Case Summary (G.R. No. L-23035)
Factual Background
Philippine Nut obtained Certificate of Registration No. SR-416 for the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" used on cans of salted peanuts, registered August 10, 1961. Standard Brands held Certificate of Registration No. SR-172 for the trademark "PLANTERS COCKTAIL PEANUTS," first used in Philippine commerce in December 1938 and issued July 28, 1958. Standard Brands alleged that Philippine Nut’s label so closely resembled its own label that confusion and deception of purchasers were likely.
Procedural History Before the Director of Patents
Standard Brands filed an inter partes petition with the Director of Patents on May 14, 1962, seeking cancellation of Philippine Nut’s registration under the grounds set forth in Republic Act 166. Philippine Nut answered on June 1, 1962, denying confusing similarity. The parties submitted partial stipulations and evidence at hearings and filed memoranda. On December 10, 1963, Director of Patents issued Decision No. 281 granting the petition and cancelling Certificate No. SR-416; a motion for reconsideration was denied, and Philippine Nut appealed to this Court.
Issue Presented
The dispositive question was whether the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS" used by Philippine Nut was confusingly similar to "PLANTERS COCKTAIL PEANUTS" used by Standard Brands so as to constitute infringement and justify cancellation under Republic Act 166, Chapter II-A, Sec. 4 (d), Sec. 17 (c), and Sec. 22.
Petitioner’s Contentions
Philippine Nut argued that the word "PLANTERS" was a common descriptive term that could not be the dominant feature of the marks and that the labels were not confusingly similar. Petitioner also contended that no showing of secondary meaning had been made by Standard Brands and that intervening non-use due to wartime conditions and import restrictions defeated any claim of exclusive association with "PLANTERS." Petitioner pointed to differences such as the word "PHILIPPINE," distinct slogans, a pictorial of peanuts on its label, and the presence of "Mr. Peanut" on Standard Brands’ can.
Respondent’s Contentions
Standard Brands maintained priority of use dating from 1938, asserted that "PLANTERS" was the dominant, eye-catching feature of its label, and alleged that Philippine Nut deliberately adopted that dominant element together with similar color scheme, layout, and type to pass off its product as that of Standard Brands. Standard Brands relied on documentary invoices and testimonial proof of continuous use to establish secondary meaning and priority.
Director of Patents’ Findings
The Director of Patents found that the dominant feature of both labels was the word "PLANTERS," displayed in a very similar manner, and that the overall appearance, color scheme of gold, blue, and white, and the lay-out of words created a very confusing similarity in appearance and general impression. The Director concluded that Philippine Nut was not entitled to register the mark at the time of its application and ordered cancellation of Certificate No. SR-416.
Standard of Law Applied
The Court applied Republic Act 166, emphasizing that registration is barred where a mark "so resembles a mark ... registered in the Philippines or a mark ... previously used in the Philippines by another and not abandoned, as to be likely ... to cause confusion" (Chapter II-A, Sec. 4 (d)). The Court reaffirmed that infringement exists when use of a mark is likely to cause confusion as to source, that the question is factual and resolved by the test of dominancy, and that duplication is unnecessary where the dominant features are similar. The Court also treated the doctrine of secondary meaning as recognized in Sec. 4 (f) (as amended) and as established by prior Philippine jurisprudence.
Evidence of Priority and Secondary Meaning
The Court found substantial evidence that Standard Brands used "PLANTERS" in the Philippines since 1938 as shown by the parties’ amended stipulation, testimony at the October 4, 1962 hearing, and documentary exhibits including sales invoices. The Court held that such proof established that "PLANTERS" had become distinctive of Standard Brands’ salted peanuts and had acquired secondary meaning sufficient to warrant protection by priority of use.
Consideration of Non-Use and Abandonment
The Court rejected petitioner’s contention that interruptions in use during the Japanese occupation and import restrictions constituted abandonment. It applied the rule that non-use occasioned by legal restrictions or circumstances beyond control does not constitute abandonment, and it cited prior decisions holding that abandonment requires an intentional and permanent discontinuance of use.
Comparison of Labels and Likelihood of Confusion
The Court reviewed the labels themselves and held that visual and graphic presentation constituted the best evidence of dominancy and
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Case Syllabus (G.R. No. L-23035)
Parties and Posture
- Philippine Nut Industry, Inc. was the petitioner and registrant of Certificate of Registration No. SR-416 for the trademark "PHILIPPINE PLANTERS CORDIAL PEANUTS."
- Standard Brands Incorporated was the complainant and owner of Certificate of Registration No. SR-172 for the trademark "PLANTERS COCKTAIL PEANUTS."
- Tiburcio S. Evalle, as Director of Patents was respondent in his official capacity for Decision No. 281 cancelling Certificate No. SR-416.
- The Director of Patents rendered Decision No. 281 cancelling petitioner’s registration and denied petitioner’s motion for reconsideration before the matter was brought to the Court.
- Munoz Palma, J. authored the opinion affirming the Director of Patents.
Key Factual Allegations
- Standard Brands alleged that Philippine Nut’s trademark closely resembled and was confusingly similar to its own trademark used on salted peanuts, and that registration of the former would deceive the buying public.
- Philippine Nut alleged that its label was not confusingly similar and raised other distinctions such as the word "Philippine," a pictorial of peanuts, and different inscriptions.
- The parties stipulated that Standard Brands first used its mark in the Philippines in December 1938 and that Philippine Nut first used its mark on December 20, 1958.
- Philippine Nut obtained registration of its mark on August 10, 1961, and Standard Brands obtained registration of its mark on July 28, 1958.
- The record included testimonial evidence and documentary exhibits consisting of invoices and reproductions of the respective can labels of the parties.
Procedural History
- Standard Brands filed Inter Partes Case No. 268 on May 14, 1962 asking for cancellation of Certificate No. SR-416.
- The parties filed pleadings, submitted partial stipulations of fact, and introduced oral and documentary evidence at hearing.
- The Director of Patents issued Decision No. 281 on December 10, 1963 granting Standard Brands’ petition and ordering cancellation.
- Petitioner’s motion for reconsideration was denied and petitioner appealed to the Court.
Statutory Framework
- The Court applied Republic Act 166 as the controlling Trade‑Mark Law.
- The Court relied on Sec. 4, Chapter II-A for prohibitions against registration of marks likely to cause confusion.
- The Court relied on Sec. 17 as the statutory ground allowing cancellation of a registration obtained contrary to Section 4.
- The Court relied on Sec. 22 for the definition of infringement as use of a reproduction or colorable imitation likely to cause confusion.
Issues Presented
- The central issue was whether PHILIPPINE PLANTERS CORDIAL PEANUTS was confusingly similar to PLANTERS COCKTAIL PEANUTS so as to warrant cancellation of petitioner’s registration under Republic Act 166.
- A subsidiary issue was whether the word "PLANTERS" constituted a dominant feature and whether it had acquired a secondary meaning protecting it from adoption by