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ASIA BREWERY VS CA AND SMC

In September 1988, San Miguel Corporation (SMC) sued Asia

Brewery Inc. for allegedly infringing upon their trademark on

their beerproduct popularly known as San Miguel

Pale Pilsen; that Asia Brewerys Beer na Beer product, by

infringing upon SMCs trademark has committed

unfair competition as Beer na Beer creates confusionbetween the two products. The RTC ruled in favor of Asia

Brewery but the Court of Appeals reversed the RTC.

ISSUE: Whether or not Asia Brewery infringed upon the

trademark of SMC.

HELD: No. Both products are manufactured using amber

colored steinie bottles of 320 ml. Both were labeled in a

rectangular fashion using white color paint. But other than

these similarities, there are salient differences between the

two. As found by the Supreme Court, among others they are

the following:

1. The dominant feature of SMCs trademark arethe wordsSan Miguel Pale Pilsen while that of Asia

Brewerys trademark is the word Beer. Nowhere in

SMCs product can be seen the word Beer nor in Asia

Brewerys product can be seen the words San Miguel

Pale Pilsen. Surely, someone buying Beer na Beer

cannot mistake it as San Miguel Pale Pilsen beer.

2. The bottle designs are different. SMCs bottles haveslender tapered neck while that of Beer na Beer are fat.

Though both beer products use steinie bottles, SMC

cannot claim that Asia Brewery copied the idea from

SMC. SMC did not invent but merely borrowed the steinie

bottle from abroad and SMC does not have any patent or

trademark to protect the steinie bottle shape and design.

3. In SMC bottles, the words pale pilsen are writtendiagonally while in Beer na Beer, the words pale

pilsen are written horizontally. Further, the words pale

pilsen cannot be said to be copied from SMC for pale

pilsen are generic words which originated from Pilsen,

Czechoslovakia. Pilsen is a geographically descriptive

word and is non-registrable.

4. SMC bottles have no slogans written on them while AsiaBrewerys bottles have a copyrighted slogan written on

them that is Beer na Beer.

5. In SMC bottles, it is expressly labeledas manufactured by SMC. In Asia Brewery beer products,

it is likewise expressly labeled as manufactured by Asia

Brewery. Surely, there is no intention on the part of Asia

Brewery to confuse the public and make it appear that

Beer na Beer is a product of SMC, a long-established

and more popular brand.

Justice Cruz Dissenting:

A number of courts have held that to determine whether a

trademark has been infringed, we must consider the mark as

a whole and not as dissected. If the buyer is deceived, it is

attributable to the marks as a totality, not usually to any part

of it. The court therefore should be guided by its first

impression, for a buyer acts quickly and is governed by a

casual glance, the value of which may be dissipated as soon

as the court assumes to analyze carefully the

respective features of the mark. (Del Monte vs CA & Sunshine

Sauce)

Del Monte vs Court of Appeals and Sunshine Sauce

Del Monte Corporation is an American corporation which is

not engaged in business in the Philippines. Though not

engaging business here, it has given authority to Philippine

Packing Corporation (Philpack) the right to manufacture,

distribute and sell in the Philippines variousagricultural products, including catsup, under the Del Monte

trademark and logo. In 1965, Del Monte also authorized PPC

to register with the Patent Office the Del Monte catsup bottle

configuration. Philpack was issued a certificate of trademark

registration under the Supplemental Register.

Later, Del Monte and Philpack learned that Sunshine

Sauce Manufacturing was using Del Monte bottles in selling its

products and that Sunshine Sauces logo is similar to that of

Del Monte. The RTC of Makati as well as the Court of Appeals

ruled that there was no infringement because the trademarks

used between the two are different in designs and that the

use of Del Monte bottles by Sunshine Sauce does not

constitute unfair competition because as ruled in

Shell Company vs Insular Petroleum: selling oil in containers

of another with markings erased, without intent to deceive,

was not unfair competition.

ISSUE: Whether or not there is unfair competition and

infringement in the case at bar.

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HELD: Yes. The Supreme Court recognizes that there really

are distinctions between the designs of the logos or

trademarks of Del Monte and Sunshine Sauce. However, it

has been that side by side comparison is not the final test of

similarity. Sunshine Sauces logo is a colorable imitation of

Del Montes trademark. The word catsup in both bottles

is printed in white and the style of the print/letter is the

same. Although the logo of Sunshine is not a tomato, the

figure nevertheless approximates that of a tomato. The

person who infringes a trade mark does not normally copy out

but only makes colorable changes, employing enough points

of similarity to confuse the public with enough points of

differences to confuse the courts. What is undeniable is the

fact that when a manufacturer prepares to package his

product, he has before him a boundless choice of words,

phrases, colors and symbols sufficient to distinguish his

product from the others. When as in this case, Sunshine

chose, without a reasonable explanation, to use the same

colors and letters as those used by Del Monte though the field

of its selection was so broad, the inevitable conclusion is that

it was done deliberately to deceive.

The Supreme Court also ruled that Del Monte does not have

the exclusive right to use Del Monte bottles in the Philippines

because Philpackspatent was only registered under the

Supplemental Register and not with the Principal Register.

Under the law, registration under the Supplemental Register

is not a basis for a case of infringement because unlike

registration under the Principal Register, it does

not grantexclusive use of the patent. However, the bottles of

Del Monte do say in embossed letters: Del Monte

Corporation, Not to be Refilled. And yet Sunshine Sauce

refilled these bottles with its catsup products. This clearly

shows the Sunshine Sauces bad faith and its intention

tocapitalize on the Del Montes reputation and goodwill and

pass off its own product as that of Del Monte.

Read the full text of the case here.

Compare it with the case ofAsia Brewery vs CA and SMC.

Note: This case (Del Monte case) is a prime example of how

to apply the Holistic Test as opposed to the Asia Brewery case

which applied the Dominancy Test

MIGHTY CORPORATION VS. E & J GALLO WINERY

IP Views

No confusion arises from the use of similar marks onwines and cigarettesSeptember 20, 2007

E. & J. Gallo Winery, producer of wines and brandy productswhich is based in California, U.S.A., registered its GALLO wine

trademark in the Philippines in 1971. On the other hand,Mighty Corporation and La Campana Fabrica de Tabaco, Inc.,together with their affiliate, Tobacco Industries of thePhilippines, were engaged in the manufacture and distributionof tobacco products for which they have been using theGALLO cigarette trademark since 1973.

On 14 July 2004, the Supreme Court1 ruled that MightyCorporation, et al. are not liable for trademark infringementor unfair competition and reaffirmed the doctrine that the useof an identical mark does not, by itself, lead to a legalconclusion that there is trademark infringement. A crucialissue in any trademark infringement case is the likelihood ofconfusion, mistake or deceit as to the identity, source ororigin of the goods, or identity of the business as a

consequence of using a certain mark.

According to the High Court, there are two types of confusionin trademark infringement, namely, "confusion of goods" and"confusion of business." Confusion of goods is evident wherethe litigants are actually in competition; but confusion ofbusiness may arise between non-competing interests as well.Thus, there is likelihood of confusion when, although thegoods of the parties are different, they are so relatedthat thedefendant's product can reasonably be assumed to originatefrom the plaintiff.

The GALLO trademark registration certificates in thePhilippines and in other countries expressly state that theycover wines only, without any evidence or indication that

registrant Gallo Winery expanded or intended to expand itsbusiness to cigarettes.

In determining likelihood of confusion, the Supreme Courtconsidered the following factors: [a] the resemblancebetween the trademarks; [b] the similarity of the goods towhich the trademarks are attached; [c] the likely effect onthe purchaser; and [d] the registrant's express or impliedconsent and other fair and equitable considerations.

In comparing the resemblance or colorable imitation ofmarks, various elements were considered, such as thedominant color, style, size, form, meaning of letters, words,designs and emblems used, the likelihood of deception of themark or name's tendency to confuse, and the commercial

impression likely to be conveyed by the trademarks if used inconjunction with the respective goods of the parties.

The Supreme Court found that the similarity between theparties' GALLO trademarks, i.e., the use of the word "GALLO"- a family surname for Gallo Winery's wines and a Spanishword for "rooster" for Mighty Corporation, et al.'s cigarettes,was overridden by their different features like color schemes,art works and other markings of both products.

In determining whether goods are related the followingfactors apply:

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a. the business (and its location) to which the goodsbelong;

b. the class of product to which the goods belong;c. the product's quality, quantity, or size, including the

nature of the package, wrapper or container;

d. the nature and cost of the articles;e. the descriptive properties, physical attributes or

essential characteristics with reference to their form,composition, texture or quality;

f. the purpose of the goods;g. whether the article is bought for immediate

consumption, that is, day-to-day household items;

h. the fields of manufacture;i. the conditions under which the article is usually

purchased and

j. the channels of trade through which the goods flow,how they are distributed, marketed, displayed andsold.

As each trademark infringement case presents its own uniqueset of facts, no single factor is preeminent. A very importantcircumstance is whether there exists likelihood that anappreciable number of "ordinarily prudent purchasers" will bemisled, or simply confused, as to the source of the goods inquestion. The "purchaser" is not the "completely unwaryconsumer" but is the "ordinarily intelligent buyer" who isaccustomed to buy, and therefore to some extent familiarwith, the goods in question.

The Supreme Court distinguished between GALLO wines andGALLO cigarettes as follows: (1) wines are bottled andconsumed by drinking while cigarettes are packed in cartons

or packages and smoked; (2) there is a whale of a differencebetween their descriptive properties, physical attributes oressential characteristics like form, composition, texture andquality; (3) GALLO cigarettes are inexpensive items thatappeal only to simple folks like farmers, fishermen, laborersand other low-income workers while GALLO wines arepatronized by middle-to-high-income earners; and (4) GALLOcigarettes are distributed through sidewalk vendors, sari-saristores and grocery stores in rural areas, mainly in MisamisOriental, Pangasinan, Bohol, and Cebu, whereas GALLO winesare imported and exclusively distributed by a local entity andsold in hotels, expensive bars and restaurants, and high-endgrocery stores and supermarkets.

Based on these distinctions, the High Tribunal declared that

wines and cigarettes are non-competing and totally unrelatedproducts which are not likely to cause confusion vis--vis thegoods or business of Gallo Winery and Mighty Corporation, etal. Thus, even though similar marks are used, there is notrademark infringement if the public does not expect theplaintiff to make or sell the same class of goods as thosemade or sold by the defendant.