Case Digest (G.R. No. 27897)
Facts:
Western Equipment and Supply Company, Western Electric Company, Inc., W. Z. Smith and Felix C. Reyes v. Fidel A. Reyes, Henry Herman, Peter O'Brien, Manuel B. Diaz, Felipe Mapoy and Artemio Zamora, G.R. No. 27897. December 02, 1927, the Supreme Court, Johns, J., writing for the Court.The plaintiffs (appellees) were two corporate entities and two individuals: the foreign corporations Western Equipment and Supply Company and Western Electric Company, Inc., and residents W. Z. Smith and Felix C. Reyes. The defendants (appellants) were Fidel A. Reyes, Director of the Bureau of Commerce and Industry, and five residents—Henry Herman, Peter O'Brien, Manuel B. Diaz, Felipe Mapoy and Artemio Zamora—who had filed articles to incorporate a Philippine corporation under the name “Western Electric Company, Inc.”
Plaintiffs alleged that (1) Western Equipment and Supply Company had obtained a license to do business in the Philippines and, as importer and seller, distributed electrical and telephone apparatus manufactured by the foreign Western Electric Company, Inc., (2) the foreign Western Electric Company, Inc. had long manufactured and sold equipment worldwide that bore its corporate name and trademark and thus had acquired a valuable goodwill and reputation in the Philippine Islands, and (3) defendants sought to form a domestic corporation using the identical corporate name to trade upon that reputation and deceive the public, in violation of Act No. 666. Plaintiffs asked the Court to enjoin the Director from issuing a certificate of incorporation to the local group and to restrain the defendants from using the name.
In the Court of First Instance of Manila plaintiffs secured a preliminary injunction; the case was tried on stipulated facts. The stipulation established that the foreign Western Electric Company, Inc. had never been licensed or transacted business in the Philippines, but its products were widely used and recognized there; Western Equipment and Supply Company had imported and sold those products in the Islands; defendants filed articles on October 15, 1926; plaintiff Smith filed an application for a license for the foreign Western Electric on October 21, 1926; and the Director had announced his intention to overrule the protest against registration.
The trial court rendered judgment for plaintiffs and made the preliminary injunction permanent, enjoining issuance of the certificate and the defendants' use of the corporate n...(Subscriber-Only)
Issues:
- May a foreign corporation that is unregistered and has not transacted business in the Philippine Islands maintain an action in Philippine courts to enjoin residents from organizing a domestic corporation bearing the same corporate name to protect its reputation and goodwill?
- May the courts enjoin the Director of the Bureau of Commerce and Industry from issuing a certificate of incorporation to such local organizers where registration would permit pirating of the foreign corporation's name and cause deception, i.e., was issu...(Subscriber-Only)
Ruling:
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Ratio:
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Doctrine:
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