G.R. No. L-2548 - Dee C. Chuan and Sons, Inc. vs. Court of Industrial Relations

PEMCO, the exclusive local subsidiary of GE-USA, discovered in June 1990 that GE lamp starters were proliferating locally despite no known local manufacture or importation since 1983.
Concerned about unfair competition, PEMCO commissioned a market survey conducted by Gardsmarks, Inc. Through its trademark specialist, Martin Remandaman, it was established that thirty commercial establishments were selling GE lamp starters, all apparently sourced from Tradeway Commercial Corporation (TCC).

Remandaman purchased fifty pieces of fluorescent lamp starters bearing the GE logo and design from TCC, which he judged as counterfeit.
PEMCO promptly applied for and obtained a search warrant from the Metropolitan Trial Court (MeTC), Branch 49, Caloocan City, leading to the seizure of eight boxes of lamp starters from the TCC warehouse.

TCC’s President and General Manager, George Yao, and Board member Alfredo Roxas were indicted before MeTC, Branch 52, Caloocan City for unfair competition under Article 189 of the Revised Penal Code.
The indictment charged that Yao and Roxas, in conspiracy, sold fluorescent lamp starters that deceptively bore GE’s logo and design, thereby misleading the public into believing they were genuine products.
At trial, the prosecution presented witnesses from Castillo Laman Tan and Pantaleon Law Offices as well as PEMCO’s marketing manager, Allan de la Cruz, who compared seized samples with genuine GE products, noting discrepancies in design, packaging, and pricing.
The defense rested on the testimony of Yao, who admitted to his supervisory role but denied knowledge of the counterfeit nature of the products, stressing his limited involvement in matters such as product branding, manufacturing, or certification.

In the 20 October 1993 decision, the MeTC acquitted Alfredo Roxas but convicted George Yao based on:

Yao’s admission regarding his awareness during the accreditation process that the starters were not genuine GE products.
Documentary evidence (a delivery receipt) which suggested knowledge of the anomaly despite labeling inconsistencies.
The inherent impossibility of genuine GE starters being sold in such commercial quantities given the market conditions.

Yao was sentenced to a term ranging from a minimum of four months and twenty-one days to a maximum of one year and five months, along with orders to pay consequential damages and attorney’s fees.
Yao’s motion for reconsideration was denied by the MeTC on 7 March 1994.

Yao appealed to the Regional Trial Court (RTC) and later to the Court of Appeals:

At the RTC, his appeal was docketed and a one-page decision rendered on 27 July 1994 affirmed the MeTC decision in toto, quoting its dispositive portion.
Yao then filed a motion for reconsideration with the RTC, which was denied on 28 September 1994.

Yao filed a notice of appeal with the Court of Appeals on 4 October 1994; however, evidence suggested that he had missed the reglementary period for filing a petition for review as he did not use the proper mode of appeal.
The Court of Appeals, in its 25 April 1995 resolution, declared the RTC decision final and executory by remanding case records for proper execution of judgment, effectively dismissing Yao’s appeal.
Yao raised the argument that procedural infirmities (i.e. the wrong mode of appeal) should be considered cured by the extension granted on 28 February 1995 and pleaded that his due process rights were violated because his appeal was not explicitly dismissed.

Yao filed a petition for review on certiorari before the Supreme Court challenging:

The propriety of the 25 April 1995 resolution of the Court of Appeals, which he argued did not specifically dismiss his appeal.
The procedural irregularities, including his filing of a notice of appeal instead of a petition for review, and whether any technical lapse should bar adjudication on the merits.

Yao also contended that the RTC decision failed to satisfy Section 14, Article VIII of the Constitution, as it did not clearly state the facts and legal bases underlying its judgment.
Citing precedent where the Supreme Court has “disregarded technicalities” in the interest of substantial justice, Yao appealed for a reconsideration of his case based on its intrinsic merits.

Whether the filing of a notice of appeal instead of the correct procedural remedy—petition for review—within the reglementary period, barred Yao’s appeal or if the extension granted effectively cured this procedural defect.
Whether the 25 April 1995 resolution of the Court of Appeals, despite not specifically stating it dismissed the appeal, was sufficient to render the RTC decision final and executory.

Whether, notwithstanding the technical lapse in the mode of appeal, Yao was deprived of his due process right to be heard on the merits of his case.
Whether the RTC decision complied with Section 14, Article VIII of the Constitution by clearly and distinctly stating the facts, legal bases, and reasoning underlying the conviction of unfair competition.

Whether the abbreviated decision (memorandum decision) employed in affirming the RTC judgment meets the constitutional mandate for clarity in judicial reasoning.
Whether the use of a succinct, scarcely analyzed decision deprived the parties of a fair opportunity to understand and challenge the bases of the judgment.