tends to show that 2mni indeed refilled these branded "8G cylinders without authori9ation from Total, 8etron and 8ilipinas Shell. Such a fact is bolstered by the test'buy conducted by :gent Ee <emil and @;7 confidential agent =awada( 2mni*s unauthori9ed refilling of branded "8G cylinders, contrary to Sec. 6 3a4 in relation to Sec. - 3c4 of ;8 --, as amended. :s petitioners strongly argue, even if the branded "8G cylinders were indeed owned by customers, such fact does not authori9e 2mni to refill these branded "8G cylinders without written authori9ation from the brand owners 8ilipinas Shell, 8etron and Total. This $ourt held that from Sec. +!!.+ :;of 1: ,6A- can be gleaned that "mere unauthori9ed use of a container bearing a registered trademark in connection with the sale, distribution or advertising of goods or services which is li$ely to cause confusion, mistake or deception among the buyersIconsumers can be considered as trademark infringement."

The $ourt affirmed the presence of infringement involving the )#a)t/"$i<e( sale of "asul and Shellane "8G cylinders and the )#a)t/"$i<e( $e5illi#g of the same by Masagana Gas $orporation as duly attested to and witnessed by @;7 agents who conducted the surveillance and test'buys. Similarly, in the instant case, the fact that 2mni refilled various branded "8G cylinders even if owned by its customers but without authority from brand owners 8etron, 8ilipinas Shell and Total shows palpable violation of ;8 --, as amended. 9")$t/. The issue of ownership of the sei9ed branded "8G cylinders is irrelevant and hence need no belaboring. ;8 --, as amended, does not re%uire ownership of the branded "8G cylinders as a condition sine %ua non for the commission of offenses involving petroleum and petroleum products. Jerily, the offense of refilling a branded "8G cylinder without the written consent of the brand owner constitutes the offense regardless of the buyer or possessor of the branded "8G cylinder. 9i5t/. The ownership of the sei9ed branded "8G cylinders, allegedly owned by 2mni customers as petitioners adamantly profess, is of no conse%uence. ET7Sa/ The law does not re%uire that the property to be sei9ed should be owned by the person against whom the search warrants is directed. 2wnership, therefore, is of no conse%uence, and it is sufficient that the person against whom the warrant is directed has control or possession of the property sought to be sei9ed. 8etitioners cannot deny that the sei9ed "8G cylinders were in the possession of 2mni, found as they were inside the 2mni compound.

P$".a.le +i"lati"# "5 Se6. 2 768 "5 P 33, as a&e#(e( :nent the alleged violation of Sec. 6 3c4 in relation to Sec. . of ;8 --, as amended, :gain, we are not persuaded. $ontrary to petitioners* arguments, a single underfilling constitutes an offense under ;8 --, as amended by 8E +, !, which clearly criminali9es these offenses. The $ourt affirmed the validity of E2> $ircular @o. 6???'? '?+? which '$"+i(e( 'e#alties "# a 'e$ 6=li#(e$ .asis 5"$ ea6/ +i"lati"#, thus( ;.8. ;lg. --, as amended, criminali9es illegal t$a(i#g, adulteration, )#(e$5illi#g, hoarding, and overpricing of petroleum products. Bnder this general description of what constitutes criminal acts involving petroleum products, the $ircular merely lists the various modes by which the said criminal acts may be perpetrated, namely( no price display board, no weighing scale, no tare weight or incorrect tare weight markings, #" a)t/"$i<e( LPG seal, no trade name, unbranded "8G cylinders, no serial number, no distinguishing color, no embossed identifying markings on cylinder, )#(e$5illi#g LPG 6=li#(e$s, ta&'e$i#g LPG 6=li#(e$s , and unauthori9ed decanting of "8G cylinders. These specific acts and omissions are obviously within the contemplation of the law, which seeks to curb the pernicious practices of some petroleum merchants. 3>mphasis supplied.4 Moreover, in denying the motion for reconsideration of the "8G 1efillers :ssociation of the 8hilippines, 7nc., the $ourt upheld the basis of said E2> $ircular @o. 6???'? '?+? on the i&'"siti"# "5 'e#alties "# a 'e$ 6=li#(e$ .asis, thus( 1espondent*s position is untenable. The $ircular is not confiscatory in providing penalties on a per cylinder basis. Those penalties do not exceed the ceiling prescribed in Section . of ;.8. ;lg. --, as amended, which penali9es "any person who commits any act &t'herein prohi(ited." Thus, violation on a per cylinder basis falls within the phrase " any act" as mandated in Section .. To provide the same penalty for one who violates a prohibited act in ;.8. ;lg. --, as amended, regardless of the number of cylinders involved would result in an indiscriminate, oppressive and impractical operation of ;.8. ;lg. --, as amended. The e%ual protection clause demands that "all persons su()ect to such legislation shall (e treated ali$e, under like circumstances and conditions, (oth in the privileges conferred and in the lia(ilities imposed. " The $ourt made it clear that a violation, like underfilling, on a per cylinder basis falls within the phrase of a#= a6t as mandated under Sec. . of ;8 --, as amended. 7neluctably, the underfilling of one "8G cylinder constitutes a clear violation of ;8 --, as amended. The finding of underfilling by "8G 7nspector @avio of the "8G7:, as aptly noted by Manila :ssistant $ity 8rosecutor $atalo who conducted the preliminary investigation, was indeed not controverted by petitioners. Case Title: -UN, ATISTIS +s. PE,PLE ,9 T>E P>ILIPPINES Petiti"#e$%s Clai&: ;atistis contends that( T/> 1>G72@:" T17:" $2B1T >11>E 7@ $2@J7$T7@G T/> :$$BS>E 2@ T/> ;:S7S 2K T/> S>"K'S>1J7@G :KK7E:J7TS :@E T>ST7M2@7>S 2K T/> 82"7$> 2KK7$>1S 5/2 $2@EB$T>E T/> 1:7E 2@ T/> /2BS> 2K T/> :$$BS>E. /e submits that the only direct proofs of his guilt were the self'serving testimonies of the @;7 raiding team0 that he was not present during the search0 that one of the @;7 raiding agents failed to immediately identify him in court0 and that aside from the two bottles of Fundador brandy, the rest of the confiscated items were not found in his house.

Res'"#(e#t%s Clai&: :llied Eomec% 8hilippines, 7nc., a 8hilippine corporation exclusively authori9ed to distribute Fundador brandy products imported from Spain wholly in finished form, initiated this case against ;atistis. Bpon its re%uest, agents of the @ational ;ureau of 7nvestigation 3@;74 conducted a test'buy in the premises of ;atistis, and thereby confirmed that he was actively engaged in the manufacture, sale and distribution of counterfeit Fundador brandy products. Bpon application of the @;7 agents based on the positive results of the test' buy, <udge :ntonio M. >ugenio, <r. of the Manila 1T$ issued on Eecember 6?, 6??+ Search 5arrant @o. ?+' 6!F , authori9ing the search of the premises of ;atistis located at @o. + . 2nyx St., San :ndres ;ukid, Sta. :na, Manila. The search yielded 6? empty Carlos I bottles, +? empty bottles of Blac$ *a(el whis$ey, two empty bottles of +ohnny ,al$er Swing, an empty bottle of -emy .artin /O, an empty bottle of Cha(ot, 6.+ emptyFundador bottles, + - boxes of Fundador, a half sack of Fundador plastic caps, two filled bottles of Fundador brandy, and eight cartons of empty <ose $uervo bottles. The 2ffice of the $ity 8rosecutor of Manila formally charged ;atistis in the 1T$ in Manila with two separate offenses, namely, infringement of trademar$ and unfair competition Iss)e*s: 5hether or not ;atistis is guilty of trademark infringement. R)li#g: /arvey Tan, 2perations Manager of 8edro Eomec%, S.:. whose task involved the detection of counterfeit products in the 8hilippines, testified that the sei9ed Fundador brandy, when compared with the genuine product, revealed several characteristics of counterfeiting, namely( 3a4 the ;ureau of 7nternal 1evenue 3;714 seal label attached to the confiscated products did not reflect the word tunay when he flashed a black light against the ;71 label0 3b4 the "tamper evident ring" on the confiscated item did not contain the word Fundador0 and 3c4 the word Fundador on the label was printed flat with sharper edges, unlike the raised, actually embossed, and finely printed genuine Fundador trademark. There is no %uestion, therefore, that ;atistis exerted the effort to make the counterfeit products look genuine to deceive the unwary public into regarding the products as genuine. The buying public would be easy to fall for the counterfeit products due to their having been given the appearance of the genuine products, particularly with the difficulty of detecting whether the products were fake or real if the buyers had no experience and the tools for detection, like black light. /e thereby infringed the registered Fundador trademark by the colorable imitation of it through applying the dominant features of the trademark on the fake products, particularly the two bottles filled with Fundador brandy. /is acts constituted infringement of trademark as set forth in Section +!!, supra.

Case Title: C,99EE PARTNERS, INC., 'etiti"#e$, +s. SAN 9RANCISC, C,99EE ? R,ASTERY, INC., $es'"#(e#t., G.R. N". 1@;:04. !a$6/ 3, 2010 Petiti"#e$%s Clai&s: : local corporation engaged in the business of establishing and maintaining coffee shops in the country. 7t registered with the Securities and >xchange $ommission 3S>$4 in <anuary 6??+. 7t has a franchise agreement with $offee 8artners "td. 3$8"4, a business entity organi9ed and existing under the laws of ;ritish Jirgin 7slands, for a non'exclusive right to operate coffee shops in the 8hilippines using trademarks designed by $8" such as LS:@ K1:@$7S$2 $2KK>>.M 8etitioner maintained its mark could not be confused with respondentGs trade name because of the notable distinctions in their appearances. 8etitioner argued respondent stopped operating under the trade name LS:@ K1:@$7S$2 $2KK>>M when it formed a )oint venture with ;oyd $offee BS:. 8etitioner contended respondent did not cite any specific acts that would lead one to believe petitioner had, through fraudulent means, passed off its mark as that of respondent, or that it had diverted business away from respondent.

Res'"#(e#t%s Clai&s: 1espondent is a local corporation engaged in the wholesale and retail sale of coffee. 7t registered with the S>$ in May +AA!. 7t registered the business name LS:@ K1:@$7S$2 $2KK>> N 12:ST>1O, 7@$.M with the Eepartment of Trade and 7ndustry 3ET74 in <une +AA!. 7n +AA,, respondent formed a )oint venture company with ;oyd $offee BS: under the company name ;oyd $offee $ompany 8hilippines, 7nc. 3;$$874. ;$$87 engaged in the processing, roasting, and wholesale selling of coffee. 1espondent later embarked on a pro)ect study of setting up coffee carts in malls and other commercial establishments in Metro Manila. 7n <une 6??+, respondent discovered that petitioner was about to open a coffee shop under the name LS:@ K1:@$7S$2 $2KK>>M in "ibis, Hue9on $ity. :ccording to respondent, petitionerGs shop caused confusion in the minds of the public as it bore a similar name and it also engaged in the business of selling coffee. Iss)e: 5hether petitionerGs use of the trademark LS:@ K1:@$7S$2 $2KK>>M constitutes infringement of respondentGs trade name LS:@ K1:@$7S$2 $2KK>> N 12:ST>1O, 7@$.,M even if the trade name is not registered with the 7ntellectual 8roperty 2ffice 37824. R)li#g: 7n !rosource International, Inc. v. 1orphag -esearch .anagement SA , this $ourt laid down what constitutes infringement of an unregistered trade name, thus(

3+4The trademark being infringed is registered in the 7ntellectual 8roperty 2ffice0 however, i# i#5$i#ge&e#t "5 t$a(e #a&e, t/e sa&e #ee( #"t .e $egiste$e( 0 364 The trademark or trade name is reproduced, counterfeited, copied, or colorably imitated by the infringer0 3-4 The infringing mark or trade name is used in connection with the sale, offering for sale, or advertising of any goods, business or services0 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 services0 3.4 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 business0 and 3!4 7t is without the consent of the trademark or trade name owner or the assignee thereof. $learly, a trade name need not be registered with the 782 before an infringement suit may be filed by its owner against the owner of an infringing trademark. :ll that is re%uired is that the trade name is previously used in trade or commerce in the 8hilippines. 7n its +. :ugust 6??6 Eecision, the ;":'782 held that petitionerGs trademark infringed on respondentGs trade name. 7t ruled that the right to the exclusive use of a trade name with freedom from infringement by similarity is determined from priority of adoption. Since respondent registered its business name with the ET7 in +AA! and petitioner registered its trademark with the 782 in 6??+ in the 8hilippines and in +AAF in other countries, then respondent must be protected from infringement of its trade name. The ;":'782 also held that respondent did not abandon the use of its trade name as substantial evidence indicated respondent continuously used its trade name in connection with the purpose for which it was organi9ed. 7t found that although respondent was no longer involved in blending, roasting, and distribution of coffee because of the creation of ;$$87, it continued making plans and doing research on the retailing of coffee and the

setting up of coffee carts. The ;":'782 ruled that for abandonment to exist, the disuse must be permanent, intentional, and voluntary. This court is not )ust a court of law, but also of e%uity. 5e cannot allow petitioner to profit by the name and reputation so far built by respondent without running afoul of the basic demands of fair play. @ot only the law but e%uity considerations hold petitioner liable for infringement of respondentGs trade name. Case Title: ART>UR DEL R,SARI, a#( ALEAANDER DEL R,SARI,, 'etiti"#e$s, +s. >ELLEN,R D. D,NAT,, -R. a#( RA9AEL 3. G,N4AGA, $es'"#(e#ts., G.R. N". 1B0:;:. !a$6/ :, 2010 Petiti"#e$%s Clai&s: The Eel 1osarios allege that respondents @;7 agents used an unlawfully obtained search warrant against them, evidenced by the fact that, contrary to the sworn statements used to get such warrant, the @;7 agents found no fake Marlboro cigarettes in petitioner :lexander del 1osarioGs premises. Res'"#(e#t%s Clai&s: The 1espondents content that the Eel 1osarios did not allege that respondents @;7 agents violated their right by fabricating testimonies to convince the 1T$ of :ngeles $ity to issue the search warrant. Their allegation that the @;7 agents used an unlawfully obtained search warrant is a mere conclusion of law. Iss)e: 5hether or not the $: correctly ruled that the complaint of the Eel 1osarios did not state a cause of action

R)li#g: The $: held that the Eel 1osariosG complaint before the 1T$ failed to state a cause of action against respondents @;7 agents. Such complaint said that the @;7 agents unlawfully procured and enforced the search warrant issued against the Eel 1osarios but it failed to state the ultimate facts from which they drew such conclusion. Case Title: S,CIETE DES PR,DUITS NESTLE, S.A., 'etiti"#e$, +s. !ARTIN T. DY, -R., $es'"#(e#t., G.R. N". 1C22C@. A)g)st ;, 2010. Petiti"#e$%s Clai&s: 8etitioner Societe Ees 8roduits @estle, S.:. 3@estle4 is a foreign corporation organi9ed under the laws of Swit9erland. 7t manufactures food products and beverages. :s evidenced by $ertificate of 1egistration @o. 1' +. 6+ issued on F :pril +A A by the then ;ureau of 8atents, Trademarks and Technology Transfer, @estle owns the L@:@M trademark for its line of infant powdered milk products, consisting of 81>'@:@, @:@'/.:., @:@'+, and @:@'6. @:@ is classified under $lass P Ldiatetic preparations for infant feeding.M @estle distributes and sells its @:@ milk products all over the 8hilippines. 7t has been investing tremendous amounts of resources to train its sales force and to promote the @:@ milk products through advertisements and press releases. 7n a letter dated + :ugust +A,!, @estle re%uested Ey, <r. to refrain from using L@:@@OM and to undertake that he would stop infringing the L@:@M trademark. Res'"#(e#t%s Clai&s: Ey, <r. owns !M >nterprises. /e imports Sunny ;oy powdered milk from :ustralia and repacks the powdered milk into three si9es of plastic packs bearing the name L@:@@O.M The packs weigh ,?, +,? and .!? grams and are sold for 8,.A?, 8+F.!? and 8-A.A?, respectively. @:@@O is is also classified under $lass P Lfull cream milk for adults in CsicD all ages.M Ey, <r. distributes and sells the powdered milk in Eumaguete, @egros

2riental, $agayan de 2ro, and parts of Mindanao. Ey, <r. filed a motion to dismiss alleging that the complaint did not state a cause of action. Iss)e: 5hether or not the product name @:@@O infringes upon the trademark of @estleGs @:@ R)li#g: There are two tests to determine likelihood of confusion( the dominancy test and holistic test. The dominancy test focuses on the similarity of the main, prevalent or essential features of the competing trademarks that might cause confusion. 7nfringement takes place when the competing trademark contains the essential features of another. 7mitation or an effort to imitate is unnecessary. The %uestion is whether the use of the marks is likely to cause confusion or deceive purchasers. The holistic test considers the entirety of the marks, including labels and packaging, in determining confusing similarity. The focus is not only on the predominant words but also on the other features appearing on the labels. 7n the light of the facts of the present case, the $ourt holds that the dominancy test is applicable. :pplying the dominancy test in the present case, the $ourt finds that L@:@@OM is confusingly similar to L@:@.M L@:@M is the prevalent feature of @estleGs line of infant powdered milk products. 7t is written in bold letters and used in all products. The line consists of 81>'@:@, @:@'/.:., @:@'+, and @:@'6. $learly, L@:@@OM contains the prevalent feature L@:@.M The first three letters of L@:@@OM are exactly the same as the letters of L@:@.M 5hen L@:@M and L@:@@OM are pronounced, the aural effect is confusingly similar. The $ourt agrees with the lower courts that there are differences between @:@ and @:@@O( 3+4 @:@ is intended for infants while @:@@O is intended for children past their infancy and for adults0 and 364 @:@ is more expensive than @:@@O. /owever, as the registered owner of the L@:@M mark, @estle should be free to use its mark on similar products, in different segments of the market, and at different price levels. 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 $ourt has recogni9ed that the registered trademark owner en)oys protection in product and market areas that are the normal potential e2pansion of his (usiness. Case Title: DER!ALINE, INC. vs. !YRA P>AR!ACEUTICALS, INC. Petiti"#e$%s 6lai&s: :fter petitioner filed before the 782 an application for registration for the trademark LE>1M:"7@> E>1M:"7@>, 7@$.,M it was opposed by respondent. Eermaline, in its Jerified :nswer, contends that a simple comparison of the trademark "E>1M:"7@> E>1M:"7@>, 7@$." vis'Q'vis Myra*s "E>1M:"7@" trademark would show that they have entirely different features and distinctive presentation, thus it cannot result in confusion, mistake or deception on the part of the purchasing public. Eermaline contended that, in determining if the same are confusingly similar, a comparison of their entirety must be considered in relation to the goods to which they are attached, including the other features appearing in both labels. 7t claimed that there were glaring and striking dissimilarities between the two trademarks, such that its trademark "E>1M:"7@> E>1M:"7@>, 7@$." speaks for itself 3-es ipsa lo%uitur4. Eermaline further argued that there could not be any relation between its trademark for health and beauty services from Myra*s trademark classified under medicinal goods against skin disorders. Res'"#(e#t%s 6lai&s: Myra, through a Jerified 2pposition, alleged that the trademark sought to be registered by Eermaline so resembles its trademark "E>1M:"7@," registered with the 782 way back in <uly ,, +A, and renewed in 6?? for +? years, and will likely cause confusion, mistake and deception to the purchasing public. The registration was in violation of Section +6- of the 7ntellectual 8roperty $ode of the 8hilippines since Myra had been extensively using "E>1M:"7@" commercially since 2ctober -+, +AFF, and said mark is still valid and subsisting.

Myra claimed that, despite Eermaline*s attempt to differentiate its applied mark, the dominant feature is the term "E>1M:"7@>," which is practically identical with its own "E>1M:"7@," more particularly that the first eight 3,4 letters of the marks and the pronunciation for both marks are identical. Myra further argued that its intellectual property right over its trademark is protected under Section +.F of the 7ntellectual 8roperty $ode of the 8hilippines. Iss)e: 5o@ the $: erred in upholding the 782Gs re)ection of EermalineGs application for registration of trademark. R)li#g: The petition is without merit. 7narguably, a trademark is an intellectual property deserving protection by law. :s Myra correctly posits, as a registered trademark owner, it has the right under Section +.F of 1.:. @o. ,6A- to prevent third parties from using a trademark, or similar signs or containers for goods or services, without its consent, identical or similar to its registered trademark, where such use would result in a likelihood of confusion. 7n determining likelihood of confusion, case law has developed two 364 tests, the Eominancy Test and the /olistic or Totality Test. The Eominancy Test, incorporated under Section +!!.+ of the $ode, focuses on the similarity of the prevalent features of the competing trademarks that might cause confusion or deception. 7t is applied when the trademark sought to be registered contains the main, essential and dominant features of the earlier registered trademark, and confusion or deception is likely to result 2n the other hand, the /olistic Test entails a consideration of the entirety of the marks as applied to the products, including labels and packaging, in determining confusing similarity. Krom this, )urisprudence has noted two types of confusion( 3+4 confusion of goods 3product confusion4 and 364 confusion of business 3source or origin confusion4. 7n re)ecting the application of Eermaline for the registration of its mark "E>1M:"7@> E>1M:"7@>, 7@$.," the 782 applied the Eominancy Test. 7t declared that both confusion of goods and service and confusion of business or of origin were apparent in both trademarks. 5e agree with the findings of the 782. :s correctly applied by the 782 in this case, while there are no set rules that can be deduced as what constitutes a dominant feature with respect to trademarks applied for registration0 usually, what are taken into account are signs, color, design, peculiar shape or name, or some special, easily remembered earmarks of the brand that readily attracts and catches the attention of the ordinary consumer. Kurther, Eermaline*s stance that its product belongs to a separate and different classification from Myra*s products with the registered trademark does not eradicate the possibility of mistake on the part of the purchasing public to associate the former with the latter, especially considering that both classifications pertain to treatments for the skin. Case Title: S1EC>ERS, U.S.A., INC. vs. INTER PACI9IC INDUSTRIAL TRADING C,RP., et. al. Petiti"#e$%s 6lai&s: 8etitioner filed with ;ranch 6. of the 1egional Trial $ourt 31T$4 of Manila an application for the issuance of search warrants against an outlet and warehouse operated by respondents for infringement of trademark under Section +!!, in relation to Section +F? of the 7ntellectual 8roperty $ode of the 8hilippines. 7n the course of its business, petitioner has registered the trademark "S=>$/>1S" and the trademark "S" 3within an oval design4 with the 7ntellectual 8roperty 2ffice 37824. Res'"#(e#t%s 6lai&s: 1espondents moved to %uash the warrants on the ground that there was no confusing similarity between petitionerGs LSkechersM rubber shoes and respondentGs LStrong( rubber shoes.

Iss)e: 5o@ the $: erred in affirming the decision of the 1T$ that the respondents were not guilty of trademark infringement. R)li#g: :pplying the Eominancy Test to the case at bar, this $ourt finds that the use of the styli9ed "S" by respondent in its Strong rubber shoes infringes on the mark already registered by petitioner with the 782. 5hile it is undisputed that petitioner*s styli9ed "S" is within an oval design, to this $ourt*s mind, the dominant feature of the trademark is the styli9ed "S," as it is precisely the styli9ed "S" which catches the eye of the purchaser. Thus, even if respondent did not use an oval design, the mere fact that it used the same styli9ed "S", the same being the dominant feature of petitioner*s trademark, already constitutes infringement under the Eominancy Test. This $ourt cannot agree with the observation of the $: that the use of the letter "S" could hardly be considered as highly identifiable to the products of petitioner alone. The $: 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 $: says is identifiable to Superman. Such reasoning, however, misses the entire point, which is that respondent had used a styli9ed "S," which is the same styli9ed "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. :ccordingly, the comparison made by the $: of the letter "S" used in the Superman trademark with petitioner*s styli9ed "S" is not appropriate to the case at bar. ;oth the 1T$ and the $: applied the /olistic Test in ruling that respondent had not infringed petitioner*s trademark. 5hile there may be dissimilarities between the appearances of the shoes, to this $ourt*s mind such dissimilarities do not outweigh the stark and blatant similarities in their general features. Case Title: >,N NE C>AN, YUN-I 4ENG, AND -,>N D,E vs. >,NDA !,T,R C,., LTD., AND >,NDA P>IL., INC. Petiti"#e$%s 6lai&s: Search warrants were issued against petitioners, dong business under the name and style LEragon Spirit Motorcycle $enterM for their alleged violation of Section + , in relation to Section +F? of the 7ntellectual 8roperty $ode of the 8hilippines. 8etitioners filed with the 1T$ a <oint Motion to Huash Search 5arrants and to 1eturn 7llegally Sei9ed 7tems, averring therein that the search warrants issued against them were done so despite the absence of probable cause. 8etitioners also argue that the search warrants in %uestion partook of the nature of general search warrants in that they included motorcycles bearing the model name "5:J>." They insist that word "5:J>" is generic and that it fails to pass the re%uirement of particularity of the items to be sei9ed. They also maintain that had the word "5:J>" been enough, there would have been no need for petitioners to state in their application for search warrants the specific motorcycle models, i.e., "ESM 5:J>," "ESM SB8>15:J> ++?," and "5:J> 1 +6!." Res'"#(e#t%s 6lai&s( 1espondents filed their 2pposition, alleging that petitioners are guilty of Bnfair $ompetition because of the alleged similarities between its motorcycle units and those of the petitionersG. There may be similarities as claimed by the respondents, but the differences far outweigh the similarities that any confusion to the consumer is remote and speculative. Iss)e: 5o@ the $: committed a misapprehension of facts in ruling that the petitioners passed off their goods as that of the respondentsG by using the model name L5aveM and embodying the prominent features of the designs, which is the very essence of unfair competition. R)li#g: The S$ ruled that the trial court overstepped its boundaries as far as determination of probable cause is concerned when it ratiocinated in its 2rder that aside from the differences in features, the motorcycle units sold by the petitioners prominently bear the distinct trade name "E1:G2@ S8717T." This is not the same trade name of the respondents, which is /onda. The fact alone would practically eliminate any possible confusion on the part of the public that the motorcycle units they would be buying from the petitioners are those manufactured andIor sold by respondents.

Such pronouncement by the 1T$ is utterly premature for, at that point, all that was presented before it by respondents was evidence, which to their minds, was sufficient to support a finding of probable cause. The trial court*s above'cited declaration unmistakably conveys the message that no unfair competition exists in this case P a conclusion that is not within its competence to make, for its task is merely confined to the preliminary matter of determination of probable cause and nothing more. The evidence it re%uires to dispense this function is, as stated before, far less stringent than that re%uired in the trial on the merits of the charge involving unfair competition. 7t was pointed out in famous )urisprudence that one of the tests to determine the particularity in the description of ob)ects to be sei9ed under a search warrant is when the things described are limited to those which bear direct relation to the offense for which the warrant is being issued. : reading of the search warrants issued by the trial court in this case reveals that the items to be sei9ed, including motorcycles, are those which are connected with the alleged violation of Section + , in relation to Section +F? of 1epublic :ct @o. ,6A-, notwithstanding the use of the generic word "5:J>." 5e, therefore, adopt the following finding of the appellate court( 5e may say this of the 5ave motorcycles. 7t is evident that 5ave is the model name of the motorcycles produced by the 3herein respondents4 /onda and, therefore, any imitation unit that is in the possession of the 3herein petitioners4 and carries the name 5ave is the fit ob)ect of the warrants P whether some other name or figure is affixed to it or not. The name 5ave $R ++? is but a CspeciesD of units under the generic name 5ave. 2n the other hand, in the :pplication for Search 5arrant filed by @;7 S7 "acaran, it is clearly stated that what respondents are complaining about was the alleged violation of the goodwill they have established with respect to their motorcycle models "5:J> ++? S" and "5:J> +6! S" and which goodwill is entitled to protection in the same manner as other property rights. 7t is %uite obvious then that their cause of action arose out of the intrusion into their established goodwill involving the two motorcycle models and not patent infringement. Case Title: Se/Da#i, I#6"$'"$ate( a#(*"$ e#ita%s 9$ies, I#6. +s. I#-#-")t )$ge$, I#6. Petiti"#e$%s Clai&s: 8etitioners alleged that the 1espondent lack the legal capacity to sue because it was not doing business in the 8hilippines and that it has no cause of action because its mark is not registered or used in the 8hilippines. Sehwani, 7nc. also claimed that as the registered owner of the L7@ @ 2BTM mark, it en)oys the presumption that the same was validly ac%uired and that it has the exclusive right to use the mark. Moreover, petitioners argued that other than the bare allegation of fraud in the registration of the mark, respondent failed to show the existence of any grounds of cancellation thereof under Section +!+ of the 78 $ode of the 8hilippines. 7t also alleged that the action is barred by laches. Res'"#(e#t%s Clai&s: 1espondent, 7n'n'out ;urger, 7nc., alleged that it is the owner of the tradename L7@'@'2BTM and trademarks L7@' @'2BT,M L7@'@'2BT ;urger N :rrow EesignM and L7@'@'2BT ;urger "ogoM which are used in its business since +A., up to the present. These tradename and trademarks were registered in the Bnited States as well as in other parts of the world. 8etitioner Sehwani allegedly had obtained a trademark registration for the mark L7@ @ 2BTM 3with the inside letter 2 formed like a star4 without its authority. 7ssueIs( +. 5hether or not the 1espondent has the legal capacity to sue for the protection of its trademarks albeit it is not doing business in the 8hilippines 5hether or not a ground exists for the cancellation of the 8etitionersG registration

6.

R)li#g: 1. Oes. Section + ? 1: @o. ,6A- provides for the right of foreign corporations to sue in trademark or service mark enforcement action, provided that it meets the re%uirements under Section - thereof, which are( a. :ny convention, treaty or agreement relation to intellectual property right or the repression of unfair competition wherein 8hilippines is also a party0 and :n extension therein of reciprocal rights.

b.

Moreoever, :rticle bis of The 8aris $onvention, which governs the protection of well'known trademarks, is a self'executing provision and does not re%uire legislative enactment to give it effect in the member country. The essential re%uirement therein is that the trademark must be well'known in the country where protection is sought. 7n this case, Eirector ;eltran':belardo found that 7n'n'out ;urger and :rrow Eesign is an internationally well?known mark as evidenced by its trademark registrations around the world and its comprehensive advertisements therein. 2. Oes. Section +!+3b4 of 1: ,6A- provides that a petition to cancel a registration of a mark may be filed with the ;ureau of "egal :ffairs by any person who believes that he is or will be damaged by the registration of a mark at any time, if the registered mark becomes the generic name for the goods or services, or a portion thereof, for which it is registered, or has been abandoned, or its registration was fraudulently or contrary to the provisions of this :ct, or if the registered mark is being used by or with the permission of, the registrant so as to misrepresent the source of goods or services on or in connection with which the mark is used. The evidence showed that not only did the petitioners use the 7@'@'2BT ;urger trademark for the name of their restaurant, but they also used identical or confusingly similar mark for their hamburger wrappers and Krench'fries receptacles, thereby effectively misrepresenting the source of the goods and services. Case Title: !attel, I#6. +s. E&&a 9$a#6is6", et al. Petiti"#e$%s Clai&s: Mattel, 7nc. alleges that ByGs L;arbieM trademark of confectionary products was confusingly similar to its trademark on dolls, doll clothes and doll accessories. Mattel argues that its products are items related to ByGs products0 hence, identical trademarks should not be used where the possibility of confusion as to source or origin of the products is certain and that by adopting an exactly identical mark, in spelling and style, By should be presumed to have intended to cash in or ride on the goodwill and widespread recognition en)oyed by MattelGs mark. Res'"#(e#ts% Clai&s: <immy By contends that there is no similarity between the two goods. >mma Krancisco, the Eirector General of 782, stated that there was no proof on record that Mattel had ventured into the production of chocolates and confectionary products under the trademark L;arbieM to enable it to prevent By from using an identical L;arbieM trademark on said goods. 2n the other hand, By submits that the case has become moot and academic since the records of the 782 will show that no E:B was filed on or before ?+ Eecember 6??+0 thus he is deemed to have abandoned his trademark application. Iss)e*s: 5hether or not the case has become moot and academic R)li#g:

Oes. :ccording to Section +6..6 of 1: ,6A-, the applicant shall file a declaration of actual use of the mark with evidence to that effect with three years from filing date of the application. 2therwise, the applicant shall be refused. Moreover, the issues in the present case call for an appraisal of factual considerations which are peculiar only to the transactions and parties involved in the controversy. The issues raised in this case do not call for a clarification unlike in the cases of Eavid vs. :rroyo, $onstantino vs. Sandiganbayan and others. 7n the latter cases, moot and academic issues were still decided for these pertain to important and transcendental constitutional issues, which are not in line with this case.