THE LAW ON TRADEMARKS, SERVICE MARKS
AND TRADE NAMES
Q. What is a monopoly?
A. It is the control obtained by one supplier over the commercial market within a given region (Black’s)
Q. Is the exercise of Intellectual Property Law a form of monopoly?
A. In a way. Copyright laws allow others to enjoy an author’s economic rights when there is permission. Trademarks protect goodwill, it does not prevent production of similar goods. Patent protection lasts for only 17 years.
Q. If s, why is it allowed, since the Constitution prohibits monopolies?
A. Because it provides incentive for innovation and technological advancement.
Q. The Constitution provides, “the State shall regulate the acquisition, ownership, use, and disposition of property and its increments.” How does this relate to IP law?
A. IP Law can be viewed as an exercise of this regulation. Copyright lasts for only 50 years. Patent protection for 17 years. Trademarks have to be used.
Sec. 121. Definitions. - As used in Part III, the following terms have the following meanings:
121.1. "Mark" means 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; (Sec. 38, R. A. No. 166a)
121.2. "Collective mark" means any visible sign designated as such in the application for registration and capable of distinguishing the origin or any other common characteristic, 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; (Sec. 40, R. A. No. 166a)
121.3. "Trade name" means the name or designation identifying or distinguishing an enterprise; (Sec. 38, R. A. No. 166a)
121.4. "Bureau" means the Bureau of Trademarks;
121.5. "Director" means the Director of Trademarks;
121.6. "Regulations" means the Rules of Practice in Trademarks and Service Marks formulated by the Director of Trademarks and approved by the Director General; and
121.7. "Examiner" means the trademark examiner. (Sec. 38, R. A. No. 166a)
Q. Can a trademark be a tradename at the same time?
A. Yes.
Q. Can smell be a proper trademark?
A. The law does not seem to allow it, since a “mark” is defined as a visible sign.
Q. Can sound be a proper trademark? E.g. the distinctive sound of a Harley Davidson
A. No. It must be a visible sign, under the IP code, and under an American case.
Sec. 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)
Q. How is trademark protection acquired?
A. By registration.
Q. A Singapore company sells products over the internet to the Philippines. It does not have an office in RP. If a Philippine company sells products here with the name of the Singapore company, can the Singapore company sue here in the Philippines, not having registered its trademark here?
A. Yes, it may sue. Sec. 160 provides: Any foreign national or juridical person who meets the requirements of Section 3 of this Act and does not engage in business in the Philippines may bring a civil or administrative action hereunder for opposition, cancellation, infringement, unfair competition, or false designation of origin and false description, whether or not it is licensed to do business in the Philippines under existing laws.
Q. Does it matter where title transfers, like if it were FOB Manila or FOB Singapore?
A. No.
Sec. 123. Registrability. -
123.1. A mark cannot be registered if it:
(a) Consists of immoral, deceptive or scandalous matter, or matter which may disparage or falsely suggest a connection with persons, living or dead, institutions, beliefs, or national symbols, or bring them into contempt or disrepute;
(b) Consists of the 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;
(c) Consists of a 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 the widow;
(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:
(i) The same goods or services, or
(ii) Closely related goods or services, or
(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion;
(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;
(f) Is identical with, or confusingly similar to, or constitutes a translation of a mark considered well-known in accordance with the preceding paragraph, which is registered in the Philippines with respect to goods or services which are not similar to those with respect to which registration is applied for: Provided, That use of the mark in relation to those goods or services would indicate a connection between those goods or services, and the owner of the registered mark: Provided further, That the interests of the owner of the registered mark are likely to be damaged by such use;
(g) Is likely to mislead the public, particularly as to the nature, quality, characteristics or geographical origin of the goods or services;
(h) Consists exclusively of signs that are generic for the goods or services that they seek to identify;
(i) Consists exclusively of signs or of indications that have become customary or usual to designate the goods or services in everyday language or in bona fide and established trade practice;
(j) Consists 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 services;
(k) Consists of shapes that may be necessitated by technical factors or by the nature of the goods themselves or factors that affect their intrinsic value;
(l) Consists of color alone, unless defined by a given form; or
(m) Is contrary to public order or morality.
123.2. As regards signs or devices mentioned in paragraphs (j), (k), and (l), nothing shall prevent the registration of any such sign or device which has become distinctive in relation to the goods for which registration is requested as a result of the use that have been made of it in commerce in the Philippines. The Office may accept as prima facie evidence that the mark has become distinctive, as used in connection with the applicant’s goods or services in commerce, proof of substantially exclusive and continuous use thereof by the applicant in commerce in the Philippines for five (5) years before the date on which the claim of distinctiveness is made.
123.3. The nature of the goods to which the mark is applied will not constitute an obstacle to registration. (Sec. 4, R. A. No. 166a)
A mark cannot be registered if it:
(a) immoral, deceptive or scandalous matter
(b) flag or coat of arms
(c) name of a particular living individual or portrait of a deceased President of the Philippines
(d) Is identical with a registered mark as to :
(i) The same goods or services, or
(ii) Closely related goods or services, or
(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion;
Amigo v. Cluet Peabody – Idem Sonans
354 SCRA 434 (2001)
Cluet (NY) filed for cancellation of Amigo (RP) TM for “Gold Toe.” Cluet owns “Gold Top. Cluet alleged Amigo uses similar logo, uses the word “linenized” which is their registered TM. Director of Patents and CA ruled for cancellation, based on application of 1) idem sonans rule and 2) existence of a confusing similarity in appearance between the trademarks. Amigo argues that “Gold Toe” and “Gold Top” do not sound alike and are pronounced differently. Since the words “gold” and “toe” are generic, Cluet has no right to exclusive use.
HELD: Idem sonans argument incorrect. Admittedly the pronunciation of Gold Top and Gold Toe, do not by themselves, cause confusion. However, there is hardly a variance in the appearance of the logo’s. SC used the dominancy test and the holistic test. In either test, there is an obvious colorable imitation.
Nestle v. CA – Master not generic
356 SCRA 207 (2001)
CFC Corp. filed application for registration of Flavor Master instant coffee. Nestle filed notice of opposition claiming trademark is confusingly similar for Master Roast and Master Blend are its own TM. Nestle claims use of CFC will cause confusion and deceive purchasers as dominant word present in the three trademarks is Master. CA used holistic test, Nestle claims dominancy test should be used.
HELD: Correct. Test is ordinary purchaser who in buying more common and less expensive household products is less inclined to closely examine specific details of similarities and dissimilarities. The word Master is neither a generic nor a descriptive term, and as such, said term cannot be invalidated as a trademark and may be legally protected. A generic term is the common descriptive name of an article or substance, and a descriptive term conveys the characteristics, functions, qualities and ingredient of a product to one who has never seen it and does not know what it is. Master is a suggestive term brought about by the advertising scheme of Nestle, as when it uses Jaworski and Puno.
(e) similar to, or translation of, internationally known mark, registered or not as to same goods
(f) similar to, or translation of, internationally known mark, when registered, as to all goods.
Canon v. CA
NSR Rubber filed an application for the registration of the mark Canon for Sandals. Canon (Japan) filed an opposition, alleging that it will be damaged by the registration of Canon for Sandals. Canon manufactures chemical products, photographic and cinematographic instruments, and electrical instruments. The products manufactured by the parties are dissimilar but Canon Japan points out that it has branched out its business on various goods including footwear.
Held: Ordinarily, ownership of trademark is a property right which is entitled to protection. However, when a TM is used for a product in which the other party does not deal, the use of the same trademark on the latter’s product cannot be validly objected to. The certificate of registration shown by Canon Japan in RP and other countries show that the covered goods are paints, chemical products and toners. Trademark owner is entitled to protection when junior user forestalls the normal expansion of the business, but Canon Japan has failed to attach evidence that would convince that it has also embarked in the production of footwear products.
Q. Do you agree with the decision?
A. Proper answer: The decision interpreted the law then. The case would have been decided differently today, due to the amendments introduced by Sec. 123.1 (e).
Q. Why is this the proper answer?
A. Case was drafted by Negre when he was in the Bureau of Trademarks.
(g) misleading as to the nature, quality, characteristics or geographical origin of the goods or services;
(h) generic
Kellogg v. National Biscuit Company
Nabisco brought a suit against Kellogg to enjoin unfair competition in the manufacture and sale of breakfast food known as shredded wheat. Kellogg, like Nabisco, uses the name shredded wheat and produces it in pillow-shaped form. Shredded wheat was introduced in 1893 by Perky and the patent expired in 1895, going into public domain. Nabisco was the first manufacturer. Nabisco does not claim exclusive right to make shredded wheat but claims exclusive right to the trade name “Shredded Wheat.” Nabisco also claims that it has acquired a secondary meaning.
Held: Nabisco has no exclusive right to use the term “Shredded Wheat” as a trade name, for that is the generic term of the article which describes it with a fair degree of accuracy. Since the term is generic, the original maker of the product acquired no exclusive right to use it. There is no basis for applying the doctrine of secondary meaning. To establish a trade name, plaintiff must show more than a subordinate meaning, but must show that the primary significance of the term in the minds of the consuming public is not the product but the producer.
Q. Can you trademark the terms thermos, cellophane, aspirin?
A. No. These used to be big marks, but because of “improper use” (not non-use) they were abandoned. Xerox is now spending billions in advertising to reclaim the trademark.
(i) descriptive
Q. Can a descriptive word be appropriated?
A. No. But it can be appropriated when used in combination with other words.
Romero v. Maiden Form Inc.
Maidenform, a foreign corporation, filed an application for registration of the trademark Adagio for the brassieres it manufactures. This was alleged to have first been used in US in 1937 and in RP in 1946. This was granted. Romero filed a petition for cancellation on the ground that it is a common descriptive name of an article. It was said that that Adagio has become a common descriptive name of a particular style of brassiere and is unregistrable.
Held: No merit. Adagio is a musical term meaning slow or easy manner first used by owners because they are musically inclined. They also adopted other terms such as Etude, Overture, Chansonette. The fact that said mark is used also to designate a particular style of brassiere does not affect its registrability as a trademark. Its long and continuous use has not rendered it merely descriptive. Widespread dissemination does not justify the [oppositor’s] use of the trademark.
Ong Ai Gui v. Director
Ong Ai Gui filed an application for the registration of the tradename, “20th Century Nylon Shirts Factory.” E. I. Du Pont filed an opposition on the ground that the word “nylon” was a name coined by Du Pont as a generic name of a synthetic fabric and is a generic term, the use of which is descriptive and the use would cause confusion in trade. Opposition was dismissed but director asked the word “nylon” be disclaimed. Ong appeals.
Held: The tradename may be registered, but it may not be entitled to exclusive use of the terms “shirt factory” and “nylon” because the terms are merely descriptive or general terms, incapable of appropriation by any single individual to the exclusion of others. This is because all persons have an equal right to produce and vend similar articles and they also have the right to describe them properly and to use appropriate language.
Q. Can generic terms be appropriated by long use?
A. no. Only descriptive words can be appropriated by long use.
Q. “Xerox” is descriptive or generic?
A. Seems to be generic, since it is found in the dictionary as a verb.
(j) Consists 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 services;
Q. Is a name denoting geographical location registrable as a trademark?
A. General rule: Can’t be used when
1. It induces public to believe that it is manufactured in a place where it is not really manufactured there, e.g. Champagne is a sparkling wine from a particular city in France; no other wine can be called Champagne.
2. If that place is known for the goods, you can’t register, e.g. Batangas is known for its coffee
Exception: If that place is not particularly known for products of that kind, e.g. Baguio Oil, Seattle’s Best
(k) shapes
Kellogg v. Nabisco
Nabisco claims the exclusive right to make it in pillow-shaped form. It is urged that all possibility of deception and confusion would be removed it Kellogg would adopt another form other than the pillow shape.
Held: The evidence is persuasive that this form is functional – that the cost of the biscuit would be increased and its high quality lessened if some other form were substituted for the pillow shape.
In Re Weber
The examining attorney of the Trademark Board refused registration of Weber’s barbecue grills as trademarks on the ground of functionality.
Held. Wrong. The Trademark Trial and Appeals Board found that the examining attorney erred in refusing registration in the absence of evidence that the grill’s round configuration was a superior design which other manufacturers needed to be able to use in order to compete effectively. Trade dress is mechanically functional when its elements are so utilitarian or superior to alternative elements that denying these elements to competitors inhibits competition. The factors that show mechanical functionality of trade dress include 1) if a utility patent discloses the utilitarian advantages of the design, 2) the utilitarian advantages are touted through advertising, 3) there is an unavailability of alternative designs, and 4) the design is the result of a relatively simple or inexpensive manufacturing method. In this case, the kettle body and legs configuration for barbecue grills was found NOT de jure functional. Evidence was found sufficient to establish acquired distinctiveness. Hence, it can be registered.
Q. What is different from this case and Kellogg?
A. Here, there is finding that the shape was not entirely just functional, as in Kellogg.
(l) color
(m) Is contrary to public order or morality.
Secondary meaning
Q. Cerveza Negra means “Black Beer” in Spanish, can it be registered?
A. Yes, it has acquired secondary meaning
Arce Sons v. Selecta
Selecta Biscuit filed a petition for the registration of the word Selecta as trademark to be used on its bakery products. Arce filed an opposition saying that it has continuously used that word in its products. It used this on its milk products and as the name of a bakery. Director granted trademark because the word as used by Arce points only to the place of business or location of its restaurant.
Held: Arce has made use of Selecta not only as a tradename, indicative of the location of the restaurant but also as a trademark to indicate the goods it offers for sale to the public. The word Selecta is an ordinary or common word but once adopted or coined in connection with one’s business as an emblem or as a badge of authenticity, it may acquire a secondary meaning as to be exclusively associated with its products and business.
Q. Is “premium” a proper mark?
A. No. It is descriptive.
Etepha v. Director
Westmont (NY) sought registration of Atussin, a medical expectorant antihistamine. Etepha (liechtenstin) objected, saying Atussin is confusingly similar to Pertussin and that the buying public will be misled into believing that Westmont’s product is that of Etepha’s which enjoys goodwill.
Held: Tussin is a Latin rootword meaning cough. Tussin is merely descriptive; it is generic; it furnishes to the buyer no indication of the origin of the goods. Thus, it is barred from registration as a tradename. While tussin by itself cannot be used exclusively, it may become a subject of trademark by combination with another word of phrase.
Here, the two are entirely different in colors, content and arrangement so the contrast is so pronounced that the label cannot be mistaken for another. They also don’t sound alike when pronounced. Also, medicinal preparations are unlike articles of everyday use which may freely be obtained by anyone. A buyer of medicine must first go to a doctor for instructions on what to purchase, and he is cautious and would examine the product sold to him.
Q. Do you agree with this case?
A. Hmm… maybe not, since you should take the point of view of an ordinary consumer who doesn’t know what tussis means.
Q. Would the case have been decided in the same manner if it involved veterinary medicine?
A. Probably. People don’t usually buy vet medicine so they would be careful if they do.
Philippine Nut Industry v. Standard Brands
Philippine Nut obtained registration of “Philippine Planters Cordial Peanuts.” On its salted peanuts. Standard Brands, a foreign corporation filed for the cancellation of registration saying that it was the owner of “Planters Cocktail Peanuts” trademark and that Phil Nut closely resembles and is confusingly similar to its own trademark. Phil Nut claims that “Planters” cannot be considered a dominant feature of the product since it is merely descriptive.
Held: Without merit. Planters is an ordinary word but it is used in the label not to describe the nature of the product but to project the source or origin of the salted peanuts. Based from the logos, it is true that other words are displayed (cordial and cocktail) but these are mere adjectives. As a whole, it is the word Planters which draws the attention of the buyer and leads him to conclude that the salted peanuts originate from one and the same manufacturer. It is true that no producer may have a monopoly of any color scheme or form of words in a label but when a competitor adopts a distinctive or dominant mark or feature of another’s trademark, the intent to pass to the public his product as that of another is quite obvious.
Secondary meaning – a word originally incapable of exclusive appropriation may nevertheless have been used so long and so exclusively by one producer with reference to his article that, in that trade and to that branch of the purchasing public, the word or phrase has come to mean that the article was his product. Here, there is evidence to show that the term Planters has become a distinctive mark or symbol as salted peanuts are concerned.
E Spinner v. Neuss Hesslein Corp.
E Spinner (England) is engaged in manufacture and sale of textiles. It sells khaki cloth in RP under the brand Wigan. Neuss Hesslein (US) came to RP later and sold khakis. It sold it under the Five Soldiers brand then it later asked its NY office to print the word Wigan conspicuously on the khakis intended for sale in RP. Wigan is used in commercial parlance as the name of a canvass-like cotton fabric used to stiffen parts of garments. Neuss Hesslein claims to use the word to indicate color, saying that US dealers are accustomed to use the word Wigan to indicate a color of khaki cloth. E. Spinner files action to restrain use of the word Wigan, claiming that it uses that word to indicate quality.
Held: The persons most to be considered is the consumer and when the word Wigan is found on khaki, the ultimate buyer or the consumer who would be led to suppose that the goods are sold by E Spinner. It makes no difference that dealers in the article are not deceived. They are informed and usually know what they are buying. The law concerns itself with the casual purchaser who knows the commodity only by its name. The word Wigan here is used in an entirely artificial sense and its association with quality had its origin exclusively in the use which E Spinner originally intended.
Intel v. Advanced Micro Devices
Intel uses the 386 designation for processor microchips. AMD probably used this to designate its own products and Intel filed a case against AMD.
Held: AMD argued successfully that Intel’s 386 designation for processor microchips was generic. Intel was subsequently unsuccessful in registering 486 or i486. Hence, it switched to the “Pentium” and “Celeron” names. Note that in the US, trademark protection is acquired via use, not registration. Because Intel’s purported mark is unregistered, Intel has the burden of proof on the issue of genericness of the asserted mark
Q. Why is the E. Spinner decision different from the Intel decision?
A. Because in Intel, the mark was generic. In E. Spinner, the mark is descriptive of quality because it is arbitrary.
Ana Ang v. Toribio Teodoro
Teodoro used “Ang Tibay” for slippers and shoes since 1910. Ang registered “Ang Tibay” for shorts and shirts on 1932. Teodoro filed a complaint to cancel the registration of the TM of Ana Ang. He claims that Ana Ang has not proven that she spent money for advertising Ang Tibay shirts and pants. Ana Ang claims that the term is descriptive and that there is no secondary meaning attached to the term, and that the goods are different and are not likely to mislead the general public as to their origin.
Held: “Ang Tibay” is not a descriptive term but a fanciful or coined phrase which may be legally appropriated. Ang Tibay is an exclamation denoting admiration of strength, and can be translated to mean “How strong!” Ang Tibay has also acquired a secondary meaning because the exclusive use of the phrase for Teodoro’s product has allowed it to acquire a proprietary connotation. As to the argument that the goods are not similar, although two noncompeting articles may be classified under two different classes by the Patent office, nevertheless, if simultaneous use on them would be likely to cause confusion as to the source or origin, then there can be unfair competition. Also, it would prevent the natural expansion of his business and it would cause the business to be confused with the second user.
Q. Is “Ang Tibay” descriptive?
A. Court held that it is a fanciful or coined term. The Court says that the proper descriptive term is “matibay” and not “Ang Tibay.”
Q. Is grammar important?
A. No (?)
Q. Is the use of famous marks on unrelated goods permissible?
A. Although they are noncompeting, if simultaneous use will cause confusion, it will not be permissible.
Q. What are the kinds of words?
A. The words are classified to:
1. common words
a. generic – never capable of registration
b. descriptive – there is immediate association
- not registrable except when there is secondary meaning, or used with other words
c. suggestive – requires imegination/deduction
2. fanciful/coined - e.g. Kodak
3. arbitrary - e.g. Apple Computer
Sec. 124. Requirements of Application. -
124.1. The application for the registration of the mark shall be in Filipino or in English and shall contain the following:
(a) A request for registration;
(b) The name and address of the applicant;
(c) The name of a State of which the applicant is a national or where he has domicile; and the name of a State in which the applicant has a real and effective industrial or commercial establishment, if any;
(d) Where the applicant is a juridical entity, the law under which it is organized and existing;
(e) The appointment of an agent or representative, if the applicant is not domiciled in the Philippines;
(f) Where the applicant claims the priority of an earlier application, an indication of:
(i) The name of the State with whose national office the earlier application was filed or it filed with an office other than a national office, the name of that office,
(ii) The date on which the earlier application was filed, and
(iii) Where available, the application number of the earlier application;
(g) Where the applicant claims color as a distinctive feature of the mark, a statement to that effect as well as the name or names of the color or colors claimed and an indication, in respect of each color, of the principal parts of the mark which are in that color;
(h) Where the mark is a three-dimensional mark, a statement to that effect;
(i) One or more reproductions of the mark, as prescribed in the Regulations;
(j) A transliteration or translation of the mark or of some parts of the mark, as prescribed in the Regulations;
(k) The names of the goods or services for which the registration is sought, grouped according to the classes of the Nice Classification, together with the number of the class of the said Classification to which each group of goods or services belongs; and
(l) A signature by, or other self-identification of, the applicant or his representative.
124.2. The applicant or the registrant shall file a declaration of actual use of the mark with evidence to that effect, as prescribed by the Regulations within three (3) years from the filing date of the application. Otherwise, the application shall be refused or the mark shall be removed from the Register by the Director.
124.3. One (1) application may relate to several goods and/or services, whether they belong to one (1) class or to several classes of the Nice Classification.
124.4. If during the examination of the application, the Office finds factual basis to reasonably doubt the veracity of any indication or element in the application, it may require the applicant to submit sufficient evidence to remove the doubt. (Sec. 5, R. A. No. 166a)
Sec. 125. Representation; Address for Service. - If the applicant is not domiciled or has no real and effective commercial establishment in the Philippines, he shall designate by a written document filed in the office, the name and address of a Philippine resident who may be served notices or process in proceedings affecting the mark. Such notices or services may be served upon the person so designated by leaving a copy thereof at the address specified in the last designation filed. If the person so designated cannot be found at the address given in the last designation, such notice or process may be served upon the Director. (Sec. 3, R. A. No. 166a)
Sec. 126. Disclaimers. - The Office may allow or require the applicant to disclaim an unregistrable component of an otherwise registrable mark but such disclaimer shall not prejudice or affect the applicant’s or owner’s rights then existing or thereafter arising in the disclaimed matter, nor such shall disclaimer prejudice or affect the applicant’s or owner’s right on another application of later date if the disclaimed matter became distinctive of the applicant’s or owner’s goods, business or services. (Sec. 13, R. A. No. 166a)
Sec. 127. Filing Date. -
127.1. Requirements. - The filing date of an application shall be the date on which the Office received the following indications and elements in English or Filipino:
(a) An express or implicit indication that the registration of a mark is sought;
(b) The identity of the applicant;
(c) Indications sufficient to contact the applicant or his representative, if any;
(d) A reproduction of the mark whose registration is sought; and
(e) The list of the goods or services for which the registration is sought.
127.2 No filing date shall be accorded until the required fee is paid. (n)
Sec. 128. Single Registration for Goods and/or Services. - Where goods and/or services belonging to several classes of the Nice Classification have been included in one (1) application, such an application shall result in one registration. (n)
Sec. 129. Division of Application. - Any application referring to several goods or services, hereafter referred to as the "initial application," may be divided by the applicant into two (2) or more applications, hereafter referred to as the "divisional applications," by distributing among the latter the goods or services referred to in the initial application. The divisional applications shall preserve the filing date of the initial application or the benefit of the right of priority. (n)
Sec. 130. Signature and Other Means of Self-Identification. -
130.1. Where a signature is required, the Office shall accept:
(a) A hand-written signature; or
(b) The use of other forms of signature, such as a printed or stamped signature, or the use of a seal, instead of a hand-written signature: Provided, That where a seal is used, it should be accompanied by an indication in letters of the name of the signatory.
130.2. The Office shall accept communications to it by telecopier, or by electronic means subject to the conditions or requirements that will be prescribed by the Regulations. When communications are made by telefacsimile, the reproduction of the signature, or the reproduction of the seal together with, where required, the indication in letters of the name of the natural person whose seal is used, appears. The original communications must be received by the Office within thirty (30) days from date of receipt of the telefacsimile.
130.3. No attestation, notarization, authentication, legalization or other certification of any signature or other means of self-identification referred to in the preceding paragraphs, will be required, except, where the signature concerns the surrender of a registration. (n)
Sec. 131. Priority Right. -
131.1. An application for registration of a mark filed in the Philippines by a person referred to in Section 3, and who previously duly filed an application for registration of the same mark in one of those countries, shall be considered as filed as of the day the application was first filed in the foreign country.
131.2. No registration of a mark in the Philippines by a person described in this section shall be granted until such mark has been registered in the country of origin of the applicant.
131.3. Nothing in this section shall entitle the owner of a registration granted under this section to sue for acts committed prior to the date on which his mark was registered in this country: Provided, That, notwithstanding the foregoing, the owner of a well-known mark as defined in Section 123.1(e) of this Act, that is not registered in the Philippines, may, against an identical or confusingly similar mark, oppose its registration, or petition the cancellation of its registration or sue for unfair competition, without prejudice to availing himself of other remedies provided for under the law.
131.4. In like manner and subject to the same conditions and requirements, the right provided in this section may be based upon a subsequent regularly filed application in the same foreign country: Provided, That any foreign application filed prior to such subsequent application has been withdrawn, abandoned, or otherwise disposed of, without having been laid open to public inspection and without leaving any rights outstanding, and has not served, nor thereafter shall serve, as a basis for claiming a right of priority. (Sec. 37, R. A. No. 166a)
Sec. 132. Application Number and Filing Date. -
132.1. The Office shall examine whether the application satisfies the requirements for the grant of a filing date as provided in Section 127 and Regulations relating thereto. If the application does not satisfy the filing requirements, the Office shall notify the applicant who shall within a period fixed by the Regulations complete or correct the application as required, otherwise, the application shall be considered withdrawn.
132.2 Once an application meets the filing requirements of Section 127, it shall be numbered in the sequential order, and the applicant shall be informed of the application number and the filing date of the application will be deemed to have been abandoned. (n)
Sec. 133. Examination and Publication. -
133.1. Once the application meets the filing requirements of Section 127, the Office shall examine whether the application meets the requirements of Section 124 and the mark as defined in Section 121 is registrable under Section 123.
133.2. Where the Office finds that the conditions referred to in Subsection 133.1 are fulfilled, it shall, upon payment of the prescribed fee. Forthwith cause the application, as filed, to be published in the prescribed manner.
133.3. If after the examination, the applicant is not entitled to registration for any reason, the Office shall advise the applicant thereof and the reasons therefor. The applicant shall have a period of four (4) months in which to reply or amend his application, which shall then be re-examined. The Regulations shall determine the procedure for the re-examination or revival of an application as well as the appeal to the Director of Trademarks from any final action by the Examiner.
133.4. An abandoned application may be revived as a pending application within three (3) months from the date of abandonment, upon good cause shown and the payment of the required fee.
133.5. The final decision of refusal of the Director of Trademarks shall be appealable to the Director General in accordance with the procedure fixed by the Regulations. (Sec. 7, R. A. No. 166a)
Sec. 134. Opposition. - Any person who believes that he would be damaged by the registration of a mark may, upon payment of the required fee and within thirty (30) days after the publication referred to in Subsection 133.2, file with the Office an opposition to the application. Such opposition shall be in writing and verified by the oppositor or by any person on his behalf who knows the facts, and shall specify the grounds on which it is based and include a statement of the facts relied upon. Copies of certificates of registration of marks registered in other countries or other supporting documents mentioned in the opposition shall be filed therewith, together with the translation in English, if not in the English language. For good cause shown and upon payment of the required surcharge, the time for filing an opposition may be extended by the Director of Legal Affairs, who shall notify the applicant of such extension. The Regulations shall fix the maximum period of time within which to file the opposition. (Sec. 8, R. A. No. 165a)
Sec. 135. Notice and Hearing. - Upon the filing of an opposition, the Office shall serve notice of the filing on the applicant, and of the date of the hearing thereof upon the applicant and the oppositor and all other persons having any right, title or interest in the mark covered by the application, as appear of record in the Office. (Sec. 9 R. A. No. 165)
Sec. 136. Issuance and Publication of Certificate. - When the period for filing the opposition has expired, or when the Director of Legal Affairs shall have denied the opposition, the Office upon payment of the required fee, shall issue the certificate of registration. Upon issuance of a certificate of registration, notice thereof making reference to the publication of the application shall be published in the IPO Gazette. (Sec. 10, R. A. No. 165)
Sec. 137. Registration of Mark and Issuance of a Certificate to the Owner or his Assignee. -
137.1. The Office shall maintain a Register in which shall be registered marks, numbered in the order of their registration, and all transactions in respect of each mark, required to be recorded by virtue of this law.
137.2. The registration of a mark shall include a reproduction of the mark and shall mention: its number; the name and address of the registered owner and, if the registered owner’s address is outside the country, his address for service within the country; the dates of application and registration; if priority is claimed, an indication of this fact, and the number, date and country of the application, basis of the priority claims; the list of goods or services in respect of which registration has been granted, with the indication of the corresponding class or classes; and such other data as the Regulations may prescribe from time to time.
137.3. A certificate of registration of a mark may be issued to the assignee of the applicant: Provided, That the assignment is recorded in the Office. In case of a change of ownership, the Office shall at the written request signed by the owner, or his representative, or by the new owner, or his representative and upon a proper showing and the payment of the prescribed fee, issue to such assignee a new certificate of registration of the said mark in the name of such assignee, and for the unexpired part of the original period.
137.4. The Office shall record any change of address, or address for service, which shall be notified to it by the registered owner.
137.5. In the absence of any provision to the contrary in this Act, communications to be made to the registered owner by virtue of this Act shall be sent to him at his last recorded address and, at the same, at his last recorded address for service.
Sec. 138. Certificates 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.
Fabrege v. CA
Co Beng Kay registered “Brute” for use on shirts, shoes and slippers. Fabrege, owner of the TM “Brut” for use on after shave lotion, shaving cream, deodorant, files opposition. Fabrege claims that it will cause confusion.
Held: Co Beng Kay may be permitted to register, since Fabrege has not ventured in the production of briefs, so it cannot be allowed to feight that Co has invaded Fabrege’s exclusive domain. Justice JBL Reyes says in the Sta. Ana case that the law does not require that the goods manufactured by the second user be related to the goods produced by the senior user. But the law also says that there is infringement when the reproduction is that which causes confusion. Since the products are different, there can be no confusion.
Q. Would the case have been decided the same way today?
A. No, because of Sec. 138.
Developer’s Group v. CA
Developer’s (RP) filed an infringement case against Shangri-La Hotel claiming that it was granted the ‘Shangri-la” mark for restaurant services in 1983. It claims that the hotel was using the mark causing it prejudice. Hotel claims that it is the legal and beneficial owner of the mark which was first adopted in 1962, used in their hotel business in China, HK, Malaysia, Singapore, etc. Hotel also filed a petition against Developers for the cancellation of its registration. RTC granted Developers an injunction and Hotel seeks to lift the injunction.
Held: The conflicting claims of the parties show that the right claims by Developers is far from clear. The prima facie validity of its registration has been put into serious question by the cases filed by Shangri-La 3 years ahead of its complaint. While it is not required that Developer’s right be conclusively established in this case, it is nevertheless necessary to show that it exists and is not vitiated by any substantial challenge or contradiction. Developers has failed to comply with this requirement.
Shangri-La Hotel v. CA
Shangri-La filed a petition for cancellation of Developer’s “Shangri-La” mark saying that this was illegally and fraudulently obtained. Developer’s filed a complaint for infringement against the Hotel. The Hotel seeks to suspend the infringement case because of the pendency of the cancellation proceedings.
Held: The earlier institution of the Hotel of the cancellation proceeding cannot effectively bar the subsequent filing of the infringement case by Developers. The certificate of registration remains valid and subsisting for as long as it has not been canceled by the court. Developer’s certificate continues as prima facie evidence of the validity of the registration. Such certificate still subsists and Developer’s may thus file a corresponding infringement case and recover damages. Further, the issue in the cancellation case is quite different from that raised in the trial court.
Q. In the Developer’s case, why wasn’t it considered that the certificate gives rise to prima facie presumption, such that Developer’s still had the burden of proof?
A. Court probably focused on the preliminary injunction issue rather than to intellectual property law issues.
Mirpuri v. CA (not discussed in class)
Escobar (RP) filed application for the use of the TM “Barbizon” for brassiers. Barbizon (NY) filed an opposition claiming that it is confusingly similar to its own mark. Opposition was dismissed and the application was granted. Later, Escobar failed to file the affidavit of use, so its registration was cancelled. Escobar reapplied for registration but assigned this to Mirpuri. This was again opposed by Barbizon with the allegation that the mark was used in US and also it has protection under the Paris Convention. Mirpuri claims the defense of res judicata.
Held: The two caes do not have identical causes of action. In the present case, Barbizon introduced a fact that did not exist at the time the first case was filed and terminated. The cancellation from non-use could not have occurred in the first case, and this gave Barbizon another cause to oppose the second application. Res judicata extends only to facts and conditions as they existed at the time the judgment was rendered. When new facts intervene furnishing new basis, there is no longer res judicata.
Sec. 139. Publication of Registered Marks; Inspection of Register. -
139.1. The Office shall publish, in the form and within the period fixed by the Regulations, the mark registered, in the order of their registration, reproducing all the particulars referred to in Subsection 137.2.
139.2. Marks registered at the Office may be inspected free of charge and any person may obtain copies thereof at his own expense. This provision shall also be applicable to transactions recorded in respect of any registered mark. (n)
Sec. 140. Cancellation upon Application by Registrant; Amendment or Disclaimer of Registration. - Upon application of the registrant, the Office may permit any registration to be surrendered for cancellation, and upon cancellation the appropriate entry shall be made in the records of the Office. Upon application of the registrant and payment of the prescribed fee, the Office for good cause may permit any registration to be amended or to be disclaimed in part: Provided, That the amendment or disclaimer does not alter materially the character of the mark. Appropriate entry shall be made in the records of the Office upon the certificate of registration or, if said certificates is lost or destroyed, upon a certified copy thereof.
Sec. 141. Sealed and Certified Copies as Evidence. - Copies of any records, books, papers, or drawings belonging to the Office relating to marks, and copies of registrations, when authenticated by the seal of the Office and certified by the Director of the Administrative, Financial and Human Resource Development Service Bureau or in his name by an employee of the Office duly authorized by said Director, shall be evidence in all cases wherein the originals would be evidence; and any person who applies and pays the prescribed fee shall secure such copies. (n)
Sec. 142. Correction of Mistakes Made by the Office. - Whenever a material mistake in a registration incurred through the fault of the Office is clearly disclosed by the records of the Office, a certificate stating the fact and nature of such mistake shall be issued without charge, recorded and a printed copy thereof shall be attached to each printed copy of the registration. Such corrected registration shall thereafter have the same effect as the original certificate; or in the discretion of the Director of the Administrative, Financial and Human Resource Development Service Bureau a new certificate of registration may be issued without charge. All certificates of correction heretofore issued in accordance with the Regulations and the registration to which they are attached shall have the same force and effect as if such certificates and their issuance had been authorized by this Act. (n)
Sec. 143. Correction of Mistakes Made by Applicant. - Whenever a mistake is made in a registration and such mistake occurred in good faith through the fault of the applicant, the Office may issue a certificate upon the payment of the prescribed fee: Provided, That the correction does not involve any change in the registration that requires republication of the mark. (n)
Sec. 144. Classification of Goods and Services. -
144.1. Each registration, and any publication of the Office which concerns an application or registration effected by the Office shall indicate the goods or services by their names, grouped according to the classes of the Nice Classification, and each group shall be preceded by the number of the class of that Classification to which that group of goods or services belongs, presented in the order of the classes of the said Classification.
144.2. 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.
Sec. 145. Duration. - A certificate of registration shall remain in force for ten (10) years: Provided, That 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, as prescribed by the Regulations, within one (1) year from the fifth anniversary of the date of the registration of the mark. Otherwise, the mark shall be removed from the Register by the Office.
Sec. 146. Renewal. -
146.1. A certificate of registration may be renewed for periods of ten (10) years at its expiration upon payment of the prescribed fee and upon filing of a request. The request shall contain the following indications:
(a) An indication that renewal is sought;
(b) The name and address of the registrant or his successor-in-interest, hereafter referred to as the "right holder";
(c) The registration number of the registration concerned;
(d) The filing date of the application which resulted in the registration concerned to be renewed;
(e) Where the right holder has a representative, the name and address of that representative;
(f) The names of the recorded goods or services for which the renewal is requested or the names of the recorded goods or services for which the renewal is not requested, grouped according to the classes of the Nice Classification to which that group of goods or services belongs and presented in the order of the classes of the said Classification; and
(g) A signature by the right holder or his representative.
146.2. Such request shall be in Filipino or English and may be made at any time within six (6) months before the expiration of the period for which the registration was issued or renewed, or it may be made within six (6) months after such expiration on payment of the additional fee herein prescribed.
146.3. If the Office refuses to renew the registration, it shall notify the registrant of his refusal and the reasons therefor.
146.4. An applicant for renewal not domiciled in the Philippines shall be subject to and comply with the requirements of this Act.
Sec. 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.
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 and 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 goods or services and the owner of the registered mark: Provided, further, That the interests of the owner of the registered mark are likely to be damaged by such use. (n)
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. (n)
Sec. 149. Assignment and Transfer of Application and Registration. -
149.1. An application for registration of a mark, or its registration, may be assigned or transferred with or without the transfer of the business using the mark. (n)
149.2. Such assignment or transfer shall, however, be null and void if it is liable to mislead the public, particularly as regards the nature, source, manufacturing process, characteristics, or suitability for their purpose, of the goods or services to which the mark is applied.
149.3. The assignment of the application for registration of a mark, or of its registration, shall be in writing and require the signatures of the contracting parties. Transfers by mergers or other forms of succession may be made by any document supporting such transfer.
149.4. Assignments and transfers of registration of marks shall be recorded at the Office on payment of the prescribed fee; assignment and transfers of applications for registration shall, on payment of the same fee, be provisionally recorded, and the mark, when registered, shall be in the name of the assignee or transferee.
149.5. Assignments and transfers shall have no effect against third parties until they are recorded at the Office.
Sec. 150. License Contracts. -
150.1. Any license contract concerning the registration of a mark, or an application therefor, shall provide for effective control by the licensor of the quality of the goods or services of the licensee in connection with which the mark is used. If the license contract does not provide for such quality control, or if such quality control is not effectively carried out, the license contract shall not be valid.
150.2. A license contract shall be submitted to the Office which shall keep its contents confidential but shall record it and publish a reference thereto. A license contract shall have no effect against third parties until such recording is effected. The Regulations shall fix the procedure for the recording of the license contract. (n)
Sec. 151. Cancellation. -
151.1. A petition to cancel a registration of a mark under this Act may be filed with the Bureau of Legal Affairs by any person who believes that he is or will be damaged by the registration of a mark under this Act as follows:
(a) Within five (5) years from the date of the registration of the mark under this Act.
(b) At any time, if the registered mark becomes the generic name for the goods or services, or a portion thereof, for which it is registered, or has been abandoned, or its registration was obtained fraudulently or contrary to the provisions of this Act, or if 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. If the registered mark becomes the generic name for less than all of the goods or services for which it is registered, a petition to cancel the registration for only those goods or services may be filed. A registered mark shall not be deemed to be the generic name of goods or services solely because such mark is also used as a name of or to identify a unique product or service. The primary significance of the registered mark to the relevant public rather than purchaser motivation shall be the test for determining whether the registered mark has become the generic name of goods or services on or in connection with which it has been used. (n)
(c) At any time, if the registered owner of the mark without legitimate reason fails to use the mark within the Philippines, or to cause it to be used in the Philippines by virtue of a license during an uninterrupted period of three (3) years or longer.
151.2. Notwithstanding the foregoing provisions, the court or the administrative agency vested with jurisdiction to hear and adjudicate any action to enforce the rights to a registered mark shall likewise exercise jurisdiction to determine whether the registration of said mark may be cancelled in accordance with this Act. The filing of a suit to enforce the registered mark with the proper court or agency shall exclude any other court or agency from assuming jurisdiction over a subsequently filed petition to cancel the same mark. On the other hand, the earlier filing of petition to cancel the mark with the Bureau of Legal Affairs shall not constitute a prejudicial question that must be resolved before an action to enforce the rights to same registered mark may be decided.
Q. Is there a presumption of abandonment under the law?
A. Yes. If the registered owner of the mark without legitimate reason fails to use the mark within the Philippines, or to cause it to be used in the Philippines by virtue of a license during an uninterrupted period of three (3) years or longer, a petition may be filed for the cancellation of the mark.
Q. What if your TM expires and before you register it, someone registers before you file?
A. It would depend on the gap. If it’s just a matter of days or months, prior registrant has priority. It long gap, senior registrant has priority.
Pagasa Industrial v. CA
1961 - Kaisha registers YKK as trademark for slide fasteners and zippers.
1967- Pagasa files application for registration of YKK for zippers.
1977 - Kaisha files petition for cancellation of Pagasa’s registration claiming both are confusingly similar.
Pagasa claims that failure or neglect to assert its trademark rights for more than five years bars Kaisha from filing the petition.
Held: Law requires actual commercial use of the mark prior to registration. Here, Kaisha was prior registrant but it did not present proof that it had considerable sales since its first use. The invoices submitted date back to 1957 showing sale of samples. Samples are not for sale and are of no commercial value. Only after more than 7 years too did Kaisha file for cancellation. An unreasonable length of time had already passed before the right was asserted. There is a presumption of neglect already amounting to abandonment.
Bata Industries v. CA
New Olympian sought registration of Bata as trademark for casual rubber shoes, claiming that it has used this mark since 1970. Bata (Canada) opposed this saying that it owns and has not abandoned the trademark Bata. It was shown that Bata shoes were indeed sold in RP prior to WWII, until 1948.
Held: Any slight goodwill generated by Bata was completedly abandoned and lost in the more than 35 years that have passed since it last used the trademark. Bata has no Philippine goodwill that would be damaged by the registration of the mark in New Olympian’s favor.
Sec. 152. Non-use of a Mark When Excused. -
152.1. Non-use of a mark may be excused if caused by circumstances arising independently of the will of the trademark owner. Lack of funds shall not excuse non-use of a mark.
152.2. The use of the mark in a form different from the form in which it is registered, which does not alter its distinctive character, shall not be ground for cancellation or removal of the mark and shall not diminish the protection granted to the mark.
152.3. The use of a mark in connection with one or more of the goods or services belonging to the class in respect of which the mark is registered shall prevent its cancellation or removal in respect of all other goods or services of the same class.
152.4. The use of a mark by a company related with the registrant or applicant shall inure to the latter’s benefit, and such use shall not affect the validity of such mark or of its registration: Provided, That such mark is not used in such manner as to deceive the public. If use of a mark by a person is controlled by the registrant or applicant with respect to the nature and quality of the goods or services, such use shall inure to the benefit of the registrant or applicant. (n)
Sec. 153. Requirements of Petition; Notice and Hearing. - Insofar as applicable, the petition for cancellation shall be in the same form as that provided in Section 134 hereof, and notice and hearing shall be as provided in Section 135 hereof.
Sec. 154. Cancellation of Registration. - If the Bureau of Legal Affairs finds that a case for cancellation has been made out, it shall order the cancellation of the registration. When the order or judgment becomes final, any right conferred by such registration upon the registrant or any person in interest of record shall terminate. Notice of cancellation shall be published in the IPO Gazette.
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 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 155.1 or this subsection are committed regardless of whether there is actual sale of goods or services using the infringing material.
Q. Is registration needed for infringement cases?
A. Yes. Sec. 155 says, “any person who shall, without the consent of the owner of the REGISTERED MARK….”
Similar Goods – Dominancy/wholistic test
Nestle v. CA
Flavor Master v. Master Roast. Applied the dominancy test.
Asia Brewery v. CA & San Miguel Corporation
Grino-Aquino, J.
SMC filed a complaint against Asia Brewery Inc. (ABI) for infringement and unfair competition for ABI’s Beer Pale Pilasen or Beer na Beer. SMC cites the following issues (ratio follows issue)
1. SMC Pale Pilsen has rectagular hops and malt design which is similar with ABI’s trademark – Test of Dominancy was used where similarity in size form and color while relevant is not conclusive. Here, “Beer” does not appear in SMC’s TM, “San Miguel” does not appear in ABI’s TM. No similarity in sound, spelling or appearance. No evidence presented by SMC proving that anyone who purchases ABI can be deceived that it is SMC’s.
2. Bottle’s are bottled in amber-colored steinie bottles of 320 ml capacity – steinie bottles are similar but not identical. Also, the bottle is a standard type originally developed in US and not an SMC design. Also, protection is confined to nonfunctional features. Amber color is for preventing transmission of light and provides maximum protection to beer. Also, 320 ml is the standard prescribed under a circular of the DTI.
Court also held that there is a substantial price difference.
Negre: The case seems to be decided in a wrong manner, by an old lady justice. San Miguel Light comes out in transparent bottles, and there are green and yellow bottles in the market. Also, after consuming 3 beers, you can’t really tell the difference in taste.
Del Monte v. CA & Sunshine Sauce
Del Monte (US) granted PhilPack (RP) right to manufacture and sell products under Del Monte TM and it registered the TM. Sunshine manufactures sauce too, contained in various kinds of bottles including the Del Monte bottle which it bought from junk shops. Philpack files complaint for TM infringement and for unfair competition. CA held that a side-by-side comparison shows no colorable imitation of TM since design is different.
Held: Side-by-side comparison is not the final test of similarity. Average shopper is usually in a hurry and does not inspect every product on the shelf as if he were browsing in a library. So the casual purchaser who is unsuspicious must be the standard. The factors to consider are (1) the training and education of the usual purchaser, (2) the cost of the article and the (3) conditions under which it is usually purchased. Thus, there is TM infringement of the mark but none as to the bottle because although bad faith of Sunshine is evident since Del Monte’s bottle states, “Del Monte Corp, Not to be Refilled,” there is still no infringement since the bottle’s design was registered only in the Supplemental Register and this does not vest the registrant with the exclusive right to use the label nor does it give rise to the presumption of validity of the registration.
Converse Rubber v. Universal Rubber
Universal Rubber filed an application for the registration of “Universal Converse” for use on rubber shoes and rubber slippers. Converse files an opposition saying that the TM is confusingly similar to the word “Converse”. Converse presents lone witness, a private merchant with stores selling Converse that the sales in her store averaged 12-20 pairs a month purchased mostly by basketball palyers of local private educational institutions. She presents sales invoices as proof.
Held: “Converse” is the dominant word which identifies petitioner. Universal admits that Converse has known that the word Converse belongs to and is being used by petitioner. Boundless choice of words are available and when there is no reasonable explanation for the defendant’s choice of such a mark, the inference is inevitable that it wsa chosen to deceive. Sales invoices are best proof of actual sales of Converse products in RP. Sale of 12-20 pairs is not considered insignificant because the shoes are of high expensive quality which not too many people can afford. Such actual use of goods in the local market establishes trademark use which serves as the basis for action aimed at trademark pre-emption.
Q. What is the best proof of use of the product in the country?
A. Sales invoices.
Q. What if the sales were done over the internet, is it sufficient to establish actual use?
A. Yes. There is no need for actual presence in RP.
Q. What if the foreign based company does advertising in cable, is it sufficient to prove use of the mark in RP?A. No definite answer, but Converse seems to require actual sales, since it says that sales invoices are the best proof of use in a country.
Emerald Garments v. CA
HD Lee (Lee Jeans) filed for the cancellation of the TM of Emerald Garments called “Stylistic Mr. Lee” (skirts, jeans, blouses, socks, briefs, jackets, jogging suits). HD Lee claims that the products are so closely related that it will cause confusion, mistake and deception. CA used the test of dominancy saying that if the competing trademark contains the essential or dominant features of another, such that it will cause confusion and deception, then there would be infringement. Thus, since the labels are similar, the CA ruled there was infringement.
Held: The SC used the holistic test which says that the entirety of the marks in question must be considered in determining confusing similarity. It ruled that there is no infringement. Emerald’s TM is “Stylistic Mr. Lee” and is not confusingly similar to “Lee.” Since the product is jeans which are not inexpensive, the casual buyer is more cautious and discriminating. Confusion and deception is less likely. The average consumer also buys his jeans by brand. Also, “Lee” is primarily a surname, so HD Lee can’t acquire exclusive ownership of the term. In addition, HD Lee failed to show prior actual commercial use of its “Lee” TM in RP before it filed its application.
Q. Would the result have been different had a different test been used?
A. It seems that way, since the CA used dominancy test and the result was different from the SC decision which used the holistic test.
Q. Why was this case decided differently from the Converse?
A. In Converse, there was proof of actual prior commercial use.
Lim Hoa v. Director
Lim Hoa filed for application of registration of TM consisting of two midget roosters in combat with the word Bantam, for food seasoning. Agricom Dev’t opposed the application saying that it is confusingly similar with its own TM which is a pictorial representation of a hen with the words “Hen Brand” and “Marca Manok” also used in food seasoning.
Held: There is such similarity between them as to cause confusion. In the test of dominancy, similarity in size, form, color, while relevant, is not conclusive. If the competing trademark contains the main or essential dominant features of another, infringement takes place. Duplication is not necessary, not is it necessary that the infringing label should suggest an effort to imitate. Also, the product is purchased by cooks and household help, sometimes illiterate who are guided by pictorial representations and the sound of the word. There is also greater danger here since the products are cheap.
Q. What was the factor considered by the court?
A. Same animals and similar products.
Q. Would there be infringement in crocodile and alligator?
A. Yes.
Q. Tiger and lion?
A. Yes.
Q. Would the ruling be the same if the case involved leather goods?
A. It may have been decided differently since the case would involve expensive products where the buyers are wary and not illiterate.
Philips Export v. CA & SEC
Philips Export (Netherlands) owns TM for “Philips,” for electrical products. Standard Philips (RP) was issued a certificate of registration by SEC for the business of chain rollers, belts, bearing. PE filed a complaint asking for the cancellation of SP’s name and filed for a petition for injunction. SEC ruled against PE, saying that Sec. 18 of the Corp. Code is applicable only when the corporate names are identical.
Held: The right to use a corporate name is a property right, a right in rem which it may assert. Corp Code gives two requirements: (1) That complaint acquired a prior right over such name and (2) that the proposed name is either identical, deceptively or confusingly similar, or patently deceptive. PE’s prior adoption of the term “Philips” is not in doubt, and the test as to whether it would be confusing is the ordinary person. “Philips” is indeed the dominant word. Note that although no proof was presented of actual confusion, it is sufficient that confusion is probably or likely to occur.
Q. Where did the case emanate?
A. From SEC.
Q. Does SEC have jurisdiction over the case?
A. Yes because it involves corporate names.
Q. Who has jurisdiction over cases involving corporate names under PD 902-A, the SEC or the RTC?
A. This is still a grey area.
Q. Which test should be applied in this case?
A. The court seemed to apply the dominancy test. Note that when goods are similar and the marks are identical, Sec. 147.1 gives a presumption of the likelihood of confusion.
Spectrum of the Likelihood of Confusion
Same goods Different goods
Identical marks Different marks
Negre: There should be no difference between the dominancy and holistic test. With either test, you should arrive at the same conclusion, based on this spectrum.
Dissimilar Goods
Polaroid v. Polarad
Polaroid (Delaware) is registrant of the name Polaroid for the use of sheet polarizing material, lamps, optical lans. It files an action for injunction against Polarad claiming that its use infringed on its trademark and is unfair competition. Polarad is engaged in manufacture of microwave generating devices and TV studio equipment. Polarad admits that he had some knowledge of plaintiff’s use of the name Polaroid, but not as to electronics. Polarad used the name as early as 1945, but there was no protest. It registered in 1953, and plaintiff delayed suit until 1956. Polaroid claims that laches does not apply in tm cases since injunction, rather than damages, are sought.
Held: Plaintiff is guilty of laches. Doctrine of laches has no such reach as claimed when the goods are different. TM owner’s interest is in preventing such use because he may wish to preempt the market for later exploitation. Here, owner’s rights in such appendant markets are easily lost. They must be asserted early, lest they be made the means of reaping a harvest which others have sown.
Q. What are the factors cited by the court in deciding infringement cases when the products are different?
A. 1. Strength of the mark
2. Degree of similarity between the two marks
3. Proximity of the products
4. Likelihood that the prior owner will bridge the gap
5. Actual confusion
6. Defendant’s good faith in adopting its own mark
7. Quality of the defendant’s product
8. Sophistication of the buyers
QUALITY INNS INTERNATIONAL, INC. v. McDONALD’S CORPORATION
On September 21, 1987 , Quality Inns International, Inc. announced a new chain of economy hotels to be marketed under the name “McSleep Inn.” McDonald’s Corporation responded immediately claiming that the name “McSleep” infringed on the McDonald’s family of marks that are characterized by the prefix “Mc” combined with a generic word. Robert C. Hazard, Jr., CEO of Quality International in 1980, claimed he was driving down the highway when it hit him, “to name the new economy chain McSleep,” and had no intent of using McDonald’s goodwill to its advantage. McDonald’s contends that it is the owner of a family of marks each of which is formulated by combining the prefix “Mc” with a generic word to form a fanciful trademark or service mark. It contends that “McSleep Inn” that had been adopted by Quality International is likely to cause confusion and that Quality International selected the word Mc Sleep deliberately to trade on the goodwill and reputation of McDonald’s.
Conclusion: The Court finds and concludes that (1) McDonald’s is entitled to enforce its family of marks that are characterized by the combination of the prefix “Mc” with a generic word; (2) the name McSleep Inn is likely to cause an appreciable number of the public to be confused by believing McSleep Inn is sponsored, associated, affiliated, connected, or endorsed by McDonald’s; and (3) the adoption and use by Quality International of the name McSleep Inn was a deliberate attempt to benefit by the good will and reputation of McDonald’s. The Court found trademark infringement, unfair competition, and dilution under the Illinois statute.
Q. In this case, what were the 7 factors applied?
Similar with the earlier ones given. These are considered in determining the likelihood of confusion:
(1) the strength of distinctiveness of the mark,
(2) the similarity of the two marks,
(3) the similarity of the goods or services with the marks identify,
(4) the similarity of the facilities used by the parties in conducting their businesses,
(5) the similarity of advertising used by the parties,
(6) the defendant’s intent,
(7) and actual confusion.
If we apply the facts of the case to this statute, we will see that some of these conditions have been met.
Q. Can bad faith in trademark infringement cases be presumed?
A. No, it should be proven.
Q. Are surveys admissible? Since in the Quality Inn case, a survey was presented by McDonald’s which showed that people associated McDonald’s with Quality Inn’s McSleep.
A. Yes, if accompanied with testimony of the person conducting the survey, or if it falls under the commercial list exception.
Sec. 156. Actions, and Damages and Injunction for Infringement. -
156.1. The owner of a registered mark may recover damages from any person who infringes his rights, and the measure of the damages suffered shall be either the reasonable profit which the complaining party would have made, had the defendant not infringed his rights, or the profit 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.
156.2. On application of the complainant, the court may impound during the pendency of the action, sales invoices and other documents evidencing sales. (n)
156.3. 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.
156.4. The complainant, upon proper showing, may also be granted injunction.
Q. What are the types of remedies granted for infringement?
A. 1) Damages, 2) impounding of sales invoice, 3) injunction.
Q. What kind of damages are compensable?
A. Only loss of profit. But when there is intent to mislead, double the profit.
NOTE: It is thus evident that even when there is no intent to mislead, there can be infringement.
Q. Can the court award damages when there is no notice to infringer? Like when he is not aware that he is infringing?
A. It appears that the court can do this, since intent to mislead is not essential. (?)
Sec. 157. Power of Court to Order Infringing Material Destroyed. -
157.1. In any action arising under this Act, in which a violation of any right of the owner of the registered mark is established, the court may order that goods found to be infringing be, without compensation of any sort, disposed of outside the channels of commerce in such a manner as to avoid any harm caused to the right holder, or destroyed; and all labels, signs, prints, packages, wrappers, receptacles and advertisements in the possession of the defendant, bearing the registered mark or trade name or any reproduction, counterfeit, copy or colorable imitation thereof, all plates, molds, matrices and other means of making the same, shall be delivered up and destroyed.
157.2. In regard to counterfeit goods, the simple removal of the trademark affixed shall not be sufficient other than in exceptional cases which shall be determined by the Regulations, to permit the release of the goods into the channels of commerce.
Sec. 158. Damages; Requirement of Notice. - 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. 159. Limitations to Actions for Infringement. - Notwithstanding any other provision of this Act, the remedies given to the owner of a right infringed under this Act shall be limited as follows:
159.1 Notwithstanding the provisions of Section 155 hereof, a registered mark shall have no effect against any person who, in good faith, before the filing date or the priority date, was using the mark for the purposes of his business or enterprise: Provided, That his right may only be transferred or assigned together with his enterprise or business or with that part of his enterprise or business in which the mark is used.
159.2 Where an infringer who is engaged solely in the business of printing the mark or other infringing materials for others is an innocent infringer, the owner of the right infringed shall be entitled as against such infringer only to an injunction against future printing.
159.3. Where the infringement complained of is contained in or is part of paid advertisement in a newspaper, magazine, or other similar periodical or in an electronic communication, the remedies of the owner of the right infringed as against the publisher or distributor of such newspaper, magazine, or other similar periodical or electronic communication shall be limited to an injunction against the presentation of such advertising matter in future issues of such newspapers, magazines, or other similar periodicals or in future transmissions of such electronic communications. The limitations of this subparagraph shall apply only to innocent infringers: Provided, That such injunctive relief shall not be available to the owner of the right infringed with respect to an issue of a newspaper, magazine, or other similar periodical or an electronic communication containing infringing matter where restraining the dissemination of such infringing matter in any particular issue of such periodical or in an electronic communication would delay the delivery of such issue or transmission of such electronic communication is customarily conducted in accordance with the sound business practice, and not due to any method or device adopted to evade this section or to prevent or delay the issuance of an injunction or restraining order with respect to such infringing matter. (n)
Sec. 160. Right of Foreign Corporation to Sue in Trademark or Service Mark Enforcement Action. - Any foreign national or juridical person who meets the requirements of Section 3 of this Act and does not engage in business in the Philippines may bring a civil or administrative action hereunder for opposition, cancellation, infringement, unfair competition, or false designation of origin and false description, whether or not it is licensed to do business in the Philippines under existing laws.
Q. Converse and Canon required prior actual use in RP of the mark in order for the foreign oppositor’s case to prosper. Is actual use in RP still required?
A. It appears that this is no longer a requirement, since the foreign national who sues under this section is required not to engage in business in the Philippines.
Yu v. CA
Philip Yu is the exclusive distributor of House of Mayfair wallcovering products. Unisia imported the same goods via FNF Trading and sold the products in the domestic market. Yu filed for injunction. Unisia claims ignorance of the exclusive contract.
Held: The right to perform an exclusive distributorship agreement and to reap the profits resulting from such performance are proprietary rights which a party may protect and which may not be diminished by the expedient act of utilizing a person to obtain goods from the supplier to defeat the very purpose for which the exclusive distributorship was conceptualized at the expense of the exclusive distributor. Also, the House of Mayfair in England was duped into believing that the goods ordered through FNF Trading was to be shipped to Nigeria only but the goods were actually sold in the Philippines.
Q. What does this case have to do with IP rights? (actual question asked by Negre)
A. IP rights, like exclusive distributorship, are proprietary rights which a party may protect.
Q. Co. A based in Singapore has exclusive distribution with Co. B in RP for product “D.” Can Co. B prevent Co. C from bringing the product to the Philippines?
A. Yes.
Q. What if C is not aware of the exclusive distributorship?
A. From the case, it seems that intent is required. (but answer changes later)
Q. What if the product is a life-saving drug imported by the government?
A. The government may probably import it by exerting its police power.
Q. Where do you draw the line?
A. Maybe for life-saving drugs, or important technologies like fast growing rice palay. If not, government will be depriving persons of proprietary rights (property) without due process.
Q. What does TRIPS and WTO provide on parallel importation?
A. Once the product is distributed, he can no longer control resale because the right is limited to the first distribution.
Q. So should B have been able to prevent importation, since after the first sale, there is no more right to control sale? Won’t there be a monopoly if this is the case?
A. Yes, it does seem that way, because only the government, in the exercise of police power, can deprive persons of property rights without due process.
Sec. 161. Authority to Determine Right to Registration. - In any action involving a registered mark, the court may determine the right to registration, order the cancellation of a registration, in whole or in part, and otherwise rectify the register with respect to the registration of any party to the action in the exercise of this. Judgment and orders shall be certified by the court to the Director, who shall make appropriate entry upon the records of the Bureau, and shall be controlled thereby.
Sec. 162. Action for False or Fraudulent Declaration. - Any person who shall procure registration in the Office of a mark by a false or fraudulent declaration or representation, whether oral or in writing, or by any false means, shall be liable in a civil action by any person injured thereby for any damages sustained in consequence thereof.
Sec. 163. Jurisdiction of Court. - All actions under Sections 150, 155, 164, and 166 to 169 shall be brought before the proper courts with appropriate jurisdiction under existing laws.
Sec. 164. Notice of Filing Suit Given to the Director. - It shall be the duty of the clerks of such courts within one (1) month after the filing of any action, suit, or proceeding involving a mark registered under the provisions of this Act, to notify the Director in writing setting forth: the names and addresses of the litigants and designating the number of the registration or registrations and within one (1) month after the judgment is entered or an appeal is taken, the clerk of court shall give notice thereof to the Office, and the latter shall endorse the same upon the filewrapper of the said registration or registrations and incorporate the same as a part of the contents of said filewrapper. (n)
Sec. 165. Trade Names or Business Names. -
165.1. A name or designation may not be used as a trade name if by its nature or the use to which such name or designation may be put, it is contrary to public order or morals and if, in particular, it is liable to deceive trade circles or the public as to the nature of the enterprise identified by that name.
165.2. (a) 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.
(b) In particular, any 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.
165.3. The remedies provided for in Sections 153 to 156 and Sections 166 and 167 shall apply mutatis mutandis.
165.4. Any change in the ownership of a trade name shall be made with the transfer of the enterprise or part thereof identified by that name. The provisions of Subsections 149.2 to 149.4 shall apply mutatis mutandis.
Sec. 166. Goods Bearing Infringing Marks or Trade Names. - No article of imported merchandise which shall copy or simulate the name of any domestic product, or manufacturer, or dealer, or which shall copy or simulate a mark registered in accordance with the provisions of this Act, or shall bear a mark or trade name calculated to induce the public to believe that the article is manufactured in the Philippines, or that it is manufactured in any foreign country or locality other than the country or locality where it is in fact manufactured, shall be admitted to entry at any customhouse of the Philippines. In order to aid the officers of the customs service in enforcing this prohibition, any person who is entitled to the benefits of this Act, may require that his name and residence, and the name of the locality in which his goods are manufactured, a copy of the certificate of registration of his mark or trade name, to be recorded in books which shall be kept for this purpose in the Bureau of Customs, under such regulations as the Collector of Customs with the approval of the Secretary of Finance shall prescribe, and may furnish to the said Bureau facsimiles of his name, the name of the locality in which his goods are manufactured, or his registered mark or trade name, and thereupon the Collector of Customs shall cause one (1) or more copies of the same to be transmitted to each collector or to other proper officer of the Bureau of Customs. (Sec. 35, R. A. No. 166)
Q. Can the customs seize the goods?
A. It appears under this section that all they can do is to prevent entry. But under Art. 9 of the Paris Convention, “All goods unlawfully bearing a trademark or trade name shall be seized on importation into those countries of the Union where such mark or trade name is entitled to legal protection.” Note that under the Paris convention, authorities shall not be bound to effect seizure. If the legislation of a country does not permit seizure on importation, it shall be replaced by prohibition of importation or by seizure on inside the country.
Sec. 167. Collective Marks. -
167.1. Subject to Subsections 167.2 and 167.3, Sections 122 to 164 and 166 shall apply to collective marks, except that references therein to "mark" shall be read as "collective mark."
167.2 (a) An application for registration of a collective mark shall designate the mark as a collective mark and shall be accompanied by a copy of the agreement, if any, governing the use of the collective mark.
(b) The registered owner of a collective mark shall notify the Director of any changes made in respect of the agreement referred to in paragraph (a).
167.3. In addition to the grounds provided in Section 149, the Court shall cancel the registration of a collective mark if the person requesting the cancellation proves that only the registered owner uses the mark, or that he uses or permits its use in contravention of the agreements referred to in Subsection 166.2 or that he uses or permits its use in a manner liable to deceive trade circles or the public as to the origin or any other common characteristics of the goods or services concerned.
167.4. The registration of a collective mark, or an application therefor shall not be the subject of a license contract.
Sec. 168. Unfair Competition, Rights, Regulation and Remedies. -
168.1. A person who has identified in the mind of the public the goods he manufactures or deals in, his business or services from those of others, whether or not a registered mark is employed, has a property right in the goodwill of the said goods, business or services so identified, which will be protected in the same manner as other property rights.
168.2. Any person who shall employ deception or any other means contrary to good faith by which he shall pass off the goods manufactured by him or in which he deals, or his business, or services for those of the one having established such goodwill, or who shall commit any acts calculated to produce said result, shall be guilty of unfair competition, and shall be subject to an action therefor.
168.3. In particular, and without in any way limiting the scope of protection against unfair competition, the following shall be deemed guilty of unfair competition:
(a) Any person, who is selling his goods and gives them the general appearance of goods of another manufacturer or dealer, either as to the goods themselves or in the wrapping of the packages in which they are contained, or the devices or words thereon, or in any other feature of their appearance, which would be likely to influence purchasers to believe that the goods offered are those of a manufacturer or dealer, other than the actual manufacturer or dealer, or who otherwise clothes the goods with such appearance as shall deceive the public and defraud another of his legitimate trade, or any subsequent vendor of such goods or any agent of any vendor engaged in selling such goods with a like purpose;
(b) Any person who by any artifice, or device, or who employs any other means calculated to induce the false belief that such person is offering the services of another who has identified such services in the mind of the public; or
(c) Any person who shall make any false statement in the course of trade or who shall commit any other act contrary to good faith of a nature calculated to discredit the goods, business or services of another.
168.4. The remedies provided by Sections 156, 157 and 161 shall apply mutatis mutandis.
Q. What is unfair competition?
A. It is the passing off of one’s goods as those of another.
Compana General de Tabacos v. Alhambra Cigar
Compania files case against Alhambra who sold cigarettes bearing the words “Alhambra Isabelas,” for TM infringement and unfair competition, arising from the use of the word “Isabelas.”
Held: In infringement case, the action does not proceed on the theory that the public will be defrauded, although that may be the result. It is on the claim that the plaintiff’s right on the mark ahs been invaded. There is no need to proof anything more than right to the exclusive use. No proof of fraud or intent to defraud is necessary. In unfair competition, the action is exclusively based on fraud. A violation of TM cannot be carried on with an action of unfair competition based on similarity to the plaintiff’s TM. The law does not permit these two actions to be maintained on the same facts.
(As to infringement case)
There can be no registration of a TM which represents the geographical place of production or the origin of the product or is merely the description. Also, there is no secondary meaning of the word “Isabela” acquired by long association with plaintiff’s cigarettes. There are also other cigarettes using “Isabela.”
Q. Can a person file for both trademark infringement and unfair competition?
A. Yes, they are not mutually exclusive.
Q. Can you file for both in the same action?
A. Yes. But in Alhambra, if the action is based on the mark, it is only an action for infringement.
Q. Compare infringement and unfair competition.
A. See chart.
Trademark Infringement
Unfair Competition
What is?
Unauthorized use of a trademark
Passing off of one’s product for another based on general appearance
Bad faith/intent necessary?
No.
Intent to deceive/Fraudulent intent is essential
Registration of the trademark required?
Prior registration is required
Registration is not necessary
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 the affiliation, connection, or association of such person with another person, or as to the 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 Sections 156 and 157 of this Act by any person who believes that he or she is or likely to be damaged by such act.
169.2. Any goods marked or labeled in contravention of the provisions of this Section shall not be imported into the Philippines or admitted entry at any customhouse of the Philippines. The owner, importer, or consignee of goods refused entry at any customhouse under this section may have any recourse under the customs revenue laws or may have the remedy given by this Act in cases involving goods refused entry or seized. (Sec. 30, R. A. No. 166a)
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 Fifty thousand pesos (P50,000) to Two hundred thousand pesos (P200,000), shall be imposed on any person who is found guilty of committing any of the acts mentioned in Section 155, Section 168 and Subsection 169.1.
Q. What actions are available to TM holders?
A. Civil, criminal and administrative cases.
Q. What is the venue?
A. For civil cases, either MTC (below P300K, below P400K for Manila) or RTC depending on the amount.
For criminal cases, it is unclear if jurisdiction should depend on the imprisonment or fine.
For administrative cases, the DTI for tradenames, the IPO for trademarks.
PRIMER ON INTERNET RELATED
TRADE MARK ISSUES
Joint Recommendation Concerning Provisions on
the Protection of Marks, and Other Industrial Property Rights in Signs, on the Internet
Q. What are some of the important provisions discussed in Joint Recommendation?
A. Only Article 2 and 3 were discussed in class. They are:
Article 2Use of a Sign on the Internet in a Member State
Use of a sign on the Internet shall constitute use in a Member State for the purposes of these provisions, only if the use has a commercial effect in that Member State as described in Article 3.
Article 3Factors for Determining Commercial Effect in a Member State
(1) [Factors] In determining whether use of a sign on the Internet has a commercial effect in a Member State, the competent authority shall take into account all relevant circumstances. Circumstances that may be relevant include, but are not limited to:
(a) circumstances indicating that the user of the sign is doing, or has undertaken significant plans to do, business in the Member State in relation to goods or services which are identical or similar to those for which the sign is used on the Internet.
(b) the level and character of commercial activity of the user in relation to the Member State, including:
(i) whether the user is actually serving customers located in the Member State or has entered into other commercially motivated relationships with persons located in the Member State;
(ii) whether the user has stated, in conjunction with the use of the sign on the Internet, that he does not intend to deliver the goods or services offered to customers located in the Member State and whether he adheres to his stated intent;
(iii) whether the user offers post-sales activities in the Member State, such as warranty or service;
(iv) whether the user undertakes further commercial activities in the Member State which are related to the use of the sign on the Internet but which are not carried out over the Internet.
(c) the connection of an offer of goods or services on the Internet with the Member State, including:
(i) whether the goods or services offered can be lawfully delivered in the Member State;
(ii) whether the prices are indicated in the official currency of the Member State.
(d) the connection of the manner of use of the sign on the Internet with the Member State, including:
(i) whether the sign is used in conjunction with means of interactive contact which are accessible to Internet users in the Member State;
(ii) whether the user has indicated, in conjunction with the use of the sign, an address, telephone number or other means of contact in the Member State;
(iii) whether the sign is used in connection with a domain name which is registered under the ISO Standard country code 3166 Top Level Domain referring to the Member State;
(iv) whether the text used in conjunction with the use of the sign is in a language predominantly used in the Member State;
(v) whether the sign is used in conjunction with an Internet location which has actually been visited by Internet users located in the Member State.
(e) the relation of the use of the sign on the Internet with a right in that sign in the Member State, including:
(i) whether the use is supported by that right;
(ii) whether, where the right belongs to another, the use would take unfair advantage of, or unjustifiably impair, the distinctive character or the reputation of the sign that is the subject of that right.
(2) [Relevance of Factors] The above factors, which are guidelines to assist the competent authority to determine whether the use of a sign has produced a commercial effect in a Member State, are not pre‑conditions for reaching that determination. Rather, the determination in each case will depend upon the particular circumstances of that case. In some cases all of the factors may be relevant. In other cases some of the factors may be relevant. In still other cases none of the factors may be relevant, and the decision may be based on additional factors that are not listed in paragraph (1), above. Such additional factors may be relevant, alone, or in combination with one or more of the factors listed in paragraph (1), above.
Q. Is actual sale needed to constitute use?
A. No. The Joint Recommendation states that the following are sufficient: (a) circumstances indicating that the user of the sign is doing, or (b) has undertaken significant plans to do, business in the Member State in relation to goods or services which are identical or similar to those for which the sign is used on the Internet.
Q. Japanese company is selling products in the Internet using Japanese language. Is this commercial use?
A. No.
Q. If a company has no means of delivering the products to a particular country, is this an important factor to consider?
A. Yes.
Q. Post sales services, where should this be done?
A. The place where the item is sold.
Q. Does the place where the sale is perfected determine where the commercial use of the trademark is undertaken? (Just a note:
General Rule: Art. 1523, Civil code: Where in pursuance of a contract of sale, the seller is authorized to send the goods to the buyer, delivery of the goods to a carrier is deemed to be delivery of the goods to the buyer.
Exception: When otherwise specified, e.g., the Incoterms, i.e., FOB Manila (title transfers in Manila)
A. No. There is commercial use when the user of the mark is actually serving customers located
in the Member State or has entered into other commercially motivated relationships with persons located in the Member State.
Domain Names
Q. What are the parts of a domain name?
A. Everything that precedes the dot is second level domain à yahoo[.]com ß Everything that comes after the dot is first level domain.
Q. What are the dual functions of a domain name?
A. The functions are:
1. Represents the address of a computer on the Internet so that every computer can communicate with every other computer.
2. Serves the same function in electronic commerce as the trademark in more traditional modes of business.
Q. How do you obtain a domain name?
A. Through an Internet Service Provider that submits the electronic application to 240 registries worldwide. Among these are NSI – Network Solutions Inc.
Q. What is the system of registry?
A. Domain names are assigned on a first come first serve basis. Thre is no requirement of use of the domain name in connection with an Internet-related service. While this may seem to aid cyberpiracy, this aids in defensive registry to prevent cyber-piracy.
Q. What is the manner by which disputes on domain names are resolved?
A. The owner of a trademark registration can challenge the domain name holder’s registration of an “identical” second-level domain provided the “effective date” of the complainant’s trademark registration predates the “creation date” of the domain name registration.
Q. What is the procedure?
A. It is as follows:
1. NSI will send a letter to the domain name registrant giving him 30 days to supply his own trademark registration.
2. If the domain name registrant’s TM registration predates the notice of dispute, he will be able to keep his domain name. The trademark owner’s recourse would be to file a lawsuit or to have a settlement or arbitration.
3. If the domain name registrant cannot produce its own TM registration:
a. registrant can transfer domain name to TM owner
b. registrant can register new TM which places the disputed name “on hold”
c. registrant canr efuse to transfer, dispute name is “on hold”
d. registrant can file for declaratory judgment
Q. What are the requirements to invoke the NSI dispute resolution?
A. TM owner must have TM registration, the dispute is for an identical second level registry, on the federal principal register, application filing date predates the creation date of the domain name.
Q. Is the dispute resolution viable?
A. Not if the TM owner wishes to use the domain name because the domain name will be put on hold indefinitely.
Q. What is the new method for domain name dispute resolution?
A. The Uniform Dispute Resolution Policy (UDRP) which applies to any domain name confusingly similar to the complainant’s trademark, not simply an identical one.
Q. What is the complainant’s burden of proof?
A. They are three
1. The registrant’s domain name is identical or confusingly similar to a trademark or service mark of the complainant;
2. The registrant has no rights or legitimate interest in the domain name;
3. The domain name has been registered and used in bad faith.
Q. What are some indicators of bad faith?
A. (1) Respondent’s offer to sell the domain name
(2) no use of the domain name
(3) attempt to show affiliation or trade off the goodwill of the complainant
(4) failure to file a response
(5) pattern of registering domain name consisting of marks belonging to others who are not affiliated with respondent
(6) suspect timing in that respondent was aware of complainant’s prior rights
Q. Please give a short summary of the proceedings.
A. Certainly.
1. A complaint is filed in hard copy and via e-mail – this should request transfer of domain name and not cancellation; a provider (such as WIPO) is selected, and the panelists must be selected.
2. A response is filed 20 days from commencement date in hard copy and e-mail.
Q. Are precedents respected?
A. Some UDRP decisions have cited other decisions as precedent but there are many inconsisted decisions.
Yahoo! Inc. v. Net Games, Inc.
Yahoo owns the trademarks YAHOO! and YAHOO!; services include both local and international web directory and search services, online games, people searches. Net Games uses the domain name yahoops.com for a gambling website that offers gambling on a variety of sports, including basketball, hockey, tennis, and boxing. Yahoo filed a cease-and-desist letter but Net Games claims that it uses the name with a bona fide offering of goods, has used the name for many months without objection and it does not promote search engines nor cause actual confusion.
Held: Based on the 3 factor test, (1) confusion - a reader is likely to believe that the subject domain name is related to the comlainant and its mark.; (2) legitimate right – it is a reasonable inference that the subject domain name was created with YAHOO!’s mark in mind. Net Games has spent little time and money to develop the site, and it cannot be said to have legitimate interest in the domain name; (3) bad faith – but there is no bad faith. The only proof alleged is that Net Games is benefiting from the notoriety of its mark. This is not enough.
Philips v. Park Kyoung Seok
Philips (Netherlands) owns the TM Philips. Park acquired “philips.com.ph” and registered it with dotPHone, Inc. in RP. There are no active websites for them but are currently pointed to name servers.When Philips sent it a cease and desist letter, it replied that it is not willing to sell the domain names yet, but would like to know exactly about the condition and proposition of those who are interested in these domain names. Park argues that it used “Philips” because it is an acronym for Philippine Information Providing Service.
Held: (1) confusion – the names are identical; (2) legitimate rights – Park has no legitimate right over the TM Philips. It is not supported by any evidence of use, and reference to the Oxford Dictionary does not disclose such accepted abbreviation. (3) bad faith – the response to the letter suggests that it was part of Park’s intention to sell the domain name at some time for valuable consideration. The court also observed a pattern of registering famous marks in RP. There is no evidence that Park has ever had a business which attempted to use the domain names.
Yahoo! v. Yahoo Computer Services
Yahoo! (Delaware) is a search engine and Yahoo Computer Services (RP) is a business in Makati which registered “yahoo.com.ph” and “yahoo.ph.” Yahoo! Claims that it is the owner of the mark and the use of YCS is infringing. YCS claims that its main income is from the sale of services and sale of hardware and software. Its income has risen only 1.7% since the domain name was acquired and it is only a small company which has had 1,004 hits on its site.
Held: YCS has no legitimate right of interest in the domain name. Its alleged rights are based on a certificate of registration of business name. But there is no evidence that registration of a business name with the DTI of RP provides the registrant with any exclusive rights with respect to the business name. It did not provide YCS with an exclusive right to use of the domain name. There is also clear bad faith since it is inconceivable that YCS could have been unaware of the complainant’s name and TM when it registered.
Philips v. Relson
Philips Electronics (Netherlands) filed a complaint against Relson Ltd. of Western Samoa which registered “philips.ws”. Relson did not reply to the complaint.
Held: The fact that Relson failed to provide a response to the complaint does not relieve the complainant Philips of the burden of proving its case. Though Relson did not expressly challenge any of the assertions, this cannot simply be taken as an admission. (1) identity - There is indeed identity of the names. (2) legitimate rights – not proven. Its allegations say that it has no right to the domain name are no more than the factors given in the Policy. Mere assertion is not proof. (3) Bad faith – there is no challenge to the complaint. But there ought not to be any inferences from default other than those that have been established or can be fairly inferred from the facts in the complaint. There is also no evidence that there is intention to sell, nor a plan to sell the domain name.
America Online v. Frank Albanese
America Online uses “aol.com”. Frank registered “aoltrader.com”. AOL filed a complaint saying that there is use in bad faith, since Frank registered the domain name after AOL’s adoption of the mark, that they are nearly identical, that Frank has registered numerous other domain names that infringe upon famous marks including “inteltrader.com,” “ciscotrader.com,” “ibmtrader.com,” etc.
Held: AOL has not met all the requirements. No question that it is confusingly similar. However, Frank has rights or legitimate interests to the domain name, since he has used the domain name with a bona fide offering of services, that is, online stock brokerage services. There is fair use of the disputed domain name and the use of Frank is merely descriptive of the services offered by Frank. There is also a disclaimer on the website of any affiliation with AOL which supports the finding of good faith.
Yahoo! v. Syrynx, Inc.
April ’99, Yahoo officially anounced its acquisition of “broadcast.com”, an internet co. that specializes in aggregation and broadcast of streaming audio via the internet. But as early as March ’99, there had been industry speculation on such merger. The day before Syrynx registered the domain name “yahoobroadcast.com” and “yahoolinux.com” (Mar ’99), Wall Street Journal reported that Yahoo! Was in talks to acquire Broadcast.com. Yahoo filed a complaint but Syrynx claims that it spent $100-$125K to get the site going although the site actually connects to an index page displaying a deadline. Syrynx filed no response.
Held: (1) identical – established; (2) legitimate use – respondent has to prove use or preparation to use; that he has been commonly known by the disputed domain name, and that he is making a legitimate noncommercial or fair use of the name with no intent for commercial gain. Here, Syrynx is in default and he has failed to prove the factors; (3) the name is also registered in bad faith, because it has registered multiple domain names all identical to names belonging to Yahoo.
Arthur Guinness v. Dejan Macesic
Arthur Guiness (Ireline) owns the TM “Guinness” for beer. Dejan registered the domain name “guiness.com” for a website dedicated to the discussion of home brewing and sports.
Held: (1) identity – Dejan is not infringing on Arthur’s mark as he is not selling similar wares or services. Guinness has other products like the Guinness World Book of Records, Guinness Flight, Guinness Group. The word “guinness” is not automatically associated with “guinness beer”. There is also a legitimate noncommercial, fair use of the domain name with no intent for commercial gain. Revenues are modest and serve to cover hosting and maintenance costs. Also, there is no bad faith since every effort has been made to eliminate the likelihood of any possible mistaken association of the site with the beer.
Q. What are the factors showing bad faith?
A. The factors are:
(i) circumstances that indicate that the Respondent has registered or has acquired the domain name primarily for the purpose of selling, renting, or otherwise transferring the domain name registration to the Complainant who is the owner of the trademark or service mark or to a competitor of the Complainant, for valuable consideration in excess of the Respondent’s documented out-of-pocket costs directly related to the domain name;
(ii) registration of the domain name in order to prevent the owner of the trademark or service mark from reflecting the mark in a corresponding domain name, provided that the Respondent has engaged in a pattern of such conduct;
(iii) registration of the domain name primarily for the purpose of disrupting the business of a competitor;
(iv) by using the domain name, intentionally attempting to attract, for commercial gain, Internet users to the Respondent’s web site or other on-line location, by creating a likelihood of confusion with the complainant's mark as to the source, sponsorship, affiliation, or endorsement of the web site or location or of a product or service on it or a location.
Q. Is the UDRP available to RP companies for violation of domain names?
A. Yes, since jurisdiction is acquired by UDRP when parties submit to its jurisdiction.
Q. A UK company registeres “jollibee.uk”, can Jollibee file a case against it in RP RTC’s?
A. No. RP court can’t acquire jurisdiction over that foreign firm, the cause of action of Jollibee would not be on RP law, and this case differs from traditional TM infringement cases in many aspects.
Abuse of Web Technologies
Q. What are the issues in linking?
A. Linking is vital to the seamless functioning of the web, because it reduces the need to use complex address and provides nearly instantaneous access to other sites of interest. Linking increases “hits” which increases advertising revenues. But the problem primarily is that one loses track of exactly whose website one is on, where the information is coming from, and how current it is.
Q. What are the dangers of framing?
A. In framing, a user reads content from one site in another’s site. In the Total News case, plaintiff objected not to linking per se but only to partial linking, where their advertising has been edited or deleted and the defendants have substituted their own advertising. Implied license to link did not permit any right to alter.
Q. Summarize the dangers of framing.
A. They are: (1) Loss of advertising revenue, and (2) Confusion over the ownership of a site
Q. What is a metatag?
A. It is a software parameter of HTML, where a website creator can describe what is available in that particular site, and search engines rely on that to match a website to a search query.
Q. What is cyberstuffing?
A. It is the placing of multiple entries of a keyword on the face of a webpage. It can be invisible on the face of a webpage (black lettering against black background) or from repeated use of a word (e.g. This site is not related to X, is not endorsed by X, we don’t use X, X, sorry if you see this, X, we love you.)
Q. What is the problem brought about by metatagging and cyberstuffing?
A. Internet advertising erevenues are driven by the number of hits or times a certainw ebsite is accessed. The purpose of both is to lure persons searching the third-party trademark to an unrelated website.
Q. Cause of action in metatagging and cyberstuffing?
A. Unfair competition.
Q. What is an aggregation site?
A. A site that essentially serves as a specialized search engine. An auction aggregation site will serve to search multiple auction sites by use of automated software programs.
Q. Cause of action.
A. In one case, eBay filed for trespass, false advertising, trademark dilution, computer fraud and abuse, unfair competition, unjust enrichment. The court granted it an injunction since it was found that the aggregation site’s actions was unauthorized and the proximate cause of injury suffered by eBay due to loss of bandwidth or server capacity.
Q. What is mousetrapping?
A. Here, when one views a webpage, he is unable to go back to any of the previous pages visited and is trapped at the last site viewed.
Q. What are webrings?
A. Webrings are a web within a web, where owners of websites with a common theme band together to arrange sites into linked circles. For examples, there can be a Star Trek webring, etc.
Q. What are possible violations in webrings?
A. There could be violation on how the trademarks are used.
Q. Will an action in RP against “sucks” sites prosper? E.g., jollibeesucks.com, ateneosucks.com.
A. Possible causes of action would be violation of abuse of right provisions under Art. 19, 20, 21 of the Civil Code, and that the freedom of speech does not extend to that.
Q. US firm distributing porn over the net. How can RP stop pornographers over the internet?
A. Maybe through ISP’s, under the E-Commerce Act.
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