AMERICAN CYANAMID COMPANY, PETITIONER, VS. THE DIRECTOR OF PATENTS AND TIU CHIAN, RESPONDENTS.

This is an appeal from a decision of the Director of Patents in Inter
Partes Case No. 140 entitled “American
Cyanamid Company, petitioner, versus Tiu Chian, respondent”, which denied the petition of
American Cyanamid Company to cancel the registration of the trademark SULMETINE issued in favor of Tiu Chian.

The factual background of this case follows:

Petitioner to which We shall refer at times as Cyanamid
filed on April 3, 1959, a petition to cancel certificate of registration No.
5348 issued on July 6, 1956, in favor of respondent Tiu
Chian of the latter’s trademark SULMETINE
used on medicine for the control of infectious coryza
and for the prevention of cold, rhinitis, roup, cecal coccidiosis and intestinal coccidiosis of chicken and other domesticated birds.  Cyanamid claims that it is the owner of a trademark SULMET which it had used for many years in the United
States since 1946 and which was duly registered in said country on August 12,
1947, under U.S. Registration No. 431929 and which was first used in the
Philippines on May 25, 1950, for which it filed an application for registration of the same in this country on
May 3, 1956, and which was approved on July 8, 1958 and for which certificate
of registration No. 6894 was issued on October 30, 1958.  SULMET is the
trademark of a veterinary product used, among other purposes, “for the
control of outbreaks of cecal and intestinal coccidiosis and infectious coryza
(colds) in chicken flocks; coccidiosis in turkeys;
and for reducing mortality in pullorum disease in
baby chicks, acute fowl cholera in chickens, turkeys and ducks and anatipestifer disease in ducks.” Through long use in
the country, SULMET has become popular and well-known
and enjoys widespread reputation brought about by extensive advertisement and
promotion through the media. 
Notwithstanding the above, respondent fraudulently filed an application
for registration of SULMETINE as his trademark on a
veterinary product used for the same purposes thereby making respondent’s
product confusingly similar with that of petitioner which is unfair and unjust
to the latter.

In support of its Petition for cancellation, Cyanamid
presented as its Exhibit B a sample of the label used on its product and as
Exhibit C a sample of the label of respondent Tiu Chian used on the latter’s product.  (pp. 264-265, original record) It likewise
submitted among its exhibits several indent orders issued by F.E. ZUELLIG, INC. to various
business companies covering petitioner’s Sulmet
Solution (Exhibits H, H-1, J, J-1, I, I-1, K, and L).

Respondent Tiu Chian
opposed this Petition for cancellation of his trademark SULMETINE.

On June 9, 1964,
the Director of Patents rendered his decision denying the Petition for
cancellation of respondent’s certificate of registration of the trademark SULMETINE, based on the following findings:

(1)  Petitioner’s trademark
SULMET (Exhibit B) is used on a preparation for
practically all domesticated animals such as fowl, cattle, pigs, horses and
sheep, whereas, SULMETINE is limited only to chicken
and other domesticated birds.  This
distinction is evident from the printed matter appearing on the respective
labels of the parties.  Thus, on
respondent’s label (Exhibit C) it is indicated thereon that the preparation is
for treatment of birds and chicken (p. 265, volume of exhibits), whereas, the
label (Exhibit B) of petitioner indicates that the product is for chicken,
turkey, duck, and may be employed in the treatment of certain conditions in
horses, cattle, calves, sheep, and swine (p. 264, idem).

(2)  On the top of
petitioner’s label, Exhibit B, the word “CYANAMID” is printed in prominent
letters and at the bottom of the label there appears in bold letters the words
“AMERICAN CYANAMID COMPANY, NEW YORK 20, N.Y.” indicating the
manufacturer of the product.  On the
other hand, at the top of respondent’s label, Exhibit C, there appears the pictures of two roosters with the word
“HENRY’S” in-between, and at the bottom “HENRY’S LABORATORIES
PHILIPPINES” are clearly printed indicating the source of the product.

(3)  Petitioner’s
preparation consists of a drinking water solution and this is clearly
indicated in bold letters on the label, whereas, that of respondent consists of
tablets for veterinary use prominently indicated in red letters on the
label, Exhibit C.

The above differences in the physical aspect or appearance of the
respective labels were found by the Director of Patents substantial and striking enough so as to prevent any confusing similarity
between the two which may lead a buyer to confuse one with the other.

With respect to Petitioner’s contention that respondent’s
trademark bears the two syllables of petitioner’s SULMET
and that respondent merely added the syllable “INE“, the Director of
Patents reasoned out that the syllables “SUL”
and “MET” are coined from a common source suggestive of chemical
compounds which are attributes of the products of the parties herein, that is,
“SUL” being derived from “SULFA”
and “MET” from methyl, so that neither party may claim exclusive use
to them, and that with the addition of the syllable “INE”
by respondent, a marked distinction is effected to distinguish the two
trademarks.

The Director of Patents likewise found that no material damage
was sustained by petitioner during the time that respondent was using SULMETINE on its products. 
Thus, it is shown from Exhibit S that the total of the sales of SULMET product was P72,824.35 in 1959, which increased to
P123,641.85 in 1960, and that although in 1961 the sales decreased slightly to
P118,621.25, that was offset considerably by the sudden increase to P161,238.65
in 1962.

From the foregoing decision, American Cyanamid Company appeals to
this Court and submits five assigned errors, to wit:

First Assignment of Error

“Respondent Director of Patents erred in finding that
petitioner did not have priority in the use of its trademark SULMET over respondent Tiu Chian’s use of his trademark SULMETINE.”

Second Assignment of Error

“Respondent Director of Patents erred in holding that the trademark SULMETINE
is not confusingly similar to the trademark SULMET.”

Third Assignment of Error

“Respondent Director of Patents erred in holding that
respondent Tiu Chian’s
certificate of registration No. 5348 for the trademark SULMETINE
was not obtained by fraud.”

Fourth Assignment of Error

“Respondent Director of Patents erred in holding that
petitioner is legally obliged to prove damages by reason of the issuance of
certificate of registration No. 5348 as a condition precedent for obtaining its
cancellation.”

Fifth Assignment of Error

“Respondent Director of Patents erred in dele­gating the
authority to hear and receive the evidence in this case to a so-called hearing
officer and therefore he has no jurisdiction to render the decision appealed
from because he did not hear the case nor receive the evidence thereof.”

We view the second
assignment of error as the issue which goes to the very heart of the
litigation, the disposition of which renders the treatment of the other
assigned errors unnecessary.

The problem therefore to be resolved is whether or not petitioner
correctly claims that respondent’s trademark SULMETINE
was copied from its trademark SULMET giving rise to a
confusing similarity between the two in violation of Republic Act 166 otherwise
known as the Trade-Mark Law.

We find petitioner’s
submittal devoid of merit and hold that there is no infringement of trademark
which justify a cancellation of respondent’s
registered trademark SULMETINE.

1.  An examination of the
documentary evidence submitted by the parties confirms the findings of the
Director of Patents that there are striking differences between the two labels,
Exhibits B and C, which preclude the possibility of the purchasing public
confusing one product with the other. 
Said labels are entirely different in size, background, colors,
contents, and pictorial arrangement; in short, the general appearances of the
labels bearing the respective trade­marks are so distinct from each other that
petitioner cannot assert that the dominant features, if any, of its trademark
were used or appropriated in respondent’s own.

Thus – –

(a)  The coloring scheme:  Petitioner’s SULMET
label, Exhibit B, has a white background with the word SULMET
printed in dark green, while respondent’s SULMETINE
label, Exhibit C, is dark yellow in color, and the word SULMETINE
is printed in dark blue.  In fact,
Exhibit B carries mainly two colors – white and green, while Exhibit C uses
yellow, blue, and red.

(b)  The
pictorial representation: 
Respondent’s label, Exhibit C, presents at its top the pictures of two
roosters and in-between is the word “HENRY’S” printed in an egg-shaped
enclosure, while petitioner’s label carries no such pictorial representation
nor even one similar to it, for what appears on the top of its label is the
word “CYANAMID” printed in bold and widely-spaced green letters.

(c)  The printed matter on the label:  A very important point of difference between
the labels of the parties is found in the contents of the printed matter.  In the label Exhibit B, the product is
described in bold green letters as “Drinking Water Solution”
and the printed directions indicate that it is for use of chicken flocks,
turkeys, ducks, as well as in certain conditions for horses, cattle, calves,
sheep, and swine.  On the other hand, in
respondent’s label Exhibit C what are printed in bold red letters are “Tablets Veterinary”.  Except for the use of the words “Adult
birds” and “Small chicks”, there is nothing in Exhibit C which
indicates that the preparation may be used for turkeys, ducks, or for any other
domesticated animals mentioned in the SULMET
label.  On this point, it is significant
to note that the product represented by the trademarks of the parties is a medicinal
preparation for veterinary use, consequently, a prospective buyer will be
cautious and prudent enough to examine the contents of the printed matter on
the label, unlike in a situation where the product is for ordinary personal or
household use, such as soap and other toilet articles, biscuits, candies, and
the like where the consumer is not expected to exercise more than ordinary
diligence in the choice or selection of the article he is buying.  Here, it is hardly possible for a purchaser
not to ascertain that what he is purchasing is a medicine for use of chicken
alone or for other four-legged animals, and in the process mistake a water
solution for a tablet or vice versa.

(d) The clear
indication of the source: 
Petitioner’s label clearly indicates that the product SULMET is of foreign origin.  Not only is the word “CYANAMID”
printed in big widely-spaced letters at the top of the label but at the bottom
thereof the words “AMERICAN CYANAMID COMPANY, NEW YORK 20, N.Y.” are
printed in white capital letters against a dark green background.  In respondent’s SULMETINE
label, Exhibit C, the name “HENRY’S” in turn is printed clearly above
the word SULMETINE and at the bottom of the label the
phrase “HENRY’S LABORATORIES PHILIPPINES” is printed in white letters
against a dark blue background making it distinctly visible.

Thus, looking at the two labels Exhibits B and C it is quite
apparent that the source of the product is predominantly indicated
thereby discounting petitioner’s assertion that the SULMETINE
trademark is a plain copy of its own with intent to pass respondent’s article
as coming from the same source as that of petitioner’s medicinal preparation.

What have been stated above sufficiently throws out petitioner’s
second assignment of error.

2.  In page 56 of
petitioner’s brief the case of Lim Hoa vs.
Director of Patents, L- 8072, October
31, 1956, is invoked in support of this appeal.  However, that case is not controlling because
the article in question in Lim Hoa was a
food seasoning product which according to this Court is “generally
purchased by cooks and house­hold help, sometimes illiterate, who are guided by
pictorial representa­tions”; that the two roosters appearing in the
trademark of applicant and the hen appearing in the trademark of the oppositor although of different sexes belong to the same
family of chicken known as “manok” so that
when a cook or a housewife buys a food seasoning product for the kitchen the
brand of “manok” or “marka manok” will be
uppermost in her mind and
regardless of whether the picture is a hen or a rooster, to her, they are all
“manok“, and consequently there lies the
confusion, even deception.

In this case of SULMET and SULMETINE, the product is for medicinal veterinary use
and consequently, the purchaser will be more wary of the nature of the product
he is buying.  Contrary to the allegation
of petitioner herein, the source or manufacturer of the article will be a most
important factor in the mind of the purchaser in selecting the article he will
buy, and a preparation manufactured by a well-known foreign company such as the
“American Cyanamid Com­pany, New York”, enjoys a decided advantage
over one which is locally produced and manufactured by an unknown entity such
as “Henry’s Laboratories”.

What is relevant to and decisive of the case at bar is Mead
Johnson & Co. vs. N.V.J. Van Dorp,
Ltd., et al., L- 17501, decided on April 27, 1963, barely a year before the
appealed decision in the instant case.  Van
Dorp, Ltd., a Netherlands
corporation, filed an application for the registration of its trademark “ALASKA
and pictorial representation of a Boy’s Head within a rectangular design.”
Mead Johnson, a corporation organized under the laws of Indiana, U.S.A.,
being the owner of a trademark “ALACTA”
used for powdered half-skim milk, which was registered with the Patent Office
on June 12, 1951, opposed the registration on the ground that it will be
damaged by the use of the trademark “ALASKA” on milk products, etc.,
the same being confusedly similar to its trademark “ALACTA“.  The Director of Patents dismissed the
opposition and approved for registration the trademark “ALASKA”
on the ground that the applicant’s trade­mark does not sufficiently resemble oppositor’s mark as to cause confusion or mistake or
deceive purchasers.  This Court
through Justice Bautista Angelo upheld the findings of the Director of
Patents.  The Court held that while there
are similarities in spelling, appearance and sound between “ALACTA” and “ALASKA” the trademarks in
their entirety as they appear in their respective labels show glaring and
striking differences or dissimilarities such as in size of the containers,
the colors of the labels, inasmuch as one uses light blue, pink, and white,
while Van Dorp containers uses two color bands,
yellowish white and red; furthermore the mark “ALACTA”
has only the first letter capitalized and is written in black while the mark
“ALASKA” has all the letters capitalized written in white except that
of the condensed full cream milk which is in red.^[1]

Ethepa vs. the Director of
Patents, Westmont Pharmaceutical, Inc. is another case in point.  In Ethepa,
the question was whether the trademark “ATUSSIN”
of Westmont may be registered in the Philippines
notwithstanding the objection of Ethepa which
claimed that it would be damaged because “ATUSSIN”
is so confusingly similar with “PERTUSSIN”
registered in this country on September
25, 1957.  The Director of
Patents approved the application for the registration of the trademark “ATUSSIN” and his decision was appealed to this
Court.  In disposing of the appeal, the
Court affirmed the decision of the Director of Patents holding, inter alia, that a practical approach to the problem of
similarity or dissimilarity is to go into the whole of the two trademarks
pictured in their manner of display; that taking a casual look at the two
labels it is shown that they are entirely different in color, contents, arrangement
of words thereon, sizes, shape, and general appearance so that the label of one
cannot be mistaken for that of the other; that the use of the word “tussin” as a component of both trademarks
cannot be considered as a factor for declaring the two confusingly similar for
“tussin” is descriptive and generic
and is open for appropriation by anyone, and that while the word by itself
cannot be used exclusively to identify one’s goods it may properly become a
subject of a trademark by combination with another word or phrase; hence, Ethepa’s “Pertussin”
and Westmont’s “Atussin“.^[2]

Similarly, in the case before Us, as correctly stated by the
Director of Patents, the word SULMET is derived from
a combination of the syllables “SUL” which
is derived from Sulfa and “MET” from methyl both of
which are chemical compounds present in the article manufactured by the
contending parties, and the addition of the syllable “INE”
in respondent’s label is sufficient to distinguish respondent’s product or
trademark from that of petitioner.

3.  Petitioner also asserts
that the trademarks of the parties are used on identical goods and for
identical purposes and that this is an important factor in determining whether
or not there is infringement of a trademark. 
(p. 49, petitioner’s brief).  We cannot agree with petitioner that the
trademarks are used on identical goods because as already indicated earlier,
petitioner’s SULMET label, Exhibit B, is used on a drinking
water solution while that of respondent labels tablets.  That both products are for identical use may
be admitted to the extent that respondent’s tablets are indicated for the
treatment, control, and prevention in chicken of infectious coryza
(also known as colds, rhinitis and roup) and for the
prevention of cecal and intestinal coccidiosis which is also indicated in peti­tioner’s SULMET label. 
However, no one including petitioner can claim a monopoly in the
preparation of a medicinal product for the use indicated above.  The field is open for the manufacture of
medicinal preparations for the same veterinary purposes.  What the law prohibits is that one
manufacturer labels his product in a manner strikingly identical with or
similar to that of another manufacturer as to deceive or confuse the buying
public into believing that the two preparations are one and come from the same
source.  In the case however of SULMET and SULMETINE it is
satisfactorily shown from the evidence of the parties that while their products
may be for a similar use, their presentation to the purchasing public come in
totally different forms.

Bristol Myers Company vs The Director of Patents and United American Pharmaceuticals,
Inc., presents a similar problem or situation.  In this case, United American Pharmaceuticals
filed on October 21, 1957
a petition for registration with the patent office of its trademark “BIOFERIN” intended for the treatment of common colds,
influenza, etc.  This application was
opposed by Bristol Myers Company which is the owner in the Philippines
of the trade­mark “BUFFERIN” and which is
also intended for relief in cases of “simple headaches, neuralgia, colds,
menstrual pain and minor muscular aches.” The Director of Patents approved
the registra­tion of “BIOFERIN” and his
decision was appealed to this Court, the appellant contending principally that
both products are used for the relief of pains such as headaches and colds and
that the words “BIOFERIN” and “BUFFERIN” are practically the same in spelling and
pronunciation.  Affirming the decision of
the Director of Patents, the Court through Justice J.P. Bengzon
held that although the two words “BIOFERIN”
and “BUFFERIN” have the same suffix and
similar sounding prefixes, they appear in their respective labels with striking
different backgrounds and surroundings, as to color, size and design, and
consequently there is no confusing similarity between the trademarks.^[3]

Similarly, the trademarks “ALACTA”
and “ALASKA” were used
for milk products and the like (Mead Johnson vs N.V.J. Van Dorp, Ltd., supra)
while “ATUSSIN” and “PERTUSSIN” as trade­marks were used for cough and
other bronchial ailments (Ethepa vs
Director of Patents, supra), and all were duly recognized as registrable trademarks.

4.  In view of our
conclusion that there is no confusing or deceptive similarity between SULMET and SULMETINE, it is un­necessary
to pass upon the merits of the first, third and fourth assigned errors.

Absent a finding of confusing similarity between the two trademarks,
the priority in the use of the mark SULMET by the
petitioner will have no decisive effect in the granting of his petition for the
cancellation of the registration of respondent’s trademark (First Assign­ment
of Error).

With respect to the allegation of petitioner that the trademark SULMETINE was obtained by fraud, as held in La Estrella Distillery, Inc. vs The
Director of Patents, et. al., 105 Phil. 1213, the
question of whether or not the registration of a trademark had been obtained
with fraud and false representation becomes necessary and important only when
there is a finding of similarity between the contesting trade­marks, and in
order that proof of fraud might produce cancellation it is necessary that it be
coupled with a showing that the label trademarks of the parties are similar and
that the maintenance of one trademark would work to the damage of the
other.  (Third Assignment of Error)

On the contention of petitioner herein that it was error for the
Director of Patents to rule that the burden rests on petitioner to show
probable damage which it has not discharged, suffice it to state that any error
or mistake committed by respondent Director of Patents on this point will not
affect one way or the other the Decision in this case which is principally
based on the finding that there is no similarity between the two trademarks SULMET and SULMETINE likely to
cause confusion in the buying public so as to constitute a violation of the
Trade­mark Statute.  (Fourth Assignment
of Error)

In its fifth assignment of error, petitioner questions the delegation
by the Director of Patents of his authority to hear and receive the evidence in
this case to a Hearing Officer and alleges that respondent Director had no
jurisdiction to render the decision appealed from.  This matter has now been put to rest in American
Tobacco Company, et al. vs Director of Patents, et
al., L-268.03, decided on October 14, 1975 which involved the authority of
the Director of Patents to designate a ranking official of the Patent’s Office
to hear Inter Partes Pro­ceedings in the
registration of trademarks and tradenames under
Republic Act 166.  This Court through
Justice Felix Antonio held inter alia:

“The nature of the power and authority entrusted to the
Director of Patents suggests that the aforecited laws
(Republic Act No. 166, in relation to Republic Act No. 165) should be construed
so as to give the aforesaid official the administrative flexibility neces­sary
for the prompt and expeditious discharge of his duties in the administration of
said laws.  As such officer, he is required,
among others, to determine the question of priority in patent interference pro­ceedings,
decide applications for reinstatement of a lapsed patent, cancellation of
patents under Republic Act No. 165, inter partes
proceedings such as oppositions, claims of interference, cancellation
cases under the Trade-mark.  Law and other matters in connection with the enforcement of the
aforesaid laws.  xxx xxx xxx

“Thus, it is well-settled that while the power to decide
resides solely in the administrative agency vested by law, this does not
preclude a delegation of the power to hold a hearing on the basis of which the
decision of the administrative agency will be made.

“The rule that requires an administrative officer to exercise
his own judgment and discretion does not preclude him from utilizing, as a
matter of practical administrative procedure, the aid of subordinates to
investigate and report to him the facts, on the basis of which the officer
makes his decisions.  It is sufficient
that the judgment and discretion finally exercised are those of the officer
authorized by law.”^[4]

As correctly observed in the foregoing case, the point involved
is procedural and not jurisdictional. 
Being so, the jurisdiction of respondent Director to render the decision
assailed is not affected by lapses in the observance of the procedural rules,
if no objection thereto is seasonably raised. 
Non-conformity with rules on procedure is deemed waived in the absence
of any objection thereto.  The entire records of the case at bar fail to disclose any
objection on the part of petitioner to the hearing of the case and the
reception of evidence by a Hearing Officer.  It surprises us why the petitioner
participated throughout the proceedings before the Hearing Officer from 1959 to
1964, actively prosecuting its case therein, and now asks this Court to nullify
the whole proceedings together with the decision rendered which happened to be
adverse to him.

WHEREFORE, We affirm the decision
of respondent Director of Patents, with costs against petitioner.

So Ordered.

Teehankee, (Chairman), Makasiar, and
Martin, JJ., concur.

Antonio*, J., concurs in a separate opinion.

^[1]
7 SCRA 768

^[2]
per Conrado Sanchez, J., L-20635, March 31, 1966, 16 SCRA 495

^[3]
L- 21587
May 19, 1966, 17 SCRA 128

^[4]
67 SCRA 287, 292-295, citing among others, Sections
10 and 16, Republic Act No. 165; Section 23, ibid; Sections 32 and 33, ibid;
Sections 8 and 9, Republic Act No. 166; Section 10-A, Ibid; Sections 17
to 19, Ibid; Sec. 9, C.A. 103; Ang Tibay v. C.I.R., 69 Phil.
635; National Union v Asian Printing, 99 Phil. 589; Ruperto
v Torres, Feb. 25, 1957; Orlanes, et al. v
Public Service Commission, 57 Phil. 634; Northern Luzon Transportation, Inc. v
Sambrano, 58 Phil. 35; Cebu
Transit, Inc. v Jereza 58 Phil. 760. ….; Morgan v United States, 298 US 468, 481-482 (1935), 80 L. ed. 1288, 1295-1296.

* Designated to
sit in the First Division.

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