Review Guide Ip II

INTELLECTUAL PROPERTY CODE
PART II
TRADEMARKS AND TRADE NAMES

GUIDE QUESTIONS
1. What is the requirement of actual use in connection with marks?

2. What is the connection or relation, if any, between trademark infringement and unfair
competition?
3. Is there a conflict between the Madrid Protocol and the IP Code? Why or why not?
4. Based on the cases assigned, which between the dominancy test and the holistic test, is
more often applied? Please make a table of the pertinent cases, indicate which ones were
decided using what test(s) and cite pertinent portions.
5. What test and findings did J. Leonen use in the case of Citibank to conclude that there
was no confusing similarity between the two marks?
6. In the case of Emerald, what did H.D. Lee allege to prove that its mark was well-known
internationally?
7. Why is unfair competition always a question of fact per the case of San Miguel Pure
Foods?
8. How is the idem sonans rule applied? Illustrate how this rule has been applied by the SC.
COVERAGE
• DEFINITION OF MARKS, COLLECTIVE MARKS AND TRADE NAMES
• ACQUISITION OF OWNERSHIP OF MARK
• ACQUISITION OF OWNERHSIP OF TRADE NAME
• NON-REGISTRABLE MARKS
• PRIOR USE OF MARK AS REQUIREMENT

COVERAGE
• TESTS TO DETERMINE CONFUSING SIMILARITY BETWEEN
MARKS
• DOMINANCY TEST
• HOLISTIC TEST
• IDEM SONAMS
• WELL-KNOWN MARKS
• RIGHTS CONFERRED BY REGISTATION
• USE BY THIRD PARTIES OF NAMES, ETC. SIMILAR TO

REGISTERED MARK
COVERAGE
• INFRINGEMENT AND REMEDIES
• TRADEMARK INFRINGEMENT
• DAMAGES
• REQUIREMENT OF NOTICE
• PENALTIES
• UNFAIR COMPETITION
• REGISTRATION OF MARKS UNDER THE MADRID PROTOCOL

• COVERAGE
• RIGHTS CONFERRED
• REQUIREMENTS FOR REGISTRATION
• TERM OF PROTECTION
PURPOSE OF TRADEMARKS
Businesses generally thrive or perish depending on their reputation among customers.

Logically, consumers gravitate towards products and services they believe are of a
certain quality and provide perceived benefits. Thus, entrepreneurs and businesses
actively seek to set apart their reputation and goodwill from every other enterprise with
the goal of being the top-of-mind choice for the consumers. As signs differentiating the
wares or services offered by enterprises, trademarks serve this purpose of making the
products and services of each business uniquely memorable. Trademarks have several
functions: they indicate the origin or ownership of the articles or services in which they
are used; they guarantee that the articles or services come up to a certain standard of
quality; and they advertise the articles and services they symbolize. Indeed, the
goodwill of a business, as symbolized and distinguished by its trademarks, helps ensure
that the enterprise stands out, stays afloat, and possibly flourish amidst the sea of
commercial activity where the consumers' continued patronage is a lifebuoy that may
determine life or death.
Zuneca Pharmaceutical, et al v Natrapharm Inc. GR 211850 Sep 8, 2020
PURPOSE OF TRADEMARKS
Faced with this intrinsic need to survive, enterprises are becoming increasingly aware of
the need to protect their goodwill and their brands. The State, too, is interested in the
protection of the intellectual property of enterprises and individuals who have exerted
effort and money to create beneficial products and services. [2] In line with this, and
considering the extent to which intellectual property rights impact on the viability of
businesses, a common controversy in the field of intellectual property law is to whom these
rights pertain.
In this case of first impression, this is precisely the issue at hand. This case concerns
trademarks which are used for different types of medicines but are admitted by both parties
to be confusingly similar. Exacerbating this controversy on the issue of ownership,
however, are conflicting interpretations on the rules on the acquisition of ownership over
trademarks, muddled by jurisprudential precedents which applied principles inconsistent
with the current law. Thus, in resolving this issue, the Court needed to examine and
ascertain the meaning and intent behind the rules that affect trademark ownership.
DEFINITIONS
121.1. 'MARK' – any visible sign capable of distinguishing the goods (trademark)
or services (service mark) of an enterprise and shall include a stamped or marked
container of goods
121.2. 'COLLECTIVE MARKS' – any visible sign designated as such in the

application for registration and capable of distinguishing the origin or any other
common characteristics, including the quality of goods or services of different
enterprises which use the sign under the control of the registered owner of the
collective mark
121.3. 'TRADE NAME' - the name or designation identifying or distinguishing

an enterprise
ACQUISITION OF OWNERSHIP OF MARK
• ACQUISITION OF OWNERSHIP – the rights in mark shall be acquired
through registration made validly in accordance with the provisions of this law.
(Sec 122)
• CONCEPT OF ACTUAL USE – the registrant shall file a declaration of
actual use and evidence to that effect, or shall show valid reasons based on the
existence of obstacles to such use, within one year from the fifth anniversary of
the date of registration of the mark. Otherwise, the mark shall be removed from
the Register by the Office. (Sec 145)
• EFFECT OF REGISTRATION – a certificate of registration of a mark shall
be prima facie evidence of the validity of the registration, the registrant’s
ownership of the mark, and of 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 (Sec 138); a certificate of registration shall remain in
force for 10 years and may be renewed for periods of 10 years at its expiration.
The case of Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

discussed the trademarks law particularly on the aspect of acquisition of ownership over marks:
Special laws have historically determined and provided for the acquisition of ownership over
marks, and a survey thereof shows that ownership of marks is acquired either through
registration or use.
Spanish Royal Decree of October 26, 1888
As early as the Spanish regime, trademarks were already protected in the Philippines. The Real

Decreto de 26 de octubre de 1888[70] or the Spanish Royal Decree of October 26, 1888 provided
for the concession and use of Philippine trademarks as follows:
Xxx
Based on the above provisions, one who wished to own and use a trademark had to request for
a certificate of ownership in accordance with the royal decree. The use of unregistered
trademarks was prohibited. In other words, because trademarks could not be used without first
securing the necessary certificate, the ownership of trademarks under the Spanish Royal
Decree of October 26, 1888 was acquired only by means of registration.
Act No. 666
The manner of acquiring ownership over trademarks changed during the

American period. In 1903, Act No. 666 [71] was enacted, which provided that
the ownership of a mark was acquired through actual use thereof. The
pertinent provisions of said law are reproduced below:
SECTION 2. Anyone who produces or deals in merchandise of any kind by
actual use thereof in trade may appropriate to his exclusive use a trade-mark,
not so appropriated by another, to designate the origin or ownership
thereof: Provided, That a designation or part of a designation which relates
only to the name, quality, or description of the merchandise or geographical
place of its production or origin cannot be the subject of a trade-mark.
R.A. 166
On June 20, 1947, R.A. 166 [72] (Trademark Law) was enacted and approved. It is worth
noting that the Trademark Law, as clarified through its subsequent amendment, explicitly
stated that actual use was a prerequisite for the ownership of marks.
Section 4 of the Trademark Law stated that the owner of the mark had the right to register
the same. Despite not categorically defining who the owner of the mark was, the same
section also provided that one could not register a mark that was previously used and not
abandoned by another. Consequently, prior use and non-abandonment determined the
ownership of the mark because it effectively barred someone else from registering the
mark and representing himself[73] to be the owner thereof. In other words, the only person
who was entitled to register the mark, and therefore be considered as the owner thereof,
was the person who first used and who did not abandon the mark, viz.:
SECTION 4. Registration of Trade-marks, Trade-names and Service-marks. - The owner
of a trade-mark, trade-name or service-mark used to distinguish his goods, business or
services from the goods, business or services of others shall have the right to register the
same, unless it: x x x
Civil Code
When the Civil Code took effect in 1950, it included the rule that the owner of the
trademark was the person, corporation, or firm registering the same, but said rule
was made subject to the provisions of special laws. Hence, the manner of
acquiring ownership was still through actual use because the special law in effect
at that time was the Trademark Law, viz.:
CHAPTER 3
TRADEMARKS AND TRADENAMES

ART. 520. A trademark or tradename duly registered in the proper government
bureau or office is owned by and pertains to the person, corporation, or firm
registering the same, subject to the provisions of special laws. (Emphasis
supplied)
Amendment to the Trademark Law
In 1951, the Trademark Law was amended by R.A. 638,[74] which added Section 2-A,
among others. As previously mentioned, this amendment explicitly provided that
ownership over a mark was acquired through actual use, viz.:
Sec. 2-A. Ownership of trade-marks, trade-names and service-marks; how
acquired. - Anyone who lawfully produces or deals in merchandise of any kind or
who engages in any lawful business, or who renders any lawful service in commerce,
by actual use thereof in manufacture or trade, in business, and in the service
rendered, may appropriate to his exclusive use a trade-mark, a trade-name, or a
service-mark not so appropriated by another, to distinguish his merchandise,
business or service from the merchandise, business or services of others. The
ownership or possession of a trade-mark, trade-name, service-mark, heretofore or
hereafter appropriated, as in this section provided, shall be recognized and
protected in the same manner and to the same extent as are other property rights
known to the law. (Emphasis and underscoring supplied)
IP Code
Forty-seven years later, upon the effectivity of the IP Code on January 1,
1998, the manner of acquiring ownership of trademarks reverted to
registration. This is expressed in Section 122 of the IP Code, viz.:
SECTION 122. How Marks are Acquired. - The rights in a mark shall
be acquired through registration made validly in accordance with the
provisions of this law. (Sec. 2-A, R.A. No. 166a) (Emphasis and
underscoring supplied)
Related to this, Section 123. l(d) of the IP Code expresses the first-to-file
rule as follows:
SECTION 123. Registrability. - 123.1. A mark cannot be registered if it:
xxxx
(d) Is identical with a registered mark belonging to a different
proprietor or a mark with an earlier filing or priority date, in respect of:
To clarify, while it is the fact of registration which confers ownership of the mark and enables the owner
thereof to exercise the rights expressed in Section 147[75] of the IP Code, the first-to-file rule nevertheless
prioritizes the first filer of the trademark application and operates to prevent any subsequent applicants
from registering marks described under Section 123.1(d) of the IP Code.
Reading together Sections 122 and 123. l(d) of the IP Code, therefore, a registered mark or a mark with an
earlier filing or priority date generally bars the future registration of- and the future acquisition of rights in -
an identical or a confusingly similar mark, in respect of the same or closely-related goods or services, if the
resemblance will likely deceive or cause confusion.
The current rule under the IP Code is thus in stark contrast to the rule on acquisition of ownership under the
Trademark Law, as amended. To recall, the Trademark Law, as amended, provided that prior use and non-
abandonment of a mark by one person barred the future registration of an identical or a confusingly similar
mark by a different proprietor when confusion or deception was likely.[76] It also stated that one acquired
ownership over a mark by actual use.[77]
Once the IP Code took effect, however, the general rule on ownership was changed and repealed.[78] At
present, as expressed in the language of the provisions of the IP Code, prior use no longer determines the
acquisition of ownership of a mark in light of the adoption of the rule that ownership of a mark is
acquired through registration made validly in accordance with the provisions of the IP Code. Accordingly,
the trademark provisions of the IP Code use the term "owner" in relation to registrations.
Certainly, while the IP Code and the Rules of the IPO mandate that the applicant/registrant
must prove continued actual use of the mark, it is the considered view of the Court that this
does not imply that actual use is still a recognized mode of acquisition of ownership under the
IP Code. Rather, these must be understood as provisions that require actual use of the mark in
order for the registered owner of a mark to maintain his ownership.
In the same vein, the prima facie nature of the certificate of registration is not indicative of
the fact that prior use is still a recognized mode of acquiring ownership under the IP Code.
Rather, it is meant to recognize the instances when the certificate of registration is not
reflective of ownership of the holder thereof, such as when: [1] the first registrant has
acquired ownership of the mark through registration but subsequently lost the same due to
non-use or abandonment[ (e.g., failure to file the Declaration of Actual Use); [2] the
registration was done in bad faith; [3] the mark itself becomes generic;[4] the mark was
registered contrary to the IP Code (e.g., when a generic mark was successfully registered
for some reason); or [5] the registered mark is being used by, or with the permission of, the
registrant so as to misrepresent the source of the goods or services on or in connection with
which the mark is used.
To repeat, after the IP Code became effective starting 1998, use was no longer required in order to acquire
or perfect ownership of the mark. In this regard, the Court now rectifies the inaccurate statement
in Berris that "[t]he ownership of a trademark is acquired by its registration and its actual use." The
rectified statement should thus read: "Under the IP Code, the ownership of a trademark is acquired by its
registration." Any pronouncement in Berris inconsistent herewith should be harmonized accordingly. To
clarify, while subsequent use of the mark and proof thereof are required to prevent the removal or
cancellation of a registered mark or the refusal of a pending application under the IP Code, [103] this
should not be taken to mean that actual use and proof thereof are necessary before one can own the
mark or exercise the rights of a trademark owner. [104]
Likewise, the rule on acquiring ownership discussed in E. Y. Industrial Sales, Inc. is inconsistent with the
current rule under the IP Code. In said case, E.Y. Industrial Sales, Inc. (EYIS) imported air compressors
from Shen Dar from 1997 to 2004. In 1997, during the effectivity of the Trademark Law, as amended, Shen
Dar filed a trademark application for "VESPA, Chinese Characters and Device" for use on air
compressors and welding machines. Subsequently, in 1999, or already during the effectivity of the IP
Code, EYIS filed a trademark application for "VESPA" for use on air compressors. On January 18, 2004,
the IPO issued the certificate of registration for "VESPA" in favor of EYIS. Subsequently, on February 8,
2007, the certificate of registration for "VESPA, Chinese Characters and Device" was issued in favor of
Shen Dar.
Subparagraph (d) of the above provision of the Trademark Law was amended in the IP
Code to, among others, remove the phrase "previously used in the Philippines by
another and not abandoned." Under the Trademark Law, as amended, the first user of
the mark had the right to file a cancellation case against an identical or confusingly
mark registered in good faith by another person. However, with the omission in the IP
Code provision of the phrase "previously used in the Philippines by another and not
abandoned” said right of the first user is no longer available. In effect, based on the
language of the provisions of the IP Code, even if the mark was previously used and
not abandoned by another person, a good faith applicant may still register the same
and thus become the owner thereof, and the prior user cannot ask for the
cancellation of the latter's registration. If the lawmakers had wanted to retain the
regime of acquiring ownership through use, this phrase should have been retained in
order to avoid conflicts in ownership. The removal of such a right unequivocally
shows the intent of the lawmakers to abandon the regime of ownership under the
Trademark Law, as amended.
It must be emphasized that registration of a trademark, by itself, is not a mode of acquiring

ownership. If the applicant is not the owner of the trademark, he has no right to apply for its
registration. Registration merely creates a prima facie presumption of the validity of the
registration, of the registrant's ownership of the trademark, and of the exclusive right to the use
thereof. Such presumption, just like the presumptive regularity in the performance of official
functions, is rebuttable and must give way to evidence to the contrary.
Clearly, it is not the application or registration of a trademark that vests ownership thereof, but it is
the ownership of a trademark that confers the right to register the same. A trademark is an
industrial property over which its owner is entitled to property rights which cannot be appropriated
by unscrupulous entities that, in one way or another, happen to register such trademark ahead of its
true and lawful owner. The presumption of ownership accorded to a registrant must then
necessarily yield to superior evidence of actual and real ownership of a trademark.
Birkenstock Orthopaedie GmbH and Co. KG v. Phil. Shoe Expo Marketing Corp., G.R. No. 194307,
[November 20, 2013], 721 PHIL 867-882
ACQUISITION OF OWNERSHIP OF TRADE NAME
• Notwithstanding any laws or regulations providing for any

obligation to register trade names, such names shall be protected,
even prior to or without registration, against any unlawful act
committed by third parties. (Sec 165.2.a)
• The subsequent use of the trade name by a third party, whether as

a trade name or a mark or collective mark, or any such use of a
similar trade name or mark, likely to mislead the public, shall be
deemed unlawful. (Sec 165.2.b)
NON-REGISTRABLE MARKS
• Immoral, deceptive or scandalous matter, or matter disparaging or falsely suggesting a connection
with persons, living or dead, institutions, beliefs or national symbols or bring them into contempt
or disrepute;
• Flag or coat of arms or other insignia of the Philippines or any of its political subdivisions or of
any foreign nation or any simulation thereof;
• Name, portrait or signature identifying a particular living individual except by his written consent,
or the name, signature or portrait of a deceased president of the Philippines during the life of his
widow, if any except by written consent of widow;
• Identical with a registered mark belonging to a different proprietor or a mark with an earlier filing
or priority date in respect of
• Same goods or services
• Closely related goods or services
• If it nearly resembles such a mark as to be likely to deceive or cause confusion
• Identical or confusingly similar to, or constitutes a translation of a mark which is considered by
the competent authority of the Philippines to be well known internationally and in the
Philippines whether or not it is registered here, as being already the mark of a person other than
applicant and used for identical or similar goods or services
• Where mark is well known, knowledge of the relevant sector of the public (not public at
large) including knowledge in the Philippines obtained as a result of promotion of the mark
• Identical with, or confusingly similar to, or constitutes a translation of, a mark considered well-
known in accordance with preceding paragraph, registered in the Philippines with respect to
goods or services not similar to those with respect to which registration is applied for;
• Likely to mislead the pubic, particularly as to nature, quality, characteristics or geographical

origin of the goods or services;
• Consisting exclusively of signs that are generic for the goods or services that they seek to
identify;
• Consisting exclusively of signs or indications that have become customary or usual to

designate the goods or services in everyday language or in bona fide and established trade
practice;
• Consisting exclusively of signs or of indications that may serve in trade to designate the
kind, quality, quantity, intended purpose, value, geographical origin, time or production of
the goods or rendering of the services, or other characteristics of the goods or service;
• Shapes that may be necessitated by technical factors or by nature of the goods themselves or
factors that affect their intrinsic value;
• Color alone unless defined by a given form; or
• Contrary to public order or morality.

In Asia Brewery, Inc. v. Court of Appeals, the Court ruled that there was no infringement of San Miguel Brewery's Pale Pilsen trademark
because Pale Pilsen could not be appropriated. The Court explained:
The fact that the words pale pilsen are part of ABI's trademark does not constitute an infringement of SMC's trademark: SAN MIGUEL
PALE PILSEN, for "pale pilsen" are generic words descriptive of the color ("pale"), of a type of beer ("pilsen"), which is a light bohemian
beer with a strong hops flavor that originated in the City of Pilsen in Czechoslovakia and became famous in the Middle Ages. (Webster's
Third New International Dictionary of the English Language, Unabridged. Edited by Philip Babcock Gove. Springfield, Mass.: G & C
Merriam Co., 1976, page 1716.) "Pilsen" is a "primarily geographically descriptive word," (Sec. 4, subpar. [e] Republic Act No. 166, as
inserted by Sec. 2 of R.A. No. 638) hence, non-registerable and not appropriable by any beer manufacturer. The Trademark Law
provides:
"Sec. 4. . . . The owner of trade-mark, trade-name or service-mark used to distinguish his goods, business or services from the goods,
business or services of others shall have the right to register the same [on the principal register], unless it:
xxx xxx xxx
"(e) Consists of a mark or trade-name which, when applied to or used in connection with the goods, business or services of the
applicant is merely descriptive or deceptively misdescriptive of them, or when applied to or used in connection with the goods, business
or services of the applicant is primarily geographically descriptive or deceptively misdescriptive of them, or is primarily merely a
surname." (Emphasis supplied.)
The words "pale pilsen" may not be appropriated by SMC for its exclusive use even if they are part of its registered trademark: SAN
MIGUEL PALE PILSEN, any more than such descriptive words as "evaporated milk," "tomato ketchup," "cheddar cheese," "corn flakes"
and "cooking oil" may be appropriated by any single manufacturer of these food products, for no other reason than that he was the
first to use them in his registered trademark. In Masso Hermanos, S.A. vs. Director of Patents, 94 Phil. 136, 139 (1953), it was held that
a dealer in shoes cannot register "Leather Shoes" as his trademark because that would be merely descriptive and it would be unjust to
deprive other dealers in leather shoes of the right to use the same words with reference to their merchandise. No one may appropriate
generic or descriptive words.
Kensonic, Inc. v. Uni-Line Multi-Resources, Inc. (Phil.), G.R. Nos. 211820-21 & 211834-35, [June 6, 2018]
NON-REGISTRABILE MARKS
“We agree that respondent's mark cannot be registered. Respondent's mark is related to a product,
lechon sauce, an everyday all-purpose condiment and sauce, that is not subjected to great scrutiny
and care by the casual purchaser, who knows from regular visits to the grocery store under what
aisle to find it, in which bottle it is contained, and approximately how much it costs. Since
petitioner's product, catsup, is also a household product found on the same grocery aisle, in similar
packaging, the public could think that petitioner had expanded its product mix to include lechon
sauce, and that the ‘PAPA BOY’ lechon sauce is now part of the ‘PAPA’ family of sauces, which is not
unlikely considering the nature of business that petitioner is in. Thus, if allowed registration,
confusion of business may set in, and petitioner's hard-earned goodwill may be associated to the
newer product introduced by respondent, all because of the use of the dominant feature of
petitioner's mark on respondent's mark, which is the word ‘PAPA.’ The words ‘Barrio Fiesta’ are not
included in the mark, and although printed on the label of respondent's lechon sauce packaging, still
do not remove the impression that ‘PAPA BOY’ is a product owned by the manufacturer of ‘PAPA’
catsup, by virtue of the use of the dominant feature. It is possible that petitioner could expand its
business to include lechon sauce, and that would be well within petitioner's rights, but the existence
of a ‘PAPA BOY’ lechon sauce would already eliminate this possibility and deprive petitioner of its
rights as an owner of a valid mark included in the Intellectual Property Code. ”
UFC Philippines, Inc. v. Barrio Fiesta Manufacturing Corp., G.R. No. 198889, [January 20, 2016],
778 PHIL 763-807
“We resolve the issue of whether there is confusing similarity between ORLANE and LOLANE
which would bar the registration of LOLANE before the IPO.
“XXX
“There is no colorable imitation between the marks LOLANE and ORLANE which would lead
to any likelihood of confusion to the ordinary purchasers.
“A trademark is defined under Section 121.1 of RA 8293 as any visible sign capable of
distinguishing the goods. It is susceptible to registration if it is crafted fancifully or arbitrarily
and is capable of identifying and distinguishing the goods of one manufacturer or seller
from those of another. Thus, the mark must be distinctive. The registrability of a trademark
is governed by Section 123 of RA 8293.”
Seri Somboonsakdikul v. Orlane S.A., G.R. No. 188996, [February 1, 2017], 805 PHIL 37-58
TESTS TO DETERMINE
CONFUSING SIMILARITY BETWEEN MARKS
• Dominancy test – focuses on the similarity of the prevalent features of the competing trademarks
that might cause confusion and deception, thus constituting infringement. If the competing
trademark contains the main, essential and dominant features of another, and confusion or
deception is likely to result, infringement occurs. Exact duplication or imitation is not required. The
question is whether the use of the marks involve is likely to cause confusion or mistake in the mind
of the public or to deceive consumers.
• Holistic test – entails a consideration of the entirety of the marks as applied to the products,
including the labels and packaging, in determining confusing similarity. The discerning eye of the
observer must focus not only on the predominant words but also on the other features appearing on
both marks in order that the observer may draw his conclusion whether one is confusingly similar
to the other. Coffee Partners, Inc. v San Francisco Coffee & Roastery, Inc. GR 169504, Mar 3 2010
• Idem sonans - in determining the issue of confusing similarity, the Court takes into account the
aural effect of the letters contained in the marks. Marex Commercial Co. Inc. v Petra Hawpia &
Co., and Director of Patents, GR L-19297, Dec 22, 1966
DOMINANCY TEST
J. Leonen
“With these guidelines in mind, this Court considered 'the main, essential, and
dominant features' of the marks in this case, as well as the contexts in which the
marks are to be used. This Court finds that the use of the 'CITY CASH WITH
GOLDEN LION'S HEAD' mark will not result in the likelihood of confusion in
the minds of customers.
A visual comparison of the marks reveals no likelihood of confusion.
This Court agrees with the observation of Director General Cristobal that the
most noticeable part of this mark is the golden lion's head device, and finds that
after noticing the image of the lion's head, the words 'CITY' and 'CASH' are
equally prominent.”
(Citigroup, Inc. v. Citystate Savings Bank, Inc., G.R. No. 205409, [June 13,
2018])
DOMINANCY TEST
DOMINANCY TEST
J. Leonen
Examining these marks, this Court finds that petitioner's marks can best be described
as consisting of the prefix 'CITI' added to other words.
Applying the dominancy test, this Court sees that the prevalent feature of respondent's
mark, the golden lion's head device, is not present at all in any of petitioner's marks.
The only similar feature between respondent's mark and petitioner's collection of
marks is the word 'CITY' in the former, and the 'CITI' prefix found in the latter. This
Court agrees with the findings of the Court of Appeals that this similarity alone is not
enough to create a likelihood of confusion.
(Citigroup, Inc. v. Citystate Savings Bank, Inc., G.R. No. 205409, [June 13, 2018])
DOMINANCY TEST
J. LEONEN
Verily, the variations in the appearance of the 'CITI' marks by petitioner, when conjoined
with other words, would dissolve the alleged similarity between them and the trademark of
respondent. These dissimilarities, and the insignia of a golden lion's head before the
words 'CITY CASH' in the mark of the respondent would sufficiently acquaint and apprise
the public that respondent's trademark 'CITY CASH WITH GOLDEN LION'S HEAD' is
not connected with the 'CITI' marks of petitioner.
This Court also agrees with the Court of Appeals that the context where respondent's mark
is to be used, namely, for its ATM services, which could only be secured at respondent's
premises and not in an open market of ATM services, further diminishes the possibility of
confusion on the part of prospective customers.
Citigroup, Inc. v. Citystate Savings Bank, Inc., G.R. No. 205409, [June 13, 2018]
HOLISTIC TEST
“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. In
determining if colorable imitation exists, jurisprudence has developed two kinds
of tests — the Dominancy Test and the Holistic Test. The test of dominancy
focuses on the similarity of the prevalent features of the competing trademarks
which might cause confusion or deception and thus constitute 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.”
Societe des Produits Nestle, S.A. v. Court of Appeals, G.R. No. 112012, [April 4,
2001], 408 PHIL 307-327
HOLISTIC TEST
“In the above cases cited by the Court of Appeals to justify the application of the totality or holistic test to this instant
case, the factual circumstances are substantially different. In the Bristol Myers case, this Court held that although both
BIOFERIN and BUFFERIN are primarily used for the relief of pains such as headaches and colds, and their names are
practically the same in spelling and pronunciation, both labels have strikingly different backgrounds and surroundings. In
addition, one is dispensable only upon doctor's prescription, while the other may be purchased over-the-counter.
In the Mead Johnson case, the differences between ALACTA and ALASKA are glaring and striking to the eye. Also,
ALACTA refers to "Pharmaceutical Preparations which Supply Nutritional Needs," falling under Class 6 of the official
classification of Medicines and Pharmaceutical Preparations to be used as prescribed by physicians. On the other hand,
ALASKA refers to "Foods and Ingredients of Foods" falling under Class 47, and does not require medical prescription.
In the American Cyanamid case, the word SULMET is distinguishable from the word SULMETINE, as the former is
derived from a combination of the syllables "SUL" which is derived from sulfa and "MET" from methyl, both of which are
chemical compounds present in the article manufactured by the contending parties. This Court held that the addition of the
syllable "INE" in respondent's label is sufficient to distinguish respondent's product or trademark from that of petitioner.
Also, both products are for medicinal veterinary use and the buyer will be more wary of the nature of the product he is
buying. In any case, both products are not identical as SULMET's label indicates that it is used in a drinking water
solution while that of SULMETINE indicates that they are tablets.
It cannot also be said that the products in the above cases can be bought off the shelf except, perhaps, for ALASKA. The
said products are not the usual "common and inexpensive" household items which an "undiscerningly rash" buyer would
unthinkingly buy.”
Societe des Produits Nestle, S.A. v. Court of Appeals, G.R. No. 112012, [April 4, 2001], 408 PHIL 307-327
HOLISTIC TEST
“In the case at bar, other than the fact that both Nestle's and CFC's
products are inexpensive and common household items, the similarity
ends there. What is being questioned here is the use by CFC of the
trademark MASTER. In view of the difficulty of applying jurisprudential
precedents to trademark cases due to the peculiarity of each case,
judicial fora should not readily apply a certain test or standard just
because of seeming similarities. As this Court has pointed above, there
could be more telling differences than similarities as to make a
jurisprudential precedent inapplicable.”
Societe des Produits Nestle, S.A. v. Court of Appeals, G.R. No. 112012,
[April 4, 2001], 408 PHIL 307-327
IDEM SONANS
However, while we agree with the CA's use of the dominancy test, we arrive at a different
conclusion. Based on the distinct visual and aural differences between LOLANE and
ORLANE, we find that there is no confusing similarity between the two marks.
The suffix LANE is not the dominant feature of petitioner's mark. Neither can it be
considered as the dominant feature of ORLANE which would make the two marks
confusingly similar.
First, an examination of the appearance of the marks would show that there are noticeable
differences in the way they are written or printed as shown below:
XXX
As correctly argued by petitioner in his answer before the BLA, there are visual differences
between LOLANE and ORLANE since the mark ORLANE is in plain block upper case letters
while the mark LOLANE was rendered in stylized word with the second letter L and the
letter A co-joined.
Seri Somboonsakdikul v. Orlane S.A., G.R. No. 188996, [February 1, 2017], 805 PHIL 37-
58
IDEM SONANS
Similar to Etepha, appeals to the ear in pronouncing ORLANE and LOLANE are dissimilar.
The first syllables of each mark, i.e., OR and LO do not sound alike, while the proper
pronunciation of the last syllable LANE — 'LEYN' for LOLANE and 'LAN' for ORLANE,
being of French origin, also differ. We take exception to the generalizing statement of the
Director General, which was affirmed by the CA, that Filipinos would invariably pronounce
ORLANE as 'ORLEYN.' This is another finding of fact which has no basis, and thus, justifies
our reversal of the decisions of the IPO Director General and the CA. While there is possible
aural similarity when certain sectors of the market would pronounce ORLANE as 'ORLEYN,'
it is not also impossible that some would also be aware of the proper pronunciation —
especially since, as respondent claims, its trademark ORLANE has been sold in the market
for more than 60 years and in the Philippines, for more than 40 years.
Seri Somboonsakdikul v. Orlane S.A., G.R. No. 188996, [February 1, 2017], 805 PHIL 37-
58
IDEM SONANS
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
McDonald's 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:
xxx xxx xxx
Even respondent's use of the ‘Big Mak’ mark on non-hamburger food products cannot excuse their infringement
of petitioners' registered mark, otherwise registered marks will lose their protection under the law.
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.
Societe Produits Nestle, S.A. v. Dy, Jr., G.R. No. 172276, [August 9, 2010], 641 PHIL 345-367
IDEM SONANS
Applying the dominancy test in the present case, the Court finds that "NANNY" is confusingly similar to "NAN." "NAN" is the prevalent feature
of Nestle's 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.
In determining the issue of confusing similarity, the Court takes into account the aural effect of the letters contained in the marks. In
Marvex Commercial Company, Inc. v. Petra Hawpia & Company, the Court held:
It is our considered view that the trademarks "SALONPAS" and "LIONPAS" are confusingly similar in sound.
Both these words have the same suffix, "PAS", which is used to denote a plaster that adheres to the body with curative powers. "PAS," being
merely descriptive, furnishes no indication of the origin of the article and therefore is open for appropriation by anyone (Ethepa vs. Director of
Patents, L-20635, March 31, 1966) and may properly become the subject of a trademark by combination with another word or phrase.
xxx xxx xxx
The following random list of confusingly similar sounds in the matter of trademarks, culled from Nims, Unfair Competition and Trade Marks,
1947, Vol. 1, will reinforce our view that "SALONPAS" and "LIONPAS" are confusingly similar in sound: "Gold Dust" and ""Gold Drop";
"Jantzen" and "Jass-Sea"; "Silver Flash" and "Supper Flash"; "Cascarete" and "Celborite"; "Celluloid" and "Cellonite"; "Chartreuse" and
"Charseurs"; "Cutex" and "Cuticlean"; "Hebe" and "Meje"; "Kotex" and "Femetex"; "Zuso" and "Hoo Hoo." Leon Amdur, in his book "Trade-
Mark Law and Practice," pp. 419-421, cities [sic], as coming within the purview of the idem sonans rule, "Yusea" and "U-C-A," "Steinway
Pianos" and "Steinberg Pianos," and "Seven-Up" and "Lemon-Up." In Co Tiong vs. Director of Patents, this Court unequivocally said that
"Celdura" and "Condura" are confusingly similar in sound; this Court held in Sapolin Co. vs. Balmaceda, 67 Phil. 795 that the name "Lusolin"
is an infringement of the trademark "Sapolin," as the sound of the two names is almost the same.
Societe Produits Nestle, S.A. v. Dy, Jr., G.R. No. 172276, [August 9, 2010], 641 PHIL 345-367
WELL-KNOWN MARKS
SEC. 123. Registrability. – 123.1. A mark cannot be registered if it:
xxx
123.1. ( e ) Is identical with, or confusingly similar to, or constitutes a translation of a mark which is
considered by the competent authority of the Philippines to be well-known internationally and in the
Philippines, whether or not it is registered here, as being already the mark of a person other than the
applicant for registration, and used for identical or similar goods or services; Provided, That in
determining whether a mark is well-known, account shall be taken of the knowledge of the relevant
sector of the public, rather than of the public at large, including knowledge in the Philippines which
has been obtained as a result of the promotion of the mark;
xxx
147.2. The exclusive right of the owner of a well known mark defined in Subsection 123.1 ( e ) which
is registered in the Philippines, shall extend to goods or services which are not similar to those in
respect of which the mark is registered; Provided, That use of that mark in relation to those goods or
services would indicate a connection between those services or goods and the owner of the registered
mark; Provided, further, that the interests of the owner of the registered mark are likely damaged by
such use.
WELL-KNOWN MARKS
“The present controversy arose from H.D. Lee's application for the registration of the mark ’LEE & OGIVE CURVE
DESIGN,’ which was filed in 2001, pending the final resolution of Emerald's separate applications for the registration of
the marks ’DOUBLE CURVE LINES’ and ’DOUBLE REVERSIBLE WAVE LINE (Back Pocket Design).’
In 2009, then BLA Director Atty. Abelardo denied H.D. Lee's application for registration of ’OGIVE CURVE DESIGN’ by
reason of opposer Emerald's proven prior commercial use of ’DOUBLE REVERSIBLE WAVE LINE. ‘ Back then, Atty.
Abelardo already took note of the pendency of Emerald's two separate applications for the registration of ’DOUBLE
CURVE LINES’ and ’DOUBLE REVERSIBLE WAVE LINE.’
Despite the foregoing, the IPO's DG and CA proceeded to resolve the case unmindful of the pending applications for the
registration of ’DOUBLE CURVE LINES’ and ’DOUBLE REVERSIBLE WAVE LINE’ previously filed by Emerald.
Meanwhile, in G.R. No. 195415, the Court, via the Resolutions dated November 28, 2012 and January 28, 2013, made the
following findings with finality: (1) Emerald has been using the mark ’DOUBLE REVERSIBLE WAVE LINE (Back Pocket
Design)’ since October 1973, with sales invoices proving actual commercial use of the mark more than two months before
the application for its registration in 1990; (2) H.D. Lee's sale of its garments in the Philippines only began in 1996; and
(3) H.D. Lee failed to prove that the mark ’OGIVE CURVE DEVICE’ was well-known locally and internationally at the
time Emerald filed its application for the registration of the mark ’DOUBLE REVERSIBLE WAVE LINE (Back Pocket
Design).’
On the other hand, Emerald's application for the registration of its mark ’DOUBLE CURVE LINES’ had likewise been
resolved with finality by the IPO DG on June 5, 2008, and the corresponding Entry of Judgment was recorded on October
21, 2008.”
Emerald Garment Manufacturing Corp. v. The H.D. Lee Co., Inc. , G.R. No. 210693, [June 7, 2017], 810 PHIL 835-852
RIGHTS CONFERRED BY REGISTRATION
SEC. 147. Rights Conferred. – 147.1. Except in the cases of

importation of drugs and medicines allowed under Section 72.1
and of off-patent drugs and medicines, 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.
USE BY THIRD PARTIES OF NAMES, ETC.,
SIMILAR TO REGISTERED MARK
SEC. 148. Use of Indications by Third Parties for Purposes Other than those
for which the Mark is Used - Registration of the mark shall not confer on the
registered owner the right to preclude third parties from using bona fide their
names, addresses, pseudonyms, a geographical name, or exact indications
concerning the kind, quality, quantity, destination, value, place of origin or time
of production or of supply, of their goods or services; Provided That such use
is confined to the purposes of mere identification or information and cannot
mislead the public as to the source of the goods or services.
CANCELLATION OF REGISTRATION
• Cancellation by registrant
• Upon application
• Surrender of registration
• Petition for cancellation
• May be filed with Bureau of Legal Affairs by any person who believes he will be damaged by
registration of mark
• Within 5 years from date of registration
• At any time, where registered mark has become generic name for the goods or services or portion thereof or
registration obtained fraudulently or contrary to the IP Code, being used to misrepresent source of goods or services
• When mark has become generic
• Significance of registered mark to relevant public rather than purchasing motivation test
• Failure to use in the Philippines for uninterrupted period of 3 years or longer (unless caused by
circumstances arising independently of the will of the trademark owner);
• Lack of funds is not an excuse;
• Use of mark in different form but no alteration of distinctive character is not a ground;
• Use of a mark in connection with one or more goods or service belonging to the class not ground;
• Use of a mark by a company related to registrant inures to latter’s benefit.
Resultantly - unlike the rule on acquisition of ownership - the pronouncements of the Court relative to
registrations obtained in bad faith under the Trademark Law, as amended, still subsist even after the effectivity of
the IP Code. Thus, the following cases where the Court defined bad faith and fraud, although decided under the
regime of the Trademark Law, as amended, are still applicable.
The concepts of bad faith and fraud were defined in Mustang-Bekleidungswerke GmbH + Co. KG v. Hung Chiu
Ming, a case decided by the Office of the Director General of the IPO under the Trademark Law, as
amended, viz.:
What constitutes fraud or bad faith in trademark registration? Bad faith means that the applicant or registrant
has knowledge of prior creation, use and/or registration by another of an identical or similar trademark. In other
words, it is copying and using somebody else's trademark. Fraud, on the other hand, may be committed by
making false claims in connection with the trademark application and registration, particularly, on the issues of
origin, ownership, and use of the trademark in question, among other things.
Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

The concept of fraud contemplated above is not a mere inaccurate claim as to the origin, ownership,
and use of the trademark. In civil law, the concept of fraud has been defined as the deliberate intention
to cause damage or prejudice. The same principle applies in the context of trademark registrations:
fraud is intentionally making false claims to take advantage of another's goodwill thereby causing
damage or prejudice to another. Indeed, the concepts of bad faith and fraud go hand-in-hand in this
context. There is no distinction between the concepts of bad faith and fraud in trademark registrations
because the existence of one necessarily presupposes the existence of the other.
Shangri-la supports the definition of bad faith in trademark registrations as knowledge by the

registrant of prior creation, use, and/or registration by another of an identical or similar trademark.
In said case, since respondent Developers Group of Companies, Inc.'s (DGI) president was a previous
guest at one of petitioner's hotels, it was found that DGI was in bad faith when it appropriated and
registered the "SHANGRI-LA" mark and the "S" logo, viz.: x x x
Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

Shangrila case - When a trademark copycat adopts the word portion of

another's trademark as his own, there may still be some doubt that the
adoption is intentional. But if he copies not only the word but also the
word's exact font and lettering style and in addition, he copies also the
logo portion of the trademark, the slightest doubt vanishes. It is then
replaced by the certainty that the adoption was deliberate, malicious
and in bad faith.
Pagasa Industrial Corporation v. Court of Appeals [113] likewise supports
the definition of bad faith as prior knowledge. In said case, the Court
found that Pagasa registered the "YKK" mark in bad faith because it had
previously known that there was another person using the mark.

Birkenstock Orthopaedie GmbH and Co. KG v. Phil. Shoe Expo Marketing Corp. also
involved a finding that a party was in bad faith because it had known of the existence and
use by another person of the mark before said party appropriated and registered the
same, viz.: x x x
More importantly, however, there is also jurisprudential basis to declare these trademark
registrations done in bad faith as void. In the case of Shangri-La International Hotel
Management, Ltd. v. Developers Group of Companies, Inc. (Shangri-la Resolution), the
Court classified the respondent's registration as void due to the existence of bad faith and
because it failed to comply[118] with the provisions of the Trademark Law, as amended.
While the Court in the Shangri-la Resolution declared the trademark registration as void
based on two grounds, i.e., the presence of bad faith and the fact that the mark was
registered contrary to provisions of the law, either one of these grounds may be used as
sufficient basis for the courts or the IPO to declare trademark registrations as void.

To emphasize, the presence of bad faith alone renders void the trademark registrations.
Accordingly, it follows as a matter of consequence that a mark registered in bad faith shall be
cancelled by the IPO or the courts, as the case may be, after the appropriate proceedings.
This concept of bad faith, however, does not only exist in registrations. To the mind of the Court,
the definition of bad faith as knowledge of prior creation, use and/or registration by another of an
identical or similar trademark is also applicable in the use of trademarks without the benefit of
registration.
Accordingly, such bad faith use is also appropriately punished in the IP Code as can be seen in its
unfair competition provisions.
It is apparent, therefore, that the law intends to deter registrations and use of trademarks in bad
faith.
Concurrent with these aims, the law also protects prior registration and prior use of trademarks in
good faith.
Zuneca's evidence clearly falls short of establishing that Natrapharm had knowledge of the
prior creation or use by Zuneca of the "ZYNAPS" mark. Zuneca's evidence only tends to prove
that there was a possibility that someone from Natrapharm might have known of Zuneca's use of
"ZYNAPS" because Natrapharm and Zuneca attended the same conferences and that Zuneca
had listed "ZYNAPS" in the PPD publication.
Such possibility is not, however, sufficient to prove bad faith, especially when weighed against
Natrapharm's evidence and explanation on how it coined "ZYNAPSE" and the steps it took to
ensure that there were no other marks that were confusingly similar to it. Not only was
Natrapharm able to explain the origin of the name, it was also able to show that it had checked
the IMS-PPI, IPO, and BFAD databases and found that there was no brand name which was
confusingly similar to "ZYNAPSE".
Since Natrapharm was not shown to have been in bad faith, it is thus considered to have
acquired all the rights of a trademark owner under the IP Code upon the registration of the
"ZYNAPSE" mark.
TRADEMARK INFRINGEMENT
SEC. 155. 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 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, wrapper, 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 hereafter set forth:
Provided, that the infringement takes place at the moment any acts stated in Subsection 155.1 or this
subsection are committed regardless of whether there is actual sale of goods or services using the
infringing material
• MEASURE OF DAMAGES
• Reasonable profit which the complainant would have made or
• Profit which defendant actually made out of the infringement or
• In the event damages cannot be reasonably ascertained
• Reasonable percentage based upon the amount of gross sales of defendant or
• Value of the services in connection with which the mark or trade name was used in the infringement
• Where actual intent to mislead the public or defraud the complainant is shown, in the discretion of the
court, the damages may be doubled
• ACTIONS
• Impound during pendency of action, sales invoices and other documents evidence sales
• Injunction upon proper showing
• Court may order that infringing material be destroyed including labels, signs, prints, packages, wrappers,
etc, all plates, molds, matrices, etc.
• Re counterfeit goods, removal of trademark shall not be sufficient other than in exceptional cases which
shall be determined by Regulations to permit the release of the goods into channels of commerce
• REQUIREMENT OF NOTICE
• No entitlement to damages unless acts have been committed with knowledge that such imitation
is likely to cause confusion or to cause mistake or to deceive.
• Such knowledge is presumed if the registrant gives notice that his mark is registered by
displaying 'registered mark' or the letter ‘R' within a circle or if the defendant had otherwise
actual notice of registration
• LIMITATIONS TO ACTIONS FOR INFRINGEMENT

• Where person in good faith, before filing date or priority date ,was using the mark for the
purpose of his business or enterprise provided the right may be transferred or assigned only
together with such business or enterprise or that part of it in which the mark is used
• Innocent infringer (owner entitled only to injunction against future printing)
• Where infringement contained is in an ad in a newspaper, electronic communication, owner is
limited to an injunction against presentation in future issues or transmissions (except if injunction
will cause delay in delivery of such, but not to evade this section or delay injunctive relief
• A foreign corporation not engaged in business in the Philippines may sue with or
without license
• The court may determine who has right to registration, order cancellation in whole
or in part, otherwise rectify the register
• Action for false or fraudulent declaration or representation whether oral or written

or by any means renders the person liable in a civil action by the injured party
• Actions under SEC. 150, 155, 164 and 166 to 169 shall be brought before proper
courts with appropriate jurisdiction
• Clerks of courts to notify director in writing within one month after filing and one month
after judgment is entered
ELEMENTS OF TRADEMARK INFRINGEMENT
Further, in Prosource International, Inc. v. Horphag Research Management
SA, the Court held that, to establish trademark infringement, the following
elements must be proven: (l)the trademark being infringed is registered in
the IPO; (2) the trademark is reproduced, counterfeited, copied, or colorably
imitated by the infringer; (3) 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; (4) 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 (5) it is without the consent of the trademark owner or the assignee
thereof.
The essential element of infringement is that the infringing mark is likely

to cause confusion. In this case, the complaint-affidavit for the Davidoff
infringement case alleged confusing similarity between the cigarette
packs of the authentic Davidoff cigarette and the sample Dageta cigarette
pack seized during the search of FMC's premises. Respondents submitted
samples of the Davidoff and Dageta cigarette packs during the
preliminary investigation. They noted the following similarities: xxx
(see next slide)
Forietrans Manufacturing Corp. v. Davidoff Et. Cie Sa & Japan Tobacco,

Inc., G.R. No. 197482, [March 6, 2017], 806 PHIL 704-724
Davidoff (Exhibit 1) Dageta (Exhibit 2)
Black and red covering Black and red covering
Black and red covering Black and red covering
Silver coloring of the tear tape and printing Silver coloring of the tear tape and printing
"Made in Germany by Reemtsman under license of "Made Germany under license of DAGETA & Tobacco LT"
Davidoff & CIE SA, Geneva"
Manufacturing Code imprinted on the base of the pack Manufacturing Code imprinted on the base of the pack
Writing at the back says : "These carefully selected Writing at the back says: "These specifically selected
tobaccos have been skillfully blended to assure your tobaccos have been professionally blended to ensure
pleasure" with the signature of Zino Davidoff highest quality" with Chinese letters underneath the name
Dageta
DAMAGES
• The owner of a registered mark may recover damages from any person who
infringes his rights.
• The measure of damages suffered shall be either
• the reasonable profit which the complaining party would have made, had the
defendant not infringed his rights, or
• the profits which the defendant actually made out of the infringement, or
• in the event such measure of damages cannot be readily ascertained with reasonable
certainty, then the court may award as damages a reasonable percentage based upon
• the amount of gross sales of the defendant or
• the value of the services in connection with which the mark or trade name was used in the
infringement of the rights of the complaining party.
• On application of the complainant, the court may impound during the
pendency of the action, sales invoices and other documents evidencing sales.
(Sec 156)
DAMAGES
• In cases where actual intent to mislead the public or to defraud the
complainant is shown, in the discretion of the court, the damages may
be doubled.
• The complainant, upon proper showing, may also be granted
injunction. (Sec 156)
• In any suit for infringement, the owner of the registered mark shall not
be entitled to recover profits or damages unless the acts have been
committed with knowledge that such imitation is likely to cause
confusion, or to cause mistake, or to deceive.
• Such knowledge is presumed if the registrant gives notice that his
mark is registered by displaying with the mark the words “Registered
Mark” or the letter R within a circle or if the defendant had otherwise
actual notice of the registration. (Sec 158)
PENALTIES
SEC. 170. Penalties. – Independent of the civil and administrative

sanctions imposed by law, a criminal penalty of imprisonment from two
(2) years to Five (5) years and a fine ranging from Php 50,000 to Php
200,000 shall be imposed on any person who is found guilty of
committing any of the acts mentioned in Section 155 (infringement),
Section 168 (unfair competition) and Subsection 169.1 (false
designation of origin; false description or representation)
UNFAIR COMPETITION
• Person who has identified in public mind his goods, business or service, whether or
not a registered mark is employed, has property right in the goodwill of said goods,
business or service, which will be protected in the same manner as other property
rights
• The guilty person generally is the one who:
• Employs deception or other means contrary to good faith
• Passes off his goods, business or service as those of the one having established such goodwill
• Does any other act calculated to produce said result
• The guilty person in particular is the one who:
• Gives general appearance of goods of another to goods he is selling, either goods themselves
or wrapping of packages, devices or words or any other feature of appearance
• Is likely to influence purchasers to believe goods are those of the manufacturer or dealer
• Cloths the goods with such appearance to deceive public and defraud another of his
legitimate trade
• Is a subsequent vendor of such goods
• Is the agent of any vendor engaged in selling such goods with a like purpose (Sec 168)
UNFAIR COMPETITION
Time and again, the Court has held that unfair competition consists of the passing off (or palming off)
or attempting to pass off upon the public of the goods or business of one person as the goods or
business of another with the end and probable effect of deceiving the public. Passing off (or palming
off) takes place where the defendant, by imitative devices on the general appearance of the goods,
misleads prospective purchasers into buying his merchandise under the impression that they are
buying that of his competitors. In other words, the defendant gives his goods the general appearance
of the goods of his competitor with the intention of deceiving the public that the goods are those of his
competitor. The "true test," therefore, of unfair competition has thus been "whether the acts of the
defendant have the intent of deceiving or are calculated to deceive the ordinary buyer making his
purchases under the ordinary conditions of the particular trade to which the controversy relates."
Thus, the essential elements of an action for unfair competition are: (1) confusing similarity in the
general appearance of the goods; and (2) intent to deceive the public and defraud a competitor.
The confusing similarity may or may not result from similarity in the marks, but may result from other
external factors in the packaging or presentation of the goods. The intent to deceive and defraud may
be inferred from the similarity of the appearance of the goods as offered for sale to the public. Act
San Miguel Pure Foods Co., Inc. v. Foodsphere, Inc., G.R. Nos. 217781 & 217788, [June 20, 2018]
UNFAIR COMPETITION
In the instant case, the Court finds no error with the findings of the CA and Director General insofar as the
presence of the foregoing elements is concerned. First of all, there exists a substantial and confusing similarity in
the packaging of Foodsphere's product with that of SMPFCI, which, as the records reveal, was change by
Foodsphere from a paper box to a paper ham bag that is significantly similar to SMPFCI's paper ham bag. As
duly noted by the Director General and the CA, both packages use paper ham bags as the container for the
hams, both paper ham bags use the color as the main colors, and both have the layout design appearing on the
bags consisting of a partly sliced ham and fruits on the front and other ham varieties offered at the back. Thus,
Foodsphere's packaging in its entirety, and not merely its "PISTA" mark thereon, renders the general appearance
thereof confusingly similar with the packaging of SMPFCI's ham, that would likely influence purchasers to
believe that these products are similar, if not the same, as those of SMPFCI.

Second of all, Foodsphere's intent to deceive the public, to defraud its competitor, and to ride on the goodwill of
SMPFCI's products is evidenced by the fact that not only did Foodsphere switch from its old box packaging to
the same paper ham bag packaging as that used by SMPFCI, it also used the same layout design printed on the
same. As the Director General observed, why, of the millions of terms and combinations of letters, designs, and
packaging available, Foodsphere had to choose those so closely similar to SMPFCI's if there was no intent to
pass off upon the public the ham of SMPFCI as its own with the end and probable effect of deceiving the public.
San Miguel Pure Foods Co., Inc. v. Foodsphere, Inc., G.R. Nos. 217781 & 217788, [June 20, 2018]
UNFAIR COMPETITION
At this juncture, it is worthy to note that unfair competition is always a question of

fact. There is no inflexible rule that can be laid down as to what will constitute the
same, each case being, in the measure, a law unto itself. Thus, the question to be
determined is whether or not, as a matter of fact, the name or mark used by the
defendant has previously come to indicate and designate plaintiff's goods, or, to state
it in another way, whether defendant, as a matter of fact, is, by his conduct, passing
off defendant's goods as plaintiff's goods or his business as plaintiff's business. As
such, the Court is of the opinion that the case records readily supports the findings of
fact made by the Director General as to Foodsphere's commission of unfair
competition. Settled is the rule that factual findings of administrative agencies are
generally accorded respect and even finality by this Court, if such findings are
supported by substantial evidence, as it is presumed that these agencies have the
knowledge and expertise over matters under their jurisdiction, xxx”
San Miguel Pure Foods Co., Inc. v. Foodsphere, Inc., G.R. Nos. 217781 & 217788,
[June 20, 2018]
UNFAIR COMPETITION
The core of the controversy is the adoption of "PAPERONE" in the trade name of respondent,
which petitioner claims it has prior right to, since it was the first to use it as its trademark for its
paper products. Petitioner claims that respondent committed unfair competition by adopting
PAPERONE in its trade name. It is noteworthy that the issue of trademark infringement is not
the subject of the appeal before us.
xxx
Confusing similarity
As to the first element, the confusing similarity may or may not result from similarity in the
marks, but may result from other external factors in the packaging or presentation of the
goods. Likelihood of confusion of goods or business is a relative concept, to be determined only
according to peculiar circumstances of each case.
The marks under scrutiny in this case are hereby reproduced for easy reference:
Asia Pacific Resources International Holdings, Ltd. v. Paperone, Inc., G.R. Nos. 213365-66,
[December 10, 2018]
UNFAIR COMPETITION
Relative to the issue on confusion of marks and trade names, jurisprudence has noted two types
of confusion, viz.: (1) confusion of goods (product confusion), where the ordinarily prudent
purchaser would be induced to purchase one product in the belief that he was purchasing the
other; and (2) confusion of business (source or origin confusion), where, although the goods of
the parties are different, the product, the mark of which registration is applied for by one party, is
such as might reasonably be assumed to originate with the registrant of an earlier product; and
the public would then be deceived either into that belief or into the belief that there is some
connection between the two parties, though inexistent. Thus, while there is confusion of goods
when the products are competing, confusion of business exists when the products are non-
competing but related enough to produce confusion of affiliation.
This case falls under the second type of confusion. Although we see a noticeable difference on
how the trade name of respondent is being used in its products as compared to the trademark of
petitioner, there could likely be confusion as to the origin of the products. Thus, a consumer
might conclude that PAPER ONE products are manufactured by or are products of Paperone,
Inc. Additionally, although respondent claims that its products are not the same as petitioner's,
the goods of the parties are obviously related as they are both kinds of paper products.
Asia Pacific Resources International Holdings, Ltd. v. Paperone, Inc., G.R. Nos. 213365-66,
[December 10, 2018]
UNFAIR COMPETITION
The BLA Director aptly ruled that "[t]o permit respondent to continue using the same or identical
Paperone in its corporate name although not [used] as label for its paper products, but the same line of
business, that of manufacturing goods such as PAPER PRODUCTS, therefore their co-existence would
result in confusion as to source of goods and diversion of sales to [r]espondent knowing that purchasers
are getting products from [petitioner] APRIL with the use of the corporate name Paper One, Inc. or
Paperone, Inc. by herein [r]espondent."
The matter of prior right over PAPERONE, again, is a matter of factual determination; therefore, we give
credence to the findings of the IPO, who has the expertise in this matter, being supported by substantial
evidence. The Court has consistently recognized the specialized functions of the administrative agencies
— in this case, the IPO. Berris Agricultural Co., Inc. v. Abyadang states, thus:
The determination of priority of use of a mark is a question of fact. Adoption of the mark alone does not
suffice. One may make advertisements, issue circulars, distribute price lists on certain goods, but these
alone will not inure to the claim of ownership of the mark until the goods bearing the mark are sold to the
public in the market. Accordingly, receipts, sales invoices, and testimonies of witnesses as customers, or
orders of buyers, best prove the actual use of a mark in trade and commerce during a certain period of
time.
Asia Pacific Resources International Holdings, L td. v. Paperone, Inc., G.R. Nos. 213365-66, [December 10, 2018]
UNFAIR COMPETITION
Intent to deceive the public and defraud a competitor

The element of intent to deceive and to defraud may be inferred from the similarity of the
appearance of the goods as offered for sale to the public. Contrary to the ruling of the CA,
actual fraudulent intent need not be shown. Factual circumstances were established
showing that respondent adopted PAPERONE in its trade name even with the prior
knowledge of the existence of PAPER ONE as a trademark of petitioner. As in all other
cases of colorable imitations, the unanswered riddle is why, of the millions of terms and
combinations of letters available, respondent had to choose those so closely similar to
another's trademark if there was no intent to take advantage of the goodwill generated by
the other mark.
With regard to the issue on damages, we likewise agree with the IPO that the actual
damages prayed for cannot be granted because petitioner has not presented sufficient
evidence to prove the amount claimed and the basis to measure actual damages.
Asia Pacific Resources International Holdings, Ltd. v. Paperone, Inc., G.R. Nos. 213365-
66, [December 10, 2018]
FALSE DESIGNATION OF ORIGIN
FALSE DESCRIPTION OR REPRESENTATION
SEC 169. FALSE DESIGNATIONS OF ORIGIN; FALSE DESCRIPTION OR
REPRESENTATION. – 169.1. Any person who, on or in connection with any goods or
services, or any container for goods, uses in commerce any word, term, name, symbol,
or device, or any combination thereof, or any false designation of origin, false or
misleading description of fact, or false or misleading representation of fact, which:
(a) Is likely to cause confusion, or to cause mistake, or to deceive as to affiliation,
connection, or association of such person with another person, or as to origin,
sponsorship, or approval of his or her goods, services, or commercial activities by
another person; or
(b) In commercial advertising or promotion, misrepresents the nature, characteristics,
qualities or geographic origin of his or her or another person’s goods, services, or
commercial activities, shall be liable to a civil action for damages and injunction
provided in Section 156 and 157 of this Act by any person who believes that he or
she is or is likely to be damages by such act.
FALSE DESIGNATION OF ORIGIN
FALSE DESCRIPTION OR REPRESENTATION
“Respondents alleged in their Complaint-Affidavit that petitioners illegally manufactured and/or stored
cigarettes bearing the ‘DAGETA’ label with an indication that these cigarettes were made in Germany even
if they were actually processed, manufactured and packed in the premises of FMC. To support their claim,
respondents submitted samples and attached a copy of the receipt/inventory of the items seized during the
August 4, 2004 raid. These included cigarettes bearing the infringing DAGETA trademark and various
machineries, receptacles, boxes and other paraphernalia used in the manufacturing and packing of the
infringing products.
Petitioners, for their part, disputed respondents' claim and maintained that the items seized from their
warehouse were genuine Dageta and Dageta International cigarettes imported from Germany. In
dismissing the charge, Secretary Gonzalez ruled that respondents failed to establish the falsity of the claim
indicated in the cigarettes' labels that they were made in Germany without providing the factual or legal
basis for his conclusion. He also brushed aside the allegations that (1) machines intended for
manufacturing cigarettes and (2) cigarettes' bearing the label ‘Made in Germany’ were found and seized
from FMC's warehouse in the Philippines. To our mind, however, these circumstances are enough to excite
the belief that indeed petitioners were manufacturing cigarettes in their warehouse here in the Philippines
but misrepresenting the cigarettes' origin to be Germany. The CA, therefore, did not err in reversing the
Resolution of the Secretary of Justice.”
Forietrans Manufacturing Corp. v. Davidoff Et. Cie Sa & Japan Tobacco, Inc., G.R. No. 197482, [March 6,
2017], 806 PHIL 704-724
TRADEMARK INFRINGEMENT v UNFAIR COMPETITION
'In intellectual property law, a registered trademark owner has the right to

prevent others from the use of the same mark (brand) for identical goods or
services. The use of an identical or colorable imitation of a
registered trademark by a person for the same goods or services or closely
related goods or services of another party constitutes infringement. It is a
form of unfair competition because there is an attempt to get a free ride on
the reputation and selling power of another manufacturer by passing of
one's goods as identical or produced by the same manufacturer as those
carrying the other mark (brand).'
Commissioner of Internal Revenue v. San Miguel Corp., G.R. Nos. 205045
& 205723, [January 25, 2017], 804 PHIL 293-340
REGISTRATION OF MARKS
UNDER THE MADRID PROTOCOL
• COVERAGE - The Madrid System for the International Registration of Marks provides a single
solution for registering and managing marks worldwide. It became effective in the Philippines on July
25, 2012.
• RIGHTS CONFERRED – It allows the trademark owner to file one application in one language, and
to pay one set of fees to protect mark in up to 120 countries.
• REQUIREMENTS FOR REGISTRATION – To file an international registration, applicant must

submit a basic application file with IPO under the IP Code. The applicant must be a national of, is
domiciled in, or must have been a business operating in the Philippines. The application may be based
on a mark already registered or applied for and should contain:
• Name. address, and details of applicant or his representative
• Designated contracting parties
• Reproduction of the mark
• Goods and services bearing the mark
• TERM OF PROTECTION – 10 years

MADRID PROTOCOL
On March 27, 2012, President Benigno C. Aquino III ratified
the Madrid Protocol through an instrument of accession. The instrument of
accession was deposited with the Director General of the World Intellectual
Property Organization (WIPO) on April 25, 2012. The Madrid Protocol entered into
force in the Philippines on July 25, 2012.
Petitioner IPAP, an association of more than 100 law firms and individual
practitioners in Intellectual Property Law whose main objective is to promote and
protect intellectual property rights in the Philippines through constant assistance
and involvement in the legislation of Intellectual Property Law, has commenced this
special civil action for certiorari and prohibition to challenge the validity of the
President's accession to the Madrid Protocol without the concurrence of the Senate.
Intellectual Property Association of the Philippines v. Ochoa, G.R. No. 204605, [July
19, 2016], 790 PHIL 276-347
MADRID PROTOCOL
The Madrid System for the International Registration of Marks (Madrid

System), which is the centralized system providing a one-stop solution for registering
and managing marks worldwide, allows the trademark owner to file one application
in one language, and to pay one set of fees to protect his mark in the territories of
up to 97 member-states. The Madrid System is governed by the Madrid Agreement,
concluded in 1891, and the Madrid Protocol, concluded in 1989.
The Madrid Protocol, which was adopted in order to remove the challenges
deterring some countries from acceding to the Madrid Agreement, has two
objectives, namely: (1) to facilitate securing protection for marks; and (2) to make
the management of the registered marks easier in different countries.
Intellectual Property Association of the Philippines v. Ochoa, G.R. No. 204605, [July
19, 2016], 790 PHIL 276-347
MADRID PROTOCOL
There is no conflict between the

Madrid Protocol and the IP Code.
The IPAP also rests its challenge on the supposed conflict between the Madrid Protocol and the IP Code,
contending that the Madrid Protocol does away with the requirement of a resident agent under Section 125 of
the IP Code; and that the Madrid Protocol is unconstitutional for being in conflict with the local law, which it
cannot modify.
The IPAP's contentions stand on a faulty premise. The method of registration through the IPOPHL, as laid
down by the IP Code, is distinct and separate from the method of registration through the WIPO, as set in
the Madrid Protocol. Comparing the two methods of registration despite their being governed by two separate
systems of registration is thus misplaced.
In arguing that the Madrid Protocol conflicts with Section 125 of the IP Code, the IPAP highlights the
importance of the requirement for the designation of a resident agent. It underscores that the requirement is
intended to ensure that non-resident entities seeking protection or privileges under Philippine Intellectual
Property Laws will be subjected to the country's jurisdiction. It submits that without such resident agent, there
will be a need to resort to costly, time consuming and cumbersome extra-territorial service of writs and
processes.

Intellectual Property Association of the Philippines v. Ochoa, G.R. No. 204605, [July 19, 2016], 790 PHIL 276-347
MADRID PROTOCOL
The IPAP misapprehends the procedure for examination under the Madrid Protocol. The
difficulty, which the IPAP illustrates, is minimal, if not altogether inexistent. The IPOPHL
actually requires the designation of the resident agent when it refuses the registration of a
mark. Local representation is further required in the submission of the Declaration of Actual
Use, as well as in the submission of the license contract. The Madrid Protocol accords with
the intent and spirit of the IP Code, particularly on the subject of the registration of
trademarks. The Madrid Protocol does not amend or modify the IP Code on the acquisition
of trademark rights considering that the applications under the Madrid Protocol are still
examined according to the relevant national law. In that regard, the IPOPHL will only grant
protection to a mark that meets the local registration requirements.
Intellectual Property Association of the Philippines v. Ochoa, G.R. No. 204605, [July 19,
2016], 790 PHIL 276-347

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INTELLECTUAL PROPERTY CODE

TRADEMARKS AND TRADE NAMES

1. What is the requirement of actual use in connection with marks?

• DEFINITION OF MARKS, COLLECTIVE MARKS AND TRADE NAMES

• ACQUISITION OF OWNERSHIP OF MARK

• ACQUISITION OF OWNERHSIP OF TRADE NAME

• PRIOR USE OF MARK AS REQUIREMENT

• RIGHTS CONFERRED BY REGISTATION

• USE BY THIRD PARTIES OF NAMES, ETC. SIMILAR TO

• REGISTRATION OF MARKS UNDER THE MADRID PROTOCOL

Businesses generally thrive or perish depending on their reputation among customers.

121.2. 'COLLECTIVE MARKS' – any visible sign designated as such in the

121.3. 'TRADE NAME' - the name or designation identifying or distinguishing

The case of Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

As early as the Spanish regime, trademarks were already protected in the Philippines. The Real

Act No. 666

The manner of acquiring ownership over trademarks changed during the

TRADEMARKS AND TRADENAMES

Amendment to the Trademark Law

It must be emphasized that registration of a trademark, by itself, is not a mode of acquiring

• Notwithstanding any laws or regulations providing for any

• The subsequent use of the trade name by a third party, whether as

• Likely to mislead the pubic, particularly as to nature, quality, characteristics or geographical

• Consisting exclusively of signs or indications that have become customary or usual to

• Color alone unless defined by a given form; or

• Contrary to public order or morality.

“Colorable imitation denotes such a close or ingenious imitation as to be

SEC. 147. Rights Conferred. – 147.1. Except in the cases of

Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

Shangri-la supports the definition of bad faith in trademark registrations as knowledge by the

Zuneca Pharmaceutical, et al v Natrapharm Inc., GR 211850, Sep 8, 2020

Shangrila case - When a trademark copycat adopts the word portion of

Zuneca Pharmaceutical, et al v Natrapharm Inc. GR 211850 Sep 8, 2020

Zuneca Pharmaceutical, et al v Natrapharm Inc. GR 211850 Sep 8, 2020

• LIMITATIONS TO ACTIONS FOR INFRINGEMENT

• Action for false or fraudulent declaration or representation whether oral or written

The essential element of infringement is that the infringing mark is likely

Forietrans Manufacturing Corp. v. Davidoff Et. Cie Sa & Japan Tobacco,

Black and red covering Black and red covering

Black and red covering Black and red covering

SEC. 170. Penalties. – Independent of the civil and administrative

At this juncture, it is worthy to note that unfair competition is always a question of

Intent to deceive the public and defraud a competitor

'In intellectual property law, a registered trademark owner has the right to

• REQUIREMENTS FOR REGISTRATION – To file an international registration, applicant must

• TERM OF PROTECTION – 10 years

The Madrid System for the International Registration of Marks (Madrid

There is no conflict between the

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