Ipr-cases.docx

Diaz vs People of the Philippines G.R. No. 180677 February 18, 2013 Facts: Levi Strauss Philippines, Inc. (Levi’s Philippines) is a licensee of Levi’s. After receiving information that Diaz was selling counterfeit LEVI’S 501 jeans in his tailoring shops in Almanza and Talon, Las Piñas City, Levi’s Philippines hired a private investigation group to verify the information. Surveillance and the purchase of jeans from the tailoring shops of Diaz established that the jeans bought from the tailoring shops of Diaz were counterfeit or imitations of LEVI’S 501. Levi’s Philippines then sought the assistance of the National Bureau of Investigation (NBI) for purposes of applying for a search warrant against Diaz to be served at his tailoring shops. The search warrants were issued in due course. Armed with the search warrants, NBI agents searched the tailoring shops of Diaz and seized several fake LEVI’S 501 jeans from them. Levi’s Philippines claimed that it did not authorize the making and selling of the seized jeans; that each of the jeans were mere imitations of genuine LEVI’S 501 jeans by each of them bearing the registered trademarks, like the arcuate design, the tab, and the leather patch; and that the seized jeans could be mistaken for original LEVI’S 501 jeans due to the placement of the arcuate, tab, and two-horse leather patch. Diaz stated that he did not manufacture Levi’s jeans, and that he used the label “LS Jeans Tailoring” in the jeans that he made and sold; that the label “LS Jeans Tailoring” was registered with the Intellectual Property Office; that his shops received clothes for sewing or repair; that his shops offered made-to-order jeans, whose styles or designs were done in accordance with instructions of the customers; that since the time his shops began operating in 1992, he had received no notice or warning regarding his operations; that the jeans he produced were easily recognizable because the label “LS Jeans Tailoring,” and the names of the customers were placed inside the pockets, and each of the jeans had an “LSJT” red tab; that “LS” stood for “Latest Style;” and that the leather patch on his jeans had two buffaloes, not two horses. Issue: Whether or not Diaz is liable for trademark infringement.

155.1 or this subsection are committed regardless of whether there is actual sale of goods or services using the infringing material. The elements of the offense of trademark infringement under the Intellectual Property Code are, therefore, the following:  The trademark being infringed is registered in the Intellectual Property Office;  The trademark is reproduced, counterfeited, copied, or colorably imitated by the infringer;  The infringing mark is used in connection with the sale, offering for sale, or advertising of any goods, business or services; or the infringing mark 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;  The use or application of the infringing mark is likely to cause confusion or mistake or to deceive purchasers or others as to the goods or services themselves or as to the source or origin of such goods or services or the identity of such business; and  The use or application of the infringing mark is without the consent of the trademark owner or the assignee thereof. As can be seen, the likelihood of confusion is the gravamen of the offense of trademark infringement. There are two tests to determine likelihood of confusion, namely: the dominancy test, and the holistic test. The contrasting concept of these tests was explained in Societes Des Produits Nestle, S.A. v. Dy, Jr., thus: x x x. 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. 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.

Held: No. Section 155 of R.A. No. 8293 defines the acts that constitute infringement of trademark, viz: Remedies; Infringement. — Any person who shall, without the consent of the owner of the registered mark: 155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the same container or a dominant feature thereof in connection with the sale, offering for sale, distribution, advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or 155.2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant feature thereof and apply such reproduction, counterfeit, copy or colorable imitation to labels, signs, prints, packages, wrappers, receptacles or advertisements intended to be used in commerce upon or in connection with the sale, offering for sale, distribution, or advertising of goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive, shall be liable in a civil action for infringement by the registrant for the remedies hereinafter set forth: Provided, That the infringement takes place at the moment any of the acts stated in Subsection

The holistic test is applicable here considering that the herein criminal cases also involved trademark infringement in relation to jeans products. Accordingly, the jeans trademarks of Levi’s Philippines and Diaz must be considered as a whole in determining the likelihood of confusion between them. The maong pants or jeans made and sold by Levi’s Philippines, which included LEVI’S 501, were very popular in the Philippines. The consuming public knew that the original LEVI’S 501 jeans were under a foreign brand and quite expensive. Such jeans could be purchased only in malls or boutiques as ready-to-wear items, and were not available in tailoring shops like those of Diaz’s as well as not acquired on a “made-to-order” basis. Under the circumstances, the consuming public could easily discern if the jeans were original or fake LEVI’S 501, or were manufactured by other brands of jeans. Given the foregoing, it should be plain that there was no likelihood of confusion between the trademarks involved. Thereby, the evidence of guilt did not satisfy the quantum of proof required for a criminal conviction, which is proof beyond reasonable doubt. According to Section 2, Rule 133 of the Rules of Court, proof beyond a reasonable doubt does not mean such a degree of proof as, excluding possibility of error, produces absolute certainty. Moral certainty only is required, or that degree of proof which produces conviction in an unprejudiced mind. Consequently, Diaz should be acquitted of the charges.

ABS-CBN Corp., petitioner vs. GMA Pres. and CEO Atty. Felipe Gozon, GMA Vice President and COO Gilberto Duavit Jr., Marissa L. Flores, Jessica A. Soho, GMA Head of News Operations Grace Dela PeñaReyes, GMA News Program Manager John Oliver Manalastas, et. al., respondents. G.R. No. 195956, 1 March 2015 Ponente: Justice Marvic F. Leonen

FACTS: On August 13, 2004, petitioner ABS-CBN filed a criminal complaint against respondent GMA for (alleged) act of copyright infringement under Sections 177 and 211 of the Intellectual Property Code (RA 8293, as amended), because the respondent aired footage of the arrival and homecoming of OFW Angelo dela Cruz at NAIA from Iraq without the petitioner's consent. ABS-CBN stated that it has an agreement with Reuter's that the petition will contribute news and content that it owns and makes to Reuters in exchange of the latter's news and video material, and Reuters will ensure that ABS-CBN's materials cannot be aired in the country. The respondent was a subscriber of Reuter's and CNN live feeds. After it received the live feed of Angelo Dela Cruz's arrival and homecoming from Reuter's, it immediately aired the video from that news feed. The respondent alleged that its news staff was not aware that there was (a news embargo) agreement between ABSCBN and Reuters. Respondent alleged that it was not also aware that it aired petitioner's footage. Assistant City Prosecutor Dindo Venturanza issued resolution on 3 December 2004 which found probable cause to indict Dela Peña-Reyes and Manalastas. The respondents appealed the Prosccutor's resolution before DOJ. DOJ Secretary Raul M. Gonzalez ruled in favor of respondents in his resolution dated 1 August 2005 and held that good faith may be raised as a defense in the case. Meanwhile, DOJ Acting Secretary Alberto C. Agra issued a resolution on 29 June 2010 which reversed Sec. Gonzalez's resolution and found probable cause to charge Dela Peña-Reyes, Manalastas, as well as to indict Gozon, Duavit, Jr., Flores, and Soho for violation of the Intellectual Property Code (due to copyright infringement). The Court of Appeals rendered a decision on 9 November 2010, which granted the Petition for Certiorari to reverse and set aside DOJ Sec. Alberto Agra's resolution and a prayer for issuance of a temporary restraining order and/or Writ of Preliminary Injunction. The appellate court stated that the petitioner has copyright of its news coverage, but respondents’ act of airing five (5) seconds of the homecoming footage without notice of the “No Access Philippines” restriction of the live Reuter's video feed, was undeniably attended by good faith and thus, serves to exculpate from criminal liability under the Intellectual Property Code. ISSUES: W/N there is probable cause to find respondents to be held liable criminally for the case of copyright infringement under the Intellectual Property Law (RA 8293, as amended)? HELD: The Supreme Court PARTIALLY GRANTED ABS-CBN’s petition and ordered RTC Q.C. Branch 93 to continue with the criminal proceedings against Grace Dela PeñaReyes and John Oliver Manalastas due to copyright infringement. The other respondents, Atty. Felipe Gozon, Gilberto Duavit Jr., Marissa L. Flores, and Jessica A. Soho were held

not liable for the (criminal) act of copyright infringement. The Court held that their mere membership in GMA7's Board of Directors does not mean that they have knowledge, approval, or participation in the criminal act of copyright infringement., as there is a need for their direct/active participation in such act. Also, there was lack of proof that they actively participated or exercised moral ascendancy over Manalastas and Dela Cruz-Pena. Contrary to GMA’s contention, the Supreme Court deemed GMA's mere act of rebroadcast of ABS-CBN’s news footage (arrival and homecoming of OFW Angelo dela Cruz at NAIA from Iraq last 22 July 2004) for 2 mins and 40 secs. without the latter's authority creates probable cause to find GMA's news personnel Manalastas and Dela PeñaReyes criminally liable for violating provisions of Intellectual Property Code (Section 216217 of RA 8293, as amended) that imposes strict liability for copyright infringement, since they have not been diligent in their functions to prevent that footage from being aired on television. They knew that there would be consequences in carrying ABS-CBN’s footage in their broadcast – which is why they allegedly cut the feed from Reuters upon seeing ABS-CBN’s logo and reporter. The difference of an act mala in se and mala prohibita was stated in the present case. Acts mala in se requires presence of criminal intent and the person's knowledge of the nature of his/her act, while in acts mala prohibita, presence of criminal intent and the person's knowledge is not necessary. The Court also stated that Philippine laws on copyright infringement does not require criminal intent (mens rea) and does not support good faith as a defense. Thus, the act of infringement and not the intent is the one that causes the damage. It held that ABS-CBN's video footage is copyrightable because it is under “audiovisual works and cinematographic works and works produced by a process analogous to cinematography or any process for making audiovisual recordings.” It also stated that news or the event itself is not copyrightable. The Court differentiated idea and expression – idea meant as “a form, the look or appearance of a thing” while expression is its reality or the “external, perceptible world of articulate sounds and visible written symbols that others can understand.” Thus, the Supreme Court stated that “only the expression of an idea is protected by copyright, not the idea itself”, citing the US Supreme Court's decision in Baker vs Selden (101 U.S. 99). In the present case, expression applies to the event captured and presented in a specific medium via cinematography or processes analogous to it. The Court also gave the four-fold test under the Fair Use Doctrine (stated in section 185 of RA 8293 or the Intellectual Property Code, as amended) to determine fair use: a. The purpose and character of the use, including whether such use is of a commercial nature or is for non-profit educational purposes; b. The nature of the copyrighted work; c. The amount and substantiality of the portion used in relation to the copyrighted work as a whole; and d. The effect of the use upon the potential market for or value of the copyrighted work. Fair use, which is an exception to copyright owner’s monopoly of the work's usage, was defined by the Supreme Court as privilege to use the copyrighted material in a reasonable manner without the copyright owner's consent or by copying the material's theme or idea rather than its expression. It also said that determination of whether the Angelo dela Cruz footage is subject to fair use is better left to the trial court where the proceedings are currently pending.

EY Industrial Vs. Shen Dar G.R. No. 184850, October 20, 2010 Facts: EY Industrial Sales is a domestic corporation engaged in the production, distribution and sale of air compressors.  Shen Dar is a Taiwan-based foreign corporation engaged in the manufacture of compressors.  From 1997-2004, EY Industrial imported air compressors from Shen Dar.  In 1997, Shen Dar filed a Trademark Application with the Intellectual Property Office (IPO) for the mark “Vespa” for the use of air compressors. It was approved in 2007.  In 1999, EY Industrial filed a Trademark Application also for the mark “VESPA” for the use of air compressors. It was approved in 2004.  Shen Dar filed a Petition for Cancellation of the Industrial’s EYES COR with the Bureau of Legal Affairs contending that: a. there was a violation of Section 123.1 (D) of the Intellectual Property Code which provides that: A mark cannot be registered if it is identical to a mark with an earlier filing or priority date. b. EY Industrial is only a distributor of the air compressors  On the other hand, EY Industrial alleged that it is the sole assembler and fabricator of VESPA air compressors since the early 1990s and that Shen Dar supplied them air compressors with the mark “SD” and not “VESPA”

Issues: 1. Who between EY Industrial and Shen Dar is entitled to the trademark “VESPA”. EY INDUSTRIAL SALES 2. WON the Bureau of Legal Affairs has the power to cancel the application of Shen Dar even if it is Shen Dar who filed the case? YES Held: 1st: EY INDUSTRIAL has the right to the trademark. Based on the evidence, EYIS owns the “VESPA” trademark; it has prior use, as shown by various sales invoices. Ownership of a mark or trade name may be acquired not necessarily by registration but by adoption and use in trade or commerce. As between actual use of a mark without registration, and registration of the mark without actual use thereof, the former prevails over the latter. For 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 pre-requisite to the acquisition of the right of ownership. It is non sequitur to hold that porque EYIS is a distributor, it is no longer the owner. FIRST-TO-FILE RULE Under Section 123.1 of IPO provision, the registration of a mark is prevented with the filing of an earlier application for registration.

This must not, however, be interpreted to mean that ownership should be based upon an earlier filing date. While RA 8293 (IPC) removed the previous requirement of proof of actual use prior to the filing of an application for registration of a mark, proof of prior and continuous use is necessary to establish ownership of a mark. Such ownership constitutes sufficient evidence to oppose the registration of a mark. When we talk about trademark, we are just talking about the mark. It does not include the product. Shen Dar is the manufacturer of the product, but they did not name the product as VESPA. It was EY that named the VESPA, and used the VESPA, even though they were only the distributors. 
It was EY that actually used the trademark through the use of receipts, and other documents. The first to file rule – According to the SC that Shen Dar filed under the old IPC where prior use is the one applied. 
 2nd: BLA has the power to cancel the application. Shen Dar challenges the propriety of such cancellation on the ground that there was no petition for cancellation as required under Sec. 151 of RA 8293. The IPO Director General stated that, despite the fact that the instant case was for the cancellation of the COR issued in favor of EYIS, the interests of justice dictate, and in view of its findings, that the COR of Shen Dar must be cancelled. The above rule reflects the oft-repeated legal principle that quasi-judicial and administrative bodies are not bound by technical rules of procedure. Such principle, however, is tempered by fundamental evidentiary rules, including due process. The fact that no petition for cancellation was filed against the COR issued to Shen Dar does not preclude the cancellation of Shen Dar’s COR. It must be emphasized that, during the hearing for the cancellation of EYIS’ COR before the BLA, Shen Dar tried to establish that it, not EYIS, was the true owner of the mark “VESPA” and, thus, entitled to have it registered. Shen Dar had more than sufficient opportunity to present its evidence and argue its case, and it did. It was given its day in court and its right to due process was respected. The IPO Director General’s disregard of the procedure for the cancellation of a registered mark was a valid exercise of his discretion. Remember, EY’s application was the one granted, and it is Shen Dar’s application that was cancelled. 
It does not mean that even you were the one who filed, it your application cannot be cancelled. The BLA, who has jurisdiction over the case, were able to determine that it is Shen Dar’s trademark that should not have been issued with registration, even it is the plaintiff.

TAIWAN KOLIN CORPORATION v. KOLIN ELECTRONICS CO., GR No. 209843, 2015-03-25 Facts: The assailed issuances effectively denied petitioner's trademark application for the use of "KOLIN" on its television and DVD players. Taiwan Kolin filed with the Intellectual Property Office (IPO), then Bureau of Patents, Trademarks, and Technology Transfer, a trademark application,... for the use of "KOLIN" on a combination of goods,... including colored televisions, refrigerators, window-type and split-type air conditioners, electric fans and water dispensers. Said goods allegedly fall under Classes 9, 11, and 21 of the Nice Classification (NCL).

Ruling of the IPO Director General... the IPO Director General rendered a Decision[15] reversing that of the BLAIPO in the following wise:... hereby GIVEN DUE COURSE subject to the use limitation or restriction for the goods "television and DVD player" In so ruling, the IPO Director General ratiocinated that product classification alone cannot serve as the decisive factor in the resolution of whether or not the goods are related and that emphasis should be on the similarity of the products involved and not on the arbitrary... classification or general description of their properties or characteristics. As held, the mere fact that one person has adopted and used a particular trademark for his goods does not prevent the adoption and use of the same trademark by others on articles of a different... description.[16] Aggrieved, respondent elevated the case to the CA.

Application... would eventually be considered abandoned for Taiwan Kolin's failure to respond to IPO's Paper No. 5 requiring it to elect one class of good for its coverage. However, the same application was subsequently revived... with petitioner electing Class 9 as the subject of its application, particularly: television sets, cassette recorder, VCD Amplifiers, camcorders and other audio/video electronic equipment, flat iron, vacuum cleaners, cordless handsets,... videophones, facsimile machines, teleprinters, cellular phones and automatic goods vending machine. The application would in time be duly published.[... respondent Kolin Electronics Co., Inc. (Kolin Electronics) opposed petitioner's revived application,... As argued, the mark Taiwan Kolin seeks to register is identical, if not confusingly similar, with its "KOLIN"... mark registered on November 23, 2003, covering the following products under Class 9 of the NCL: automatic voltage regulator, converter, recharger, stereo booster, AC-DC regulated power supply, stepdown transformer, and PA amplified AC-DC

The CA found for Kolin Electronics, on the strength of the following premises: (a) the mark sought to be registered by Taiwan Kolin is confusingly similar to the one already registered in favor of Kolin Electronics; (b) there are no other designs,... special shape or easily identifiable earmarks that would differentiate the products of both competing companies;[17] and (c) the intertwined use of television sets with amplifier, booster and voltage regulator bolstered the fact that televisions can be... considered as within the normal expansion of Kolin Electronics,[

"KOLIN" registration was, as it turns out, the subject of a prior legal dispute

Issues:

In the said case, Kolin Electronics' own application was opposed by Taiwan Kolin,... being, as Taiwan Kolin claimed, the prior registrant and user of the "KOLIN" trademark, having registered the same in Taipei, Taiwan

The Issue

The Bureau of Legal Affairs of the IPO (BLA-IPO), however, did not accord priority right to Taiwan Kolin's Taipei... registration absent evidence to prove that it has already used the said mark in the Philippines as early as 1988. On appeal, the IPO Director General affirmed the BLA-IPO's Decision. Taiwan Kolin elevated the case to the CA, but without injunctive relief, Kolin Electronics was able to register the "KOLIN" trademark on November 23, 2003 for its products.[6] Subsequently, the CA, on July 31, 2006, affirmed[7] the Decision of the Director General. In answer to respondent's opposition... etitioner argued that it should be accorded the benefits of a foreignregistered mark under Secs. 3 and 131.1 of Republic Act No. 8293, otherwise known as the Intellectual Property Code of the

Respondent avers that Kolin Electronics' and Taiwan Kolin's products are closely-related not only because both fall under Class 9 of the NCL, but mainly because they both relate to electronic products, instruments, apparatus, or appliances.[34] Pushing the... point, respondent would argue that Taiwan Kolin and Kolin Electronics' goods are inherently similar in that they are all plugged into electric sockets and perform a useful function.[3

The primordial issue to be resolved boils down to whether or not petitioner is entitled to its trademark registration of "KOLIN" over its specific goods of television sets and DVD players. Petitioner postulates, in the main, that its goods are not closely related to those of Kolin Electronics. On the other hand, respondent hinges its case on the CA's findings that its and petitioner's products are closely-related. Thus, granting petitioner's application for trademark registration, according to respondent, would cause confusion as to the... public. Ruling: The petition is impressed with merit. Identical marks may be registered for... products from the same classification

Philippines (IP Code);[8] that it has already registered the "KOLIN" mark in the People's Republic of China, Malaysia and Vietnam, all of which are parties to the Paris Convention for the Protection of Industrial Property (Paris Convention) and the

The parties admit that their respective sets of goods belong to Class 9 of the NCL, which includes the following:[22]

Agreement on Trade-Related Aspects of Intellectual Property Rights (TRIPS);and that benefits accorded to a wellknown mark should be accorded to petitioner.

Scientific, nautical, surveying, photographic, cinematographic, optical, weighing, measuring, signalling, checking (supervision), life-saving and teaching apparatus and instruments; apparatus and instruments for conducting, switching, transforming, accumulating, regulating or... controlling electricity; apparatus for recording, transmission or reproduction of sound or images; magnetic data carriers, recording discs; compact discs, DVDs and other digital recording media; mechanisms for coin-operated apparatus; cash registers, calculating machines, data... processing equipment, computers; computer software; fire-extinguishing apparatus.

Ruling of the BLA-IPO... the BLA-IPO denied petitioner's application... hus, petitioner appealed the above Decision to the Office of the Director General of the IPO.

Class 9

But mere uniformity in categorization, by itself, does not automatically preclude the registration of what appears to be an identical mark, if that be the case. It is hornbook doctrine, as held in the above-cited cases, that emphasis should be on the similarity of the products... involved and not on the arbitrary classification or general description of their properties or characteristics. The mere fact that one person has adopted and used a trademark on his goods would not, without more, prevent the adoption and use of the same trademark by others on... unrelated articles of a different kind.[2 Taiwan Kolin's goods are classified as home appliances as opposed to Kolin Electronics' goods which are power supply and audio equipment accessories; Taiwan Kolin's television sets and DVD players perform distinct function and purpose from Kolin Electronics' power supply and audio equipment; and Taiwan Kolin sells and distributes its various home appliance products on wholesale and to accredited dealers, whereas Kolin Electronics' goods are sold and flow through electrical and hardware stores. The ordinarily intelligent buyer... is not likely to be confused While both competing marks refer to the word "KOLIN" written in upper case letters and in bold font, the Court at once notes the distinct visual and aural differences between them: Kolin Electronics' mark is italicized and colored black while that of Taiwan Kolin is white in... pantone red color background. The differing features between the two, though they may appear minimal, are sufficient to distinguish one brand from the other. The... products of the contending parties are relatively luxury items not easily considered affordable. 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.[ All told, We are convinced that petitioner's trademark registration not only covers unrelated good, but is also incapable of deceiving the ordinary intelligent buyer. The ordinary purchaser must be thought of as having, and credited with, at least a modicum of intelligence to be... able to see the differences between the two trademarks in question WHEREFORE, in view of the foregoing, the petition is hereby GRANTED. The Decision and the Resolution of the Court of Appeals in CA-G.R. SP No. 122565, dated April 30, 2013 and November 6, 2013, respectively, are hereby REVERSED and SET ASIDE. Accordingly, the Decision of the Intellectual Property Office Director General in Inter Partes Case No. 14-200600096, dated November 23, 2011, is hereby REINSTATED.

Principles: Citing Sec. 123(d) of the IP Code,[11] the BLA-IPO held that a mark cannot be registered if it is identical with a registered mark belonging to a different proprietor in respect of the same or closely-related goods. But mere uniformity in categorization, by itself, does not automatically preclude the registration of what appears to be an identical mark, if that be the case.

It is hornbook doctrine, as held in the above-cited cases, that emphasis should be on the similarity of the products... involved and not on the arbitrary classification or general description of their properties or characteristics. The mere fact that one person has adopted and used a trademark on his goods would not, without more, prevent the adoption and use of the same trademark by others on... unrelated articles of a different kind.[27]... whether or not the products of the parties involved are related the doctrine in Mighty Corporation is authoritative. There, the Court held that the goods should be tested against several factors before arriving at... a sound conclusion on the question of relatedness. Among these are: (a) the business (and its location) to which the goods belong; (b) the class of product to which the goods belong; (c) the product's quality, quantity, or size, including the nature of the package, wrapper or container; (d) the nature and cost of the articles; (e) the descriptive properties, physical attributes or essential characteristics with reference to their form, composition, texture or quality; (f) the purpose of the goods; (g) whether the article is bought for immediate consumption, that is, day-to-day household items; (h) the fields of manufacture; (i) the conditions under which the article is usually purchased; and (j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed and sold.[3 Expensive and valuable items are normally bought only after deliberate, comparative and analytical... investigation. But mass products, low priced articles in wide use, and matters of everyday purchase requiring frequent replacement are bought by the casual consumer without great care x x x.(emphasis added)

#5 G.R. No. 188526, November 11, 2013 CENTURY CHINESE MEDICINE CO., et., Petitioners vs. PEOPLE OF THE PHILIPPINES AND LING NA LAU Respondents

said trademark on August 24, 2003 by the Intellectual Property Office, and is thus considered the lawful holder of the said trademark. Being the registrant and the holder of the same, private respondent had the authority to enforce and protect intellectual property rights over it. Further, said applications for the search warrants were granted after by Judge Laguilles after examining under oath the applicant Agent Furing of the NBI and his witnesses Ping Na Lau and Junayd R. Ismael. It is therefore clear that the requisites for the issuance of the search warrants had been complied with and that there is probable cause to believe that an offense had been committed by petitioners against respondent, as holder of the trademark TOP GEL T.G. & DEVICE OF A LEAF.

Facts: Respondent Ling Na Lau, doing business under Worldwide Pharmacy, is the sole distributor and registered trademark owner of TOP GEL T.G. & DEVICE OF A LEAF papaya whitening soap as shown by a Certificate of Registration issued to her by the Intellectual Property Office (IPO) for a period of ten years from August 24, 2003.

On November 3, 2004, Lau’s representative, Ping Na Lau (Ping), requested the NBI for assistance for an investigation on several drugstores that were selling counterfeit whitening papaya soaps bearing the general appearance of their products. Agent Furing of the NBI assigned to the case executed an affidavit stating that they were able to buy whitening soaps bearing the mentioned trademark from a list of drugstores which included herein petitioners. A search warrant was then issued by the RTC Branch 143, Makati, against petitioners for Violations of Sections 168 and 155, both in relation to section 170 of Republic Act No. 8293, otherwise known as the Intellectual Property Code of the Philippines. Section 168, in relation to section 170, penalizes unfair competition while section 155, in relation to section 170, punishes trademark infringement.

Petitioners then collectively filed their Motion to Quash the Search Warrants contending that their issuances violated the rule against forum shopping; that Benjamin Yu (Yu) is the sole owner and distributor of the product known as TOP GEL and there was a prejudicial question posed Civil Case No. 05-54747 filed by Yu against respondent for damages due to infringement of trademark/trade name, unfair competition with prayer for the immediate issuance of a temporary restraining order and/or preliminary prohibitory injunction.

Issue: Whether or not the motion to quash the Search Warrants should be sustained

Ruling: No.

The applications for the issuance of the assailed search warrants applications concern the trademark TOP GEL T.G. & DEVICE OF A LEAF. Private respondent was issued a Certicate of Registration No. 4-2000-009881 of

Further, at the time the applications for the issuance of the search warrants, Civil Case No. Q-05-54747 which the petitioners contend that a prejudicial question was raised, on June 10, 2005, because of the pendency of a case involving the same issues and parties before the IPO and before the applications for the issuance of the assailed search warrants on November 21, 2005, the IPO had issued a writ of preliminary injunction against Cu ordering him and his company to cease and desist using the trademark TOP GEL T.G. & DEVICE OF A LEAF or any colorable imitation thereof on Papaya whitening soaps they manufacture, sell, and/or offer for sale. Petitioners, having admitted that they have derived their TOP GEL products from Yu, are notified of such injunction as it was published in The Philippine Star newspaper on October 30, 2005 and were therefore enjoined from selling the same.

More importantly, during the pendency of petitioners’ motion to quash in the RTC, a compromise agreement between respondent and Yu was approved by the IPO, stating, among others, that Yu acknowledge that exclusive right of Lau over the subject trademark for use on papaya whitening soap as evidenced by the Certificate of Registration and that Yu and his company now undertake to voluntarily cease and desist from using the aforesaid tradename and trademark, and further undertake not to manufacture, sell and distribute and otherwise compete with complainant, now and at anytime in the future.

Therefore, respondent, as owner of such registered trademark has the right to the issuance of the search warrants.

On November 7, 2006 the registration was assigned to Nutri-Asia. The company has not abandoned the use of the mark “PAPA” and the variations (such as “PAPA BANANA CATSUP label” and “PAPA KETSARAP”.) thereof as it continued the use of the mark up to the present. Petitioner further allege that “PAPA BOY & DEVICE” is identical to the mark “PAPA” owned by Nutri-Asia and duly registered in its favor. The petitioner contends that the use of “PAPA” by the respondent-applicant would likely result in confusion and deception. The consuming public, particularly the unwary customers, will be deceived, confused, and mistaken into believing that respondent-applicant's goods come from Nutri-Asia, which is particularly true since Southeast Asia Food Inc, sister company of Nutri-Asia, have been major manufacturers and distributors of lechon sauce since 1965 under the registered mark “Mang Tomas”. The IPO-BLA rejected Barrio Fiesta’s application for “PAPA BOY & DEVICE”. Respondent appealed before the IPO Director General, but the appeal was denied. The CA, however, reversed the decision of the IPO-BLA and ruled to grant the application. Petitioner brought the case before the Supreme Court, seeking the reversal of the decision and resolution of the CA. Issue: Whether or not by using the “dominant feature” of Nutri-Asia’s “PAPA” mark for “PAPA BOY & DEVICE” would constitute trademark infringement. Held: Petition has merit. In Dermaline, Inc. v. Myra Pharmaceuticals, Inc., 43 we defined trademark as "any distinctive word, name, symbol, emblem, sign, or device, or any combination thereof, adopted and used by a manufacturer or merchant on his goods to identify and distinguish them from those manufactured, sold, or dealt by others." We held that a trademark is "an intellectual property deserving protection by law." The Intellectual Property Code provides: #6 UFC PHILIPPINES v BARRIO FIESTA GR No. 198889 Facts: Petitioner Nutri-Asia, Inc. (petitioner) is a corporation duly organized and existing under Philippine laws. It is the emergent entity in a merger with UFC Philippines Inc. that was completed on Feb. 11, 2009. On April 4, 2002, respondent Barrio Fiesta Manufacturing Coroporation filed for the mark “PAPA BOY & DEVICE” for goods under Class 30, specifically for “lechon sauce.” The Intellectual Property Office (IPO) published said application for opposition in the IP Phil e-Gazette on Sept. 8 2006. Petitioner Nutri-asia filed with the IPO Bureau of Legal Affairs a Verified Notice of Opposition to the application alleging that the mark “PAPA” is for use on banana catsup and other similar goods first used in 1954 by Neri Papa. After using “PAPA” for 27 years, Neri Papa subsequently assigned the mark to Herman Reyes who filed an application to register the said “PAPA” mark for use on banana catsup, chili sauce, achara, banana chips and instate ube powder.

Section 147. Rights Conferred. - 147.1. The owner of a registered mark shall have the exclusive right to prevent all third parties not having the owner's consent from using in the course of trade identical or similar signs or containers for goods or services which are identical or similar to those in respect of which the trademark is registered where such use would result in a likelihood of confusion. In case of the use of an identical sign for identical goods or services, a likelihood of confusion shall be presumed. To determine the likelihood of confusion, the Rules of Procedure for Intellectual Property Rights Cases, Rule 18, provides: RULE 18 Evidence in Trademark Infringement and Unfair Competition Cases SECTION 1. Certificate of Registration.

- A certificate of registration of a mark shall be prima facie evidence of: a) the validity of the registration; b) the registrant's ownership of the mark; and c) the registrant's exclusive right to use the same in connection with the goods or services and those that are related thereto specified in the certificate. SECTION 3. Presumption of Likelihood of Confusion. Likelihood of confusion shall be presumed in case an identical sign or mark is used for identical goods or services.

in trade or commerce. The essential element of infringement under the law is that the infringing mark is likely to cause confusion. There are two tests used to determine likelihood of confusion: the dominancy test and the holistic test. The dominancy test applies to this case. The Dominancy Test focuses on the similarity of the prevalent or dominant features of the competing trademarks that might cause confusion, mistake, and deception in the mind of the purchasing public. Duplication or imitation is not necessary; neither is it required that the mark sought to be registered suggests an effort to imitate. Given more consideration are the aural and visual impressions created by the marks on the buyers of goods, giving little weight to factors like prices, quality, sales outlets, and market segments. xx xx

SECTION 4. Likelihood of Confusion in Other Cases. – In determining whether one trademark is confusingly similar to or is a colorable imitation of another, the court must consider the general impression of the ordinary purchase buying under the normally prevalent conditions in trade and giving the attention such purchasers usually give in buying that class of goods. Visual, aural, connotative comparisons and overall impressions engendered by the marks in controversy as they are encountered in the realities of the marketplace must be taken into account. Where there are both similarities and differences in the marks, these must be weighed against one another to see which predominates. In determining likelihood of confusion between marks used on non-identical goods or services, several factors may be taken into account, such as, but not limited to: a) the strength of plaintiffs mark; b) the degree of similarity between the plaintiffs and the defendant's marks; c) the proximity of the products or services; d) the likelihood that the plaintiff will bridge the gap; e) evidence of actual confusion; f) the defendant's good faith in adopting the mark; g) the quality of defendant's product or service; and/or h) the sophistication of the buyers. "Colorable imitation" denotes such a close or ingenious imitation as to be calculated to deceive ordinary persons, or such a resemblance to the original as to deceive an ordinary purchaser giving such attention as a purchaser usually gives, as to cause him to purchase the one supposing it to be the other. SECTION 5. Determination of Similar and Dissimilar Goods or Services. - Goods or services may not be considered as being similar or dissimilar to each other on the ground that, in any registration or publication by the Office, they appear in different classes of the Nice Classification. On the other hand, R.A. No. 166 defines a "trademark" as any distinctive word, name, symbol, emblem, sign, or device, or any combination thereof, adopted and used by a manufacturer or merchant on his goods to identify and distinguish them from those manufactured, sold, or dealt by another. A trademark, being a special property, is afforded protection by law. But for one to enjoy this legal protection, legal protection ownership of the trademark should right be established. The ownership of a trademark is acquired by its registration and its actual use by the manufacturer or distributor of the goods made available to the purchasing public. The prima facie presumption brought by the registration of a mark may be challenge in an appropriate action. Moreover the protection may likewise be defeated by evidence of prior use by another person. This is because the trademark is a creation of use and belongs to one who first used it

The Totality Test The totality or holistic test is contrary to the elementary postulate of the law on trademarks and unfair competition that confusing similarity is to be determined on the basis of visual, aural, connotative comparisons and overall impressions engendered by the marks in controversy as they are encountered in the realities of the marketplace. The totality or holistic test only relies on visual comparison between two trademarks whereas the dominancy test relies not only on the visual but also on the aural and connotative comparisons and overallimpressions between the two trademarks. There are two types of confusion in trademark infringement: confusion of goods and confusion of business.

In Sterling Products International, Inc. v. Farbenfabriken Bayer Aktiengesellschaft, the Court distinguished the two types of confusion: Callman notes two types of confusion. The first is 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, "defendant's goods are then bought as the plaintiff's, and the poorer quality of the former reflects adversely on the plaintiff's reputation." The other is the confusion of business: "Here though the goods of the parties are different, the defendant's 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."

In relation to this, the court has held that 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. The scope of protection thus extends to protection from infringers with related goods.

It cannot be denied that since petitioner’s product, catsup, and respondent’s product, lechonsauce, are both household products in similar packaging the public could think that petitioner Nutri-Asia has expanded its product mix to include lechon sauce, which is not unlikely considering the nature of petitioner’s business. Moreover, the CA erred in finding that “PAPA” is a common term of endearment for “father” and therefore could not be claimed for exclusive use and ownership. What was registered was not “Papa” as denied in dictionary, but “Papa” as the last name of the owner of the brand, making it a registrable mark.

Petition granted.