37. Emerald Garment Manufacturing Corporation v.

Court of
Appeals
KAPUNAN, J.:

FACTS:
On 18 September 1981, private respondent H.D. Lee Co., Inc. filed with the Bureau of Patents, Trademarks
& Technology Transfer (BPTTT) a Petition for Cancellation of Registration No. SR 5054 for the trademark "STYLISTIC
MR. LEE" used on skirts, jeans, blouses, socks, briefs, jackets, jogging suits, dresses, shorts, shirts and lingerie under
Class 25, issued on 27 October 1980 in the name of petitioner Emerald Garment Manufacturing Corporation.
Private respondent averred that petitioner's trademark "so closely resembled its own trademark, 'LEE' as
previously registered and used in the Philippines cause confusion, mistake and deception on the part of the
purchasing public as to the origin of the goods.
On 19 July 1988, the Director of Patents rendered a decision granting private respondent's petition for
cancellation and opposition to registration. The Director of Patents, using the test of dominancy, declared that
petitioner's trademark was confusingly similar to private respondent's mark because "it is the word 'Lee' which
draws the attention of the buyer and leads him to conclude that the goods originated from the same
manufacturer. It is undeniably the dominant feature of the mark.
Director of Patents: Ruled in favor of private respondents
CA: Affirmed
SC: Reversed

ISSUE:
Whether or not “STYLISTIC MR.LEE” is an infringement of the trademark “LEE”

HELD:
No. The Supreme Court considered that the trademarks involved as a whole and ruled that Emerald
Garment’s “STYLISTIC MR. LEE” is not confusingly similar to H.D. Lee’s “LEE” trademark.
The essential element of infringement is colorable imitation. This term has been defined as "such a close
or ingenious imitation as to be calculated to deceive ordinary purchasers, or such resemblance of the infringing
mark to the original as to deceive an ordinary purchaser giving such attention as a purchaser usually gives, and to
cause him to purchase the one supposing it to be the other.
In determining whether colorable imitation exists, jurisprudence has developed two kinds of tests — the
Dominancy Test applied in Asia Brewery, Inc. v. Court of Appeals and other cases and the Holistic Test developed in
Del Monte Corporation v. Court of Appeals.
The test of dominancy focuses on the similarity of the prevalent features of the competing trademarks
which might cause confusion or deception and thus constitutes infringement. On the other side of the spectrum,
the holistic test mandates that the entirety of the marks in question must be considered in determining confusing
similarity.
The trademark “Stylistic Mr. Lee”, although on its label the word “LEE” is prominent, the trademark
should be considered as a whole and not piecemeal. The dissimilarities between the two marks become
conspicuous, noticeable and substantial enough to matter especially in the light of the following variables that
must be factored in.
First, the products involved in the case at bar are, in the main, various kinds of jeans. These are not your
ordinary household items like catsup, soysauce or soap which are of minimal cost. Maong pants or jeans are not
inexpensive. Accordingly, the casual buyer is predisposed to be more cautious and discriminating in and would
prefer to mull over his purchase. Confusion and deception, then, is less likely.
Second, like his beer, the average Filipino consumer generally buys his jeans by brand. He does not ask the
sales clerk for generic jeans but for, say, a Levis, Guess, Wrangler or even an Armani. He is, therefore, more or less
knowledgeable and familiar with his preference and will not easily be distracted.
Finally, in line with the foregoing discussions, more credit should be given to the “ordinary purchaser.”
Cast in this particular controversy, the ordinary purchaser is not the “completely unwary consumer” but is the
“ordinarily intelligent buyer” considering the type of product involved.
 There is no cause for the Court of Appeal’s apprehension that Emerald Garment’s products might be
mistaken as “another variation or line of garments under H.D. Lee’s ‘LEE’ trademark”. As one would readily
observe, H.D. Lee’s variation follows a standard format “LEERIDERS,” “LEESURES” and “LEELEENS.” It is, therefore,
improbable that the public would immediately and naturally conclude that petitioner’s “STYLISTIC MR. LEE” is but
another variation under H.D. Lee’s “LEE” mark.
The issue of confusing similarity between trademarks is resolved by considering the distinct characteristics
of each case. In the present controversy, taking into account these unique factors, we conclude that the similarities
in the trademarks in question are not sufficient as to likely cause deception and confusion tantamount to
infringement.
"LEE" is primarily a surname. Private respondent cannot, therefore, acquire exclusive ownership over and
singular use of said term.
Further, H.D. Lee failed to prove in court that it had prior actual commercial use of its “LEE” trademark in
the Philippines. H.D. Lee did show certificates of registrations for its brand but registration is not sufficient. Actual
use in commerce in the Philippines is an essential prerequisite for the acquisition of ownership over a trademark
pursuant to Sec. 2 and 2-A of the Philippine Trademark Law (R.A. No. 166).
A rule widely accepted and firmly entrenched because it has come down through the years is that actual
use in commerce or business is a prerequisite in the acquisition of the right of ownership over a trademark.
It would seem quite clear that adoption alone of a trademark would not give exclusive right thereto. Such
right “grows out of their actual use.” Adoption is not use. One may make advertisements, issue circulars, give out
price lists on certain goods; but these alone would not give exclusive right of use. For trademark is a creation of
use. The underlying reason for all these is that purchasers have come to understand the mark as indicating the
origin of the wares. Flowing from this is the trader’s right to protection in the trade he has built up and the
goodwill he has accumulated from use of the trademark. Registration of a trademark, of course, has value: it is an
administrative act declaratory of a pre-existing right. Registration does not, however, perfect a trademark right.
Note: RA No. 166 (trademark law was used in this case some principles are no longer applicable)

38. Sta. Ana v. Maliwat

REYES, J.B.L., J.:

FACTS:
· On 21 June 1962, Florentino Maliwat filed with the Patent Office an application for registration of the
trademark FLORMANN, which is used on shirts, pants, jackets and shoes for ladies, men, and children, claiming
first use in commerce of the said mark on 15 January 1962.

o The claim of first use was subsequently amended to 6 July 1955.

· On 18 September 1962, Jose P. Sta. Ana filed an application for the registration of the tradename FLORMEN
SHOE MANUFACTURERS which is used in the business of manufacturing ladies' and children's shoes. His claim
of first use in commerce of the said tradename is 8 April 1959.

· In view of the admittedly confusing similarity between the trademark FLORMANN and the tradename
FLORMEN, the Director of Patents declared an interference.

· Director: Gave due course to Maliwat's application and denied that of Sta. Ana.

ISSUE:

Whether or not Maliwat was the prior adopter and user of the mark.

RULING: YES
RATIO:
· An application for registration is not bound by the date of first use as stated by him in his application, but is
entitled to carry back said stated date of first use to a prior date by proper evidence; but in order to show an earlier
date of use, he is then under a heavy burden, and his proof must be clear and convincing

· In the case at bar, the proof of date of first use (1953), earlier than that alleged in Maliwat's application (1962),
can be no less than clear and convincing because the fact was stipulated and no proof was needed.

o There was an agreement in the stipulation of facts by the parties that Maliwat has been engaged in the
manufacture and sale of men's wear, shirts, polo shirts, and pants, since 1953, using FLORMANN as its
trademark. That Mr. Florentino Maliwat began using the trademark FLORMANN on shoes on January 1962
and the firm name FLORMANN SHOES under which these shoes with the trademark FLORMANN were
manufactured and sold was first used on January 1962, having also been registered with the Bureau of
Commerce on January 1962

· Maliwat would confine Sta. Ana’s use of the mark FLORMANN to tailoring and haberdashery only, but not on
shoes, on the ground that he had used the name FLORMEN on shoes since 1959, while the Sta. Ana used his mark
on shoes only in 1962.

· Modern law recognizes that the protection to which the owner of a trademark is entitled is not limited to
guarding his goods or business from actual market competition with identical or similar products of the parties, but
extends to all cases in which the use by a junior appropriator of a trademark or tradename is likely to lead to a
confusion of source, as where prospective purchasers would be misled into thinking that the complaining party has
extended his business into the field or is in any way connected with the activities of the infringer; or when it
forestalls the normal potential expansion of his business

o Director of Patents: I believe that it is now the common practice among local tailors and haberdashers to
branch out into articles of manufacture which have, one way or another, some direct relationship with or
appurtenance to garments or attire to complete one's wardrobe such as belts, shoes, handkerchiefs, and the like,
xxx. It goes without saying that shoes on one hand and shirts, pants and jackets on the other, have the same
descriptive properties for purposes of our Trademark Law.

· Mere dissimilarity of goods should not preclude relief where the junior user's goods are not too different or
remote from any that the owner would be likely to make or sell; and in the present case, wearing apparel is not so far
removed from shoes as to preclude relief, any more than the pancake flour is from syrup or sugar cream or baking
powder from baking soda or cosmetics and toilet goods from ladies' wearing apparel and costume jewelry

· Republic Act No. 166, as amended, provides:

SEC. 4. x x x. The owner of a trademark, tradename 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:

(d) Consists of or comprises a mark or tradename which resembles a mark or tradename registered in the Philippines or a mark
or tradename previously used in the Philippines by another and not abandoned, as to be likely, when applied to or used in
connection with the goods, business or services of the applicant, to cause confusion or mistake or to deceive purchasers;

· The provision does not require that the articles of manufacture of the previous user and the late user of the mark
should possess the same descriptive properties or should fall into the same categories as to bar the latter from
registering his mark in the principal register

· Therefore, whether or not shirts and shoes have the same descriptive properties, or whether or not it is the
prevailing practice or the tendency of tailors and haberdashers to expand their business into shoemaking, are not
controlling.
· The meat of the matter is the likelihood of confusion, mistake or deception upon purchasers of the goods of the
junior user of the mark and the goods manufactured by the previous user.

DISPOSITION: Director of Patent’s decision AFFIRMED.

39. Societedes Produits, NESTLE, SA v. Martin Dy

CARPIO, J.:

FACTS: This is a petition for certiorari under Rule 45 of the Rules of Court which challenges the decision and resolution of the Court of
Appeals finding respondent Martin Dy not liable for trademark infringement. The Court of Appeals decision reversed the RTC decision.

1. Petitioner - Societe des Produits Nestle is a foreign corporation under the laws of Switzerland that manufactures food products
and beverages, and owns the trademark NAN for its line of infant powdered milk products classified under Class 6 diatetic
preparations for infant feeding.
2. Respondent - Martin Dy owns 5m Enterprises and is an importer of “Sunny Boy" powdered milk from Australia. He repacks the
powdered milk into three sizes of plastic packs bearing the name NANNY, also classified under Class 6 full cream milk for adults
in all ages, and distributes the products in Dumaguete, Negros Oriental, Cagayan de Oro, and parts of Mindanao.
3. In a letter dated 1 August 1985, Nestle requested Dy, Jr. to refrain from using NANNY and to undertake that he would stop
infringing the NAN trademark. Dy, Jr. did not act on Nestles request.
4. On 1 March 1990, Nestle filed before the RTC Dumaguete City, a complaint against Dy, Jr. for infringement. Dy, Jr. filed a motion
to dismiss - complaint did not state a cause of action. Trial court dismissed the complaint. Nestle appealed to the Court of
Appeals, which set aside the RTC decision and remanded the case to the trial court for further proceedings.
5. Pursuant to Supreme Court Administrative Order No. 113-95, Nestle filed with the trial court a motion to transfer the case to the
RTC, Judicial Region 7, Branch 9, Cebu City, which was designated as a special court for intellectual property rights.
6. In its 18 September 1998 Decision, the Cebu city trial court found Dy, Jr. liable for infringement.
7. RTC Cebu - Using Test of Dominancy, infringement cannot be proven. There is absence of any deceptive trendency between the
Trademarks.. BUT applying the Concept of Related Goods, as held by the Supreme Court: “implicit in this definition is the concept
that the goods must be so related that there is likelihood either of confusion of goods or business. x x x But as to whether
trademark infringement exists depends for the most part upon whether or not the goods are so related that the public may be, or is
actually, deceived and misled that they came from the same maker or manufacturer. For non-competing goods may be those
which, though they are not in actual competition, are so related to each other that it might reasonably be assumed that they
originate from one manufacturer. Non-competing goods may also be those which, being entirely unrelated, could not reasonably
be assumed to have a common source. In the former case of related goods, confusion of business could arise out of the use of
similar marks; in the latter case of non-related goods, it could not..” Defendants NANNY belongs to the same class as that of
plaintiffs NAN because both are food products, the defendants unregistered trade mark NANNY should be held an infringement to
plaintiffs registered trademark NAN because defendants use of NANNY would imply that it came from the manufacturer of NAN.
Furthermore, since the word nanny means a childs nurse, there might result the not so remote probability that defendants NANNY
may be confused with infant formula NAN despite the aparent disparity between the features of the two products.
8. On appeal, CA reversed RTC decision, found Dy not liable for trademark infringement. Nestle filed motion for reconsideration. CA
dismissed for lack of merit.
9. CA - While it is true that both NAN and NANNY are milk products and that the word NAN is contained in the word NANNY, there
are more glaring dissimilarities in the entirety of their trademarks as they appear in their respective labels and also in relation to
the goods to which they are attached. The discerning eye of the observer must focus not only on the predominant words but also
on the other features appearing in both labels in order that he may draw his conclusion whether one is confusingly similar to the
other. Even the trial court found these glaring dissimilarities as above-quoted. We need not add more of these factual
dissimilarities. NAN products, which consist of Pre-NAN, NAN-H-A, NAN-1 and NAN-2, are all infant preparations, while NANNY is
a full cream milk for adults in [sic] all ages. NAN milk products are sold in tin cans and hence, far expensive than the full cream
milk NANNY sold in three (3) plastic packs containing 80, 180 and 450 grams and worth P8.90, P17.50 and P39.90 per milk pack.
The labels of NAN products are of the colors blue and white and have at the bottom portion an elliptical shaped figure containing
inside it a drawing of nestling birds, which is overlapped by the trade-name Nestle. On the other hand, the plastic packs NANNY
have a drawing of milking cows lazing on a vast green field, back-dropped with snow-capped mountains and using the
predominant colors of blue and green. The word NAN are all in large, formal and conservative-like block letters, while the word
NANNY are all in small and irregular style of letters with curved ends. With these material differences apparent in the packaging of
both milk products, NANNY full cream milk cannot possibly be an infringement of NAN infant milk. Moreover, NAN infant milk
preparation is more expensive than NANNY instant full cream milk. The cheaper price of NANNY would give, at the very first
instance, a considerable warning to the ordinary purchaser on whether he is buying an infant milk or a full cream milk for adults. A
cursory examination of the packaging would confirm the striking differences between the products in question.
10. Hence this petition.
11. SC set aside CA decision and reinstate RTC Cebu decision.

ISSUE

WON Martin Dy is liable for trademark infringement

HELD

Yes, Martin Dy is liable for Trademark infringement.

Section 22 of Republic Act (R.A.) No. 166, as amended, states:
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.

Section 22 of R.A. No. 166, as well as Section 2, 2-A, 9-A and 20 thereof, the following constitute the elements of trademark infringement:
(a) A trademark actually used in commerce in the Philippines and registered in the principal register of the Philippine Patent
Office;
(b) It is used by another person in connection with the sale, offering for sale, or advertising of any goods, business or services or
in connection with which such use is likely to cause confusion or mistake or to deceive purchasers or others as to the source or origin of such
goods or services, or identity of such business; or such trademark is reproduced, counterfeited, copied or colorably imitated by another
person and such reproduction, counterfeit, copy or colorable imitation is applied to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used upon or in connection with such goods, business or services as to likely cause confusion or mistake or to
deceive purchasers;
(c) The trademark is used for identical or similar goods; and
(d) Such act is done without the consent of the trademark registrant or assignee.

On the other hand, elements of infringement under RA 9283 are as follows:

(a) The trademark being infringed is registered in the Intellectual Property Office; however, in infringement of trade name, the
same need not be registered;
(b) The trademark or trade name is reproduced, counterfeited, copied, or colorably imitated by the infringer;
(c) The infringing mark or trade name is used in connection with the sale, offering for sale, or advertising of any goods, business
or services; or the infringing mark or trade name is applied to labels, signs, prints, packages, wrappers, receptacles or advertisements
intended to be used upon or in connection with such goods, business or services;
(d) The use or application of the infringing mark or trade name is likely to cause confusion or mistake or to deceive purchasers or
others as to the goods or services themselves or as to the source or origin of such goods or services or the idenity of such business; and
(e) It is without the consent of the trademark or trade name owner or the assignee thereof.

Among the elements, the element of likelihood of confusion is the gravamen of trademark infringement. There are two types of confusion in
trademark infringement as distinguished by the Supreme Court in Sterling Products International, Inc. v. Farbenfabriken Bayer
Aktiengesellschaft:
1. The confusion of goods - in which event the ordinarily prudent purchaser would be induced to purchase one product in the belief
that he was purchasing the other. In which case, defendants goods are then bought as the plaintiffs, and the poorer quality of the
former reflects adversely on the plaintiffs reputation.
2. The confusion of business - Here though the goods of the parties are different, the defendants product is such as might
reasonably be assumed to originate with the plaintiff, and the public would then be deceived either into that belief or into the belief
that there is some connection between the plaintiff and defendant which, in fact, does not exist.

Two tests to determine likelihood of confusion:

(1) the dominancy test - focuses on the similarity of the main, prevalent or essential features of the competing trademarks that might cause
confusion. Infringement takes place when the competing trademark contains the essential features of another. Imitation or an effort to imitate
is unnecessary. The question is whether the use of the marks is likely to cause confusion or deceive purchasers.
(2) The holistic test - considers the entirety of the marks, including labels and packaging, in determining confusing similarity. The focus is not
only on the predominant words but also on the other features appearing on the labels.

In cases involving trademark infringement, no set of rules can be deduced. Each case must be decided on its own merits. Jurisprudential
precedents must be studied in the light of the facts of each particular case. In the light of the facts of the present case, the Court holds that
the dominancy test is applicable. In determining the issue of confusing similarity, the Court takes into account the aural effect of the letters
contained in the marks.

Applying the dominancy test in the present case, the Court finds that NANNY is confusingly similar to NAN. NAN is the prevalent feature of
Nestles line of infant powdered milk products. It is written in bold letters and used in all products. The line consists of PRE-NAN, NAN-H.A.,
NAN-1, and NAN-2. Clearly, NANNY contains the prevalent feature NAN. The first three letters of NANNY are exactly the same as the letters
of NAN. When NAN and NANNY are pronounced, the aural effect is confusingly similar.

The scope of protection afforded to registered trademark owners is not limited to protection from infringers with identical goods. The scope of
protection extends to protection from infringers with related goods, and to market areas that are the normal expansion of business of the
registered trademark owners.

Section 138 of R.A. No. 8293 states: Certificates of Registration. A certificate of registration of a mark shall be prima facie evidence of validity
of the registration, the registrants ownership of the mark, and of the registrants exclusive right to use the same in connection with the goods
or services and those that are related thereto specified in the certificate. (Emphasis supplied)
NANNY and NAN have the same classification, descriptive properties and physical attributes. Both are classified under Class 6, both are milk
products, and both are in powder form. Also, NANNY and NAN are displayed in the same section of stores the milk section.

The Court agrees with the lower courts that there are differences between NAN and NANNY: (1) NAN is intended for infants while NANNY is
intended for children past their infancy and for adults; and (2) NAN is more expensive than NANNY. However, as the registered owner of the
NAN mark, Nestle should be free to use its mark on similar products, in different segments of the market, and at different price levels. In
McDonalds Corporation v. L.C. Big Mak Burger, Inc., the Court held that the scope of protection afforded to registered trademark owners
extends to market areas that are the normal expansion of business:
The registered trademark owner may use his mark on the same or similar products, in different segments of the market,
and at different price levels depending on variations of the products for specific segments of the market. The Court has recognized
that the registered trademark owner enjoys protection in product and market areas that are the normal potential expansion of his
business. Thus, the Court has declared:
Modern law recognizes that the protection to which the owner of a trademark is entitled is not limited to guarding his
goods or business from actual market competition with identical or similar products of the parties, but extends to all cases in
which the use by a junior appropriator of a trade-mark or trade-name is likely to lead to a confusion of source, as where
prospective purchasers would be misled into thinking that the complaining party has extended his business into the field (see 148
ALR 56 et sq; 53 Am. Jur. 576) or is in any way connected with the activities of the infringer; or when it forestalls the normal
potential expansion of his business (v. 148 ALR, 77, 84; 52 Am. Jur. 576, 577). (Emphasis supplied)

40. Faberge, Inc. v. IAC

MELO, J.

FACTS: Private respondent Co Beng Kay (CBK) filed with the Director of Patents an application to register the
trademark “BRUTE” for the briefs manufactured and sold by his Corporation in the domestic market.

Petitioner Faberge opposed this application on the ground of the similarity of the said trademark with Faberge’s
own symbol “BRUT,” which it previously registered for after shave lotion, shaving cream, deodorant, talcum
powder, and toilet soap, likewise sold in the domestic market.

The Director of Patents granted CBK’s application.

The CA initially reversed this decision, holding that the marks “BRUT” and “BRUTE” were indeed quite similar, and
that even if the products sold under these marks are different, it is still reasonable to believe that the similarity
would cause confusion and even mistake and deception in the buying public as to the origin of the goods bearing
such trademarks, especially since modern department stores usually place CBK’s products (briefs) and Faberge’s
products (after shave lotion, etc.) in one section denominated as “Men’s Accessories.” In effect, this would
supposedly allow CBK to unjustly benefit from the goodwill and reputation that Faberge has already established
for its “BRUT” products.

Upon CBK’s MR however, the CA reversed its earlier ruling, holding that the controlling ruling is to the effect that
the identical trademark can be used by different manufacturers for products that are non-competing and
unrelated.

Thus, Faberge is now before the SC to contest the above ruling, insisting that there can be unfair competition even
if the goods are noncompeting, especially in view of the alleged repeal of RA 166 by RA 666, which deleted the
phrase in the former law that the merchandise must be substantially of the same descriptive properties. It also
adds that it has a pending application of the trademark “BRUT 33 DEVICE” for briefs as proof that it intended to
expand its mark "BRUT" to other goods and thus, following the sentiment expressed by Justice JBL Reyes in Sta.
Ana v. Maliwat, it is entitled to relief that is available where the junior user's goods are not remote from any
product that the senior user would be likely to make or sell.

ISSUE: Whether or not an earlier registration of a trademark can prevent a later registration of a similarly-sounding
trademark, even if the products falling under the two are unrelated and non-competing.

RULING: No. Petition denied. Decision of the CA is affirmed.

RATIO: A review of the relevant provision of the Civil Code and RA 166, as amended would yield the conclusion
that CBK may be permitted to register the trademark “BRUTE” for briefs produced by it notwithstanding Faberge’s
vehement protestations of unfair dealings in marketing its own set of items which are limited to: after-shave
lotion, shaving cream, deodorant, talcum powder and toilet soap.

In as much as Faberge has not ventured in the production of briefs, an item which is not listed in its certificate of
registration, it cannot and should not be allowed to feign that CBK had invaded its exclusive domain. Even its
alleged application for registration of “BRUT” to other products such as briefs was not annexed to its brief, and in
any case, such application does not suffice and may not vest an exclusive right in its favor that can ordinarily be
protected by the Trademark Law.

The certificate of registration issued by the Director of Patents can confer upon Faberge the exclusive right to use
its own symbol only to those goods specified in the certificate, subject to any conditions and limitations stated
therein.

WRT argument raised by Faberge as regards its alleged business expansion, which invokes the wisdom imparted by
Justice JBL Reyes in Sta. Ana vs. Maliwat to the effect that dissimilarity of goods will not preclude relief if the junior
user's goods are not remote from any other product which the first user would be likely to make or sell, it is
indeed true that Sec. 4(d) of RA 166, as amended does not require that the articles of manufacture of the
previous user and late user of the mark should possess the same descriptive properties or should fall into the
same categories as to bar the latter from registering his mark in the principal register.

Yet, it is equally true that under Sec. 20 of the same law, the protective mantle of the Trademark Law extends
only to the goods used by the first user as specified in the certificate of registration.

How should this apparent conflict between Sec. 4(d) and Sec. 20 be reconciled? The rule has been laid down that
the clause which comes later shall be given paramount significance over an anterior proviso upon the
presumption that it expresses the latest and dominant purpose. It ineluctably follows that Sec. 20 is controlling
and, therefore, CBK can appropriate its symbol for the briefs it manufactures because as aptly remarked by Justice
Sanchez in Sterling Products v. Farbenfabriken:
“Really, if the certificate of registration were to be deemed as including goods not specified therein, then a situation
may arise whereby an applicant may be tempted to register a trademark on any and all goods which his mind may
conceive even if he had never intended to use the trademark for the said goods. We believe that such omnibus
registration is not contemplated by our Trademark Law.”

Whatever deleterious effects may arise from the above interpretation of Sec. 20 in relation to Sec. 4(d) of RA 166 is
not entirely irreversible; however the remedy is legislative and not judicial.

Neither can CBK be deemed to have committed infringement, which is defined as the use without consent of the
trademark owner of 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.

The glaring discrepancies between the products of CBK, on the one hand, and of Faberge, on the other, had been
amply portrayed to such an extent that indeed, a purchaser who is out in the market for the purpose of buying
CBK’s BRUTE brief would definitely be not mistaken or misled into buying Faberge’s BRUT after shave lotion or
deodorant.
 41. Sehwani, Inc. v. In-N-Out Burger

42. Prosource International v. Horphag Research Management, SA

FACTS:

Respondent HORPHAG RESEARCH MANAGEMENT SA is a corporation from Switzerland and owner of the
trademark PYCNOGENOL. Respondent later discovered that petitioner PROSOURCE INTERNATIONAL, INC. was also
distributing a similar food supplement using the mark PCO-GENOLS since 1996. Respondent subsequently
demanded that petitioner desist from using said mark.

Without notifying respondent, petitioner withdrew its PCO-GENOLS products and changed the mark to PCO-PLUS.
On Aug. 22, 2000, respondent filed a complaint for Infringement of Trademark against petitioner with RTC.
Petitioner argued that they are not liable because respondent is not the owner of said trademark but one
HORPHAG RESEARCH LIMITED. They also claimed that their mark is not confusingly similar and that they have since
discontinued the usage thereof (this was not tenable as they did Infringed said trademark from 1996 till they
withdrew the same)

RTC decided in favor of respondents. It observed that PYCNOGENOL and PCO-GENOLS have the same suffix GENOL
which appears to be merely descriptive and thus open for trademark registration by combining it with other
words. The trial court, likewise, concluded that the marks, when read, sound similar, and thus confusingly similar
especially since they both refer to food supplements.

On appeal to the CA, petitioner failed to obtain a favorable decision. The appellate court explained that under the
Dominancy or the Holistic Test, PCO-GENOLS is deceptively similar to PYCNOGENOL.

ISSUE: Whether or not petitioner PROSOURCE INTERNATIONAL , INC. is liable for trademark infringement.

HELD: Yes, PROSOURCE INTERNATIONAL , INC. is liable for trademark infringement.

RATIO:

Any person who shall use, without the consent of registrant, any reproduction, counterfeit, copy or colorable
imitation of any registered mark or tradename with which the use thereof will likely cause confusion is liable for
trademark infringement. it is the element of likelihood of confusion that is the gravamen of trademark
infringement. Jurisprudence has developed 2 test to measure as such; the Dominancy Test and the Holistic Test.
The Dominancy test focuses on the similarity of the prevalent features of the trademarks.

The Dominancy Test was used by the lower courts in this case. That the two marks are similar and causes
confusion because the pronunciation of both are awfully the same. To be sure, there are differences between the
marks but the close relationship of the competing product names as to their pronunciation would clearly misled
buyers believing that they are the same and/or originates from a common source and manufacturer.

43. Levi Strauss & Co. v. Clinton Apparelle, GR No. 138900 September 20, 2005

FACTS:

The Complaint alleged that LS & Co., a foreign corporation duly organized and existing under the
laws of the State of Delaware, USA and engaged in the apparel business, is the owner by prior adoption
and use since 1986 of the internationally famous “Dockers and Design” trademark. This ownership is
evidenced by its valid and existing registrations in various member countries if Paris Convention.

In the Philippines, it has a Certificate of Registration No. 46619 in the Principal Register for use
of said trademark on pants, shirts, blouses, skirts, shorts, sweatshirts and jackets under Class 25. The
“Dockers and Design” trademark was first used in the Philippines in or about May 1988, by LSPI, a
domestic corporation engaged in the manufacture, sale and distribution of various products bearing
trademarks owned by LS & Co. To date, LSPI continues to manufacture and sell Dockers Pants with the
“Dockers and Design” Trademark. LS & Co and LSPI alleged that they discovered the presence in the
local market of jeans under the brand name “Paddocks” using a device which is substantially, if not
exactly, similar to the “Dockers and Design” trademark owned and registered in their name, without
their consent. Based on their belied, they added Clinton Apparelle manufactured and continues to
manufacture such “Paddocks” jeans and other apparel. However, since LS & Co. and LSPI are unsure if
both or just one of impleaded defendants is behind the manufacture and sale of the “Paddocks” jeans
complained of, they brought this suit under Sec. 13 Rule 3 of the 1997 Rules of Court.

The evidence considered by the trial court in granting injunctive relief were as follows: (1) a
certified true copy of the certificate of trademark registration for “Dockers and Design” (2) a pair of
DOCKERS pants bearing the trademark (3) a pair of “Paddocks” pants bearing the respondents assailed
logo; (4) the trends MBL Survey Report purportedly proving that there was confusing similarity between
two marks; (5) the affidavit of one Bernabe Alajar which recounted petitioners’ prior adoption, use and
registration of the “Dockers and Design” Trademark and (6) the affidavit of Mercedes Abad of Trends
MBL Inc which detailed the methodology and procedure used in their survey and results thereof.

The trial court issued a writ of preliminary injunction, which prompted Clinton Apparelle to file a
petition for certiorari, prohibition and mandamus with the Court of Appeals. Whereby the Appellate
Court granted the petition of Clinton Apparelle’s petition; holding that the trial court did not follow the
procedure required by law. Thus, holding the issuance of the writ of preliminary injunction is
questionable after petitioner’s failure to sufficiently establish its material and substantial right to have
the writ issued. Moreover, the Court of Appeals strongly believes that the implementation of the
questions writ would effectively shut down respondent’s shut down. Hence this petition.

ISSUE:

WoN the single registration of the trademark “Dockers and Design” confers on the owner the
right to prevent the use of a fraction thereof.

HELD:

Given the single registration of the trademark “Dockers and Design” and considering that
respondent only uses the assailed device but a different word mark, the right to prevent the latter from
using the challenged “Paddocks” device is far from clear. Stated otherwise, it is not evident whether the
single registration of the trademark “Dockers and Design” confers on the owner the right to prevent the
use of a fraction thereof in the course of trade. It is also unclear whether the use without the owner’s
consent of a portion of a trademark registered in its entirety constitutes material or substantial invasion
of the owner’s right.
 It is likewise not settled whether the wing-shaped logo, as opposed to the word mark, is the
dominant or central feature of petitioners’ trademark—the feature that prevails or is retained in the
minds of the public—an imitation of which creates the likelihood of deceiving the public and constitutes
trademark infringement. In sum, there are vital matters which have yet and may only be established
through a full-blown trial.

From the above discussion, we find that petitioners’ right to injunctive relief has not been clearly
and unmistakably demonstrated. The right has yet to be determined. Petitioners also failed to show
proof that there is material and substantial invasion of their right to warrant the issuance of an
injunctive writ. Neither were petitioners able to show any urgent and permanent necessity for the writ
to prevent serious damage.

Petitioners wish to impress upon the Court the urgent necessity for injunctive relief, urging that the
erosion or dilution of their trademark is protectable. They assert that a trademark owner does not have
to wait until the mark loses its distinctiveness to obtain injunctive relief, and that the mere use by an
infringer of a registered mark is already actionable even if he has not yet profited thereby or has
damaged the trademark owner.

Trademark dilution is the lessening of the capacity of a famous mark to identify and
distinguish goods or services, regardless of the presence or absence of: (1) competition between the
owner of the famous mark and other parties; or (2) likelihood of confusion, mistake or deception.
Subject to the principles of equity, the owner of a famous mark is entitled to an injunction “against
another person’s commercial use in commerce of a mark or trade name, if such use begins after the
mark has become famous and causes dilution of the distinctive quality of the mark.” This is intended to
protect famous marks from subsequent uses that blur distinctiveness of the mark or tarnish or disparage
it.

Based on the foregoing, to be eligible for protection from dilution, there has to be a finding that:
(1) the trademark sought to be protected is famous and distinctive; (2) the use by respondent of
“Paddocks and Design” began after the petitioners’ mark became famous; and (3) such subsequent
use defames petitioners’ mark. In the case at bar, petitioners have yet to establish whether “Dockers
and Design” has acquired a strong degree of distinctiveness and whether the other two elements are
present for their cause to fall within the ambit of the invoked protection. The Trends MBL Survey Report
which petitioners presented in a bid to establish that there was confusing similarity between two marks
is not sufficient proof of any dilution that the trial court must enjoin.

After a careful consideration of the facts and arguments of the parties, the Court finds that
petitioners did not adequately prove their entitlement to the injunctive writ. In the absence of proof of a
legal right and the injury sustained by the applicant, an order of the trial court granting the issuance of
an injunctive writ will be set aside for having been issued with grave abuse of discretion. Conformably,
the Court of Appeals was correct in setting aside the assailed orders of the trial court.

44. Republic Gas Corporation, et al. v. Petron Corporation, et al.

 45. Aguas v. de Leon

46. Maguan v. CA

47. Godines v. CA

48. Schuartz v. CA

49. Creser Precision System v. CA

CRESER PRECISION SYSTEMS, INC., petitioner,
vs.
COURT OF APPEALS AND FLORO INTERNATIONAL CORP., respondents.
MARTINEZ, J.:

FACTS:

Ø Private respondent is a domestic corporation engaged in the manufacture,

production, distribution and sale of military armaments, munitions, airmunitions
and other similar materials.[2]
Ø On January 23, 1990, private respondent was granted by the Bureau of Patents,
Trademarks and Technology Transfer (BPTTT), a Letters Patent No. UM-6938[3]
covering an aerial fuze which was published in the September-October 1990,
Ø Sometime in November 1993, private respondent, through its president, Mr.
Gregory Floro, Jr., discovered that petitioner submitted samples of its patented
aerial fuze to the AFP for testing.
Ø He learned that petitioner was claiming the aforesaid aerial fuze as its own and
planning to bid and manufacture the same commercially without license or
authority from private respondent.
Ø To protect its right, private respondent sent a letter[5] to petitioner advising it
from its existing patent and its rights thereunder, warning petitioner of a
possible court action and/or application for injunction, should it proceed with the
scheduled testing by the military on December 7, 1993.
Ø In response, petitioner filed a complaint[6] for injunction and damages arising from
the alleged infringement before the Regional Trial Court of Quezon City, Branch
88.
Ø The complaint alleged, among others:
1. That petitioner is the first, true and actual inventor of an aerial fuze denominated as
Fuze, PDR 77 CB4 which is developed as early as December 1981 under the Self-
Reliance Defense Posture Program (SRDP) of the AFP;
2. That sometime in 1986, petitioner began supplying the AFP with the said aerial
fuze;
 3. That private respondents aerial fuze is identical in every respect to the petitioners
fuze; and
4. That the only difference between the two fuzes are miniscule and merely cosmetic in
nature.
Ø Petitioner prayed that a temporary restraining order and/or writ of preliminary
injunction and the trial court issued a temporary restraining order.

Ø Private respondent submitted its memorandum[7] alleging:

Ø 1. That petitioner has no cause of action to file a complaint of infringement against it
since it has no patent for the aerial fuze which it claims to have invented;
Ø 2. That petitioners available remedy is to file a petition for cancellation of patent
before the Bureau of Patents;
Ø 3. That private respondent as the patent holder cannot be stripped of its property
right over the patented aerial fuze consisting of the exclusive right to manufacture,
use and sell the same and that it stands to suffer irreparable damage and injury if it
is enjoined from the exercise of its property right over its patent.

Ø On December 29, 1993, the trial court issued an Order[8] granting the issuance of a
writ of preliminary injunction against private respondent.
Ø Private respondent moved for reconsideration but this was denied by the trial court,
pertinent portions of which reads:
Ø The plaintiff has amply proven its entitlement to the relief prayed for. It is undisputed
that the plaintiff has developed its aerial fuze way back in 1981 while the defendant
began manufacturing the same only in 1987. Thus, it is only logical to conclude that
it was the plaintiff’s aerial fuze that was copied or imitated.
Ø With regards to the defendants assertion that an action for infringement may only be
brought by anyone possessing right, title or interest to the patented invention,
(Section 42, RA 165) qualified by Section 10, RA 165 to include only the first true
and actual inventor, his heirs, legal representatives to assignees, this court finds the
foregoing to be untenable.
Ø That Sec. 10 merely enumerates the persons who may have an invention patented
which does not necessarily limit to these persons the right to institute an action for
infringement. Defendant’s claim is primarily hinged on its patent (Letters Patent No.
UM-6983) the validity of which is being questioned in this case.

Ø Aggrieved, private respondent, filed a petition for certiorari, mandamus and

prohibition[10]before respondent Court of Appeals
Ø CA reversed the trial court’s decision and dismissing the complaint filed by petitioner.

ISSUE: WHO HAS A BETTER RIGHT ON THE SUBJECT AERIAL FUZE.

SC
Ø SECTION. 42. Civil action for infringement. Any patentee, or anyone possessing any
right, title or interest in and to the patented invention, whose rights have been
 infringed, may bring a civil action before the proper Court of First Instance (now
Regional Trial court), to recover from the infringer damages sustained by reason of
the infringement and to secure an injunction for the protection of his right. x x x
Ø Under the aforequoted law, only the patentee or his successors-in-interest may file an
action for infringement. The phrase anyone possessing any right, title or interest in
and to the patented invention upon which petitioner maintains its present suit, refers
only to the patentees successors-in-interest, assignees or grantees since actions for
infringement of patent may be brought in the name of the person or persons
interested, whether as patentee, assignees or grantees, of the exclusive right.[12]
Ø Moreover, there can be no infringement of a patent until a patent has been issued,
since whatever right one has to the invention covered by the patent arises alone
from the grant of patent.[13]
Ø In short, a person or entity who has not been granted letters patent over an invention
and has not acquired any right or title thereto either as assignee or as licensee, has
no cause of action for infringement because the right to maintain an infringement
suit depends on the existence of the patent.[14]
Ø Petitioner admits it has no patent over its aerial fuze. Therefore, it has no legal basis
or cause of action to institute the petition for injunction and damages arising from
the alleged infringement by private respondent. While petitioner claims to be the first
inventor of the aerial fuze, still it has no right of property over the same upon which
it can maintain a suit unless it obtains a patent therefor.
Ø Further, the remedy of declaratory judgment or injunctive suit on patent invalidity
relied upon by petitioner cannot be likened to the civil action for infringement under
Section 42 of the Patent Law. The reason for this is that the said remedy is available
only to the patent holder or his successors-in-interest.
Ø Said person, however, is not left without any remedy. He can, under Section 28 of the
aforementioned law, file a petition for cancellation of the patent within three (3)
years from the publication of said patent with the Director of Patents and raise as
ground therefor that the person to whom the patent was issued is not the true and
actual inventor.
Ø Thus, as correctly ruled by the respondent Court of Appeals in its assailed decision:
since the petitioner (private respondent herein) is the patentee of the disputed
invention embraced by letters of patent UM No. 6938 issued to it on January 23,
1990 by the Bureau of Patents, it has in its favor not only the presumption of validity
of its patent, but that of a legal and factual first and true inventor of the invention.
WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED.

50. G. Sell v. Yap

51. Smith Kline v. CA

52. Philippine Pharmawealth, Inc. v. Pfizer Inc

 53. Roma Drug and Rome Rodriguez v. Regional Trial Court

FACTS: Petitioner Roma Drug was among the 6 local drugstores in Pampanga raided by the joint NBI and BFAD
inspectors where various medicines were found and seized on the strength of a search warrant issued by the RTC
of Pampanga and upon the request of Glaxo Smithkline, a registered corporation and the authorized Philippine
distributor of the medicines seized from said drugstores. The NBI proceeded in filing a complaint against petitioner
for violation of Section 4 (in relation to Sections 3 and 5) of Republic Act No. 8203, also known as the Special Law
on Counterfeit Drugs (SLCD), with the Office of the Provincial Prosecutor in San Fernando, Pampanga. The law
prohibits the sale of counterfeit drugs, which include an "unregistered imported drug product". The term
"unregistered" signifies lack of registration with the Bureau of Patent, Trademark and Technology Transfer of a
trademark of a drug in the name of a natural or juridical person. The seized drugs are identical in content with their
Philippine-registered counterparts. No claim was made that the drugs were adulterated in any way or mislabeled
at the least. Their classification as "counterfeit" is based solely on the fact that they were imported from abroad
and not purchased from Philippine-registered owner of the patent or trademark of the drugs.

Petitioner Roma Drug challenged the constitutionality of the SLCD during the preliminary investigation but the
provincial prosecutors issued a resolution recommending that Rodriguez, the owner of Roma Drug, be charged
with violation of Section 4 of the SLCD.

Roma Drug filed a Petition for Prohibition before the Supreme Court requesting the RTC-Guagua Pampanga and
the Provincial Prosecutor to desist from further prosecuting Rodriguez, and that Sections 3(b)(3), 4 and 5 of the
SLCD be declared unconstitutional.

The Court issued a temporary restraining order enjoining the RTC from proceeding with the trial against Rodriguez,
and the BFAD, the NBI and Glaxo Smithkline from prosecuting the petitioners.

Glaxo Smithkline and the Office of the Solicitor General (OSG) have opposed the petition. On the constitutional
issue, Glaxo Smithkline asserts the rule that the SLCD is presumed constitutional. The OSG invokes the
presumption of constitutionality of statutes and asserts that there is no clear and unequivocal breach of the
Constitution presented by the SLCD.

ISSUE: WON RA 9502 impliedly abrogates the provisions of RA 8203 (SLCD) with which the petitioner is criminally
charged? Yes

HELD: (petition granted, writ of prohibition issued, TRO made permanent)

It may be that Rep. Act No. 9502 (Universally Accessible Cheaper and Quality Medicines Act of 2008) did not
expressly repeal any provision of the SLCD. However, it is clear that the SLCD's classification of "unregistered
imported drugs" as "counterfeit drugs," and of corresponding criminal penalties therefore are irreconcilably in the
imposition conflict with Rep. Act No. 9502 since the latter indubitably grants private third persons the unqualified
right to import or otherwise use such drugs. Where a statute of later date, such as Rep. Act No. 9502, clearly
reveals an intention on the part of the legislature to abrogate a prior act on the subject that intention must be
given effect. When a subsequent enactment covering a field of operation co-terminus with a prior statute cannot
by any reasonable construction be given effect while the prior law remains in operative existence because of
irreconcilable conflict between the two acts, the latest legislative expression prevails and the prior law yields to the
extent of the conflict. Irreconcilable inconsistency between two laws embracing the same subject may exist when
the later law nullifies the reason or purpose of the earlier act, so that the latter loses all meaning and function.
Legis posteriors priores contrarias abrogant.

54. Graham, et al. v, Joh Deere co.