[G.R. No. 182147. December 15, 2010.

]
ARNEL U. TY, MARIE ANTONETTE TY, JASON ONG, WILLY DY, and ALVIN
TY, petitioners, vs. NBI SUPERVISING AGENT MARVIN E. DE JEMIL, PETRON GASUL
DEALERS ASSOCIATION, and TOTALGAZ DEALERS ASSOCIATION, respondents.
DECISION
VELASCO, JR., J p:
The Case
In this Petition for Review on Certiorari under Rule 45, petitioners seek the reversal of the
Decision 1 dated September 28, 2007 of the Court of Appeals (CA) in CA-G.R. SP No. 98054,
which reversed and set aside the Resolutions dated October 9, 2006 2 and December 14,
2006 3 of the Secretary of Justice, and reinstated the November 7, 2005 Joint Resolution 4 of
the Office of the Chief State Prosecutor. Petitioners assail also the CA Resolution 5 dated
March 14, 2008, denying their motion for reconsideration.
The Facts
Petitioners are stockholders of Omni Gas Corporation (Omni) as per Omni's General
Information Sheet 6 (GIS) dated March 6, 2004 submitted to the Securities and Exchange
Commission (SEC). Omni is in the business of trading and refilling of Liquefied Petroleum Gas
(LPG) cylinders and holds Pasig City Mayor's Permit No. RET-04-001256 dated February 3,
2004.
The case all started when Joaquin Guevara Adarlo & Caoile Law Offices (JGAC Law Offices) sent
a letter dated March 22, 2004 7 to the NBI requesting, on behalf of their clients Shellane
Dealers Association, Inc., Petron Gasul Dealers Association, Inc., and Totalgaz Dealers
Association, Inc., for the surveillance, investigation, and apprehension of persons or
establishments in Pasig City that are engaged in alleged illegal trading of petroleum products
and underfilling of branded LPG cylinders in violation of Batas Pambansa Blg. (BP) 33, 8 as
amended by Presidential Decree No. (PD) 1865. 9
Earlier, the JGAC Law Offices was furnished by several petroleum producers/brand owners
their respective certifications on the dealers/plants authorized to refill their respective
branded LPG cylinders, to wit: (1) On October 3, 2003, Pilipinas Shell Petroleum Corporation
(Pilipinas Shell) issued a certification 10 of the list of entities duly authorized to
refill Shellane LPG cylinders; (2) on December 4, 2003, Petron Corporation (Petron) issued a
certification 11 of their dealers in Luzon, Visayas, and Mindanao authorized to refill Petron
Gasul LPG cylinders; and (3) on January 5, 2004, Total (Philippines) Corporation (Total) issued
two certifications 12 of the refilling stations and plants authorized to refill
their Totalgaz and Superkalan Gaz LPG cylinders.
Agents De Jemil and Kawada attested to conducting surveillance of Omni in the months of
March and April 2004 and doing a test-buy on April 15, 2004. They brought eight branded LPG
cylinders of Shellane, Petron Gasul, Totalgaz, and Superkalan Gaz to Omni for refilling. The
branded LPG cylinders were refilled, for which the National Bureau of Investigation (NBI)
agents paid PhP1,582 as evidenced by Sales Invoice No. 90040 13 issued by Omni on April 15,
2004. The refilled LPG cylinders were without LPG valve seals and one of the cylinders was
actually underfilled, as found by LPG Inspector Noel N. Navio of the Liquefied Petroleum Gas
Industry Association (LPGIA) who inspected the eight branded LPG cylinders on April 23, 2004
which were properly marked by the NBI after the test-buy. DTAHEC
1

The NBI's test-buy yielded positive results for violations of BP 33, Section 2 (a) in relation to
Secs. 3 (c) and 4, i.e., refilling branded LPG cylinders without authority; and Sec. 2 (c) in
relation to Sec. 4, i.e., underdelivery or underfilling of LPG cylinders. Thus, on April 28, 2004,
Agent De Jemil filed an Application for Search Warrant (With Request for Temporary Custody of
the Seized Items) 14 before the Regional Trial Court (RTC) in Pasig City, attaching, among
others, his affidavit 15 and the affidavit of Edgardo C. Kawada, 16 an NBI confidential agent.
On the same day of the filing of the application for search warrants on April 28, 2004, the RTC,
Branch 167 in Pasig City issued Search Warrants No. 2624 17 and 2625. 18The NBI served the
warrants the next day or on April 29, 2004 resulting in the seizure of several items from
Omni's premises duly itemized in the NBI's Receipt/Inventory of Property/Item Seized. 19 On
May 25, 2004, Agent De Jemil filed his Consolidated Return of Search Warrants with ExParte Motion to Retain Custody of the Seized Items 20 before the RTC Pasig City.
Subsequently, Agent De Jemil filed before the Department of Justice (DOJ) his ComplaintAffidavits against petitioners for: (1) Violation of Section 2 (a), in relation to Sections 3 (c) and
4, of B.P. Blg. 33, as amended by P.D. 1865; 21 and (2) Violation of Section 2 (c), in relation to
Section 4, of B.P. Blg. 33, as amended by P.D. 1865, 22docketed as I.S. Nos. 2004-616 and
2004-618, respectively.
During the preliminary investigation, petitioners submitted their Joint CounterAffidavit, 23 which was replied 24 to by Agent De Jemil with a corresponding rejoinder 25from
petitioners.
The Ruling of the Office of the Chief State Prosecutor
in I.S. No. 2004-616 and I.S. No. 2004-618
On November 7, 2005, the 3rd Assistant City Prosecutor Leandro C. Catalo of Manila issued a
Joint Resolution, 26 later approved by the Chief State Prosecutor Jovencito R. Zuo upon the
recommendation of the Head of the Task Force on Anti-Intellectual Property Piracy (TFAIPP),
Assistant Chief State Prosecutor Leah C. Tanodra-Armamento, finding probable cause to
charge petitioners with violations of pertinent sections of BP 33, as amended, resolving as
follows:
WHEREFORE, premises considered, it is hereby recommended that two (2) Informations for
violations of Section 2 [a] (illegal trading in petroleum and/or petroleum products) and Section
2 [c] (underfilling of LPG cylinders), both of Batas Pambansa Bilang 33, as amended, be filed
against respondents [herein petitioners] ARNEL TY, MARIE ANTONETTE TY, JASON ONG, WILLY
DY and ALVIN TY. 27
Assistant City Prosecutor Catalo found the existence of probable cause based on the evidence
submitted by Agent De Jemil establishing the fact that Omni is not an authorized refiller
of Shellane, Petron Gasul, Totalgaz and Superkalan Gaz LPG cylinders. Debunking petitioners'
contention that the branded LPG cylinders are already owned by consumers who are free to do
with them as they please, the law is clear that the stamped markings on the LPG cylinders
show who are the real owners thereof and they cannot be refilled sans authority from Pilipinas
Shell, Petron or Total, as the case may be. On the underfilling of one LPG cylinder, the findings
of LPG Inspector Navio of the LPGIA were uncontroverted by petitioners.
Petitioners' motion for reconsideration, 28 was denied through a Resolution 29 by the Office of
the Chief State Prosecutor issued on May 3, 2006. ACDTcE
In time, petitioners appealed to the Office of the Secretary of Justice. 30
2

The Ruling of the DOJ Secretary

in I.S. No. 2004-616 and I.S. No. 2004-618
On October 9, 2006, the Office of the Secretary of Justice issued a Resolution 31 reversing and
setting aside the November 7, 2005 Joint Resolution of the Office of the Chief State Prosecutor,
the dispositive portion of which reads:
WHEREFORE, the assailed resolution is hereby REVERSED and SET ASIDE. The Chief State
Prosecutor is directed to cause the withdrawal of the informations for violations of Sections
2(a) and 2(c) of B.P. Blg. 33, as amended by P.D. 1865, against respondents Arnel Ty, Mari
Antonette Ty, Jason Ong, Willy Dy and Alvin Ty and report the action taken within ten (10) days
from receipt hereof.
SO ORDERED. 32
The Office of the Secretary of Justice viewed, first, that the underfilling of one of the eight LPG
cylinders was an isolated incident and cannot give rise to a conclusion of underfilling, as the
phenomenon may have been caused by human error, oversight or technical error. Being an
isolated case, it ruled that there was no showing of a clear pattern of deliberate
underfilling. Second, on the alleged violation of refilling branded LPG cylinders sans written
authority, it found no sufficient basis to hold petitioners responsible for violation of Sec. 2 (c)
of BP 33, as amended, since there was no proof that the branded LPG cylinders seized from
Omni belong to another company or firm, holding that the simple fact that the LPG cylinders
with markings or stamps of other petroleum producers cannot by itself prove ownership by
said firms or companies as the consumers who take them to Omni fully owned them having
purchased or acquired them beforehand.
Agent De Jemil moved but was denied reconsideration 33 through another
Resolution 34 dated December 14, 2006 prompting him to repair to the CA via a petition
forcertiorari 35 under Rule 65 of the Rules of Court, docketed as CA-G.R. SP No. 98054.
The Ruling of the CA
The Office of the Solicitor General (OSG), in its Comment 36 on Agent De Jemil's appeal,
sought the dismissal of the latter's petition viewing that the determination by the Office of the
Secretary of Justice of probable cause is entitled to respect owing to the exercise of his
prerogative to prosecute or not.
On August 31, 2007, Petron filed a Motion to Intervene and to Admit Attached Petition-inIntervention 37 and Petition-in-Intervention 38 before the CA in CA-G.R. SP No. 98054. And
much earlier, the Nationwide Association of Consumers, Inc. (NACI) also filed a similar motion.
On September 28, 2007, the appellate court rendered the assailed Decision 39 revoking the
resolutions of the Office of the Secretary of Justice and reinstated the November 7, 2005 Joint
Resolution of the Office of the Chief State Prosecutor. The fallo reads:
WHEREFORE, the instant petition is GRANTED. The assailed resolutions dated October 9,
2006 and December 14, 2006 are hereby REVERSED and SET ASIDE. The Joint Resolution
dated November 7, 2005 of the Office of the Chief State Prosecutor finding probable cause
against private respondents Arnel Ty, Marie Antonette Ty, Jason Ong, Willy Dy, and Alvin Ty is
hereby REINSTATED.
SO ORDERED. 40

Citing Sec. 1 (1) and (3) of BP 33, as amended, which provide for the presumption of
underfilling, the CA held that the actual underfilling of an LPG cylinder falls under the
prohibition of the law which does not require for the underfilling to be substantial and
deliberate.
Moreover, the CA found strong probable violation of "refilling of another company's or firm's
cylinders without such company's or firm's written authorization" under Sec. 3 (c) of BP 33, as
amended. The CA relied on the affidavits of Agents De Jemil and Kawada, the certifications
from various LPG producers that Omni is not authorized to refill their branded LPG cylinders,
the results of the test-buy operation as attested to by the NBI agents and confirmed by the
examination of LPG Inspector Navio of the LPGIA, the letter-opinion 41 of the Department of
Energy (DOE) to Pilipinas Shell confirming that branded LPG cylinders are properties of the
companies whose stamp markings appear thereon, and Department Circular No. 2000-05007 42 of the DOE on the required stamps or markings by the manufacturers of LPG
cylinders. IEHSDA
After granting the appeal of Agent De Jemil, however, the motions to intervene filed by Petron
and NACI were simply noted by the appellate court.
Petitioners' motion for reconsideration was rebuffed by the CA through the equally assailed
March 14, 2008 Resolution. 43
Thus, the instant petition.
The Issues
I.WHETHER OR NOT RESPONDENTS WERE ENTITLED TO THE SPECIAL CIVIL ACTION
OF CERTIORARI IN THE COURT OF APPEALS.
II.WHETHER OR NOT UNDER THE CIRCUMSTANCES THERE WAS PROBABLE CAUSE TO BELIEVE
THAT PETITIONERS VIOLATED SECTION 2(A) OF BATAS PAMBANSA BLG. 33, AS AMENDED.
III.WHETHER OR NOT UNDER THE CIRCUMSTANCES THERE WAS PROBABLE CAUSE TO BELIEVE
THAT PETITIONERS VIOLATED SECTION 2(C) OF BATAS PAMBANSA BLG. 33, AS AMENDED.
IV.WHETHER OR NOT PETITIONERS CAN BE HELD LIABLE UNDER BATAS PAMBANSA BLG. 33, AS
AMENDED, FOR BEING MERE DIRECTORS, NOT ACTUALLY IN CHARGE OF THE MANAGEMENT OF
THE BUSINESS AFFAIRS OF THE CORPORATION. 44
The foregoing issues can be summarized into two core issues: first, whether probable cause
exists against petitioners for violations of Sec. 2 (a) and (c) of BP 33, as amended;
and second, whether petitioners can be held liable therefor. We, however, will tackle at the
outset the sole procedural issue raised: the propriety of the petition for certiorari under Rule
65 availed of by public respondent Agent De Jemil to assail the resolutions of the Office of the
Secretary of Justice.
Petron's Comment-in-Intervention
On April 14, 2009, Petron entered its appearance by filing a Motion for Leave to Intervene and
to Admit Comment-in-Intervention 45 and its Comment-in-Intervention [To petition for Review
on Certiorari dated 13 May 2008]. 46 It asserted vested interest in the seizure of
several Gasul LPG cylinders and the right to prosecute petitioners for unauthorized refilling of
its branded LPG cylinders by Omni. Petitioners duly filed their Comment/Opposition 47 to
Petron's motion to intervene. It is clear, however, that Petron has substantial interest to
4

protect in so far as its business relative to the sale and refilling of Petron Gasul LPG cylinders
is concerned, and therefore its intervention in the instant case is proper.
The Court's Ruling
We partially grant the petition.
Procedural Issue: Petition for Certiorari under Rule 65 Proper
Petitioners raise the sole procedural issue of the propriety of the legal remedy availed of by
public respondent Agent De Jemil. They strongly maintain that the Office of the Secretary of
Justice properly assumed jurisdiction and did not gravely abuse its discretion in its
determination of lack of probable cause the exercise thereof being its sole prerogative
which, they lament, the appellate court did not accord proper latitude. Besides, they assail the
non-exhaustion of administrative remedies when Agent De Jemil immediately resorted to court
action through a special civil action for certiorari under Rule 65 before the CA without first
appealing the resolutions of the Office of the Secretary of Justice to the Office of the President
(OP).
We cannot agree with petitioners.
For one, while it is the consistent principle in this jurisdiction that the determination of
probable cause is a function that belongs to the public prosecutor 48 and, ultimately, to the
Secretary of Justice, who may direct the filing of the corresponding information or move for the
dismissal of the case; 49 such determination is subject to judicial review where it is
established that grave abuse of discretion tainted the determination. DCATHS
For another, there is no question that the Secretary of Justice is an alter ego of the President
who may opt to exercise or not to exercise his or her power of review over the former's
determination in criminal investigation cases. As aptly noted by Agent De Jemil, the
determination of probable cause by the Secretary of Justice is, under the doctrine of qualified
political agency, presumably that of the Chief Executive unless disapproved or reprobated by
the latter.
Chan v. Secretary of Justice 50 delineated the proper remedy from the determination of the
Secretary of Justice. Therein, the Court, after expounding on the policy of non-interference in
the determination of the existence of probable cause absent any showing of arbitrariness on
the part of the public prosecutor and the Secretary of Justice, however, concluded,
citing Alcaraz v. Gonzalez 51 and Preferred Home Specialties, Inc. v. Court of Appeals, 52 that
an aggrieved party from the resolution of the Secretary of Justice may directly resort to judicial
review on the ground of grave abuse of discretion, thus:
. . . [T]he findings of the Justice Secretary may be reviewed through a petition
for certiorari under Rule 65 based on the allegation that he acted with grave abuse of
discretion. This remedy is available to the aggrieved party. 53 (Emphasis supplied.)
It is thus clear that Agent De Jemil, the aggrieved party in the assailed resolutions of the Office
of the Secretary of Justice, availed of and pursued the proper legal remedy of a judicial review
through a petition for certiorari under Rule 65 in assailing the latter's finding of lack of
probable cause on the ground of grave abuse of discretion.
First Core Issue: Existence of Probable Cause
Petitioners contend that there is no probable cause that Omni violated Sec. 2 (a), in relation to
Secs. 3 (c) and 4 of BP 33, as amended, prohibiting the refilling of another company's or firm's
5

LPG cylinders without its written authorization. First, the branded LPG cylinders seized were
not traded by Omni as its representative annotated in the NBI receipt of seized items that the
filled LPG 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 LPG cylinders are owned by end-user customers and not by the
major petroleum companies,i.e., Petron, Pilipinas Shell and Total. And even
granting arguendo that Omni is selling these LPG cylinders, still there cannot be a prima
facie case of violation since there is no proof that the refilled branded LPG cylinders are owned
by another company or firm.
Third, granting that Petron, Total and Pilipinas Shell still own their respective branded LPG
cylinders already sold to consumers, still such fact will not bind third persons, like Omni, who
is not privy to the agreement between the buying consumers and said major petroleum
companies. Thus, a subsequent transfer by the customers of Petron, Total and Pilipinas Shell of
the duly marked or stamped LPG cylinders through swapping, for example, will effectively
transfer ownership of the LPG cylinders to the transferee, like Omni.
Fourth, LPG cylinder exchange or swapping is a common industry practice that the DOE
recognizes. They point to a series of meetings conducted by the DOE for institutionalizing the
validity of swapping of all and any kind of LPG cylinders among the industry players. The
meetings resulted in a draft Memorandum of Agreement (MOA) which unfortunately was not
signed due to the withdrawal of petroleum major players Petron, Total and Pilipinas Shell.
Nonetheless, the non-signing of the MOA does not diminish the fact of the recognized industry
practice of cylinder exchange or swapping. Relying on Republic Act No. (RA)
8479, 54 petitioners maintain that said law promotes and encourages the entry of new
participants in the petroleum industry such as Omni. And in furtherance of this mandate is the
valid practice of cylinder exchange or swapping in the LPG industry.
We are not persuaded by petitioners' strained rationalizations.
Probable violation of Sec. 2 (a) of BP 33, amended
First. The test-buy conducted on April 15, 2004 by the NBI agents, as attested to by their
respective affidavits, tends to show that Omni illegally refilled the eight branded LPG cylinders
for PhP1,582. This is a clear violation of Sec. 2 (a), in relation to Secs. 3 (c) and 4 of BP 33, as
amended. It must be noted that the criminal complaints, as clearly shown in the complaintaffidavits of Agent De Jemil, are not based solely on the seized items pursuant to the search
warrants but also on the test-buy earlier conducted by the NBI agents. DEcTIS
Second. The written certifications from Pilipinas Shell, Petron and Total show that Omni has no
written authority to refill LPG cylinders, embossed, marked or stampedShellane, Petron Gasul,
Totalgaz and Superkalan Gaz. In fact, petitioners neither dispute this nor claim that Omni has
authority to refill these branded LPG cylinders.
Third. Belying petitioners' contention, the seized items during the service of the search
warrants tend to show that Omni illegally refilled branded LPG cylinders without authority.
On April 29, 2004, the NBI agents who served the search warrants on Omni seized the
following:
Quantity/UnitDescription
7 LPG cylindersTotalgaz, 11.0 kg [filled]
1 LPG cylinderPetron Gasul, 11.0 kg [filled]
6

1 LPG cylinderShellane, 11.0 kg [filled]

29 LPG cylindersSuperkalan Gaz, 2.7 kg [empty]
17 LPG cylindersPetron Gasul, 11.0 kg [empty]
8 LPG cylindersMarked as Omnigas with Shell emboss,
11.0 kg [empty]
5 LPG cylindersMarked as Omnigas with Totalgaz emboss,
11.0 kg [empty]
23 LPG cylindersShellane, 11.0 kg [empty]
3 LPG cylindersMarked as Omnigas with Gasul emboss,
11.0 kg [empty]
21 LPG cylindersTotalgaz, 11.0 kg [empty]
The foregoing list is embodied in the NBI's Receipt/Inventory of Property/Item
Seized 55 signed by NBI Agent Edwin J. Roble who served and implemented the search
warrants. And a copy thereof was duly received by Atty. Allan U. Ty, representative of Omni,
who signed the same "under protest" and made the annotation at the bottom part thereon:
"The above items/cylinders were taken at customers' trucks and the empty cylinders taken at
the warehouse (swapping section) of the company."56
Even considering that the filled LPG cylinders were indeed already loaded on customers'
trucks when confiscated, yet the fact that these refilled LPG cylinders consisting of nine
branded LPG cylinders, specifically Totalgaz, Petron Gasul and Shellane, tends to show that
Omni indeed refilled these branded LPG cylinders without authorization from Total, Petron and
Pilipinas Shell. Such a fact is bolstered by the test-buy conducted by Agent De Jemil and NBI
confidential agent Kawada: Omni's unauthorized refilling of branded LPG cylinders, contrary to
Sec. 2 (a) in relation to Sec. 3 (c) of BP 33, as amended. Said provisos provide:
Sec. 2.Prohibited Acts. The following acts are prohibited and penalized:
(a)Illegal trading in petroleum and/or petroleum products;
xxx xxx xxx
Sec. 3.Definition of terms. For the purpose of this Act, the following terms shall be
construed to mean:
Illegal trading in petroleum and/or petroleum products
xxx xxx xxx
(c)Refilling of liquefied petroleum gas cylinders without authority from said Bureau, or
refilling of another company's or firm's cylinders without such company's or firm's
written authorization; (Emphasis supplied.)
As petitioners strongly argue, even if the branded LPG cylinders were indeed owned by
customers, such fact does not authorize Omni to refill these branded LPG cylinders without
written authorization from the brand owners Pilipinas Shell, Petron and Total. In Yao, Sr. v.
People, 57 a case involving criminal infringement of property rights under Sec. 155 of RA
8293, 58 in affirming the courts a quo's determination of the presence of probable cause, this
Court held that from Sec. 155.1 59 ofRA 8293 can be gleaned that "mere unauthorized use of
7

a container bearing a registered trademark in connection with the sale, distribution or

advertising of goods or services which is likely to cause confusion, mistake or deception
among the buyers/consumers can be considered as trademark infringement." 60 The Court
affirmed the presence of infringement involving the unauthorized
sale of Gasul and Shellane LPG cylinders and the unauthorized refilling of the same by
Masagana Gas Corporation as duly attested to and witnessed by NBI agents who conducted
the surveillance and test-buys.
Similarly, in the instant case, the fact that Omni refilled various branded LPG cylinders even if
owned by its customers but without authority from brand owners Petron, Pilipinas Shell and
Total shows palpable violation of BP 33, as amended. As aptly noted by the Court in Yao, Sr. v.
People, only the duly authorized dealers and refillers ofShellane, Petron Gasul and, by
extension, Total may refill these branded LPG cylinders. Our laws sought to deter the
pernicious practices of unscrupulous businessmen.
Fourth. The issue of ownership of the seized branded LPG cylinders is irrelevant and hence
need no belaboring. BP 33, as amended, does not require ownership of the branded LPG
cylinders as a condition sine qua non for the commission of offenses involving petroleum and
petroleum products. Verily, the offense of refilling a branded LPG cylinder without the written
consent of the brand owner constitutes the offense regardless of the buyer or possessor of the
branded LPG cylinder.
After all, once a consumer buys a branded LPG cylinder from the brand owner or its authorized
dealer, said consumer is practically free to do what he pleases with the branded LPG cylinder.
He can simply store the cylinder once it is empty or he can even destroy it since he has paid a
deposit for it which answers for the loss or cost of the empty branded LPG cylinder. Given such
fact, what the law manifestly prohibits is the refilling of a branded LPG cylinder by a refiller
who has no written authority from the brand owner. Apropos, a refiller cannot and ought not to
refill branded LPG cylinders if it has no written authority from the brand owner.
Besides, persuasive are the opinions and pronouncements by the DOE: brand owners are
deemed owners of their duly embossed, stamped and marked LPG cylinders even if these are
possessed by customers or consumers. The Court recognizes this right pursuant to our
laws, i.e., Intellectual Property Code of the Philippines. Thus the issuance by the DOE Circular
No. 2000-05-007, 61 the letter-opinion 62 dated December 9, 2004 of then DOE Secretary
Vincent S. Perez addressed to Pilipinas Shell, the June 6, 2007 letter 63 of then DOE Secretary
Raphael P.M. Lotilla to the LPGIA, and DOE Department Circular No. 2007-10-0007 64 on LPG
Cylinder Ownership and Obligations Related Thereto issued on October 13, 2007 by DOE
Secretary Angelo T. Reyes.
Fifth. The ownership of the seized branded LPG cylinders, allegedly owned by Omni
customers as petitioners adamantly profess, is of no consequence. DTISaH
The law does not require that the property to be seized should be owned by the person
against whom the search warrants is directed. Ownership, therefore, is of no consequence,
and it is sufficient that the person against whom the warrant is directed has control or
possession of the property sought to be seized. 65 Petitioners cannot deny that the seized LPG
cylinders were in the possession of Omni, found as they were inside the Omni compound.
In fine, we also note that among those seized by the NBI are 16 LPG cylinders bearing the
embossed brand names of Shellane, Gasul and Totalgaz but were marked as Omnigas.
Evidently, this pernicious practice of tampering or changing the appearance of a branded LPG
cylinder to look like another brand violates the brand owners' property rights
8

as infringement under Sec. 155.1 of RA 8293. Moreover, tampering of LPG cylinders is a mode
of perpetrating the criminal offenses under BP 33, as amended, and clearly enunciated under
DOE Circular No. 2000-06-010 which provided penalties on a per cylinder basis for each
violation.
Foregoing considered, in the backdrop of the quantum of evidence required to support a
finding of probable cause, we agree with the appellate court and the Office of the Chief State
Prosecutor, which conducted the preliminary investigation, that there exists probable cause
for the violation of Sec. 2 (a) in relation to Sec. 3 (c) of BP 33, as amended. Probable cause has
been defined as the existence of such facts and circumstances as would excite belief in a
reasonable mind, acting on the facts within the knowledge of the prosecutor, that the person
charged was guilty of the crime for which he was prosecuted. 66 After all, probable cause
need not be based on clear and convincing evidence of guilt, as the investigating officer acts
upon reasonable belief probable cause implies probability of guilt and requires more than
bare suspicion but less than evidence which would justify a conviction. 67
Probable violation of Sec. 2 (c) of BP 33, as amended
Anent the alleged violation of Sec. 2 (c) in relation to Sec. 4 of BP 33, as amended, petitioners
strongly argue that there is no probable cause for said violation based upon an underfilling of
a lone cylinder of the eight branded LPG cylinders refilled during the test-buy. Besides, they
point out that there was no finding of underfilling in any of the filled LPG cylinders seized
during the service of the search warrants. Citing DOE's Bureau of Energy Utilization Circular
No. 85-3-348, they maintain that some deviation is allowed from the exact filled weight.
Considering the fact that an isolated underfilling happened in so many LPG cylinders filled,
petitioners are of the view that such is due to human or equipment error and does not in any
way constitute deliberate underfilling within the contemplation of the law.
Moreover, petitioners cast aspersion on the report and findings of LPG Inspector Navio of the
LPGIA by assailing his independence for being a representative of the major petroleum
companies and that the inspection he conducted was made without the presence of any DOE
representative or any independent body having technical expertise in determining LPG
cylinder underfilling beyond the authorized quantity.
Again, we are not persuaded.
Contrary to petitioners' arguments, a single underfilling constitutes an offense under BP 33, as
amended by PD 1865, which clearly criminalizes these offenses. In Perez v. LPG Refillers
Association of the Philippines, Inc., 68 the Court affirmed the validity of DOE Circular No.
2000-06-010 which provided penalties on a per cylinder basis for each violation, thus:
B.P. Blg. 33, as amended, criminalizes illegal trading, adulteration, underfilling, hoarding,
and overpricing of petroleum products. Under this general description of what constitutes
criminal acts involving petroleum products, the Circular 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, no authorized LPG seal, no trade
name, unbranded LPG cylinders, no serial number, no distinguishing color, no embossed
identifying markings on cylinder, underfilling LPG cylinders, tampering LPG cylinders,
and unauthorized decanting of LPG 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. 69 (Emphasis supplied.)

Moreover, in denying the motion for reconsideration of the LPG Refillers Association of the
Philippines, Inc., the Court upheld the basis of said DOE Circular No. 2000-06-010 on
the imposition of penalties on a per cylinder basis, thus:
Respondent's position is untenable. The Circular is not confiscatory in providing penalties on a
per cylinder basis. Those penalties do not exceed the ceiling prescribed in Section 4 of B.P.
Blg. 33, as amended, which penalizes "any person who commits any act [t]herein prohibited."
Thus, violation on a per cylinder basis falls within the phrase "any act" as mandated in Section
4. To provide the same penalty for one who violates a prohibited act in B.P. Blg. 33, as
amended, regardless of the number of cylinders involved would result in an indiscriminate,
oppressive and impractical operation of B.P. Blg. 33, as amended. The equal protection clause
demands that "all persons subject to such legislation shall be treated alike, under like
circumstances and conditions, both in the privileges conferred and in the liabilities
imposed." 70ScaATD
The Court made it clear that a violation, like underfilling, on a per cylinder basis falls within the
phrase of any act as mandated under Sec. 4 of BP 33, as amended. Ineluctably, the
underfilling of one LPG cylinder constitutes a clear violation of BP 33, as amended. The finding
of underfilling by LPG Inspector Navio of the LPGIA, as aptly noted by Manila Assistant City
Prosecutor Catalo who conducted the preliminary investigation, was indeed not controverted
by petitioners.
On the issue of manifest bias and partiality, suffice it to say that aside from the allegation by
petitioners, they have not shown that LPG Inspector Navio is neither an expert nor qualified to
determine underfilling. Besides, it must be noted that the inspection by LPG Inspector Navio
was conducted in the presence of NBI agents on April 23, 2004 who attested to that fact
through their affidavits. Moreover, no rules require and petitioners have not cited any that the
inspection be conducted in the presence of DOE representatives.
Second Core Issue: Petitioners' Liability for Violations
Sec. 4 of BP 33, as amended, provides for the penalties and persons who are criminally liable,
thus:
Sec. 4.Penalties. Any person who commits any act herein prohibited shall, upon conviction,
be punished with a fine of not less than twenty thousand pesos (P20,000) but not more than
fifty thousand pesos (P50,000), or imprisonment of at least two (2) years but not more than
five (5) years, or both, in the discretion of the court. In cases of second and subsequent
conviction under this Act, the penalty shall be both fine and imprisonment as provided herein.
Furthermore, the petroleum and/or petroleum products, subject matter of the illegal trading,
adulteration, shortselling, hoarding, overpricing or misuse, shall be forfeited in favor of the
Government: Provided, That if the petroleum and/or petroleum products have already been
delivered and paid for, the offended party shall be indemnified twice the amount paid, and if
the seller who has not yet delivered has been fully paid, the price received shall be returned to
the buyer with an additional amount equivalent to such price; and in addition, if the offender
is an oil company, marketer, distributor, refiller, dealer, sub-dealer and other retail outlets, or
hauler, the cancellation of his license.
Trials of cases arising from this Act shall be terminated within thirty (30) days after
arraignment.
When the offender is a corporation, partnership, or other juridical person, the president,
the general manager, managing partner, or such other officer charged with the
management of the business affairs thereof, or employee responsible for the
10

violation shall be criminally liable; in case the offender is an alien, he shall be subject to
deportation after serving the sentence.
If the offender is a government official or employee, he shall be perpetually disqualified from
office. (Emphasis supplied.)
Relying on the third paragraph of the above statutory proviso, petitioners argue that they
cannot be held liable for any perceived violations of BP 33, as amended, since they are mere
directors of Omni who are not in charge of the management of its business affairs. Reasoning
that criminal liability is personal, liability attaches to a person from his personal act or
omission but not from the criminal act or negligence of another. Since Sec. 4 of BP 33, as
amended, clearly provides and enumerates who are criminally liable, which do not include
members of the board of directors of a corporation, petitioners, as mere members of the board
of directors who are not in charge of Omni's business affairs, maintain that they cannot be
held liable for any perceived violations of BP 33, as amended. To bolster their position, they
attest to being full-time employees of various firms as shown by the Certificates of
Employment 71 they submitted tending to show that they are neither involved in the day-today business of Omni nor managing it. Consequently, they posit that even if BP 33, as
amended, had been violated by Omni they cannot be held criminally liable thereof not being in
any way connected with the commission of the alleged violations, and, consequently, the
criminal complaints filed against them based solely on their being members of the board of
directors as per the GIS submitted by Omni to SEC are grossly discriminatory.
On this point, we agree with petitioners except as to petitioner Arnel U. Ty who is indisputably
the President of Omni.
It may be noted that Sec. 4 above enumerates the persons who may be held liable for
violations of the law, viz.: (1) the president, (2) general manager, (3) managing partner, (4)
such other officer charged with the management of the business affairs of the corporation or
juridical entity, or (5) the employee responsible for such violation. A common thread of the
first four enumerated officers is the fact that they manage the business affairs of the
corporation or juridical entity. In short, they are operating officers of a business concern, while
the last in the list is self-explanatory. AIHaCc
It is undisputed that petitioners are members of the board of directors of Omni at the time
pertinent. There can be no quibble that the enumeration of persons who may be held liable for
corporate violators of BP 33, as amended, excludes the members of the board of directors.
This stands to reason for the board of directors of a corporation is generally a policy making
body. Even if the corporate powers of a corporation are reposed in the board of directors under
the first paragraph of Sec. 23 72of the Corporation Code, it is of common knowledge and
practice that the board of directors is not directly engaged or charged with the running of the
recurring business affairs of the corporation. Depending on the powers granted to them by the
Articles of Incorporation, the members of the board generally do not concern themselves with
the day-to-day affairs of the corporation, except those corporate officers who are charged with
running the business of the corporation and are concomitantly members of the board, like the
President. Section 25 73 of the Corporation Code requires the president of a corporation to be
also a member of the board of directors.
Thus, the application of the legal maxim expressio unius est exclusio alterius, which means
the mention of one thing implies the exclusion of another thing not mentioned. If a statute
enumerates the thing upon which it is to operate, everything else must necessarily and by
implication be excluded from its operation and effect.74 The fourth officer in the enumerated
list is the catch-all "such other officer charged with the management of the business affairs" of
11

the corporation or juridical entity which is a factual issue which must be alleged and supported
by evidence.
A scrutiny of the GIS reveals that among the petitioners who are members of the board of
directors are the following who are likewise elected as corporate officers of Omni: (1)
Petitioner Arnel U. Ty (Arnel) as President; (2) petitioner Mari Antonette Ty as Treasurer; and (3)
petitioner Jason Ong as Corporate Secretary. Sec. 4 of BP 33, as amended, clearly indicated
firstly the president of a corporation or juridical entity to be criminally liable for violations
of BP 33, as amended.
Evidently, petitioner Arnel, as President, who manages the business affairs of Omni, can be
held liable for probable violations by Omni of BP 33, as amended. The fact that petitioner Arnel
is ostensibly the operations manager of Multi-Gas Corporation, a family owned business, does
not deter him from managing Omni as well. It is well-settled that where the language of the
law is clear and unequivocal, it must be taken to mean exactly what it says. 75 As to the other
petitioners, unless otherwise shown that they are situated under the catch-all "such other
officer charged with the management of the business affairs," they may not be held liable
under BP 33, as amended, for probable violations. Consequently, with the exception of
petitioner Arnel, the charges against other petitioners must perforce be dismissed or dropped.
WHEREFORE, premises considered, we PARTIALLY GRANT the instant petition. Accordingly,
the assailed September 28, 2007 Decision and March 14, 2008 Resolution of the Court of
Appeals in CA-G.R. SP No. 98054 are AFFIRMED with MODIFICATION that petitioners Mari
Antonette Ty, Jason Ong, Willy Dy and Alvin Ty are excluded from the two Informations
charging probable violations of Batas Pambansa Bilang 33, as amended. The Joint Resolution
dated November 7, 2005 of the Office of the Chief State Prosecutor is modified accordingly.
No pronouncement as to costs.
SO ORDERED.
||| (Ty v. De Jemil, G.R. No. 182147, [December 15, 2010])

[G.R. No. 180595. March 5, 2010.]

ARTHUR DEL ROSARIO and ALEXANDER DEL ROSARIO, petitioners, vs. HELLENOR D.
DONATO, JR. and RAFAEL V. GONZAGA, respondents.
DECISION
ABAD, J p:
This case is about the need for plaintiff to state the facts constituting his cause of action and
the correct forum for actions for damages arising from alleged wrongful procurement and
enforcement of a search warrant issued in connection with an alleged criminal violation of the
intellectual property law.
The Facts and the Case
On January 23, 2002 Philip Morris Products, Inc. (Philip Morris) wrote the National Bureau of
Investigation (NBI), requesting assistance in curtailing the proliferation of fake Marlboro
cigarettes in Angeles City, Pampanga. After doing surveillance work in that city, respondent
Hellenor Donato, Jr., the NBI agent assigned to the case, succeeded in confirming the storage
12

and sale of such fake cigarettes at the house at 51 New York Street, Villasol Subdivision,
Angeles City, that belonged to petitioner Alexander del Rosario.
On March 5, 2002 respondent Donato applied for a search warrant with Branch 57 of the
Regional Trial Court (RTC) of Angeles City to search the subject premises. But it took a week
later or on March 12, 2002 for the RTC to hear the application and issue the search warrant.
Although Donato felt that the delayed hearing compromised the operation, the NBI agents led
by respondent Rafael V. Gonzaga proceeded to implement the warrant. Their search yielded
no fake Marlboro cigarettes.
Subsequently, petitioners Alexander and Arthur del Rosario (the Del Rosarios) filed a complaint
for P50 million in damages against respondents NBI agents Donato and Gonzaga and two
others before the RTC of Angeles City, Branch 62, in Civil Case 10584. On August 6, 2003
respondents NBI agents answered the complaint with a motion to dismiss on the grounds of:
a) the failure of the complaint to state a cause of action; b) forum shopping; and c) the NBI
agents' immunity from suit, they being sued as such agents. The RTC denied the motion on
March 25, 2003. The NBI agents filed a motion for reconsideration but the RTC denied the
same on June 27, 2003.aDHCcE
Dissatisfied, respondents NBI agents filed a special civil action of certiorari before the Court of
Appeals (CA) in CA-G.R. SP 79496. On June 29, 2007 the latter court granted the petition and
annulled the RTC's orders, first, in alleging merely that the NBI agents unlawfully procured the
search warrant without stating the facts that made the procurement unlawful, the complaint
failed to state a cause of action; and second, the Del Rosarios were guilty of forum shopping in
that they should have filed their claim for damages against the NBI agents through a motion
for compensation with the court that issued the search warrant.
The Del Rosarios sought reconsideration of the decision but the CA denied it on November 19,
2007, prompting them to file this petition for review.
The Issues Presented
The petition presents two issues:
1. Whether or not the CA correctly ruled that the complaint of the Del Rosarios did not state a
cause of action; and
2. Whether or not the CA correctly ruled that the Del Rosarios were guilty of forum shopping.
The Court's Rulings
One. The CA held that the Del Rosarios' complaint before the RTC failed to state a cause of
action against respondents NBI agents. Such complaint said that the NBI agents unlawfully
procured and enforced the search warrant issued against the Del Rosarios but it failed to state
the ultimate facts from which they drew such conclusion.
The test of sufficiency of a complaint is whether or not, assuming the truth of the facts that
plaintiff alleges in it, the court can render judgment granting him the judicial assistance he
seeks. 1 And judgment would be right only if the facts he alleges constitute a cause of action
that consists of three elements: (1) the plaintiff's legal right in the matter; (2) the defendant's
corresponding obligation to honor or respect such right; and (3) the defendant's subsequent
violation of the right. Absent any of these, the complaint would have failed to state a cause of
action. 2 SaETCI

13

According to the Del Rosarios, the following allegations in their complaint state a cause or
causes of action against respondents NBI agents:
2.4 On 12 March 2002, elements of the [NBI] . . . led by Defendant Rafael I. Gonzaga
. . . entered by force the premises belonging to Plaintiff Alexander del Rosario
situated at No. 51 New York Street, Villasol Subdivision, Angeles City, pursuant to a
Search Warrant unlawfully obtained from the [RTC] of Angeles City, Branch 57 . . . .
xxx xxx xxx
2.6 Contrary to the sworn statements given before the court by defendants
Hellenor D. Donato Jr. . . . and contrary to the allegation in Search Warrant No. 0209A, no 'fake Marlboro cigarettes and their packaging' were found at No. 51 New
York Street, Villasol Subdivision, Angeles City . . . .
2.7 The inclusion of Plaintiff Arthur del Rosario in Search Warrant No. 02-09 had no
factual basis considering that the premises searched is the property solely of
Plaintiff Alexander del Rosario.
2.8 Worse the enforcement of Searched [sic] Warrant No. 02-09 was just part of the
series of raids and searches that was conducted in Angeles City and Pampanga,
which was done with much publicity in the community and had tended to include
the Plaintiffs in the same category as other persons and entities who were in fact
found to be dealing with fake Marlboro cigarettes.
xxx xxx xxx
3.2 The baseless sworn allegations that Plaintiffs had under their control and
possession counterfeit Marlboro cigarettes and packaging to obtain a search
warrant, and the malicious service of the such warrant at the residential premises
of Plaintiff Alexander del Rosario in full and plain view of members of the
community, as part of the series of raids and operations conducted within Angeles
City and Pampanga during that period, has tainted irreversibly the good names
which Plaintiffs have painstakingly built and maintained over the years. SDIACc
xxx xxx xxx
3.4 Plaintiffs were subjected to so much humiliation and embarrassment by the raid
conducted on the subject residential premises, and subjected them to much
unwarranted speculation of engaging in the sale of fake merchandise.
Essentially, however, all that the Del Rosarios allege is that respondents NBI 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 NBI agents found no fake Marlboro cigarettes
in petitioner Alexander del Rosario's premises.
But a judicially ordered search that fails to yield the described illicit article does not of itself
render the court's order "unlawful." The Del Rosarios did not allege that respondents NBI
agents violated their right by fabricating testimonies to convince the RTC of Angeles City to
issue the search warrant. Their allegation that the NBI agents used an unlawfully obtained
search warrant is a mere conclusion of law. While a motion to dismiss assumes as true the
facts alleged in the complaint, such admission does not extend to conclusions of
law. 3 Statements of mere conclusions of law expose the complaint to a motion to dismiss on
ground of failure to state a cause of action. 4
14

Further, the allegation that the search warrant in this case was served in a malicious manner
is also not sufficient. Allegations of bad faith, malice, and other related words without ultimate
facts to support the same are mere conclusions of law. 5
The Del Rosarios' broad assertion in their complaint that the search was conducted "in full and
plain view of members of the community" does not likewise support their claim that such
search was maliciously enforced. There is nothing inherently wrong with search warrants being
enforced in full view of neighbors. In fact, when the respondent or his representative is not
present during the search, the rules require that it be done in the presence of two residents of
the same locality. These safeguards exist to protect persons from possible abuses that may
occur if searches were done surreptitiously or clandestinely.
Two: Invoking Section 21 of this Court's Administrative Matter (A.M.) 02-1-06-SC (not A.O. 011-06-SC as cited), the CA held that, rather than file a separate action for damages, the Del
Rosarios should have filed their claim for compensation in the same proceeding and with the
same court that issued the writ of search and seizure. The Del Rosarios were thus guilty of
forum shopping. CSTEHI
A.M. 02-1-06-SC, the Rule on Search and Seizure in Civil Actions for Infringement of Intellectual
Property Rights, provides:
SEC. 21. Claim for damages. Where the writ [of search and seizure] is discharged
on any of the grounds provided in this Rule, or where it is found after trial that
there has been no infringement or threat of infringement of an intellectual property
right, the court, upon motion of the alleged infringing defendant or expected
adverse party and after due hearing, shall order the applicant to compensate the
defendant or expected adverse party upon the cash bond, surety bond or other
equivalent security for any injury or damage the latter suffered by the issuance and
enforcement of the writ. Should the damages exceed the amount of the bond, the
applicant shall be liable for the payment of the excess.
When a complaint is already filed in court, the motion shall be filed with the same
court during the trial or before appeal is perfected or before judgment becomes
executory, with due notice to the applicant, setting forth the facts showing the
defendant's right to damages and the amount thereof. The award of damages shall
be included in the judgment in the main case.
Where no complaint is filed against the expected adverse party, the motion shall be
filed with the court which issued the writ. In such a case, the court shall set the
motion for summary hearing and immediately determine the expected adverse
party's right to damages.
A judgment in favor of the applicant in its principal claim should not necessarily bar
the alleged infringing defendant from recovering damages where he suffered losses
by reason of the wrongful issuance or enforcement of the writ.
The damages provided for in this section shall be independent from the damages
claimed by the defendant in his counterclaim.
But the subject search warrant was not issued under A.M. 02-1-06-SC, which governed the
issuance of a writ of search and seizure in a civil action for infringement filed by an intellectual
property right owner against the supposed infringer of his trademark or name. Philip Morris,
the manufacturer of Marlboro cigarettes, did not go by this route. Philip Morris did not file a
15

civil action for infringement of its trademark against the Del Rosarios before the RTC of
Angeles City. TSADaI
Instead, Philip Morris sought assistance from the NBI for the apprehension and criminal
prosecution of those reportedly appropriating its trademark and selling fake Marlboro
cigarettes. In turn, the NBI instituted a police action that included applying for a search and
seizure warrant under Sections 3, 4, 5 and 6 of Rule 126 of the Rules of Criminal Procedure
(not under the provisions of A.M. 02-1-06-SC) against the Del Rosarios upon the belief that
they were storing and selling fake Marlboro cigarettes in violation of the penal provisions of
the intellectual property law.
The proceeding under Rule 126, a limited criminal one, does not provide for the filing of
counterclaims for damages against those who may have improperly sought the issuance of
the search warrant. Consequently, the Del Rosarios had the right to seek damages, if the
circumstances warranted, by separate civil action for the wrong inflicted on them by an
improperly obtained or enforced search warrant. Unfortunately, their complaint, as worded,
failed to state a proper cause of action.
Petitioner Arthur del Rosario claims that respondents NBI agents wrongfully included him as
respondent in their application for a search warrant since he neither owned the house at 51
New York Street nor resided in it. But the rules do not require respondents in search warrant
proceedings to be residents of the premises to be searched. If this were the case, criminals in
possession of illegal articles could simply use other people's residence for storing such articles
to avoid being raided and searched.
The Del Rosarios raise a number of procedural issues: a) the supposed failure of respondents
NBI agents to file their motion for reconsideration of the RTC order denying their motion to
dismiss within 15 days of receipt of the order; b) their resort to a special civil action
of certiorari to challenge the RTC's denial of their motion to dismiss; c) the propriety of their
inclusion of a motion to dismiss in their answer; d) the CA's grant to them in 2003 of a 15-day
extension to file a petition for certiorariafter the lapse of 60 days when the Court did not yet
come out with a ruling that barred such extension; and e) their being represented by private
counsel rather than by the Office of the Solicitor General.
With the Court's rulings in the principal issues raised in this case, it finds no sufficient reason
to further dwell on the lesser issues that the Del Rosarios raise above. Besides, the Court finds
no error in the CA's disposition of the same.
WHEREFORE, the Court DENIES the petition and AFFIRMSthe Decision of the Court of
Appeals in CA-G.R. SP 79496 dated June 29, 2007 and its Resolution dated November 19, 2007
for the reasons stated in this Decision, with the MODIFICATION that Civil Case 10584
is DISMISSED without prejudice. TEAaDC
SO ORDERED.
||| (Del Rosario v. Donato, Jr., G.R. No. 180595, [March 5, 2010], 628 PHIL 232-240)

[G.R. No. 103543. July 5, 1993.]

ASIA BREWERY, INC. petitioner, vs. THE HON. COURT OF APPEALS and SAN MIGUEL
CORPORATION, respondents.
Abad Santos & Associates and Sycip, Salazar, Hernandez and Gatmaitan for petitioner.
16

Roco, Bunag, Kapunan Law Office for private respondent.

SYLLABUS
1. REMEDIAL LAW; APPEAL; FACTUAL FINDINGS OF COURT OF APPEALS CONCLUSIVE AND
BINDING ON SUPREME COURT; EXCEPTIONS; CASE AT BAR. As a general rule, the findings of
the Court of Appeals upon factual questions are conclusive and ought not to be disturbed by
us. However, there are exceptions to this general rule, and they are: (1) When the conclusion
is grounded entirely on speculation, surmises and conjectures; (2) When the inference of the
Court of Appeals from its findings of fact is manifestly mistaken, absurd and impossible; (3)
Where there is grave abuse of discretion; (4) When the judgment is based on a
misapprehension of facts; (5) When the appellate court, in making its findings, went beyond
the issues of the case, and the same are contrary to the admissions of both the appellant and
the appellee; (6) When the findings of said court are contrary to those of the trial court; (7)
When the findings are without citation of specific evidence on which they are based; (8) When
the facts set forth in the petition as well as in the petitioner's main and reply briefs are not
disputed by the respondents; and (9) When the findings of facts of the Court of Appeals are
premised on the absence of evidence and are contradicted on record. (Reynolds Philippine
Corporation vs. Court of Appeals, 169 SCRA 220, 223 citing, Mendoza vs. Court of Appeals,
156 SCRA 597; Manlapaz vs. Court of Appeals, 147 SCRA 238; Sacay vs. Sandiganbayan, 142
SCRA 593, 609; Guita vs. CA, 139 SCRA 576; Casanayan vs. Court of Appeals, 198 SCRA 333,
336; also Apex Investment and Financing Corp. vs. IAC, 166 SCRA 458 [citing Tolentino vs. De
Jesus, 56 SCRA 167; Carolina Industries, Inc. vs. CMS Stock Brokerage, Inc., 97 SCRA 734;
Manero vs. CA, 102 SCRA 817; and Moran, Jr. vs. Ca, 133 SCRA 88].) Under any of these
exceptions, the Court has to review the evidence in order to arrive at the correct findings
based on the record (Roman Catholic Bishop of Malolos, Inc. vs. IAC, 191 SCRA 411, 420.)
Where findings of the Court of Appeals and trial court are contrary to each other, the Supreme
Court may scrutinize the evidence on record. (Cruz vs. CA, 129 SCRA 222, 227.) The present
case is one of the exceptions because 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.
2. COMMERCIAL LAW; TRADEMARK LAW (REPUBLIC ACT NO. 166); INFRINGEMENT; DEFINED;
NATURE THEREOF. Infringement of trademark is a form of unfair competition
(Clarke vs. Manila Candy Co., 36 Phil. 100, 106). Sec. 22 of Republic Act 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."

17

3. ID.; ID.; HOW QUESTION OF INFRINGEMENT OF TRADEMARK DETERMINED; QUESTION AT

ISSUE IN CASES OF INFRINGEMENT. Infringement is determined by the "test of dominancy"
rather than by differences or variations in the details of one trademark and of another. The
rule was formulated in Co Tiong Sa vs. Director of Patents, 95 Phil. 1, 4 (1954); reiterated in
Lim Hoa vs. Director of Patents, 100 Phil. 214, 216-217 (1956), thus: "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; not it is necessary that the infringing label should suggest an effort to imitate.
[C. Neilman Brewing Co. vs. Independent Brewing Co., 191 F., 489, 495, citing Eagle While
Lead Co., vs. Pflugh (CC) 180 Fed. 579]. The question at issue in cases of infringement of
trademarks is whether the use of the marks involvedwould be likely to cause confusion or
mistakes in the mind of the public or deceive purchasers. (Auburn Rubber
Corporation vs. Honover Rubber Co., 107 F. 2d 588; . . .)" In Forbes, Munn & Co. (Ltd.) vs. Ang
San To, 40 Phil. 272, 275), the test was similarity or "resemblance between the two
(trademarks) such as would be likely to cause the one mark to be mistaken for the other. . . .
[But] this is not such similitude as amounts to identity." In Phil. Nut Industry Inc. vs. Standard
Brands Inc., 65 SCRA 575, the court was more specific: the test is "similarity in the dominant
features of the trademarks."
4. ID.; ID.; ID.; ID.; CASE AT BAR. The dominant feature of SMC's trademark is 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. On the other hand, the dominant feature of ABI's trademark
is 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 "SAM 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.
5. ID.; ID.; GENERIC OR DESCRIPTIVE AND PRIMARILY GEOGRAPHICALLY DESCRIPTIVE WORDS
NON-REGISTRABLE AND NOT APPROPRIABLE; REASON THEREFOR; CASE AT BAR. 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. (Webster's Third New International Dictionary of the English Language,
Unabridged. Edited by Philip Babcock Gove. Springfield, Mass.: G & C Merriam Co.,) 1976,
page 1716.) "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 Trademark Law provides: "Sec. 4 . . . The
owner of trade-mark, trade-name or service-mark used to distinguished 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: . . . "(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
18

descriptive or deceptively misdescriptive of them, or is primarily merely a surname." 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. In Masso Hermanos,
S.A. vs. Director of Patents, 94 Phil. 136, 139 (1953), it was held that a dealer in shoes cannot
register "Leather Shoes" as his trademark because that would be merely descriptive and it
would be unjust to deprive other dealers in leather shoes of the right to use the same words
with reference to their merchandise. No one may appropriate generic or descriptive words.
They belong to the public domain (Ong Ai Gui vs. Director of Patents, 96 Phil. 673, 676
[1955]).
6. ID.; ID.; UNFAIR COMPETITION; DEFINED. 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.)

7. ID.; ID.; ID.; TEST TO DETERMINE EXISTENCE THEREOF. The universal test question is
whether the public is likely to be deceived. Nothing less than conduct tending to pass off one
man's goods or business as that of another will constitute unfair competition. Actual or
probable deception and confusion on the part of the customers by reason of defendant's
practices must always appear." (Shell Co. of the Philippines, Ltd. vs. Insular Petroleum Refining
Co. Ltd. et al., 120 Phil. 434, 439.) . . . In Dy Buncio vs. Tan Tiao Bok, 42 Phil. 190, 196-197,
where two competing tea products were both labelled as Formosan tea, both sold in 5-ounce
packages made of ordinary wrapping paper of conventional color, both with labels containing
designs drawn in green ink and Chinese characters written in red ink, one label showing a
double-decked jar in the center, the other, a flower pot, this court found that the resemblances
between the designs were not sufficient to mislead the ordinary intelligent buyer, hence, there
was no unfair competition. The Court held: ". . . In order that there may be deception of the
buying public in the sense necessary to constitute unfair competition, it is necessary to
suppose a public 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
persons in some measure acquainted with an established design and desirous of purchasing
the commodity with which that design has been associated. The test is not found in the
deception, or possibility of the deception, of the person who knows nothing about the design
which has been counterfeited, and who must be indifferent as between that and the other. The
simulation, in order to be objectionable, must be such as appears likely to mislead the
ordinarily intelligent buyer who has a need to supply and is familiar with the article that he
seeks to purchase."
8. ID.; ID.; PROTECTION AGAINST IMITATION PROPERLY LIMITED TO NONFUNCTIONAL
FEATURES; CASE AT BAR. The petitioner's contention that bottle size, shape and color may
not be the exclusive property of any one beer manufacturer is well taken. SMC's being the first
to use the steinie bottle does not give SMC a vested right to use it to the exclusion of
everyone else. Being of functional or common use, and not the exclusive invention of any one,
it is available to all who might need to use it within the industry. Nobody can acquire any
exclusive right to market articles supplying simple human needs in containers or wrappers of
the general form, size and character commonly and immediately used in marketing such
19

articles (Dy Buncio vs. Tan Tiao Bok, 42 Phil. 190, 194-195.) . . . ABI does not use SMC's steinie
bottle. Neither did ABI copy it. ABI makes its own steinie bottle which has a fat bulging neck to
differentiate it from SMC's bottle. The amber color is a functional feature of the beer bottle. As
pointed out by ABI, all bottled beer produced in the Philippines is contained and sold in ambercolored bottles because amber is the most effective color in preventing transmission of light
and provides the maximum protection to beer. As was ruled in California Crushed Fruit
Corporation vs. Taylor B. and Candy Co., 38 F2d 885, a merchant cannot be enjoined from
using a type or color of bottle where the same has the useful purpose of protecting the
contents from the deleterious effects of light rays. Moreover, no one may have a monopoly of
any color. Not only beer, but most medicines, whether in liquid or tablet form, are sold in
amber-colored bottles. That the ABI bottle has a 320 ml. capacity is not due to a desire to
imitate SMC's bottle but because that bottle capacity is the standard prescribed under
Metrication Circular No. 778, dated 4 December 1979, of the Department of Trade, Metric
System Board. With regard to the white label of both beer bottles, ABI explained that it used
the color white for its label because white presents the strongest contrast to the amber color
of ABI's bottle; it is also the most economical to use on labels, and the easiest to "bake" in the
furnace. No one can have a monopoly of the color amber for bottles, nor of white for labels,
nor of the rectangular shape which is the usual configuration of labels. Needless to say, the
shape of the bottle and of the label is unimportant. What is all important is the name of the
product written on the label of the bottle for that is how one beer may be distinguished from
the others.
9. ID.; ID.; TRADEMARK ALLEGEDLY INFRINGED CONSIDERED AS A WHOLE AND NOT AS
DISSECTED; DOCTRINE ENUNCIATED IN DEL MONTE CORPORATION vs.COURT OF APPEALS AND
SUNSHINE SAUCE MANUFACTURING INDUSTRIES, 181 SCRA 410, 419, NOT APPLICABLE TO
CASE AT BAR. Our decision in this case will not diminish our ruling in "Del Monte
Corporation vs. Court of Appeals and Sunshine Sauce Manufacturing Industries," 181 SCRA
410, 419, 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." That ruling may not apply to all kinds of
products. The Court itself cautioned that in resolving cases of infringement and unfair
competition, the courts should "take into consideration several factors which would affect is
conclusion, to wit: the age, training and education of the usual purchaser, the nature and cost
of the article, whether the article is bought for immediate consumption and also the conditions
under which it is usually purchased." (181 SCRA 410, 418-419). 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 up from a store shelf
but ordered by brand by the beer drinker himself from the storekeeper or waiter in a pub or
restaurant.
CRUZ, J., dissenting:
1. COMMERCIAL LAW; TRADEMARK LAW (REPUBLIC ACT NO. 166); INFRINGEMENT;
TOUCHSTONE IN DETERMINATION OF EXISTENCE THEREOF; TO DETERMINE WHETHER
TRADEMARK HAS BEEN INFRINGED, THE MARK IS CONSIDERED AS A WHOLE AND NOT AS
DISSECTED. The question is not whether the two articles are distinguishable by their labels
20

when set side by side but 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. As observed in several cases, the general impression of the
ordinary purchaser, buying under the normally prevalent conditions in trade and giving the
attention such purchasers usually give in buying that class of goods, is the touchstone. 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.
DECISION
GRIO-AQUINO, J p:
On September 15, 1988, 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. (San Miguel Corporation vs. Asia Brewery
Inc., Civ. Case No. 56390, RTC Branch 166, Pasig, Metro Manila.)
On August 27, 1990, a decision was rendered by the trial Court, presided over by Judge Jesus
O. Bersamira, dismissing SMC's complaint because ABI "has not committed trademark
infringement or unfair competition against" SMC (p. 189, Rollo). prcd
SMC appealed to the Court of Appeals (C.A.-G.R. CV No. 28104). On September 30, 1991, the
Court of Appeals (Sixth Division composed of Justice Jose C. Campos, Jr., chairman
and ponente, and Justices Venancio D. Aldecoa Jr. and Filemon H. Mendoza, as members)
reversed the trial court. The dispositive part of the decision reads as follows:
"In the light of the foregoing analysis and under the plain language of the applicable rule and
principle on the matter, We find the defendant Asia Brewery Incorporated GUILTY of
infringement of trademark and unfair competition. The decision of the trial court is hereby
REVERSED, and a new judgment entered in favor of the plaintiff and against the defendant as
follows:
"(1) The defendant Asia Brewery Inc. its officers, agents, servants and employees are hereby
permanently enjoined and restrained from manufacturing, putting up, selling, advertising,
offering or announcing for sale, or supplying Beer Pale Pilsen, or any similar preparation,
manufacture or beer in bottles and under labels substantially identical with or like the said
bottles and labels of plaintiff San Miguel Corporation employed for that purpose, or
substantially identical with or like the bottles and labels now employed by the defendant for
that purpose, or in bottles or under labels which are calculated to deceive purchasers and
consumers into the belief that the beer is the product of the plaintiff or which will enable
others to substitute, sell or palm off the said beer of the defendant as and for the beer of the
plaintiff-complainant.
21

"(2) The defendant Asia Brewery Inc. is hereby ordered to render an accounting and pay the
San Miguel Corporation double any and all the payments derived by defendant from
operations of its business and sale of goods bearing the mark 'Beer Pale Pilsen' estimated at
approximately Five Million Pesos (P5,000,000.00); to recall all its products bearing the mark
'Beer Pale Pilsen' from its retailers and deliver these as well as all labels, signs, prints,
packages, wrappers, receptacles and advertisements bearing the infringing mark and all
plates, molds, materials and other means of making the same to the Court authorized to
execute this judgment for destruction.
"(3) The defendant is hereby ordered to pay plaintiff the sum of Two Million Pesos
(P2,000,000.00) as moral damages and Half a Million Pesos (P5,000,000.00) by way of
exemplary damages.
"(4) The defendant is further ordered to pay the plaintiff attorney's fees in the amount of
P250,000.00 plus costs of this suit." (p. 90, Rollo.)
Upon a motion for reconsideration filed by ABI, the above dispositive part of the decision, was
modified by the separate opinions of the Special Sixth Division 1 so that it should read thus:
In the light of the foregoing analysis and under the plain language of the applicable rule and
principle on the matter, We find the defendant Asia Brewery IncorporatedGUILTY of
infringement of trademark and unfair competition. The decision of the trial court is hereby
REVERSED, and a new judgment entered in favor of the plaintiff and against the defendant as
follows:
(1) The defendant Asia Brewery Inc., its officers, agents, servants and employees are hereby
permanently enjoined and restrained from manufacturing, putting up, selling, advertising,
offering or announcing for sale, or supplying Beer Pale Pilsen, or any similar preparation,
manufacture or beer in bottles and under labels substantially identical with or like the said
bottles and labels of plaintiff San Miguel Corporation employed for that purpose, or
substantially identical with or like the bottles and labels now employed by the defendant for
that purpose, or in bottles or under labels which are calculated to deceive purchasers and
consumers into the belief that the beer is the product of the plaintiff or which will enable
others to substitute, sell or palm off the said beer of the defendant as and for the beer of the
plaintiff-complainant.
(2) The defendant Asia Brewery Inc. is hereby ordered 2 to recall all its products bearing the
mark Beer Pale Pilsen from its retailers and deliver these as well as all labels, signs, prints,
packages, wrappers, receptacles and advertisements bearing the infringing mark and all
plates, molds, materials and other means of making the same to the Court authorized to
execute this judgment for destruction.
(3) The defendant is hereby ordered to pay plaintiff the sum of Two Million Pesos
(P2,000,000.00) as moral damages and Half a Million Pesos (P500,000.00) by way of
exemplary damages.
(4) The defendant is further ordered to pay the plaintiff attorney's fees in the amount of
P250,000.00 plus costs of this suit.
In due time, ABI appealed to this Court by a petition for certiorari under Rule 45 of the Rules of
Court. The lone issue in this appeal is whether ABI infringes SMC's trademark: San Miguel Pale
Pilsen with Rectangular Hops and Malt Design, and thereby commits unfair competition
against the latter. It is a factual issue (Phil. Nut Industry Inc. v. Standard Brands Inc., 65 SCRA
575) and as a general rule, the findings of the Court of Appeals upon factual questions are
22

conclusive and ought not to be disturbed by us. However, there are exceptions to this general
rule, and they are:
(1) When the conclusion is grounded entirely on speculation, surmises and conjectures;
(2) When the inference of the Court of Appeals from its findings of fact is manifestly mistaken,
absurd and impossible;
(3) Where there is grave abuse of discretion;
(4) When the judgment is based on a misapprehension of facts;
(5) When the appellate court, in making its findings, went beyond the issues of the case, and
the same are contrary to the admissions of both the appellant and the appellee;
(6) When the findings of said court are contrary to those of the trial court;
(7) When the findings are without citation of specific evidence on which they are based;
(8) When the facts set forth in the petition as well as in the petitioner's main and reply briefs
are not disputed by the respondents; and
(9) When the findings of facts of the Court of Appeals are premised on the absence of
evidence and are contradicted on record. (Reynolds Philippine Corporation vs. Court of
Appeals, 169 SCRA 220, 223 citing, Mendoza vs. Court of Appeals, 156 SCRA 597; Manlapaz
vs. Court of Appeals, 147 SCRA 238; Sacay vs. Sandiganbayan, 142 SCRA 593, 609; Guita vs.
CA, 139 SCRA 576; Casanayan vs. Court of Appeals, 198 SCRA 333, 336; also Apex Investment
and Financing Corp. vs. IAC, 166 SCRA 458 [citing Tolentino vs. De Jesus, 56 SCRA 167;
Carolina Industries, Inc. vs. CMS Stock Brokerage, Inc., 97 SCRA 734; Manero vs. CA, 102 SCRA
817; and Moran, Jr. vs. CA, 133 SCRA 88].)
Under any of these exceptions, the Court has to review the evidence in order to arrive at the
correct findings based on the record (Roman Catholic Bishop of Malolos, Inc. vs. IAC, 191 SCRA
411, 420.) Where findings of the Court of Appeals and trial court are contrary to each other,
the Supreme Court may scrutinize the evidence on record. (Cruz vs. CA, 129 SCRA 222, 227.)
The present case is one of the exceptions because 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 (Clarke vs. Manila Candy Co., 36
Phil. 100, 106). Sec. 22 of Republic Act 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
23

liable to a civil action by the registrant for any or all of the remedies herein provided.
(Emphasis supplied.)
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." (Ibid.)
The registered trademark of SMC for its pale pilsen beer is:
"San Miguel Pale Pilsen With Rectangular Hops and Malt Design. (Philippine Bureau of Patents,
Trademarks and Technology Transfer Trademark Certificate of Registration No. 36103, dated 23
Oct. 1986." (p. 174, Rollo.)
As described by the trial court in its decision (Page 177, Rollo):
". . . a rectangular design [is] bordered by what appears to be minute grains arranged in rows
of three in which there appear in each corner hop designs. At the top is a phrase written in
small print 'Reg. Phil. Pat. Off.' and at the bottom 'Net Contents: 320 Ml.' The dominant feature
is the phrase 'San Miguel' written horizontally at the upper portion. Below are the words 'Pale
Pilsen' written diagonally across the middle of the rectangular design. In between is a coat of
arms and the phrase 'Expertly Brewed.' The 'S' in 'San' and the 'M' of 'Miguel,' 'P' of 'Pale' and
'Pilsen' are written in Gothic letters with fine strokes of serifs, the kind that first appeared in
the 1780s in England and used for printing German as distinguished from Roman and Italic.
Below 'Pale Pilsen' is the statement 'And Bottled by' (first line, 'San Miguel Brewery' (second
line), and 'Philippines' (third line)." (p. 177, Rollo; Italics supplied.)
On the other hand, ABI's trademark, as described by the trial court, consists of:
". . . a rectangular design bordered by what appear to be buds of flowers with leaves. The
dominant feature is 'Beer' written across the upper portion of the rectangular design. The
phrase 'Pale Pilsen' appears immediately below in smaller block letters. To the left is a hop
design and to the right, written in small prints, is the phrase 'Net Contents 320 ml.'
immediately below 'Pale Pilsen' is the statement written in three lines 'Especially brewed and
bottled by' (first line), 'Asia Brewery Incorporated' (second line), and 'Philippines' (third line)."
(p. 177, Rollo; Italics supplied.)
Does ABI's BEER PALE PILSEN label or "design" infringe upon SMC's SAN MIGUEL PALE PILSEN
WITH RECTANGULAR MALT AND HOPS DESIGN? The answer is "No."
Infringement is determined by the "test of dominancy" rather than by differences or variations
in the details of one trademark and of another. The rule was formulated in Co Tiong Sa vs.
Director of Patents, 95 Phil. 1, 4 (1954); reiterated in Lim Hoa vs. Director of Patents, 100 Phil.
214, 216-217 (1956), thus:
"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. [C. Neilman Brewing Co. vs. Independent Brewing Co., 191 F., 489, 495, citing
Eagle White Lead Co., vs. Pflugh (CC) 180 Fed. 579]. The question at issue in cases of
infringement of trademarks is whether the use of the marks involved would be likely to cause
24

confusion or mistakes in the mind of the public or deceive purchasers. (Auburn Rubber
Corporation vs. Honover Rubber Co., 107 F. 2d 588; . . .)" (Emphasis supplied.)

In Forbes, Munn & Co. (Ltd.) vs. Ang San To, 40 Phil. 272, 275), the test was similarity or
"resemblance between the two (trademarks) such as would be likely to cause the one mark to
be mistaken for the other . . . [But] this is not such similitude as amounts to identity."
In Phil. Nut Industry Inc. vs. Standard Brands Inc., 65 SCRA 575, the court was more specific:
the test is "similarity in the dominant features of the trademarks."
What are the dominant features of the competing trademarks before us?
There is hardly any dispute that the dominant feature of SMC's trademark is 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.
On the other hand, the dominant feature of ABI's trademark is 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:
(1) The SAN MIGUEL PALE PILSEN bottle has a slender tapered neck.
The BEER PALE PILSEN bottle has a fat, bulging neck.
(2) The words "pale pilsen" on SMC's label are printed in bold and laced letters along
a diagonal band, whereas the words "pale pilsen" on ABI's bottle are half the size and printed
in slender block letters on a straight horizontal band. (See Exhibit "8-a".)
(3) The names of the manufacturers are prominently printed on their respective bottles.
SAN MIGUEL PALE PILSEN is "Bottled by the San Miguel Brewery, Philippines," whereas BEER
PALE PILSEN is "Especially brewed and bottled by Asia Brewery Incorporated, Philippines."
(4) On the back of ABI's bottle is printed in big, bold letters, under a row of flower buds and
leaves, its copyrighted slogan:
"BEER NA BEER!"
Whereas SMC's bottle carries no slogan.
(5) The back of the SAN MIGUEL PALE PILSEN bottle carries the SMC logo, whereas the BEER
PALE PILSEN bottle has no logo.
25

(6) The SAN MIGUEL PALE PILSEN bottle cap is stamped with a coat of arms and the words
"San Miguel Brewery Philippines" encircling the same.
The BEER PALE PILSEN bottle cap is stamped with the name "BEER" in the center, surrounded
by the words "Asia Brewery Incorporated Philippines."
(7) Finally, there is a substantial price difference between BEER PALE PILSEN (currently at
P4.25 per bottle) and SAN MIGUEL PALE PILSEN (currently at P7.00 per bottle). One who pays
only P4.25 for a bottle of beer cannot expect to receive San Miguel Pale Pilsen from the
storekeeper or bartender.
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. (Webster's Third New International Dictionary of the
English Language, Unabridged. Edited by Philip Babcock Gove. Springfield, Mass.: G & C
Merriam Co., c) 1976, page 1716.) "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, nonregisterable and not appropriable by any beer manufacturer. The Trademark Law provides:
"Sec. 4. . . . The owner of 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." (Emphasis supplied.)
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. In Masso Hermanos,
S.A. vs. Director of Patents, 94 Phil. 136, 139 (1953), it was held that a dealer in shoes cannot
register "Leather Shoes" as his trademark because that would be merely descriptive and it
would be unjust to deprive other dealers in leather shoes of the right to use the same words
with reference to their merchandise. No one may appropriate generic or descriptive words.
They belong to the public domain (Ong Ai Gui vs. Director of Patents, 96 Phil. 673, 676
[1955]):
"A word or a combination of words which is merely descriptive of an article of trade, or of its
composition, characteristics, or qualities, cannot be appropriated and protected as a
trademark to the exclusion of its use by others . . . inasmuch as all persons have an equal
right to produce and vend similar articles, they also have the right to describe them properly
and to use any appropriate language or words for that purpose, and no person can
appropriate to himself exclusively any word or expression, properly descriptive of the article,
its qualities, ingredients or characteristics, and thus limit other persons in the use of language
appropriate to the description of their manufactures, the right to the use of such language
being common to all. This rule excluding descriptive terms has also been held to apply to
26

trade-names. As to whether words employed fall within this prohibition, it is said that the true
test is not whether they are exhaustively descriptive of the article designated, but whether in
themselves, and as they are commonly used by those who understand their meaning, they are
reasonably indicative and descriptive of the thing intended. If they are thus descriptive, and
not arbitrary, they cannot be appropriated from general use and become the exclusive
property of anyone. (52 Am. Jur. 542-543.)
". . . Others may use the same or similar descriptive word in connection with their own wares,
provided they take proper steps to prevent the public being deceived. (Richmond Remedies
Co. vs. Dr. Miles Medical Co., 16 E. [2d] 598.)
". . . A descriptive word may be admittedly distinctive, especially if the user is the first creator
of the article. It will, however, be denied protection, not because it lacks distinctiveness, but
rather because others are equally entitled to its use. (2 Callman, Unfair Competition and
Trademarks, pp. 869-870.)" (Emphasis supplied.)
The circumstance that the manufacturer of BEER PALE PILSEN, Asia Brewery Incorporated, has
printed its name all over the bottle of its beer product: on the label, on the back of the bottle,
as well as on the bottle cap, disproves SMC's charge that ABI dishonestly and fraudulently
intends to palm off its BEER PALE PILSEN as SMC's product. In view of the visible differences
between the two products, the Court believes it is quite unlikely that a customer of average
intelligence would mistake a bottle of BEER PALE PILSEN for SAN MIGUEL PALE PILSEN.
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 law further enumerates the more common ways
of committing unfair competition, thus:
"Sec. 29. . . .
"In particular, and without in any way limiting the scope of unfair competition, the following
shall be deemed guilty of unfair competition:
"(a) Any person, who in selling his goods shall give them the general appearance of goods of
another manufacturer or dealer, either as to the goods themselves or in the wrapping of the
packages in which they are contained, or the devices or words thereon, or in any other feature
of their appearance, which would be likely to influence purchasers to believe that the goods
offered are those of a manufacturer or dealer other than the actual manufacturer or dealer, or
who otherwise clothes the goods with such appearance as shall deceive the public and
defraud another of his legitimate trade, or any subsequent vendor of such goods or any agent
of any vendor engaged in selling such goods with a like purpose.
"(b) Any person who by any artifice, or device, or who employs any other means calculated to
induce the false belief that such person is offering the services of another who has identified
such services in the mind of the public; or

27

"(c) Any person who shall make any false statement in the course of trade or who shall
commit any other act contrary to good faith of a nature calculated to discredit the goods,
business or services of another."

In this case, the question to be determined is whether ABI is using a name or mark for its beer
that has previously come to designate SMC's beer, or whether ABI is passing off its BEER PALE
PILSEN as SMC's SAN MIGUEL PALE PILSEN.
". . . The universal test question is whether the public is likely to be deceived. Nothing less
than conduct tending to pass off one man's goods or business as that of another will
constitute unfair competition. Actual or probable deception and confusion on the part of the
customers by reason of defendant's practices must always appear." (Shell Co. of the
Philippines, Ltd. vs. Insular Petroleum Refining Co. Ltd. et al., 120 Phil. 434, 439.)
The use by 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. (See rollo, page 55.) The Cerveza Especial and the Efes Pale
Pilsen use the "steinie" bottle. (See Exhibits 57-D, 57-E.) The trial court found no infringement
of SMC's bottle
"The court agrees with defendant that there is no infringement of plaintiff's bottle, firstly,
because according to plaintiff's witness Deogracias Villadolid, it is a standard type of bottle
called steinie, and to witness Jose Antonio Garcia, it is not a San Miguel Corporation design but
a design originally developed in the United States by the Glass Container Manufacturer's
Institute and therefore lacks exclusivity. Secondly, the shape was never registered as a
trademark. Exhibit 'C' is not a registration of a beer bottle design required under Rep. Act
165 but the registration of the name and other marks of ownership stamped on containers as
required by Rep. Act 623. Thirdly, the neck of defendant's bottle is much larger and has a
distinct bulge in its uppermost part." (p. 186, Rollo.)
The petitioner's contention that bottle size, shape and color may not be the exclusive property
of any one beer manufacturer is well taken. SMC's being the first to use the steinie bottle does
not give SMC a vested right to use it to the exclusion of everyone else. Being of functional or
common use, and not the exclusive invention of any one, it is available to all who might need
to use it within the industry. Nobody can acquire any exclusive right to market articles
supplying simple human needs in containers or wrappers of the general form, size and
character commonly and immediately used in marketing such articles (Dy Buncio vs. Tan Tiao
Bok, 42 Phil. 190, 194-195.)
". . . protection against imitation should be properly confined to nonfunctional features. Even if
purely functional elements are slavishly copied, the resemblance will not support an action for
unfair competition, and the first user cannot claim secondary meaning protection. Nor can the
first user predicate his claim to protection on the argument that his business was established
in reliance on any such unpatented nonfunctional feature, even 'at large expenditure of
money.' (Callman Unfair Competition, Trademarks and Monopolies, Sec. 19.33 [4th Ed.].)"
(Petition for Review, p. 28.)
ABI does not use SMC's steinie bottle. Neither did ABI copy it. ABI makes its own steinie bottle
which has a fat bulging neck to differentiate it from SMC's bottle. The amber color is a
functional feature of the beer bottle. As pointed out by ABI, all bottled beer produced in the
Philippines is contained and sold in amber-colored bottles because amber is the most effective
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color in preventing transmission of light and provides the maximum protection to beer. As was
ruled in California Crushed Fruit Corporation vs. Taylor B. and Candy Co., 38 F2d 885, a
merchant cannot be enjoined from using a type or color of bottle where the same has the
useful purpose of protecting the contents from the deleterious effects of light rays. Moreover,
no one may have a monopoly of any color. Not only beer, but most medicines, whether in
liquid or tablet form, are sold in amber-colored bottles.
That the ABI bottle has a 320 ml. capacity is not due to a desire to imitate SMC's bottle but
because that bottle capacity is the standard prescribed under Metrication Circular No. 778,
dated 4 December 1979, of the Department of Trade, Metric System Board.
With regard to the white label of both beer bottles, ABI explained that it used the color white
for its label because white presents the strongest contrast to the amber color of ABI's bottle; it
is also the most economical to use on labels, and the easiest to "bake" in the furnace (p. 16,
TSN of September 20, 1988). No one can have a monopoly of the color amber for bottles, nor
of white for labels, nor of the rectangular shape which is the usual configuration of labels.
Needless to say, the shape of the bottle and of the label is unimportant. What is all important
is the name of the product written on the label of the bottle for that is how one beer may be
distinguished from the others. prLL
In Dy Buncio v. Tan Tiao Bok, 42 Phil. 190, 196-197, where two competing tea products were
both labelled as Formosan tea, both sold in 5-ounce packages made of ordinary wrapping
paper of conventional color, both with labels containing designs drawn in green ink and
Chinese characters written in red ink, one label showing a double-decked jar in the center, the
other, a flower pot, this court found that the resemblances between the designs were not
sufficient to mislead the ordinary intelligent buyer, hence, there was no unfair competition.
The Court held:
". . . In order that there may be deception of the buying public in the sense necessary to
constitute unfair competition, it is necessary to suppose a public 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 persons in some measure acquainted with
an established design and desirous of purchasing the commodity with which that design has
been associated. The test is not found in the deception, or possibility of the deception, of the
person who knows nothing about the design which has been counterfeited, and who must be
indifferent as between that and the other. The simulation, in order to be objectionable, must
be such as appears likely to mislead the ordinarily intelligent buyer who has a need to supply
and is familiar with the article that he seeks to purchase."
The main thrust of SMC's complaint is not infringement of its trademark, but unfair
competition arising from the allegedly "confusing similarity" in the general appearance or
trade dress of ABI's BEER PALE PILSEN beside SMC's SAN MIGUEL PALE PILSEN (p. 209, Rollo).
SMC claims that the "trade dress" of BEER PALE PILSEN is "confusingly similar" to its SAN
MIGUEL PALE PILSEN because both are bottled in 320 ml. steinie type, amber-colored bottles
with white rectangular labels.
However, when as in this case, 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 steinie bottle is a standard bottle for beer and is universally used. SMC did
not invent it nor patent it. The fact that SMC's bottle is registered under R.A. No. 623 (as
amended by RA 5700, An Act to Regulate the Use of Duly Stamped or Marked Bottles, Boxes,
29

Casks, Kegs, Barrels and Other Similar Containers) simply prohibits manufacturers of other
foodstuffs from the unauthorized use of SMC's bottles by refilling these with their products. It
was not uncommon then for products such as patis (fish sauce) and toyo (soy sauce) to be
sold in recycled SAN MIGUEL PALE PILSEN bottles. Registration of SMC's beer bottles did not
give SMC a patent on the steinie or on bottles of similar size, shape or color.
Most containers are standardized because they are usually made by the same manufacturer.
Milk, whether in powdered or liquid form, is sold in uniform tin cans. The same can be said of
the standard ketchup or vinegar bottle with its familiar elongated neck. Many other grocery
items such as coffee, mayonnaise, pickles and peanut butter are sold in standard glass jars.
The manufacturers of these foodstuffs have equal right to use these standard tins, bottles and
jars for their products. Only their respective labels distinguish them from each other. Just as no
milk producer may sue the others for unfair competition because they sell their milk in the
same size and shape of milk can which he uses, neither may SMC claim unfair competition
arising from the fact that ABI's BEER PALE PILSEN is sold, like SMC's SAN MIGUEL PALE PILSEN
in amber steinie bottles. prcd
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. (Op. cit. page 50.)
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. If they gravitate to ABI's cheaper beer, it will not be because they
are confused or deceived, but because they find the competing product to their taste.

Our decision in this case will not diminish our ruling in "Del Monte Corporation vs. Court of
Appeals and Sunshine Sauce Manufacturing Industries," 181 SCRA 410, 419, 3that:
". . . 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."
That ruling may not apply to all kinds of products. The Court itself cautioned that in resolving
cases of infringement and unfair competition, the courts should "take into consideration
several factors which would affect its conclusion, to wit: the age, training and education of the
usual purchaser, the nature and cost of the article, whether the article is bought for immediate
consumption and also the conditions under which it is usually purchased" (181 SCRA 410, 418419).
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
30

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 up from a store
shelf but ordered by brand by the beer drinker himself from the storekeeper or waiter in a pub
or restaurant.
Moreover, SMC's brand or trademark: "SAN MIGUEL PALE PILSEN" is not infringed by ABI's
mark: "BEER NA BEER" or "BEER PALE PILSEN." ABI makes its own bottle with a bulging neck to
differentiate it from SMC's bottle, and prints ABI's name in three (3) places on said bottle
(front, back and bottle cap) to prove that it has no intention to pass off its "BEER" as "SAN
MIGUEL."
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.
Petition ABI has neither infringed SMC's trademark nor committed unfair competition with the
latter's SAN MIGUEL PALE PILSEN product. While its BEER PALE PILSEN admittedly competes
with the latter in the open market, the competition is neither unfair nor fraudulent. Hence, we
must deny SMC's prayer to suppress it.
WHEREFORE, finding the petition for review meritorious, the same is hereby granted. The
decision and resolution of the Court of Appeals in CA-G.R. CV No. 28104 are hereby set aside
and that of the trial court is REINSTATED and AFFIRMED. Costs against the private respondent.
SO ORDERED.
||| (Asia Brewery, Inc. v. Court of Appeals, G.R. No. 103543, [July 5, 1993])

Ty v. De Jemil
G.R. No. 182147
December 15, 2010
Petitioners Claim: As petitioners strongly argue, even if the branded LPG cylinders were
indeed owned by customers, such fact does not authorize Omni to refill these branded LPG
cylinders without written authorization from the brand owners Pilipinas Shell, Petron and Total.
In a case involving criminal infringement of property rights under Sec. 155 of RA 8293, in
affirming the courts a quo's determination of the presence of probable cause, this Court held
that from Sec. 155.1 of RA 8293 can be gleaned that "mere unauthorized use of a container
bearing a registered trademark in connection with the sale, distribution or advertising of goods
or services which is likely to cause confusion, mistake or deception among the
buyers/consumers can be considered as trademark infringement."
Respondents Claim: Petitioners strongly argue that there is no probable cause for said
violation based upon an underfilling of a lone cylinder of the eight branded LPG cylinders
refilled during the test-buy. Besides, they point out that there was no finding of underfilling in
any of the filled LPG cylinders seized during the service of the search warrants. Citing DOE's
Bureau of Energy Utilization Circular No. 85-3-348, they maintain that some deviation is
allowed from the exact filled weight. Considering the fact that an isolated underfilling
happened in so many LPG cylinders filled, petitioners are of the view that such is due to
31

human or equipment error and does not in any way constitute deliberate underfilling within
the contemplation of the law.
Issues:

Whether or not probable cause exists against petitioners for violations of Sec. 2
(a) and (c) of BP 33, as amended
Whether or not petitioners can be held liable therefor

Ruling: Foregoing considered, in the backdrop of the quantum of evidence required to

support a finding of probable cause, we agree with the appellate court and the Office of the
Chief State Prosecutor, which conducted the preliminary investigation, that there exists
probable cause for the violation of Sec. 2 (a) in relation to Sec. 3 (c) of BP 33, as amended.
Probable cause has been defined as the existence of such facts and circumstances as would
excite belief in a reasonable mind, acting on the facts within the knowledge of the prosecutor,
that the person charged was guilty of the crime for which he was prosecuted. After all,
probable cause need not be based on clear and convincing evidence of guilt, as the
investigating officer acts upon reasonable belief probable cause implies probability of guilt
and requires more than bare suspicion but less than evidence which would justify a
conviction.
Sec. 4 of BP 33, as amended, clearly indicated firstly the president of a corporation or juridical
entity to be criminally liable for violations of BP 33, as amended.
Evidently, petitioner Arnel, as President, who manages the business affairs of Omni, can be
held liable for probable violations by Omni of BP 33, as amended. The fact that petitioner Arnel
is ostensibly the operations manager of Multi-Gas Corporation, a family owned business, does
not deter him from managing Omni as well. It is well-settled that where the language of the
law is clear and unequivocal, it must be taken to mean exactly what it says. As to the other
petitioners, unless otherwise shown that they are situated under the catch-all "such other
officer charged with the management of the business affairs," they may not be held liable
under BP 33, as amended, for probable violations. Consequently, with the exception of
petitioner Arnel, the charges against other petitioners must perforce be dismissed or dropped.

Del Rosario v. Donato, Jr.

G.R. No. 180595
March 5, 2010
Petitioners Claim: Petitioners Alexander and Arthur del Rosario (the Del Rosarios) filed a
complaint for P50 million in damages against respondents NBI agents Donato and Gonzaga
and two others before the RTC of Angeles City.
Respondents Claim: Respondent Hellenor Donato, Jr., the NBI agent assigned to the case,
applied for a search warrant after doing surveillance work and succeeded in confirming the
storage and sale of such fake cigarettes at the house that belonged to petitioner Alexander del
Rosario. But it took a week later for the RTC to hear the application and issue the search
warrant. Although Donato felt that the delayed hearing compromised the operation, the NBI
agents led by respondent Rafael V. Gonzaga proceeded to implement the warrant. Their
search yielded no fake Marlboro cigarettes.
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Respondents NBI agents answered the complaint with a motion to dismiss on the grounds of:
a) the failure of the complaint to state a cause of action; b) forum shopping; and c) the NBI
agents' immunity from suit, they being sued as such agents.
Issue:

Whether or not the CA correctly ruled that the complaint of the Del Rosarios did
not state a cause of action

Whether or not the CA correctly ruled that the Del Rosarios were guilty of forum
shopping.
Ruling: The Del Rosarios' complaint before the RTC failed to state a cause of action against
respondents NBI agents. Such complaint said that the NBI agents unlawfully procured and
enforced the search warrant issued against the Del Rosarios but it failed to state the ultimate
facts from which they drew such conclusion.
The test of sufficiency of a complaint is whether or not, assuming the truth of the facts that
plaintiff alleges in it, the court can render judgment granting him the judicial assistance he
seeks. 1 And judgment would be right only if the facts he alleges constitute a cause of action
that consists of three elements: (1) the plaintiff's legal right in the matter; (2) the defendant's
corresponding obligation to honor or respect such right; and (3) the defendant's subsequent
violation of the right. Absent any of these, the complaint would have failed to state a cause of
action.
Invoking Section 21 of this Court's A.M. 02-1-06-SC, the Court held that, rather than file a
separate action for damages, the Del Rosarios should have filed their claim for compensation
in the same proceeding and with the same court that issued the writ of search and seizure.
The Del Rosarios were thus guilty of forum shopping.

Asia Brewery, Inc. v. Court of Appeals,

G.R. No. 103543
July 5, 1993
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.
Petitioners Claim:
Respondents Claim: The defendant Asia Brewery Incorporated is GUILTY of infringement of
trademark and unfair competition.
Issue: WON ABI infringes SMC's trademark: San Miguel Pale Pilsen with Rectangular Hops and
Malt Design, and thereby commits unfair competition against the latter
Ruling: The answer is "No." Infringement is determined by the "test of dominancy" rather
than by differences or variations in the details of one trademark and of another. 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.
33

There is hardly any dispute that the dominant feature of SMC's trademark is 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.
On the other hand, the dominant feature of ABI's trademark is 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.

34