DY BUNCIO, PLAINTIFF AND APPELLEE, VS. TAN TIAO BOK, DEFENDANT AND APPELLANT.

This action was initiated in the Court of
First Instance of the City of Manila by the plaintiff, Dy Buncio, who
is a tea merchant, to enjoin the defendant, Tan Tiao Bok, from selling
tea in this market in packages and with wrappers of a design described
in the complaint, it being alleged that said packages were put up in
such manner as to resemble closely those long sold by the plaintiff.
The defendant answered, admitting that he was selling tea under a
trademark of the style complained of but insisted that no legal wrong
had been done; and by way of cross-complaint prayed that damages be
awarded to him by reason of the wrongful suing out of the preliminary
injunction which the plaintiff had obtained.

At the hearing the trial judge found that the defendant was
engaged in illegal competition with the plaintiff and made the
preliminary injunction perpetual. At the same times he awarded P860 as
damages to the plaintiff and absolved him from the cross-complaint.
From this judgment the defendant appealed.

It appears in evidence that since the year 1903 the plaintiff, Dy
Buncio, has been engaged in Manila as a merchant in importing Formosan
tea and has during that time been distributing and selling the same in
the Philippine market in original packages containing about 5 ounces.
These packages are enveloped in a wrapper exhibiting the following
features: On the face is a design supposedly suggested by the form of a
Chinese fruit, having somewhat the shape of a pear. Described more in
detail it suggests a vase, or flowerpot, with a main trunk, surmounted
by a smaller body, tapering off and showing an orifice at the top like
the mouth of a big bottle. Around the border is an embellishment of
conventional tracery; and as a sort of background to the upper part of
the design there are placed two symmetrical projections, extending
upward on either side of the vase. In the centre of both the main body
of the design and the superior trunk are spaces containing Chinese
characters. The characters in the upper space represent the Chinese
name of the exporter in Formosa by whom the packages appear originally
to have been put up. The characters in the lower space mean “tea from
Formosa.”

On the right side of the package is the following inscription in
English: “Formosa Tea, sold by Guan Leong, Daitotei, Formosa;” while on
the left side is a circular space more than 1 inch in diameter
containing the Chinese proper name Choa Hooseng. The relation of this
personage to the package of tea is not explained. On the bottom of the
package is printed “5 oz. net.” For the design above described a
blush-green shade of ink is used for all parts except the reading
matter, which is in red ink.

It may be stated here that other persons in the Philippine Islands
besides Dy Buncio have in the past, and are now, engaged in the
importation of tea from Formosa; and it is admitted that all tea from
that source comes to this market in packages with the same form of
wrapper.

In the year 1918, the defendant Tan Tiao Bok, a native of Formosa
and subject of Japan, who had formerly been employed by Dy Buncio as a
bookkeeper, began to import tea from Formosa on his own account with a
view to selling it in the Philippine market; and in order to identify
his tea, he adopted a trade-mark, which he duly registered in the
Bureau of Commerce and Industry. The designed adopted for this
trade-mark is correctly described in his application for the registry
thereof as follows: “My trade-mark consists of two birds placed one in
front of the other with the tails going up and placed in such a
position as to form a sort of lyre. On the upper part and right between
the ends of the tails is a flowerpot, with flowers in it; in between
the heads, which are facing each other, is a big flower; and at the
extreme corresponding to the lower end, are two Chinese characters
which correspond to the phrase, trade-mark. In the blank space between
the two birds are written Chinese characters descriptive of the quality
of the goods. On the right-hand side of this mark are the words
‘Formosa Tea sold by Ngo Teck Co., Daitotei, Formosa/ and on the left
side are the words Ngo Teck & Company. The mark has a light green
color and the letters are red.” We may add that on the bottom of each
of the defendant’s packages are the figures “502” followed by the word
“net.” The figures 502, thus used, represent an evident attempt by a
person not conversant with English to write the characters for five
ounces (5 oz.) which is presumably the weight of the package.

All the tea which has been imported and actually sold by the
defendant has been put up in wrappers bearing the trade-mark just
described; but in the year 1918 he made a single importation of thirty
boxes of tea which he was unable to sell because of the injunction.
These were put up in wrappers bearing a somewhat different design from
that of the defendant’s trade-mark; and being of less importance, this
design need not be described in detail. Suffice it to say that it
consists of a vase of flowers, embellished around the border somewhat
as in the case of the plaintiff’s design, and with flowers and plants
^around the neck and top of the vase.

The action is evidently based on section 7 of Act No. 666, of the Philippine Commission, which reads as follows:

“Any person who in selling his goods shall give
them the general appearance of goods of another manufacturer or dealer,
either in the wrapping of the packages in which they are contained, or
the devices or words thereon, or in any other feature of their
appearance, which would be likely to influence purchasers to believe
that the goods offered are those of a manufacturer or dealer other than
the actual manufacturer or dealer, and who clothes the goods with such
appearance for the purpose of deceiving the public and defrauding
another of his legitimate trade, or any subsequent vendor of such goods
or any agent of any vendor engaged in selling such goods with a like
purpose, shall be guilty of unfair competition, * * * This section
applies in cases where the deceitful appearance of the goods,
misleading as to origin or ownership, is effected not by means of
technical trade-marks, emblems, signs, or devices, but by the general
appearance of the package containing the goods, or by the devices or
words thereon, even though such packages, devices, or words are not by
law capable of appropriation as trade-marks; and in order that the
action shall lie under this section, actual intent to deceive the
public and defraud a competitor shall affirmatively appear on the part
of the person sought to be made liable, but such intent may be inferred
from similarity in the appearance of the goods as packed or offered for
sale to those of the complaining party.”

The matter here quoted is apparently merely an enactment into law
of a doctrine previously elaborated by the courts of equity of England
and America in connection with the subject of unfair competition; and
for all practical purposes the result would be about the same whether
we proceed under the statutory definition of unfair competition or
adopt the decided cases as supplying the criteria by which to be guided.

The first and principal question, therefore, to be decided is
whether the wrapper, mark, and designs used on the defendant’s packages
of tea are so far similar to those of the plaintiff that the use
thereof constitutes unfair competition and is obnoxious to the
provision of law above quoted.

Upon this question we have no hesitancy in saying, after a careful
comparison of the two packages, with the designs printed thereon, that
objectionable simulation is not made out. Some resemblance there
undoubtedly is, but in our opinion it is not such as would naturally
lead intending purchasers to believe that the goods offered by the
defendant are the same as are sold by the plaintiff. The only
individual who in our opinion would be likely to take notice of these
resemblances, on having his attention directed to the packages, is the
one who is unfamiliar with either.

Upon approaching a problem of this nature one important
consideration to be borne in mind is found in the conventional size and
style of the package adopted by tea merchants generally in putting this
commodity before the consumer. As to this it is agreed that the form of
package used by both plaintiff and defendant is the same as that
adopted by all merchants engaged in selling tea in this country; and it
is a matter of common observation that the articles supplying the
simplest human needs, such as matches, cigarettes, and certain
foodstuffs, are marketed in conventional containers of appropriate size
and of a design made almost uniform in the case of each article by
immemorial custom. Nobody can acquire any exclusive right in these
standardized forms and styles. (Alhambra Cigar etc. Co. vs. Compama
Gral. de Tabacos, 35 Phil., 62.)

No question can therefore be raised with respect to the right of
the defendant to market tea in 5-ounce packages, enveloped in ordinary
wrapping paper of conventional color and of the form adopted by both
the litigants in this case. Nor can anything be fairly made to the
detriment of the defendant out of the circumstance that the inscription
on the bottom of his package indicating the weight of the contents,
erroneously appears as “502 net” instead of “5 oz. net,” as on the
plaintiff’s package. The fact that the defendant personally does not
know the meaning of this inscription loses all significance in view of
the fact that he is a native Formosan, unversed in English, and that
the package was put up for export in Formosa.

As the size and form of the packages sold by the defendant are
practically the same as those of the packages sold by the plaintiff, it
results, as might be expected, that the trade-mark placed on the
defendant’s packages is of about the same size as the design used by
the plaintiff; and this coincidence affords no ground of legitimate
criticism, being determined in a measure by the conventional size of
the package in which tea is put upon the market.

Coming now to a comparison of the plaintiffs design (Exhibit A)
with the trade-mark (Exhibit C) used by the defendant, the differences
between the two, viewed either as a whole or in detail, are very
marked. It is probable that the mind of the artist who drew the sketch
for defendant’s trade-mark may have gotten suggestions from the
plaintiff’s design, but the general result is so different that we
consider it unlikely that a person whose eye is accustomed to the lines
of the plaintiff’s design would for a moment mistake the defendant’s
trade-mark for it. The superior finish, grace, and symmetry of the
latter readily distinguishes it from the other; and there is one other
difference which seems to us decisive. This is found in the fact that
the well-defined lines of the double-decked jar, so conspicuous in the
plaintiff’s design, are entirely wanting in the defendant’s trade-mark.
Instead the latter is formed of a combination of the figures of two
peacocks, whose ascending tails enclose at the top a pot filled with
flowers, giving the general effect of a lyre. In whatever aspect the
rival marks be viewed, we are of the opinion that the resemblance
between the two designs is not sufficiently marked to afford just cause
for complaint on the part of the plaintiff; and we do not think that
the case is altered by the circumstance that the reading matter in both
is in the usual red Chinese characters, while the body of both designs
is in green, though of differing shades.

It is perhaps worth noting here, as constituting one of the
differences between the packages sold by the two respective parties,
that the plaintiff’s design (Exhibit A) is on the broad side of the
package, while the defendant’s trade-mark is on the narrow side of the
package, with the result that the faces of the two packages are
distinctly different in size.

The resemblance between the plaintiff’s design and the design
Exhibit B, used by the defendant upon the wrappers for the tea
contained in one shipment of thirty cases— which tea was not sold—is
closer than the resemblance between the plaintiff’s design and the
defendant’s trademark (Exhibit C); but we are of the opinion that even
here the simulation is not sufficiently marked to justify relief. The
effect upon the eye of the double-decked jar, constituting the
plaintiff’s design, is decidedly different from that produced by the
flowerpot, with 3 feet, of Exhibit B. In this connection, we repeat,
the only individual apt to mistake the one design for the other would
be a person unfamiliar with either.

This last observation leads on to another, which is, that in order
that there may be deception of the buying public in the sense necessary
to constitute unfair competition, it is necessary to suppose a public
accustomed to buy, and therefore to some extent familiar with, the
goods in question. The test of fraudulent simulation is to be found in
the likelihood of the deception of persons in some measure acquainted
with an established design and desirous of purchasing the commodity
with which that design has been associated. The test is not found in
the deception, or possibility of the deception, of the person who knows
nothing about the design which has been counterfeited, and who must be
indifferent as between that and the other. The simulation, in order to
be objectionable, must be such as appears likely to mislead the
ordinarily intelligent buyer who has a need to supply and is familiar
with the article that he seeks to purchase. In the case under
consideration, the resemblances that have been pointed out between the
designs of the two litigants in this case are not in our opinion
sufficient to mislead such a person.

From what has been said it is apparent that the judgment appealed
from must be reversed in so far as relates to the injunctive relief
granted to the plaintiff in accordance with prayer contained in the
complaint and the sum of money awarded to him as damages. Conversely,
the defendant is entitled to recover from the plaintiff the damages
which the defendant has suffered by reason of the wrongful suing out of
the injunction, and the sureties on the injunction bond are of course
liable for the same damages not in excess of the amount fixed by the
bond.

Upon the question of the amount of these damages we are of the
opinion that the interests of justice require that the cause should be
remanded for further proof, and an order to this effect will
accordingly be entered. From the proof now before us it appears clearly
enough that at the time the defendant was enjoined from selling tea in
packages marked as in Exhibits B and C, the defendant had contracts
with merchants of this city for the monthly delivery to them of large
quantities of tea, with the peacock mark, from which contracts
considerable profit would have been realized. In addition to this his
retail trade in the same tea was paralyzed. Nevertheless, although the
defendant was enjoined by the lower court from selling tea in packages
bearing the marks complained of, it is conceivable that he may have
caused it to be repacked and has placed it upon the market in a
different style of wrapper. But whether he has adopted that course or
has kept all the tea on hand until now, we are of the opinion that we
should allow the plaintiff an opportunity to make further inquiry into
the amount of damages actually inflicted; and by parity of reasoning
the defendant also should be allowed to introduce further proof of
damage, if the facts warrant.

The judgment is reversed and the cause remanded for the assessment
of the damages incident to the wrongful suing out of the injunction,
without special pronouncement as to costs of either instance. So
ordered.

Johnson, Araullo, Avancena, and Villamor, JJ., concur.