CONVERSE

RUBBER
CORPORATION, petitioner, vs.
UNIVERSAL RUBBER PRODUCTS, INC. and TIBURCIO S. EVALLE, DIRECTOR OF
PATENTS, respondents.
Case Summary:
Converse Rubber Corporation is an American corporation while Universal Rubber Product is a
corporation licensed to do business in the country. Converse has been operating since 1946.
Universal Rubber has been operating since 1963. Later, Universal Rubber filed an application for
the trademark Universal Converse and Device before the Philippine Patent Office. Converse
Rubber opposed as it averred that the word Converse which is part of its corporate name
cannot be granted as part of Universal Rubbers trademark or trade name because it will likely
deceive purchasers of Universal Rubbers products as it may be mistaken by unwary customers
to be manufactured by Converse Rubber. The Director of Patents did not grant the opposition by
Converse Rubber.
Issue of the Case:
Whether or not the decision of the Director of Patents is correct.
Laws applicable:
Western Equipment and Supply Co. vs. Reyes, 51 Phil. 115, stated that:
... a foreign corporation which has never done any business in the Philippines and which is
unlicensed and unregistered to do business here, but is widely and favorably known in the
Philippines through the use therein of its products bearing its corporate and tradename, has a
legal right to maintain an action in the Philippines to restrain the residents and inhabitants thereof
from organizing a corporation therein bearing the same name as the foreign corporation, when it
appears that they have personal knowledge of the existence of such a foreign corporation, and it
is apparent that the purpose of the proposed domestic corporation is to deal and trade in the same
goods as those of the foreign corporation.
Convention of the Union of Paris for the Protection of Industrial Property to which the
Philippines became a party on September 27, 1965. Article 8 thereof provides that "a trade name
[corporate 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 the trademark. "
The mandate of the aforementioned Convention finds implementation in Sec. 37 of RA No. 166,
otherwise known as the Trademark Law: Sec. 37. Rights of Foreign Registrants-Persons who are
nationals of, domiciled or have a bona fide or effective business or commercial establishment in
any foreign country, which is a party to an international convention or treaty relating to marks or
tradenames on the repression of unfair competition to which the Philippines may be a party, shall
be entitled to the benefits and subject to the provisions of this Act . .Tradenames of persons

described in the first paragraph of this section shall be protected without the obligation of filing
or registration whether or not they form parts of marks.
Decision of the Case:
No. From a cursory appreciation of the Converse Rubbers corporate name CONVERSE
RUBBER CORPORATION, it is evident that the word CONVERSE is the dominant word
which identifies Converse Rubber from other corporations engaged in similar business.
Universal Rubber, in the stipulation of facts, admitted Converse Rubbers existence since 1946
as a duly organized foreign corporation engaged in the manufacture of rubber shoes. This
admission necessarily betrays its knowledge of the reputation and business of petitioner even
before it applied for registration of the trademark in question. Knowing, therefore, that the word
CONVERSE belongs to and is being used by Converse Rubber, and is in fact the dominant
word in its corporate name, Universal Rubber has no right to appropriate the same for use on its
products which are similar to those being produced by Converse Rubber.
Opinion:
I concur with the decision. It is unfortunate that respondent Director of Patents has concluded
that petitioner has no name to protect in the forum and thus he was ignorant of the existing laws
and international agreements. A foreign corporation has a right to maintain an action in the forum
even if it is not licensed to do business and is not actually doing business on its own therein has
been enunciated many times by this Court and in accordance with treaty
conventions/agreements.
Intellectual Property Law Law on Trademarks, Service Marks and Trade
Names Trade Name Infringement
Converse Rubber Corporation is an American corporation while Universal Rubber
Product is a corporation licensed to do business in the country. Converse has been
operating since 1946. Universal Rubber has been operating since 1963. Later,
Universal Rubber filed an application for the trademark Universal Converse and
Device before the Philippine Patent Office. Converse Rubber opposed as it averred
that the word Converse which is part of its corporate name cannot be granted as
part of Universal Rubbers trademark or trade name because it will likely deceive
purchasers of Universal Rubbers products as it may be mistaken by unwary
customers to be manufactured by Converse Rubber. The Director of Patents did not
grant the opposition by Converse Rubber.
ISSUE: Whether or not the decision of the Director of Patents is correct.
HELD: No. From a cursory appreciation of the Converse Rubbers corporate name
CONVERSE RUBBER CORPORATION, it is evident that the word CONVERSE is the
dominant word which identifies Converse Rubber from other corporations engaged
in similar business. Universal Rubber, in the stipulation of facts, admitted Converse
Rubbers existence since 1946 as a duly organized foreign corporation engaged in
the manufacture of rubber shoes. This admission necessarily betrays its knowledge
of the reputation and business of petitioner even before it applied for registration of

the trademark in question. Knowing, therefore, that the word CONVERSE belongs
to and is being used by Converse Rubber, and is in fact the dominant word in its
corporate name, Universal Rubber has no right to appropriate the same for use on
its products which are similar to those being produced by Converse Rubber.

DISTILLERIA WASHINGTON, INC. or WASHINGTON DISTILLERY, INC.,

petitioner,vs. THE HONORABLE COURT OF APPEALS and LA TONDEA
DISTILLERS, INC., respondents.
Case Summary:
La Tondea Distillers , Inc. (LTDI) filed a case against Distilleria Washington for the seizure of
18,157 empty bottles bearing the blown-in marks of La Tondea Inc. and Ginebra San Miguel.
Said bottles were being used by Washington for its own products without the consent of LTDI.
LTDI asserted that as the owner of the bottles they were entitled for the protection extended by
R.A. No. 623 (An Act to regulate the use of duly stamped or marked bottles, boxes, kegs, barrels
and other similar containers). Washington countered that R.A. No. 623 should not apply to
alcoholic beverages and the ownership of the bottles were lawfully transferred to the buyer upon
the sale of the gin and the containers at a single price. The trial court rendered a decision
favoring Washington and ordered LTDI for the return of the seized bottles. LTDI appealed the
decision to the Court of Appeals. The appellate court reversed the court a quo and ruled against
Washington.
Issue of the Case:
Whether or not ownership of the empty bottles was transferred to Washington?
Law applicable:
The pertinent provisions of R.A. 623, as amended, so reads:
Sec. 1. Persons engaged or licensed to engage in the manufacture, bottling, or selling of soda
water, mineral or aerated waters, cider, milk, cream or other lawful beverages in bottles, boxes,
casks, kegs, or barrels, and other similar containers, or in the manufacture, compressing or
selling of gases such as oxygen, acetylene, nitrogen, carbon dioxide, ammonia, hydrogen,
chloride, helium, sulphur dioxide, butane, propane, freon, methyl chloride or similar gases
contained in steel cylinders, tanks, flasks, accumulators or similar containers, with their names or
the names of their principals or products, or other marks of ownership stamped or marked
thereon, may register with the Philippine Patent Office a description of the names or marks, and
the purpose for which the containers so marked are used by them, under the same conditions,
rules, and regulations, made applicable by law or regulation to the issuance of trademarks.
Sec. 2. It shall be unlawful for any person, without the written consent of the manufacturer,
bottler, or seller, who has successfully registered the marks of ownership in accordance with the
provisions of the next preceding section, to fill such bottles, boxes, kegs, barrels, steel cylinders,

tanks, flasks, accumulators, or other similar containers so marked or stamped, for the purpose of
sale, or to sell, dispose of, buy or traffic in, or wantonly destroy the same, whether filled or not to
use the same for drinking vessels or glasses or drain pipes, foundation pipes, for any other
purpose than that registered by the manufacturer, bottler or seller. Any violation of this section
shall be punished by a fine of not more than one thousand pesos or imprisonment of not more
than one year or both.
Sec. 3. The use by any person other than the registered manufacturer, bottler or seller, without
written permission of the latter of any such bottle, cask, barrel, keg, box, steel cylinders, tanks,
flask, accumulators, or other similar containers, or the possession thereof without written
permission of the manufacturer, by any junk dealer or dealer in casks, barrels, kegs, boxes, steel
cylinders, tanks, flasks, accumulators or other similar containers, the same being duly marked or
stamped and registered as herein provided, shall give rise to a prima facie presumption that such
use or possession is unlawful.
ec. 5. No action shall be brought under this Act against any person to whom the registered
manufacturer, bottler or seller, has transferred by way of sale, any of the containers herein
referred to, but the sale of the beverage contained in the said containers shall not include the sale
of the containers unless specifically so provided.
Sec. 6. The provisions of this Act shall not be interpreted as prohibiting the use of bottles as
containers for "sisi," "bagoong," "patis," and similar native products.
Decision of the Case:
The fact of the matter is that R.A. 623, as amended, in affording trademark protection to the
registrant, has additionally expressed a prima facie presumption of illegal use by a possessor
whenever such use or possession is without the written permission of the registered
manufacturer, a provision that is neither arbitrary nor without appropriate rationale. The abovequoted provisions grant protection to a qualified manufacturer who successfully registered with
the Philippine Patent Office its duly stamped or marked bottles, boxes, casks and other similar
containers. The mere use of registered bottles or containers without the written consent of the
manufacturer is prohibited, the only exceptions being when they are used as containers for "sisi,"
"bagoong," "patis" and similar native products. It is to be pointed out that a trademark refers to
a word, name, symbol, emblem, sign or device or any combination thereof adopted and used by a
merchant to identify, and distinguish from others, his goods of commerce. It is basically an
intellectual creation that is susceptible to ownership and, consistently therewith, gives rise to its
own elements of jus posidendi jus utendi jus fruendi jus disponendi , and jus abutendi , along
with the applicable jus lex , comprising that ownership. The incorporeal right, however, is
distinct from the property in the material object subject to it. Ownership in one does not
necessarily vest ownership in the other. Thus, the transfer or assignment of the intellectual
property will not necessarily constitute a conveyance of the thing it covers, nor would
a conveyance of the latter imply the transfer or assignment of the intellectual right.
While it may be unwarranted then for LTDI to simply seize the empty containers, this Court
finds it to be legally absurd, however, to still allow petitioner to recover the possession thereof.

The fact of the matter is that R.A. 623, as amended, in affording trademark protection to the
registrant, has additionally expressed a prima facie presumption of illegal use by a possessor
whenever such use or possession is without the written permission of the registered
manufacturer, a provision that is neither arbitrary nor without appropriate rationale. Indeed, the
appellate court itself has made a finding of such unauthorized use by petitioner. The Court sees
no other logical purpose for petitioner's insistence to keep the bottles, except for such continued
use. The practical and feasible alternative is to merely require the payment of just compensation
to petitioner for the bottles seized from it by LTDI. Conventional wisdom, along with equity and
justice to both parties, dictates it.
Wherefore, the decision of the appellate court is modified by ordering LTDI to pay petitioner just
compensation for the seized bottles. Instead, however, of remanding the case to the Court of
Appeals to receive evidence on, and thereafter resolve, the assessment thereof, this Court accepts
and accordingly adopts the quantification of P18,157.00 made by the trial court.
Opinion:
I agree with the courts ruling. It is a rule of construction that, in keeping with the spirit and
intent of the law, establishes at best a presumption (of non-conveyance of the container) and
which by no means can be taken to be either interdictive or conclusive in character. The
manufacturer sells the product in marked containers, through dealers, to the public in
supermarkets, grocery shops, retail stores and other sales outlets. The buyer takes the item; he is
neither required to return the bottle nor required to make a deposit to assure its return to the
seller. He could return the bottle and get a refund. A number of bottles at times find their way to
commercial users. It cannot be gainsaid that ownership of the containers does pass on to the
consumer albeit subject to the statutory limitation on the use of the registered containers and to
the trademark right of the registrant.

Intellectual Property Law on Copyright Requirements Before a Search Warrant May

Be Issued in Copyright Cases Piracy
In 1986, the Video Regulatory Board (VRB) applied for a warrant against Jose Jinco (Jingco),
owner of Showtime Enterprises for allegedly pirating movies produced and owned by Columbia
Pictures and other motion picture companies. Jingco filed a motion to quash the search warrant
but the same was denied in 1987. Subsequently, Jinco filed an Urgent Motion to Lift the Search
Warrant and Return the Articles Seized. In 1989, the RTC judge granted the motion. The judge
ruled that based on the ruling in the 1988 case of 20th Century Fox Film Corporation vs CA,
before a search warrant could be issued in copyright cases, the master copy of the films alleged
to be pirated must be attached in the application for warrant.
ISSUE: Whether or not the 20th Century Fox ruling may be applied retroactively in this case.
HELD: No. In 1986, obviously the 1988 case of 20 th Century Fox was not yet promulgated. The
lower court could not possibly have expected more evidence from the VRB and Columbia
Pictures in their application for a search warrant other than what the law and jurisprudence, then
existing and judicially accepted, required with respect to the finding of probable cause.
The Supreme Court also revisited and clarified the ruling in the 20 th Century Fox Case. It is
evidently incorrect to suggest, as the ruling in 20th Century Fox may appear to do, that in
copyright infringement cases, the presentation of master tapes of the copyright films is always
necessary to meet the requirement of probable cause for the issuance of a search warrant. It is
true that such master tapes are object evidence, with the merit that in this class of evidence the
ascertainment of the controverted fact is made through demonstration involving the direct use of
the senses of the presiding magistrate. Such auxiliary procedure, however, does not rule out the
use of testimonial or documentary evidence, depositions, admissions or other classes of evidence
tending to prove the factum probandum, especially where the production in court of object
evidence would result in delay, inconvenience or expenses out of proportion to is evidentiary
value.
In fine, the supposed pronouncement in said case regarding the necessity for the presentation of
the master tapes of the copy-righted films for the validity of search warrants should at most be
understood to merely serve as a guidepost in determining the existence of probable cause in
copy-right infringement cases where there is doubt as to the true nexus between the master tape
and the pirated copies. An objective and careful reading of the decision in said case could lead to
no other conclusion than that said directive was hardly intended to be a sweeping and inflexible
requirement in all or similar copyright infringement cases.