G.R. No. 228165. February 09, 2021

KOLIN ELECTRONICS CO., INC., PETITIONER, VS. KOLIN PHILIPPINES INTERNATIONAL, INC., RESPONDENT.

Decisions / Signed Resolutions February 9, 2021 EN BANC

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CAGUIOA, J.:[**]

This is a Petition for Review on Certiorari^[1]
(Petition) under Rule 45 of the Rules of Court, which seeks to reverse
and set aside the following dispositions of the Court of Appeals (CA) in
CA-G.R. SP No. 131917:

Decision^[2] dated April
29, 2016 reversing the ruling of the Director General of the
Intellectual Property Office (IPO-DG) in Appeal No. 14-09-64^[3]
(IPC No. 14-2007-00167), g1vmg due course to the trademark application
of Kolin Philippines International, Inc. (KPII), and denying the
opposition of Kolin Electronics Co., Inc. (KECI); and
Resolution^[4] dated November 4, 2016, denying KECI’s motion for reconsideration.

Facts

Antecedent cases involving related parties

1. The KECI Ownership Case

On August 17, 1993, Kolin Electronics Industrial Supply (KEIS), owned by
a certain Miguel Tan, filed with the Bureau of Patents, Trademarks and
Technology Transfer (BPTTT; now known as the Intellectual Property
Office or IPO) an application for registration of Trademark Application
No. 87497 for

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KOLIN covering the following products under
Class 9: automatic voltage regulator, converter, recharger, stereo
booster, AC-DC regulated power supply, step-down transformer, and PA
amplifier AC-DC.^[5]

In a Deed of Assignment of Assets dated November 20, 1995, Miguel Tan
assigned in favor of KECI all the assets. and merchandise stocks of
KEIS, including its pending application for registration of the

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KOLIN mark.^[6]
The trademark has been continuously used in various products under the
said classification, and the products are being offered for sale at
KECI’s business establishments.^[7]

On February 29, 1996, Taiwan Kolin Co., Ltd. (TKC) filed with the BPTTT Trademark Application No. 4-1996-106310^[8] for

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KOLIN
initially covering the following goods: “color television,
refrigerator, window-type air conditioner, split-type air conditioner,
electric fan, and water dispenser”.^[9]

During the pendency of its application, TKC filed a verified Notice of
Opposition on July 22, 1998 against KECI’s trademark application for

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KOLIN.
TKC claimed that it is the owner of Taiwan registrations for KOLIN and
KOLIN SOLID SERIES and that it has a pending application for

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KOLIN,^[10] thus the grant of the

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KOLIN application would cause TKC grave and irreparable damage to its business reputation and goodwill because

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KOLIN is identical, if not confusingly similar, to TKC’s marks. TKC further claimed that if KECI’s application for

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KOLIN
would be granted, this would likely mislead the public as to the
nature, quality, and characteristics of its goods or products bearing
the “KOLIN” trademark.^[11]

On December 27, 2002, Director Estrellita Beltran-Abelardo of the
Intellectual Property Office Bureau of Legal Affairs (IPO-BLA) rendered
Decision No. 2002-46^[12] (Inter Partes Case No. 14-1998-00050) denying TKC’s opposition and giving due course to KECI’s trademark application for

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KOLIN.^[13] Premised on the factual finding that the subject marks are “the same or almost identical,”^[14] the IPO-BLA then opted to focus on the discussion of the prior adopter and user of the mark.^[15]
The IPO-BLA examined the evidence presented by the parties and
concluded that KECI “is the prior adopter and user of the mark ‘KOLIN’
in the Philippines, having been able to prove the date of first use of
its mark in the year 1989, which is ahead of [TKC’s] use in the
Philippines x x x in the year 1996.”^[16] Thus, TKC’s opposition was denied and KECI’s trademark application for

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KOLIN was given due course.

TKC appealed the decision to the IPO-DG, which, in turn, issued a Decision^[17] on November 6, 2003 sustaining the ruling of the IPO-BLA.^[18] The IPO eventually issued a Certificate of Registration for

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KOLIN in favor of KECI.^[19]
In the November 29, 2004 issue of the Philippine Daily Inquirer, KECI,
through counsel, filed a notice informing the public of the issuance of
the certificate in its favor, and claimed exclusive right of usage over
the

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KOLIN mark.^[20]

On December 10, 2004, TKC filed a petition for review with the CA with a
prayer for preliminary injunction and/or the issuance of a temporary
restraining order docketed as CA-G.R. SP No. 80641, urging the CA to
enjoin KECI from asserting exclusive rights to use the

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KOLIN mark.^[21]

On July 31, 2006, the CA issued a Decision^[22] against TKC and in favor of KECI. The CA clarified that the Trademark Law^[23]
was applicable since it was still in effect at the time of the filing
and during the pendency of the trademark applications of both parties.^[24] Accordingly, the CA held that there must be actual use thereof in commerce to acquire ownership of a mark.^[25] The CA found as undisputed that KEIS, the predecessor-in-interest of KECI, had been using the

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KOLIN mark in the Philippines since February 17, 1989, prior to the filing of the trademark application for

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KOLIN in 1993.^[26] While TKC claimed prior use of the mark in foreign jurisdictions^[27] as early as 1986,^[28]
the CA agreed with the IPO-BLA and IPO-DG that the concept of “actual
use” under the Trademark Law refers to use in the Philippines, and not
abroad.^[29] Further, the assignment of rights involving the

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KOLIN mark to KECI was not raised as an issue in the case.^[30]
On the issue of priority being claimed by TKC, the CA agreed with the
decision of IPO-DG that, whether under the Trademark Law or the
Intellectual Property Code^[31] (IP Code), TKC’s “claim of x x x priority right is unavailing.”^[32] Accordingly, the CA dismissed TKC’s petition for lack of merit and affirmed the IPO-DG’s decision.^[33]

TKC initially appealed the CA decision by filing with the Court a motion for extension to file a petition for review.^[34]
However, on September 6, 2007, TKC filed a Manifestation withdrawing
its motion for extension because “[TKC was] no longer interested in
pursuing an appeal.”^[35]
Accordingly, on September 26, 2007, a Resolution was issued by the Court
considering the case “CLOSED and TERMINATED.” In an Entry of Judgment,
the Resolution was considered final and executory on November 16, 2007^[36] (the KECI ownership case).

Thus, by virtue of the KECI ownership case, KECI is the adjudicated owner of the

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KOLIN mark under the Trademark Law as against TKC.

2. The Taiwan Kolin case

However, in another case that went up to the Court, the registration of
another KOLIN mark not owned by KECI was allowed. In G.R. No. 209843
entitled Taiwan Kolin Corporation, Ltd. v. Kolin Electronics Co., Inc.^[37] (Taiwan Kolin case), promulgated on March 25, 2015, the Court gave due course to TKC’s Trademark Application for

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KOLIN.

To recall, before filing an opposition case^[38] against KECI’s application for

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KOLIN, TKC had filed on February 29, 1996 Trademark Application No. 4-1996-106310 for

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KOLIN
initially covering the following goods: “color television,
refrigerator, window-type air conditioner, split-type air conditioner,
electric fan, and water dispenser.”

On February 10, 1999, Paper No.5 was issued by the trademark
examiner-in-charge stating that the goods enumerated in TKC’s
application fall under Classes 9, 11, and 21 of the Nice Classification
(NCL), thus, TKC was required to elect one class of goods for its
application for KOLIN.^[39] However, the application was considered abandoned as of April 18, 1999 because TKC failed to respond to Paper No. 5.^[40]
On September 14, 1999, TKC filed a petition to revive the application
stating, among other things, that in response to Paper No. 5, it was
electing Class 9 for its application.^[41] Further, TKC requested the inclusion of the following goods in its application: “cassette recorder, VCD, whoofer (sic),
amplifiers, camcorders and other audio/video electronic equipment, flat
iron, vacuum cleaners, cordless handsets, videophones, facsimile
machines, teleprinters, cellular phones, automatic goods vending
machines and other electronic equipment belonging to class 9.”^[42]

In an Order dated March 14, 2001, the Bureau of Trademarks granted TKC’s petition.^[43]
Consequently, Trademark Application No. 4-1996-106310 was published in
the IPO Electronic Gazette for Trademarks on May 16, 2006.^[44] The “television sets” was, however, not included in the enumeration of goods in the published Trademark Application.^[45]

KECI filed an opposition against TKC’s application with the IPO BLA on July 13, 2006^[46] based on the fact that it is the registered owner of the

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KOLIN^[47] mark, which it claimed was confusingly similar to TKC’s application for

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KOLIN. The case was docketed as Inter Partes Case No. 14-2006-00096.

On November 7, 2006, TKC filed an Answer to the Opposition, claiming,
among others, that its Trademark Application No. 4-1996-106310 “includes
television sets and that this trademark application later became Trademark Application No. 4-2002-011002
filed on [December 27, 2002] when it was re-filed/revived after the
handling lawyer delayed the submission of requirements for the first
application.”^[48]

The IPO-BLA rendered Decision No. 2007-118^[49] dated August 16, 2007 sustaining KECI’s opposition case and rejecting TKC’s application for

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KOLIN.

On March 27, 2009, TKC filed an Appeal Memorandum with the IPO DG,
claiming that the IPO-BLA erred in denying its application without any
allowance for use limitation or restriction on televisions and DVD
players.^[50]

Noting that TKC only wanted its

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KOLIN application to be given due course subject to the use limitation or restriction for television and DVD player,^[51] the IPO-DG issued a Decision^[52]
on November 23, 2011 granting TKC’s appeal and allowing the
registration of TKC’s mark with a limitation/restriction for the goods
“television and DVD player”.^[53]

Aggrieved, KECI appealed to the CA.

On April 30, 2013, the CA issued a Decision^[54] in CA-G.R. SP No. 122565 reversing and setting aside the IPO-DG’s decision and reinstating the IPO-BLA decision.^[55]
It ruled in favor of KECI based on the following grounds: (a) the
“KOLIN” mark sought to be registered by TKC is confusingly similar to
KECI’s “KOLIN” registration since “[t]he only difference is [KECI’s]
mark is italicized and colored black while that of [TKC] is in pantone
red color;”^[56] (b) there are
no other designs, special shape or easily identifiable earmarks that
would differentiate the products of both competing companies;^[57]
and (c) the intertwined use of television sets with amplifier, booster
and voltage regulator bolstered the fact that televisions can be
considered as within the normal expansion of KECI, and is thereby deemed
covered by its trademark as explicitly protected under Section 138 of
the IP Code;^[58] and (d) the
denial of TKC’s application would prevent the likelihood of confusion
resulting from the use of an identical mark to closely related goods.^[59] TKC moved to reconsider the decision, but this was denied by the CA.

TKC then filed an appeal to the Court.

It is important to highlight that there were three (3) marks involved in the Taiwan Kolin case
(1) KECI’s trademark registration No. 4-1993-087497; (2) TKC’s
trademark application No. 4-1996-106310, which was opposed by KECI; and
(3) TKC’s trademark application No. 4-2002-011002, which was allegedly
the “revived” version of TKC’s application.

For ease of reference, the subject marks are included in the following table:

KECI’s mark

TKC’s opposed trademark application

TKC’s “revived” application

Marks

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KOLIN^[60]

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KOLIN^[61]

(image)^[62]

Application No.

4-1993-087497

4-1996-106310

4-2002-011002

Filing Date

August 17, 1993

February 29,
1996

December 27, 2002

Current Status

Registered

Registered

Refused for non-filing of DAU/DNU

Class Covered

9

9

9

Goods Covered

Automatic Voltage
Regulator, Converter, Recharger, Stereo Booster, AC-DC Regulated Power Supply, Step-Down Transformer, PA Amplified AC-DC

Television and
DVD player

Television Sets, Audio/Video Electronic Equipment and Similar Appliances

To clarify, while Trademark Application No. 4-1996-106310 was indeed revived,^[63] it was not through another separate application, contrary to TKC’s statement.^[64]

Keeping this in mind, the Taiwan Kolin case ruled in favor of TKC.

The Court’s Third Division stated that identical marks may be registered
for products from the same classification, citing the discussion in Mighty Corporation v. E. & J. Gallo Winery^[65] (Mighty Corporation).^[66]
It also held “that emphasis should be on the similarity of the products
involved and not on the arbitrary classification or general description
of their properties or characteristics. The mere fact that one person
has adopted and used a trademark on his goods would not, without more,
prevent the adoption and use of the same trademark by others on
unrelated articles of a different kind.”^[67]

The Court’s Third Division also stated that the CA’s approach and
reasoning “fail[ed] to persuade” and ruled that the products covered by
TKC’s application and KECI’s registration are unrelated.^[68]
In saying that the CA decision was wrong, the Court’s Third Division
only cited and gave credence to the following assertions by TKC to
establish that the goods are unrelated:

a. TKC’s goods are classified as home appliances as opposed
to KECI’s goods, which are power supply and audio equipment accessories;

b. TKC’s television sets and DVD players perform functions and purposes
distinct from KECI’s power supply and audio equipment; and

c. TKC sells and distributes its various home appliance products on
wholesale and to accredited dealers, whereas KECI’s goods are sold and
flow through electrical and hardware stores.^[69]

The Court’s Third Division said that the list of products under Class 9
can be sub-categorized into five different classifications and that the
products covered by TKC’s and KECI’s marks fall under different
sub-categories. It then made a side-by-side comparison of the marks to
state that the ordinary intelligent buyer is not likely to be confused.
For reference, the side-by-side comparison used in the case is shown
below:

(image supposed to be here)

Further, it stated that confusion is not likely because the products involved (i.e., “various kinds of electronic products,” according to the Taiwan Kolin case) are more expensive than “ordinary consumable household items”, so consumers will be more careful in purchasing these products.^[70] It also cited the case of Emerald Garment Manufacturing Corporation v. Court of Appeals^[71] (Emerald Garment) which defined an “ordinary intelligent buyer”
as follows:

The definition laid down in Dy Buncio v. Tan Tiao Bok
is better suited to the present case. There, the “ordinary purchaser”
was defined as one “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 some 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 the possibility of deception, of
the person who knows nothing about the design which has been
counterfeited, and who must be indifferent between that and the other.
The simulation, in order to be objectionable, must be such as appears
likely to mislead the ordinary intelligent buyer who has a need to
supply and is familiar with the article that he seeks to purchase”.^[72] (Italics omitted)

Thus, the Court’s Third Division concluded that KECI’s trademark
registration not only covers unrelated goods but is also incapable of
deceiving the ordinary buyer in relation to TKC’s application.^[73]
Accordingly, TKC’s petition was granted, the CA decision was reversed
and set aside, and the IPODG Decision, which gave due course to TKC’s
Trademark Application No. 4-1996-106310 for

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KOLIN, was reinstated.

Facts of the present case

On September 11, 2006^[74] – more than a month after the promulgation of the KECI ownership case – KPII, an affiliate of TKC,^[75] filed Trademark Application No. 4-2006-010021 for the kolin mark under Class 9 covering “Televisions and DVD players”.

On June 12, 2007, KECI filed an opposition against KPII’s Trademark
Application No. 4-2006-010021 based on, among others, the fact that it
is the registered owner of the

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KOLIN mark and that the registration of KPII’s kolin mark will cause confusion among consumers.^[76]

In its defense, KPII claimed that its application for kolin cannot be denied on the basis of the ruling in the KECI ownership case because it was not a party to said case and the KECI ownership case is not res judicata to the instant case.^[77] Besides, KPII asserted that the KECI ownership case
specifically clarified that KECI’s ownership over the mark is limited
only in connection with goods specified in KECI’s certificate of
registration and those related thereto.^[78] KPII insisted that “Televisions and DVD players” are not related to the goods covered by KECI’s registered mark.^[79]

For ease of reference, the marks involved in the present dispute
(subject marks) and their related information are included in the table
below:

Parties

KECI

KPII

Marks

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KOLIN^[80]

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kolin^[81]

Application No.

4-1993-087497

4-2006-010021

Status

Registered

Trademark Application subject of opposition by
KECI

Classes Covered

9

9

Goods Covered

Automatic Voltage Regulator, Converter,
Recharger, Stereo Booster, AC-DC Regulated Power Supply, Step-Down
Transformer, PA Amplified AC-DC

Televisions, DVD Players

IPO-BLA Decision

In a Decision^[82] on IPC No.
14-2007-00167 dated September 9, 2009, the IPO-BLA sustained KECI’s
opposition. One of the reasons why KPII’s Trademark Application No.
4-2006-010021 for kolin was rejected was the fact that buyers would be confused as to the origin of the products being offered by KECI and KPII.^[83]
Significantly, the IPO-BLA also noted that KECI had received several
customer e-mails complaining against or seeking information about the
products of KPII.^[84]

Further, the IPO-BLA found that KPII is an instrumentality of TKC, as seen in the excerpt below:

An exhaustive scrutiny of the records of the case convince[s] this Bureau to concur with the position of [KECI] that indeed, [KPII]
is an instrumentality of [TKC]. [KECI] presented substantial evidence
that [KPII] is effectively under the management, supervision and control
of [TKC] manifested through the assignment of five (5) persons to the
financial and plant operations x x x; [TKC’s] admission of its direct
participation in the management, supervision and control of [KPII];
[TKC’s] majority ownership of stocks in [KPII] x x x; and the
maintenance of one website of both companies and the admission to the
same x x x.^[85] (Emphasis supplied)

Accordingly, the IPO-BLA rejected KPII’s application for kolin. The dispositive portion of the IPO-BLA Decision reads:

WHEREFORE, premises considered the Notice of Opposition filed by [KECI], is as it is hereby SUSTAINED.
Accordingly, Application Serial No. 4-2006-010021 filed by
respondent-applicant, [KPII] on 27 December 2002 for the mark [kolin]
under Class 09 for televisions and DVD players, is as it is hereby, REJECTED.

Let the file wrapper of [kolin], subject matter of this case be
forwarded to the Bureau of Trademarks for appropriate action in
accordance with this decision.

SO ORDERED.^[86]

Aggrieved, KPII appealed the case to the IPO-DG.

IPO-DG Decision

On September 12, 2013, the IPO-DG issued a Decision^[87]
on Appeal No. 14-09-64 in IPC No. 14-2007-00167 dismissing KPII’s
appeal. It is important to stress that, at this juncture, the Taiwan Kolin case
had not yet been promulgated. At that time, the case was still pending
with the Court. The CA decision (CA-G.R. SP No. 122565) that was
promulgated on April 30, 2013 and where the CA ruled in favor of KECI,
was the prevailing judgment between KECI and TKC.

The IPO-DG stated that “with the decision of the [CA in CA-G.R. SP No.
122565] that [TKC’s] television sets and DVD players are related to
[KECI’s] goods covered by the latter’s certificate of registration for KOLIN, this Office rules in favor of [KECI].”^[88]

Accordingly, the IPO-DG dismissed KPII’s appeal. KPII then filed an appeal to the CA, docketed therein as CA-G.R. SP No. 131917.

CA Decision (CA-G.R. SP No.131917)

After the promulgation of the Taiwan Kolin case on March 25, 2015, the CA issued in CA-G.R. SP No. 131917 a Decision^[89] dated April 29, 2016 granting KPII’s appeal.

Faced with the issue of whether KPII is entitled to the registration of
the kolin mark covering television and DVD players, the CA relied
heavily on, and quoted the reasoning in, the Taiwan Kolin case.^[90] Accordingly, the CA ruled that KPII may register its mark for television sets and DVD players and the doctrine of res judicata forbids it from arriving at a contrary conclusion.^[91] The dispositive portion of the CA decision reads:

WHEREFORE, premises considered, the petition is hereby GRANTED. The Decision dated September 12, 2013, issued by the [IPO DG], in Appeal Case No. 14-09-64 (IPC No. 14-2007-00167), is REVERSED and SET ASIDE, and a new one is entered giving due course to [KPII’s] Trademark Application No. 04-2006-010021.

Let a copy of this Decision as well as the trademark application and
records be furnished and returned to the Director of the [IPO-BLA] for
appropriate action. Further, let the Director of the Bureau of
Trademarks and the library of the Documentation, Information, and
Technology Transfer Bureau be furnished a copy of this Decision for
information, guidance, and records purposes.

SO ORDERED.^[92]

Thus, KECI filed the instant Rule 45 Petition, raising the following arguments: (1) the ruling in the Taiwan Kolin case is not applicable in the present case; and (2) the registration of KPII’s kolin mark is contrary to the provisions of the IP Code.

In a Comment^[93] dated June 5, 2017, KPII argued that the CA had correctly applied the principle of res judicata.

In the Reply^[94] dated November 16, 2017, KECI insisted that the ruling in the Taiwan Kolin case
cannot be made to apply in this case. Further, in arguing that the CA
decision should be reversed, KECI emphasized the confusing similarity
between the subject marks.

Issue

The main issue in this case is whether KPII should be allowed to register its kolin mark.

The Court’s Ruling

The Petition is granted. KPII is not allowed to register its kolin mark for “Televisions and DVD players.”

RES JUDICATA DOES NOT APPLY

Citing the Taiwan Kolin case, the CA stated that the doctrine of res judicata is applicable and “forbids [it] from arriving at a contrary conclusion.”^[95] It stated that all the requisites of res judicata are fulfilled in the instant case, viz.:

All of these requisites [of res judicata] are fulfilled in the instant case. While KPII may not be involved in the [Taiwan Kolin case],
it must be noted that KPII is an affiliate company of [TKC], as
admitted by KECI An absolute identity of the parties is not required for
res judicata to apply, for as long as there exists an identity or community of interest.

It may be claimed that [TKC] is now the owner of the mark KOLIN for
television and DVD players by virtue of the Supreme Court decision in
the [Taiwan Kolin case], thereby preventing registration in the
name of KPII. Still, we again emphasize that they are affiliated
companies and [TKC] has authorized KPII to adopt and use the mark
“KOLIN” in the Philippines and to register the mark in connection with
its business dealings. More importantly, however, it appears that the
marks applied for by [TKC] and KPII are not identical. x x x Thus, since
there is no identity of marks so as to prevent registration, KPII may
validly register its mark.^[96]

A. Res judicata in the concept of bar by prior judgment

The Court disagrees with the conclusion of the CA because all the elements of res judicata are not present.

The following excerpts in Monterona v. Coca-Cola Bottlers Philippines, Inc.^[97] are instructive:

There is “bar by prior judgment” when, as
between the first case where the judgment was rendered and the second
case that is sought to be barred, there is identity of parties, subject
matter, and causes of action. In this instance, the judgment in the
first case constitutes an absolute bar to the second action. Otherwise
put, the judgment or decree of the court of competent jurisdiction on
the merits concludes the litigation between the parties, as well as
their privies, and constitutes a bar to a new action or suit involving
the same cause of action before the same or any other tribunal.

x x x x

The elements of res judicata are: (1) the judgment sought to bar
the new action must be final; (2) the decision must have been rendered
by a court having jurisdiction over the subject matter and the parties;
(3) the disposition of the case must be a judgment on the merits; and
(4) there must be as between the first and second actions, identity of
parties, subject matter, and causes of action. x x x Should identity of
parties, subject matter, and causes of action be shown in the two cases,
then res judicata in its aspect as a “bar by prior judgment” would apply. x x x^[98]

Based on the facts, the subject matter in this case and the Taiwan Kolin
case are different. A subject matter is the item with respect to which
the controversy has arisen, or concerning which the wrong has been done,
and it is ordinarily the right, the thing, or the contract under
dispute.^[99] In this case, the item to which the controversy has arisen or the thing under dispute is KPII’s kolin mark, while in the Taiwan Kolin case, the subject matter is TKC’s KOLIN mark.

The cause of action in the Taiwan Kolin case is also different
from the cause of action in the case at bar. Rule 2, Section 2 of the
Rules of Court defines a cause of action as an act or omission by which a
party violates the right of another. In the Taiwan Kolin case, the cause of action was TKC’s act of filing Trademark Application No. 4-1996-106310 for

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KOLIN,
which allegedly violated KECI’s rights because confusion would be
likely among consumers if TKC’s trademark application were to be given
due course. In contrast, in the case at bar, the cause of action is
KPII’s act of filing Trademark Application No. 4-2006-010021 for kolin.

Thus, there is no bar by prior judgment in this case.

B. Res judicata in the concept of conclusiveness of judgment

Neither can res judicata in the concept of conclusiveness of
judgment operate to prevent the Court from determining the
registrability of KPII’s trademark application.

Jurisprudence describes how this principle is applied below:

Section 49(c) of Rule 39 enumerates the concept of
conclusiveness of judgment. This is the second branch, otherwise known
as collateral estoppel or estoppel by verdict. This applies where,
between the first case wherein judgment is rendered and the second case
wherein such judgment is involved, there is no identity of causes of
action. As explained by this Court:

It has been held that in order that a judgment in one action
can be conclusive as to a particular matter in another action between
the same parties or their privies, it is essential that the issues be
identical. If a particular point or question is in issue in the second
action, and the judgment will depend on the determination of that
particular point or question, a former judgment between the same parties
will be final and conclusive in the second if that same point or
question was in issue and adjudicated in the first suit; but the
adjudication of an issue in the first case is not conclusive of an
entirely different and distinct issue arising in the second. In order
that this rule may be applied, it must clearly and positively appear,
either from the record itself or by the aid of competent extrinsic
evidence that the precise point or question in issue in the second suit
was involved and decided in the first. And in determining whether a
given question was an issue in the prior action, it is proper to look
behind the judgment to ascertain whether the evidence necessary to
sustain a judgment in the second action would have authorized a judgment
for the same party in the first action.^[100]

To emphasize, in the Taiwan Kolin case, the Court only ruled that TKC’s Trademark Application No. 4-1996-106310 for

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KOLIN should be given due course.

What is involved in this case now before the Court is a new trademark
application by KPII which means that it is going through an entirely new
process of determining registrability. There is nothing under the law
which mandates that registered trademark owners and/or their privies may
automatically register all similar marks, despite allegations of
“damage”^[101] by opposers.

Since new trademark applications are attempts to claim new exclusive
rights, there will necessarily be new nuances of “damage”, even if the
same parties are involved, and the Court should carefully consider these
nuances in deciding to give due course to the application. There are
new issues on “damage” to KECI here, not decided in the Taiwan Kolin
case, which affect the registrability of KPII’s application for kolin
and which must be resolved by the Court.

The registration of KPII’s kolin will create new rights which would
change the status quo. Thus, the opposed trademark application before
the Court presents the following new issues:

a)	KPII’s new application for kolin essentially amounts to seeking exclusivity^[102] over a stylized version of the “KOLIN” word as against other parties, including KECI, for a range of goods/services.^[103] This issue was not considered in the Taiwan Kolin case because the Court only essentially ruled therein that the registration of Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* will not cause damage to KECL Thus, the relevant questions are these: should KPII be given a new right to assert exclusivity over the kolin stylized mark, as against KECI, for a range of goods/services? Will KPII’s exclusive appropriation of a specific stylized version (kolin) cause “damage” to KECI who, as it stands, has an existing right to use any and all stylized versions of “KOLIN” for a range of goods/services (i.e., goods covered by its registration, related goods/services, and goods/services falling within the normal expansion of its business)?

b)	As mentioned, KECI is the owner of the mark under the Trademark Law based on the KECI ownership case. Section 236^[104] of the IP Code mandates that nothing in the IP Code – which logically includes marks registered under the IP Code-can adversely affect the rights on enforcement of marks acquired in good faith prior to the effective date of the law. In this regard, does KPII’s application under the IP Code for exclusive appropriation of a stylized KOLIN (kolin) for a range of goods/services adversely affect KECI’s rights under Section 236 of the IP Code in such a way that it amounts to “damage” to KECI? Will KPII’s registration adversely affect the rights on KECI’s enforcement of its KOLIN mark established under the KECI ownership case?

The Court is therefore called upon to resolve the question of whether KPII deserves to exclusively appropriate a stylized version of the KOLIN word mark for a range of goods/services, considering all aspects of “damage” to KECI.

Because this involves a new trademark application and there are new issues arising here which were not decided in the Taiwan Kolin case, the principle of res judicata in the concept of conclusiveness of judgment does not apply.

Senior Associate Justice Estela M. Perlas-Bernabe also raises a
compelling and well-reasoned point on why the principle of
conclusiveness of judgment does not apply here. As expertly detailed in
her Concurring Opinion, the Court’s Third Division in the Taiwan Kolin case could have only allowed the registration of TKC’s

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KOLIN as a mark with a specific stylization, and not a word mark.^[105]

Indeed, a perusal of the marks involved in the Taiwan Kolin case would confirm that TKC sought to protect a specific style of lettering in its trademark application, thereby precluding the possibility that the registration granted in the Taiwan Kolin case belongs in the category of word marks:^[106]

TKC’s opposed Trademark Application No. 4-1996-106310, which was granted registration in the Taiwan Kolin case

TKC’s Trademark Application No. 4-2002-011002, the alleged “revived version” in the Taiwan Kolin case

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KOLIN^[107]

(image)^[108]

The two marks overlayed

(image)

Thus, even if the CA had found that “[TKC] had authorized KPII to adopt
and use [its] mark “KOLIN” in the Philippines and to register the mark
in connection with its business dealings,”^[109]
the only consequence of TKC’s authorization is that KPII was given the
right to use the exact mark allowed to be registered in the Taiwan Kolin case,
not a blanket authority to use-or register, for that matter – any and
all figurative or stylized versions of the word “KOLIN”. The Court
adopts Senior Associate Justice Perlas-Bernabe’s insightful disquisition
on this point, viz.:

x x x [I]t should be discerned that the CA’s application of res judicata in the concept of conclusiveness of judgment failed to take into account the nature of TKC’s KOLIN mark as a mere design mark, which attribution should consequently limit the legal effects of the [Taiwan Kolin case‘s]
final judgment. x x x TKC having been adjudged as the owner of a mere
design mark – could have only assigned to KPII the right to adopt and
use its mark under the specific stylization and design of

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KOLIN. x x x^[110]

Consequently, the principle of conclusiveness of judgment cannot apply
here because the issue involving KPII’s use of another figurative or
stylized version of “KOLIN” (“kolin“) – or the use of any other figurative or stylized versions of the word “KOLIN” – was not ruled upon in the Taiwan Kolin case.

In light of the foregoing, the Court must therefore determine whether KPII deserves to register its trademark application for kolin, a stylized version of the word “KOLIN”, despite KECI’s opposition.

II.

KPII’S TRADEMARK APPLICATION IS NOT REGISTRABLE BECAUSE IT WILL CAUSE DAMAGE TO KECI

In its Petition,^[111] KECI
squarely raises the issue of likelihood of confusion, arguing that
KPII’s trademark should not be registered based on, among others,
Section 123.1(d) of the IP Code, which reads:

SECTION 123. Registrability. – 123.1. A mark cannot be registered if it:

x x x x

(d)

Is identical with a registered
mark belonging to a different proprietor or a mark with an earlier
filing or priority date, in respect of:

(i)

The same goods or services, or

(ii)

Closely related goods or services, or

(iii)

If it nearly resembles such a mark as to be likely to deceive or cause confusion;

x x x x

In determining likelihood of confusion – which can manifest in the form of “confusion of goods” and/or “confusion of business”^[112] – several factors may be taken into account, such as:

a)	the strength of plaintiffs mark;

b)	the degree of similarity between the plaintiffs and the defendant’s marks;

c)	the proximity of the products or services;

d)	the likelihood that the plaintiff will bridge the gap;

e)	evidence of actual confusion;

f)	the defendant’s good faith in adopting the mark;

g)	the quality of defendant’s product or service; and/or

h)	the sophistication of the buyers.^[113]

These criteria may be collectively referred to as the multifactor test. Out of these criteria, there are two which are uniformly deemed significant under the Trademark Law^[114] and the IP Code:^[115]
the resemblance of marks (the degree of similarity between the
plaintiffs and the defendant’s marks) and the relatedness of goods or
services (the proximity of products or services). Nevertheless, the
other factors also contribute to the finding of likelihood of confusion,
as will be discussed.

A. Resemblance of marks

The marks involved in this dispute are KECI’s

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KOLIN and KPII’s kolin.
In assessing the resemblance of marks to determine the existence of
likelihood of confusion, there are two tests prescribed by
jurisprudence, viz.:

Jurisprudence has developed two tests in determining similarity and likelihood of confusion in trademark resemblance:

(a) the Dominancy Test applied in Asia Brewery, Inc. vs. Court of Appeals and other cases, and

(b) the Holistic or Totality Test used in Del Monte Corporation vs. Court of Appeals and its preceding cases.

The Dominancy Test focuses on the similarity of the prevalent features
of the competing trademarks which might cause confusion or deception,
and thus infringement. If the competing trademark contains the main,
essential or dominant features of another, and confusion or deception is
likely to result, infringement takes place. Duplication or imitation is
not necessary; nor is it necessary that the infringing label should
suggest an effort to imitate. The question is whether the use of the
marks involved is likely to cause confusion or mistake in the mind of
the public or deceive purchasers.

On the other hand, the Holistic Test requires that the entirety of the
marks in question be considered in resolving confusing similarity.
Comparison of words is not the only determining factor. The trademarks
in their entirety as they appear in their respective labels or hang tags
must also be considered in relation to the goods to which they are
attached. The discerning eye of the observer must focus not only on the
predominant words but also on the other features appearing in both
labels in order that he may draw his conclusion whether one is
confusingly similar to the other.^[116] (Emphasis supplied)

Unfortunately, jurisprudence has not been consistent in saying what test
should be used under what circumstances such that either or both tests
may viably be employed by the IPO or the courts in finding resemblance
between marks. As expertly outlined by Associate Justice Marvic M.V.F.
Leonen, there are contradictory lines of jurisprudence advocating the
use of the Dominancy Test alone,^[117] the Holistic Test alone,^[118] or both tests.^[119] There is also at least one case where the Court did not use either test.^[120]

Needless to say, the current state of jurisprudence in deciding the
resemblance of marks is unclear. Out of the two tests, however, only the
Dominancy Test has been incorporated in the IP Code. This was discussed
in McDonald’s Corporation v. L.C. Big Mak Burger, Inc.,^[121] where the Court also observed its own reliance on the dominancy test, thus:

This Court, however, has relied on the dominancy test rather than the holistic test. The dominancy test considers the dominant features in the competing marks in determining whether they are confusingly similar. Under
the dominancy test, courts give greater weight to the similarity of the
appearance of the product arising from the adoption of the dominant
features of the registered mark, disregarding minor differences. Courts
will consider more the aural and visual impressions created by the marks
in the public mind, giving little weight to factors like prices,
quality, sales outlets and market segments.

x x x x

The test of dominancy is now explicitly incorporated into law in Section 155.1 of the Intellectual Property Code which defines infringement as the “colorable imitation of a registered mark x x x or a dominant feature thereof.”^[122] (Emphasis supplied; italics omitted)

More than an indicator of a mere preference for the Dominancy Test, it
appears that the legislative intent in explicitly adopting the Dominancy
Test was to abandon the Holistic Test altogether, as can be seen in the
legislative deliberations:

Trademarks

Part III of the Code is the new law on trademarks.

x x x x

To resolve the conflicting doctrines regarding what constitutes
colorable imitation of a registered mark, the Code adopts the Dominancy
Test so that any person who uses in commerce any colorable imitation
of [a] registered mark or a dominant feature thereof shall be liable
for damages for infringement.

x x x x

Policy Issues

We have summarized the basic features of the proposed Intellectual
Property Code. Let me now try to identify provisions of the Code that
may be the focus of policy debates.

Without being exclusive, they are the following:

x x x x

Trademarks

x x x x

8. The committee notes the varying decisions of the Supreme Court regarding colorable imitation of a registered mark. There
are decisions which espouse the Dominancy Test, while there are others
which use the Holistic Test. We, therefore, recommend the adoption of
the Dominancy Test to resolve once and for all the debate.^[123] (Emphasis supplied)

Considering the adoption of the Dominancy Test and the abandonment of
the Holistic Test, as confirmed by the provisions of the IP Code and the
legislative deliberations, the Court hereby makes it crystal clear
that the use of the Holistic Test in determining the resemblance of
marks has been abandoned.

The inapplicability of the Taiwan Kolin case in the case at bar is thus evident. As correctly pointed out by Associate Justice Leonen,^[124] the Taiwan Kolin case
used the Holistic Test in evaluating trademark resemblance. This is
improper precedent because the Dominancy Test is what is prescribed
under the law.

Using the Dominancy Test, the Court should now determine the resemblance between

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KOLIN and kolin
in terms of the similarity of the dominant features used. This is
consistent with the basic rule in determining resemblance of marks,
which requires that the appearance, sound, meaning, and overall
impressions generated by the marks shall be considered.^[125]

In Societe Des Produits Nestle, S.A. v. Dy, Jr.,^[126]
the Court stated that the marks are confusingly similar based on the
Dominancy Test because the mark “NANNY” “contains the prevalent feature
‘NAN'” and because the marks are aurally similar, thus:

Applying the dominancy test in the present case, the Court
finds that “NANNY” is confusingly similar to “NAN.” “NAN” is the
prevalent feature of Nestle’s line of infant powdered milk products. It
is written in bold letters and used in all products. The line consists
of PRE-NAN, NANH.A., NAN-1, and NAN-2. Clearly, “NANNY” contains the
prevalent feature “NAN.” The first three letters of “NANNY” are exactly
the same as the letters of “NAN.” When “NAN” and “NANNY” are
pronounced, the aural effect is confusingly similar.^[127] (Emphasis supplied)

Applying the Dominancy Test here, KPII’s kolin mark resembles KECI’s

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KOLIN mark because the word “KOLIN” is the prevalent feature of both marks.
Phonetically or aurally, the marks are exactly the same. Surely, the
manner of pronouncing the word “KOLIN” does not change just because
KPII’s mark is in lowercase and contains an italicized orange letter
“i”. In terms of connotation and overall impression, there seems to be
no difference between the two marks.

Another consideration is the type of marks used. Logically, this may
affect the determination of resemblance of the marks in terms of their
visual, aural, or connotative aspects, which are key areas to consider
in using the Dominancy Test.

As summarized in the IPO website,^[128]
the types of marks allowed to be registered in the Philippines are the
following: “word mark,” “figurative mark,” “figurative mark with words,”
“3D mark,” and “stamped or marked containers of goods.” Notably, the IP
Code and the current Trademark Regulations do not define these terms
and how they impact the finding of resemblance between marks. However,
IPOPHL Memorandum Circular No. 17-010, Rules and Regulations on Trademarks, Service Marks, Trade names and Marked or Stamped Containers makes an explicit reference to “word marks,” as follows:

RULE 402. Reproduction of the Mark. – x x x

In the case of word marks or if no special characteristics have
to be shown, such as design, style of lettering, color, diacritical
marks, or unusual forms of punctuation, the mark must be represented in
standard characters. The specification of the mark to be reproduced will
be indicated in the application form and/or published on the website.

x x x x

That word marks protect the word itself stands to reason. Since there
are no special characteristics to be shown in the reproduction of the
mark in the application, the word itself is the subject of protection.
This understanding of the protection given to word marks is also
consistent with trademark jurisprudence in the United States, where most
of our intellectual property laws were patterned from.^[129]

The case of Cunningham v. Laser Golf Corp.^[130] (Cunningham) may be considered relevant in this jurisdiction. In Cunningham,
Laser Golf, the prior user and registrant of the “LASER” mark for golf
clubs and golf balls, filed a cancellation case against Cunningham’s
registration for “LASERSWING” for golf clubs. Since Cunningham’s
“LASERSWING” registration was cancelled, he sought before the court a
review of the decision cancelling his registration. One of Cunningham’s
arguments was that the appearance of his mark in commerce is
distinguishable from the mark of Laser Golf in the sense that he uses
“particular colors and a particular font”, “specific arrangements of
lower and upper case”, “colored whoosh stripes”, and a “juxtaposition of
the main brand name”. In ruling that this was not enough to avoid
confusion, the U.S. court pertinently stated:

However, Cunningham’s argument is inapposite to our review of this cancellation proceeding. The record shows that the registration for the LASERSWING mark contains a “typed drawing.” …Registrations
with typed drawings are not limited to any particular rendition of the
mark and, in particular, are not limited to the mark as it is used in
commerce. See Vornado, Inc. v. Breuer Elec. Mfg. Co.,
C.C.P.A. 858, 390 F.2d 724, 727, 156 USPQ 340, 342 (1968) (stating that
because the registration for the senior mark, upon which the opposition
was based, disclosed only the word, “the [advertising] display of the
mark in a particular style is of no material significance since the
display may be changed at any time as may be dictated by the fancy of
the applicant or the owner of the mark“); Phillips Petroleum Co. v. C.J. Webb, Inc., 58 C.C.P.A. 1255, 442 F.2d 1376, 1378, 170 USPQ 35, 36 (1971) (“The
drawing in the [opposed] application shows the mark typed in capital
letters, and x x x this means that [the] application is not limited to
the mark depicted in any special form.“); Kimberly-Clark Corp. v. H Douglas Enters., Ltd.,
774 F.2d 1144, 1147, 227 USPQ 541, 543 (Fed.Cir.1985) (stating that
trade dress associated with the mark of the opposed registration was
irrelevant in distinguishing the mark because “such dress might well be changed at any time; only the word mark itself is to be registered“). Therefore,
it is irrelevant that Cunningham has a particular display for his mark
in commerce, and the Board was correct to ignore those features.^[131] (Emphasis and underscoring ours)

Using the persuasive logic in Cunningham together with the Dominancy Test, there is no doubt that the minor differences between kolin and

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KOLIN mark should be completely disregarded. The fact that KPII’s trademark application possesses special characteristics (e.g., the italicized orange letter “i”) not present in KECI’s

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KOLIN
word mark makes no difference in terms of appearance, sound,
connotation, or overall impression because the “KOLIN” word itself is
the subject of KECI’s registration.

B. Relatedness of Goods/Services

The goods involved in the case at bar are as follows:

KECI’s

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KOLIN

KPII’s kolin

Automatic Voltage Regulator,
Converter, Recharger, Stereo Booster, AC-DC Regulated Power Supply,
Step-Down Transformer, PA Amplified AC-DC.

Televisions, DVD Players

In assessing relatedness of goods/services to determine likelihood of confusion, Mighty Corporation provides a list of factors that should be considered, viz.:

Non-competing goods may be those which, though they are not
in actual competition, are so related to each other that it can
reasonably be assumed that they originate from one manufacturer, in
which case, confusion of business can arise out of the use of similar
marks. They may also be those which, being entirely unrelated, cannot be
assumed to have a common source; hence, there is no confusion of
business, even though similar marks are used. Thus, there is no
trademark infringement if the public does not expect the plaintiff to
make or sell the same class of goods as those made or sold by the
defendant.

In resolving whether goods are related, several factors come into play:

(a)

the business (and its location) to which the goods belong

(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 and sold.

The wisdom of this approach is its recognition that each trademark
infringement case presents its own unique set of facts. No single factor
is preeminent, nor can the presence or absence of one determine,
without analysis of the others, the outcome of an infringement suit.
Rather, the court is required to sift the evidence relevant to each of
the criteria. This requires that the entire panoply of elements constituting the relevant factual landscape be comprehensively examined.
It is a weighing and balancing process. With reference to this ultimate
question, and from a balancing of the determinations reached on all of
the factors, a conclusion is reached whether the parties have a right to
the relief sought.^[132] (Emphasis supplied)

Indeed, a comprehensive examination of all these factors is
needed to ensure that pronouncements on legal relatedness are not based
on skewed factual premises, especially since relatedness of
goods/services significantly impacts the finding of likelihood of
confusion as mentioned above.

Too, because of the importance of relatedness of goods/services in
deciding controversies involving the issue of likelihood of confusion of
marks, the Court en banc takes a closer look at one factor inconsistent with our laws and creates problems with making precedents on legal relatedness.

As astutely explained by Chief Justice Diosdado M. Peralta,^[133]
the NCL serves purely administrative purposes – merely a way for
trademark offices worldwide to organize the thousands of applications
that are filed – and the classification of products/services should not
have been included as one of the factors in determining relatedness
because there was no legal basis for its inclusion. In fact, it even contradicts specific provisions of the Trademark Law^[134] and the IP Code.^[135]
The use of classification of products/services in determining
relatedness also conflicts with a provision of the 2020 Revised Rules of
Procedure for Intellectual Property Rights Cases,^[136] viz.:

SECTION 6. Likelihood of Confusion; Determination of Related Goods or Services.
– Goods or services may not be considered as being similar or
dissimilar to each other on the ground that, in any registration or
publication by the Office, they appear in the same or different classes
of the Nice Classification.

Allowing this factor to remain as a criterion in determining legal
relatedness would not be merely inconsequential. In fact, it may even
create problems in jurisprudential precedents on legal relatedness due
to the principle of stare decisis.

The Classes in the NCL undergo several changes each year. To illustrate,
the Alphabetical List of Goods in Class 9 underwent several changes in
2017,^[137] 2018,^[138] 2019,^[139] and 2020.^[140]
Significantly, “socks, electrically heated” was changed from being a
Class 9 product to a Class 11 product in 2017, showing that the
classification of the specific goods per class is still subject to
change. Surely, jurisprudential pronouncements regarding the nature of
certain goods/services and their legal relatedness/non relatedness to
each other-which pronouncements would, in turn, effectively affect
substantive rights over marks and affect future cases involving the same
goods or services-should not be made to depend on a constantly changing
list.

Considering the foregoing discussion, the Court hereby abandons the use of product or service classification as a factor in determining relatedness or non-relatedness.

In this light, the inapplicability of the Taiwan Kolin case as
precedent in the instant controversy becomes all the more apparent
because it did not comprehensively consider all the jurisprudential
factors in determining relatedness and it included an inapposite
discussion on subcategories in the NCL as an additional rationale for
its conclusion on non-relatedness.

Based on the evidence on record and reasonable inferences in accord with
common experience, the factors to determine relatedness in Mighty Corporation yields the conclusion that the goods covered by

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KOLIN and kolin are related, as seen in the following table:

(d) the nature and cost of the articles

Goods covered by

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KOLIN and kolin
are electronic m nature, relatively expensive, and rarely bought. It
will likely take several years before consumers would make repeat
purchases of the goods involved.

(e) the descriptive properties,
physical attributes or essential characteristics with reference to their
form, composition, texture or quality

Considering that they are electronic goods, goods covered by

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KOLIN and kolin
are likely made of metal. It is also likely that such goods cannot be
easily carried around and are usually brought back to the consumer’s
place after being bought.

(f) the purpose of the goods

The audiovisual goods covered by kolin (Television and DVD players) and

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KOLIN (stereo booster) marks can be used for entertainment purposes.

(g) whether the article is bought for immediate consumption, that is, day-to-day household items

Goods covered by

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KOLIN and kolin are not bought for immediate consumption.

(i) the conditions under which the article is usually purchased, and

Because they are relatively expensive and they last for a long time, goods covered by KOLIN and kolin are rarely bought. They are non-essential goods.

(j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed and sold.

The goods covered by

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KOLIN and kolin marks will likely be offered in “the same channels of trade such as department stores or appliance stores”.^[141]

Clearly, the goods covered by

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KOLIN and kolin are related, and this legal relatedness significantly impacts a finding of likelihood of confusion.

In addition to the factors in Mighty Corporation, another ground for finding relatedness of goods/services is their complementarity.

The reasoning used in the case of Hewlett-Packard Development Company, L.P. v. Vudu, Inc.^[142] is also logical and persuasive. In said case, the opposer Hewlett-Packard registered its “VOODOO” mark for, inter alia, “personal and gaming computers” under Class 9. Meanwhile, Vudu, Inc. sought to register its “VUDU” mark for, inter alia,
“computer software for use in computers for the transmission, storage
and playback of audio and video content” also under Class 9. The
tribunal therein pointed out that “the goods of the parties may be used
together for the same purposes, may be found in the same channels of
trade, and may appeal to the same purchasers. x x x [B]y their
descriptions, [VUDU’s] particular type of software for computers and
[Hewlett-Packard’s] personal and gaming computers are complementary goods“,
thus, it granted Hewlett-Packard’s opposition of the “VUDU” mark based
on the finding that the goods under Class 9 covered by the marks are
related and confusion is likely.^[143]

Applying this reasoning to the herein dispute, it is clear that the goods covered by KECI’s KOLIN are complementary to the goods covered by KPII’s kolin
and could thus be considered as related. This increases the likelihood
that consumers will at least think that the goods come from the same
source. In other words, confusion of business will likely arise.

C. Actual Confusion

The IPO-BLA stated that there is already actual confusion among consumers regarding the goods of KECI and KPII:

More so, [KECPs] evidence consisting of various e-mails x x x
it received from public consumers reflecting their complaints,
concerns, and other information about [KPII’s] goods as televisions,
air-conditioning units and DVD players, are obvious showing of actual
confusion of goods as well as confusion as to origin or source [of]
goods. These reveal factual confusion of the buying public between the
marks in controversy.^[144]

The presence of actual confusion is not an insignificant circumstance.
Indeed, the evidence of actual confusion is often considered the most
persuasive evidence of likelihood of confusion because past confusion is
frequently a strong indicator of future confusion.^[145]

It is the Court’s considered view that evidence of actual confusion
should be considered as strong evidence of likelihood of confusion,
especially when there are concurrent findings of resemblance of marks
and/or relatedness of the goods/services. If “likelihood of confusion”
is already abhorred by the infringement provisions^[146] of the law and the evidence of likelihood of confusion already creates basis to prevent another’s use of its mark, it should logically follow that actual confusion should be given more weight because confusion among consumers is not only speculated but has actually transpired.

Parenthetically, the presence of this criterion in ascertaining the
existence of likelihood of confusion in the multifactor test is yet
another reason why the Taiwan Kolin case should not be held as a binding precedent here. In the Taiwan Kolin case, while there was evidence of actual confusion presented in the IPO-BLA,^[147] this was ultimately not considered in resolving the issue of likelihood of confusion.

D. Normal Potential Expansion of Business

The factor involving the “likelihood that the plaintiff will bridge the
gap” pertains to the possibility that the plaintiff will expand its
product offerings to cover the product areas of the defendant.^[148]

In the case of Dermaline, Inc. v. Myra Pharmaceuticals, Inc.,^[149] the Court already acknowledged “that the registered trademark owner enjoys protection in product and market areas that are the normal potential expansion of his business.”^[150] As well, Societe Des Produits Nestle, S.A. v. Dy, Jr.^[151] describes the scope of protection given to registrants as follows:

The scope of protection afforded to registered trademark owners is not limited to protection from infringers with identical goods. The scope of protection extends to protection from infringers with related goods, and to market areas that are the normal expansion of business of the registered trademark owners. x x x^[152] (Emphasis supplied)

As stated above, the goods covered by

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KOLIN and kolin are related. Therefore, it is likely that the goods covered by kolin falls within the normal potential expansion of business of KECI.

E. Sophistication of the buyers

As stated in Philip Morris, Inc. v. Fortune Tobacco Corporation,^[153] “the general impression of the ordinary purchaser, buying
under the normally prevalent conditions in trade and giving the
attention such purchasers usually give in buying that class of goods, is the touchstone.”^[154]

The goods covered by

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KOLIN and kolin
are not inexpensive goods and consumers may pay more attention in buying
these goods. However, this does not eliminate the possibility of
confusion, especially since most consumers likely do not frequently
purchase Automatic Voltage Regulators, stereo boosters, TV sets, DVD
players, etc. Unless they have jobs or hobbies that allow them to
frequently purchase these electronic products, it is not farfetched to
suppose that they may only encounter the marks in the marketplace itself
once they are about to buy said goods once every five years or so.

Consequently, while consumers may concededly be familiar with these
goods to some extent, such familiarity will likely not be an intimate
knowledge thereof associated with the frequent and repeated purchase of
said goods.

It is not difficult to imagine that ordinary purchasers looking to buy a
home entertainment set for their homes would likely not know that the
“XYZ” – branded stereo boosters and the “XYZ” – branded televisions they
encounter in the store are offered by different companies. If the
consumer happens to like the “XYZ” brand for the stereo boosters after
seeing it for the first time, said consumer will most likely associate
it with the “XYZ” brand for television set and vice versa, especially
since these goods are complementary to each other.

Even if sophisticated consumers are making a repeat purchase years after
they first bought a “KOLIN” product, confusion is still possible
because of the degree of similarity of the subject marks. As mentioned
above, KECI’s

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KOLIN mark is a word mark. Stated simply,
the goodwill over the products will likely be associated with the
“KOLIN” word among consumers’ minds, regardless of their sophistication.
Thus, these consumers who prefer KECI’s products will likely go into
stores asking and looking for the “KOLIN” brand, regardless of its
stylization or additional figurative features. If they happen to see
KPII’s “KOLIN” – branded products, they may not readily know that the
products come from another source and mistakenly purchase those products
thinking that these products are from KECL Any perceived visual
differences between KECI’s and KPII’s “KOLIN” mark will likely be
disregarded, especially considering that it is not unusual for companies
to rebrand and overhaul their “brand image”, including their logos,
every so often.

Ultimately, there is no need to speculate and imagine how an average
consumer would think and act in this hypothetical situation because, as
discussed, there is actual proof of confusion among consumers between
the

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KOLIN and kolin goods.^[155] It is clear that consumers have actually associated KPII’s “KOLIN” – branded products with KECI’s business.
To be sure, that consumers have complained about KPII’s products and
associated the quality of such products with KECI’s business shows that
the concurrent use of “KOLIN” by KPII had already unfairly smeared
KECI’s goodwill and reputation over its products.

F. Strength of the Mark

The factor on “strength of plaintiffs mark” pertains to the degree of distinctiveness of marks,^[156] which can be divided into five categories^[157] enumerated in decreasing order of strength below:

1)	Coined or fanciful marks – invented words or signs that have no real meaning (e.g., Google, Kodak). These marks are the strongest and have the greatest chance of being registered.

2)	Arbitrary marks^[158] – words that have a meaning but have no logical relation to a product (e.g., SUNNY as a mark covering mobile phones, APPLE in relation to computers/phones).

3)	Suggestive marks^[159] – marks that hint at the nature, quality or attributes of the product, without describing these attributes (e.g., SUNNY for lamps, which would hint that the product will bring light to homes). If not considered as bordering on descriptive, this may be allowed.

4)	Descriptive marks^[160] – describe the feature of the product such as quality, type, efficacy, use, shape, etc. The registration of descriptive marks is generally not allowed under the IP Code.^[161]

5)	Generic marks^[162] – words or signs that name the species or object to which they apply (e.g., CHAIR in relation to chairs). They are not eligible for protection as marks under the IP Code.^[163]

KECI’s

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KOLIN mark is a fanciful or coined mark.
Considering that it is highly distinctive, confusion would be likely if
someone else were to be allowed to concurrently use such mark in
commerce.

G. Bad Faith

The discussion of bad faith in the case of Zuneca Pharmaceutical v. Natrapharm, Inc.^[164] is instructive:

The concepts of bad faith and fraud were defined in MustangBekleidungswerke GmbH + Co. KG v. Hung Chiu Ming, a case decided by the Office of the Director General of the IPO under the Trademark Law, as amended, viz.:

What constitutes fraud or bad faith in trademark
registration? Bad faith means that the applicant or registrant has
knowledge of prior creation, use and/or registration by another of an
identical or similar trademark. In other words, it is copying and using
somebody else’s trademark. Fraud, on the other hand, may be committed by
making false claims in connection with the trademark application and
registration, particularly on the issues of origin, ownership, and use
of the trademark in question among other things.

The concept of ‘fraud contemplated above is not a mere inaccurate claim
as to the origin, ownership, and use of the trademark. In civil law, the
concept of fraud has been defined as the deliberate intention to cause
damage or prejudice. The same principle applies in the context of
trademark registrations: fraud is intentionally making false claims
to take advantage of another’s goodwill thereby causing damage or
prejudice to another. Indeed, the concepts of bad faith and fraud go
hand-in-hand in this context. There is no distinction between the
concepts of bad faith and fraud in trademark registrations because the
existence of one necessarily presupposes the existence of the other.^[165] (Emphasis supplied)

To recall, the KECI ownership case, promulgated on July 31, 2006, ruled that KECI is the owner of the

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KOLIN
mark under the Trademark Law, despite TKC’s opposition that confusion
is likely because it had foreign registrations for “KOLIN” and a local
trademark application for

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KOLIN. Thereafter, KPII (TKC’s affiliate) filed a trademark application for kolin covering the same goods.

While KECI had squarely alleged the issue of KPII’s bad faith,^[166]
there was no explicit finding of bad faith on the part of KPII in the
decisions of the IPO-BLA, IPO-DG, and the CA. After an examination of
the records, however, the Court finds that circumstances in this case
would lead a reasonable mind to conclude that KPII knew about KECI’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN registration when it made a trademark application for kolin.

First, there was a factual finding by the IPO-BLA that KPII is an
instrumentality of TKC and TKC directly participates in the management,
supervision, and control of KPII, viz:

An exhaustive scrutiny of the records of the case
convince[s] this Bureau to concur with the position of [KECI] that
indeed, [KPII] is an instrumentality of [TKC]. [KECI] presented
substantial evidence that [KPII] is effectively under the management,
supervision and control of [TKC] manifested through the assignment of
five (5) persons to the financial and plant operations x x x; [TKC’s] admission of its direct participation in the management, supervision and control of [KPII]
x x x; [TKC’s] majority ownership of stocks in [KPII] x x x; and the
maintenance of one website of both companies and the admission to the
same x x x.^[167] (Emphasis supplied)

Second, as found by the CA,^[168] KPII was authorized by TKC to use the “KOLIN” mark.

Third, KPII filed a trademark application for kolin barely two months after KECI was declared as the owner of the

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark.

Fourth, KECI and KPII may be considered as being in the same line of
business and it would have been highly improbable that KPII did not know
an existing

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark owned by KECI, especially since it is an affiliate of TKC. Notably, in the case of Birkenstock Orthopaedie GmbH and Co. KG v. Phil. Shoe Expo Marketing Corp.,^[169]
the Court agreed with the IPO’s finding that the party was in bad faith
because it was in the same line of business and it was highly
improbable for it to not know of the existence of BIRKENSTOCK before it
appropriated and registered this “highly distinct” mark.^[170]

Thus, there exists relevant evidence and factual findings that a
reasonable mind might accept as adequate to support the conclusion that
KPII was in bad faith.

To summarize the above discussion: (1) there is resemblance between KECI’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN and KPII’s kolin marks; (2) the goods covered by KECI’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN
are related to the goods covered by KPII’s kolin; (3) there is evidence
of actual confusion between the two marks; (4) the goods covered by
KPII’s kolin fall within the normal potential
expansion of business of KECI; (5) sophistication of buyers is not
enough to eliminate confusion; (6) KPII’s adoption of KECI’s coined and
fanciful mark would greatly contribute to likelihood of confusion; and
(7) KPII applied for kolin in bad faith. Thus, KPII’s application for kolin should be denied because it would cause likelihood of confusion and KECI’s rights would be damaged.

* * *

It must also be stressed that KECI was already declared as the owner of the

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark under the Trademark Law. Section 236^[171]
of the IP Code states that nothing in the IP Code – which, as
mentioned, logically includes registrations made pursuant thereto –
shall adversely affect the rights of the enforcement of marks acquired
in good faith prior to the effective date of said law.

As seen above, the existence of likelihood of confusion is already
considered as damage that would be sufficient to sustain the opposition
and rejection of KPII’s trademark application. More than that, however,
the Court is likewise cognizant that, by granting this registration,
KPII would acquire exclusive rights over the stylized version of KOLIN
(“kolin“) for a range of goods/services,^[172] i.e.,
covered goods, related goods/services, goods/services falling within
the normal potential expansion of KPII’s business. Owing to the peculiar
circumstances of this case, this will effectively amount to a
curtailment of KECI’s right to freely use and enforce the KOLIN word
mark, or any stylized version thereof, for its own range of
goods/services, especially against KPII, regardless of the existence of actual confusion. Thus, based on Section 122^[173] vis-a-vis Section 236^[174] of the IP Code, the Court cannot give due course to KPII’s trademark application for “kolin“.

WHEREFORE, premises considered, the instant Petition is GRANTED.
The assailed Decision dated April 29, 2016 and Resolution dated
November 4, 2016 of the Court of Appeals in CA-G.R. SP No. 131917 are REVERSED and SET ASIDE.
Accordingly, the Decision of the Office of the Director General of the
Intellectual Property Office in IPC No. 14-2007-00167 is REINSTATED and AFFIRMED.

Consequently, the Trademark Application Serial No. 4-2006-010021 for kolin filed by respondent Kolin Philippines International, Inc. under Class 9 for “Television and DVD players” is REJECTED.

SO ORDERED.

Peralta, C. J., Gesmundo, Hernando, Carandang, Lazaro-Javier, Inting, Zalameda, Delos Santos, Gaerlan, Rosario, and J. Lopez, JJ., concur.
Perlas-Bernabe, J., Please see separate concurring opinion.
Leonen, J., I concur. See separate opinion.
M. Lopez, J., Please see separate opinion.

^[1] Rollo, pp. 9-28A.

^[2] Id. at 30-47. Penned by
Associate Justice Victoria Isabel A. Paredes and concurred in by
Associate Justices Francisco P. Acosta and Elihu A. Ybañez.

^[3] Also appears as Appeal Case No. 14-09-64 in some part of the rollo.

^[4] Rollo, pp. 49-50.

^[5] Id. at 79.

^[6] Id.

^[7] Id.

^[8] See <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.41996106310>.

^[9] Rollo, p. 119. N.B.:
Since the goods fell under Classes 9, 11, and 21, the trademark
examiner required TKC to elect one class of goods for the subject
application. Eventually, IPO-DG allowed the registration of Trademark
Application No. 4-1996-106310 for Class 9 goods limited to “television
and DVD player”.

^[10] Id. at 55.

^[11] Id. at 80.

^[12] Id. at 54-64.

^[13] Id. at 65, 81.

^[14] Id. at 58.

^[15] Id. The relevant excerpt of page 5 of the IPO-BLA decision reads: “Considering that the marks under contention are the same or almost identical,
the main issue to be resolved in this case is, WHO BETWEEN THE PARTIES
IS THE PRIOR ADOPTER AND USER OF THE TRADEMARK “KOLIN” AND THEREFORE,
ENTITLED TO ITS REGISTRATION.” (Emphasis supplied; emphasis in the
original omitted)

^[16] Id. at 62. Emphasis and underscoring omitted.

^[17] Id. at 65-77. IPO-DG Decision on Appeal No. 14-03-24, Inter Partes Case No. 14-1998-00050; penned by IPO Director General Emma C. Francisco.

^[18] Id. at 77, 83-84.

^[19] Id. at 84-85.

^[20] Id. at 85.

^[21] Id.

^[22] Id. at 78-102. Penned by
Associate Justice Amelita G. Tolentino and concurred in by Associate
Justices Portia Aliño Hormachuelos and Santiago Javier Ranada.

^[23] Republic Act (R.A.) No.
166, AN ACT TO PROVIDE FOR THE REGISTRATION AND PROTECTION OF
TRADE-MARKS, TRADE-NAMES AND SERVICE MARKS, DEFINING UNFAIR COMPETITION
AND FALSE MARKING AND PROVIDING REMEDIES AGAINST THE SAME, AND FOR OTHER
PURPOSES (1947), as amended.

^[24] Rollo, p. 92.

^[25] Id. at 95.

^[26] Id.

^[27] Id. at 87.

^[28] N.B.: TKC’s
Trademark Registration Certificate was issued in Taiwan on December 1,
1986 but the same had expired on September 15, 1996; see id. at 99.

^[29] Rollo, pp. 96-97.

^[30] Id. at 95.

^[31] R.A. No. 8293, AN ACT
PRESCRIBING THE INTELLECTUAL PROPERTY CODE AND ESTABLISHING THE
INTELLECTUAL PROPERTY OFFICE, PROVIDING FOR ITS POWERS AND FUNCTIONS,
AND FOR OTHER PURPOSES (1997).

^[32] Rollo, p. 99.

^[33] Id. at 101-102.

^[34] See id. at 103.

^[35] Id.

^[36] Id.

^[37] G.R. No. 209843, March
25, 2015, 754 SCRA 556. Penned by Associate Justice Presbitero J.
Velasco, Jr. and concurred in by Associate Justices Diosdado M. Peralta,
Martin S. Villarama, Jr., Bienvenido L. Reyes and Francis H. Jardeleza.

^[38] N.B. The opposition proceedings where the KECI ownership case stemmed from.

^[39] Id.; see IPO-DG Decision on Opposition to Trademark Application No. 4-1996-106310, p. 1, available at <http://121.58.254.45/ipcaselibrary/ipcasepdf/AP_IPC_14-2009-000027_Decision.pdf>.

^[40] Id.; id.

^[41] Id.; id.

^[42] Id.; id.

^[43] Id. at 120; id. at 2.

^[44] Id.; id.

^[45] Id.; id.

^[46] N.B.: This is the date stated in the Taiwan Kolin case,
supra note 37, at 559. However, the IPO-BLA decision, IPO-DG decision,
and CA decision state that the opposition was filed on July 17, 2006.

^[47] Registered on November 23, 2003; covered by Application No. 4-1993-087497, rollo, p. 52. See also <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.41993087497>for details regarding the mark.

^[48] Rollo, p. 121; see IPO-DG Decision on Opposition to Trademark Application No. 4-1996-106310, supra note 39, at 3.

^[49] Id. at 105-118. Penned by IPO-BLA Director Estrellita Beltran-Abelardo. See IPO-BLA Decision available at <http://121.58.254.45/ipcaselibrary/ipcasepdf/IPC 14-2006-00096.pdf>.

^[50] Id. at 122; see page 4 of IPO-DG Decision on Opposition to Trademark Application No. 4-1996-106310, supra note 39, at 4.

^[51] Id. at 123; id. at 5.

^[52] Id. at 119-126. Penned by
IPO Djrector General Ricardo R. Blancaflor. See IPO-DG Decision on
Opposition to Trademark Application No. 4-1996-106310, supra note 39.

^[53] Id. at 126; see id. at 8.

^[54] Rollo, pp.
127-139. Penned by Associate Justice Pedro B. Corales and concurred in
by Associate Justices Sesinando E. Villon and Fiorito S. Macalino.

^[55] Id. at 138.

^[56] Id. at 135.

^[57] Id.

^[58] Id. at 138.

^[59] Id.

^[60] Id. at 52; see also <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.41993087497>.

^[61] See <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.41996106310>.

^[62] See <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.42002011002>.

^[63] See rollo, pp. 114-115; see also IPO-BLA Decision, supra note 49, at 10-11; rollo, p. 119; IPO-DG Decision on Opposition to Trademark Application No. 4-1996-106310, supra note 39, at 1.

^[64] N.B.: This
“revival” was alleged by TKC in its Answer according to page 3 of the
IPO-DG Decision on Opposition to Trademark Application No.
4-1996-106310, id. at 121; id. at 3.

^[65] G.R. No. 154342, July 14, 2004, 434 SCRA 473.

^[66] Taiwan Kolin case, supra note 37, at 565-567.

^[67] Id. at 567.

^[68] Id. at 570.

^[69] Id. at 571.

^[70] See id. at 574.

^[71] G.R. No. 100098, December 29, 1995,251 SCRA 600.

^[72] Id. at 617.

^[73] Taiwan Kolin case, supra note 37, at 577.

^[74] Rollo, p. 31.

^[75] Id. at 273.

^[76] Id. at 158; IPO-BLA
Decision on Opposition to Trademark Application No. 4-2006-010021, p. 4,
also available at <http://121.58.254.45/ipcaselibrary/ipcasepdf/IPC 14-2007-00167.pdf>.

^[77] Id. at 161-162; id. at 7-8.

^[78] Id. 162; id. at 8.

^[79] Id.; id.

^[80] See <https://www3.wipo.int/branddb/ph/en/showData.jsp?ID=PHTM.41993087497>.

^[81] See <https://www3.wipo.int/branddb/ph/en/showData.isp?ID=PHTM.42006010021>.

^[82] Rollo, pp.
155-170. Penned by BLA Director Estrellita Beltran-Abelardo. IPO-BLA
Decision on Opposition to Trademark Application No. 4-2006-010021, supra
note 76.

^[83] Id. at 167; id. at 13.

^[84] See id. at 167-168; id. at 13-14.

^[85] Id. at 169; id. at 15.

^[86] Id. at 170; id. at 16.

^[87] Id. at 172-178. Penned by
Director General Ricardo R. Blancaflor. IPO-DG Decision on Opposition
to Trademark Application No. 4-2006-010021, also available at <http://121.58.254.45/ipcaselibrary/ipcasepdf/AP_IPC14-09-64.pdf>.

^[88] Id. at 178; id. at 7.

^[89] Id. at 30-47.

^[90] Id. at 35-44.

^[91] Id. at 44.

^[92] Id. at 46.

^[93] Id. at 271-278.

^[94] Id. at 281-290.

^[95] Id. at 44.

^[96] Id. at 45-46.

^[97] G.R. No. 209116, January 14, 2019, 890 SCRA 278.

^[98] Id. at 286-287.

^[99] Id. at 288.

^[100] Perez v. Court of Appeals, G.R. No. 157616, July 22, 2005, 464 SCRA 89, 108-109.

^[101] See IP CODE, SECTION 134. Opposition.
– Any person who believes that he would be damaged by the registration
of a mark may, upon payment of the required fee and within thirty (30)
days after the publication referred to in Subsection 133.2, file with
the Office an opposition to the application. Such opposition shall be in
writing and verified by the oppositor or by any person on his behalf
who knows the facts, and shall specify the grounds on which it is based
and include a statement of the facts relied upon. Copies of certificates
of registration of marks registered in other countries or other
supporting documents mentioned in the opposition shall be filed
therewith, together with the translation in English, if not in the
English language. For good cause shown and upon payment of the required
surcharge, the time for filing an opposition may be extended by the
Director of Legal Affairs, who shall notify the applicant of such
extension. The Regulations shall fix the maximum period of time within
which to file the opposition. (Sec. 8, R.A. No. 165a) (Underscoring
supplied)

^[102] Id., SECTION 147. Rights Conferred.
– 147.1. The owner of a registered mark shall have the exclusive right
to prevent all third parties not having the owner’s consent from using
in the course of trade identical or similar signs or containers for
goods or services which are identical or similar to those in respect of
which the trademark is registered where such use would result in a
likelihood of confusion. In case of the use of an identical sign for
identical goods or services, a likelihood of confusion shall be
presumed.

^[103] See Societe Des Produits Nestle, S.A. v. Dy, Jr.,
G.R. No. 172276, August 9, 2010, 627 SCRA 223, 242: “The scope of
protection afforded to registered trademark owners is not limited to
protection from infringers with identical goods. The scope of protection
extends to protection from infringers with related goods, and to market areas that are the normal expansion of business of the registered trademark owners.” (Emphasis supplied)

^[104] IP CODE, SECTION 236. Preservation of Existing Rights.
Nothing herein shall adversely affect the rights on the enforcement of
rights in patents, utility models, industrial designs, marks and works,
acquired in good faith prior to the effective date of this Act. (n)

^[105] Separate Concurring Opinion of Senior Associate Justice Estela M. Perlas-Bernabe, pp. 6-11.

^[106] See IPOPHL Memorandum
Circular No. 17-010, RULES AND REGULATIONS ON TRADEMARKS, SERVICE MARKS,
TRADE NAMES AND MARKED OR STAMPED CONTAINERS, Rule 402 which reads:

RULE 402. Reproduction of the Mark. – x x x

In the case of word marks or if no special characteristics have to be shown, such as design, style of lettering,
color, diacritical marks, or unusual forms of punctuation, the mark
must be represented in standard characters. The specification of the
mark to be reproduced will be indicated in the application form and/or
published on the website.

x x x x (Emphasis supplied)

^[107] Supra note 61.

^[108] Supra note 62.

^[109] Rollo, p. 46.

^[110] Separate Concurring Opinion of Senior Associate Justice Estela M. Perlas-Bernabe, p. 6.

^[111] Rollo, p. 20.

^[112] Mighty Corp. v. E. & J. Gallo Winery, supra note 65, at 504. The relevant excerpt reads:

x x x The first is “confusion of goods” when an
otherwise prudent purchaser is induced to purchase one product in the
belief that he is purchasing another, in which case defendant’s goods
are then bought as the plaintiffs and its poor quality reflects badly on
the plaintiffs reputation. The other is “confusion of business” wherein
the goods of the parties are different but the defendant’s product can
reasonably (though mistakenly) be assumed to originate from the
plaintiff, thus deceiving the public into believing that there is some
connection between the plaintiff and defendant which, in fact, does not
exist. (Emphasis supplied)

^[113] See A.M. No. 10-3-10-SC,
RULES OF PROCEDURE FOR INTELLECTUAL PROPERTY RIGHTS CASES (October 18,
2011), Rule 18, Sec. 4 and A.M. No. 10-3-10-SC, 2020 REVISED RULES OF
PROCEDURE FOR INTELLECTUAL PROPERTY RIGHTS CASES (October 6, 2020), Rule
18, Sec. 5.

^[114] TRADEMARK LAW, as amended, SECTION 4. Registration of trade-marks, trade-names and servicemarks on the principal register.
There is hereby established a register of trade-mark[s], trade-names
and service-marks which shall be known as the principal register. The
owner of a trade-mark, a tradename or service-mark used to distinguish
his goods, business or services from the goods, business or services of
others shall have the right to register the same on the principal
register, unless it:

x x x x

(d) Consists of or comprises a mark or trade-name which so resembles a mark or tradename registered in the Philippines or a mark or trade-name previously used in the Philippines by another and not abandoned, as to be likely, when applied to or used in connection with the goods, business or services of the applicant, to cause confusion or mistake or to deceive purchasers x x x[.]

x x x x

SECTION 22. Infringement, What Constitute’s. Any person who shal1 use, without the consent of the registrant, any reproduction, counterfeit, copy or colorable imitation of any registered mark or trade-name in connection with the sale, offering for sale, or advertising of any goods, business or services
on or in connection with which such use is likely to cause confusion or
mistake or to deceive purchasers or others as to the source or origin
of such goods or services, or identity of such business; or reproduce, counterfeit, copy or colorably imitate any such mark
or trade-name and apply such reproduction, counterfeit, copy, or
colorable imitation to labels, signs, prints, packages, wrappers,
receptacles or advertisements intended to be used upon or in connection with such goods, business or services,
shall be liable to a civil action by the registrant for any or all of
the remedies herein provided. (Emphasis and underscoring supplied)

^[115] IP CODE, SECTION 123. Registrability. 123.1. A mark cannot be registered if it:

x x x x

(d) Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority date, in respect of:

(i) The same goods or services, or

(ii) Closely related goods or services, or

(iii) If it nearly resembles such a mark as to be likely to deceive or cause confusion[.]

x x x x

SECTION 155. Remedies; Infringement. – Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the same container or a dominant feature thereof in connection with the sale, offering for sale, distribution, advertising of any goods or services including other preparatory steps necessary to carry out the sale of any goods or services on or in connection with which such use is likely to cause confusion, or to cause mistake, or to deceive; or

155.2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant feature thereof and apply such reproduction, counterfeit, copy or colorable imitation
to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or in connection
with the sale, offering for sale, distribution, or advertising of goods or services
on or in connection with which such use is likely to cause confusion,
or to cause mistake, or to deceive, shall be liable in a civil action
for infringement by the registrant for the remedies hereinafter set
forth: Provided, That the infringement takes place at the moment
any of the acts stated in Subsection 155.1 or this subsection are
committed regardless of whether there is actual sale of goods or
services using the infringing material. (Sec. 22, R.A. No. 166a)
(Emphasis and underscoring supplied)

^[116] Mighty Corporation v. E. & J. Gallo Winery, supra note 65, at 506-507.

^[117] Separate Concurring Opinion of Associate Justice Marvic M.V.F. Leonen, pp. 16-19.

^[118] Id. at 19-20.

^[119] Id. at 20-21.

^[120] “Irrespective of both tests, the Court finds no confusing similarity between the subject marks.” (Great White Shark Enterprises, Inc. v. Caralde, Jr., G.R. No. 192294, November 21, 2012, 686 SCRA 201, 208.)

^[121] G.R. No. 143993, August 18, 2004, 437 SCRA 10.

^[122] Id. at 32-33.

^[123] Record of the Senate, October 8, 1996, Vol. II, No. 29, pp. 131-135.

^[124] Separate Concurring Opinion of Associate Justice Marvic M.V.F. Leonen, p. 22.

^[125] See Societe Des Produits Nestle, S.A. v. Court of Appeals,
G.R. No. 112012, April 4, 2001, 356 SCRA 207, 221, which states that:
“the dominancy test relies not only on the visual but also on the aural
and connotative comparisons and overall impressions between the two
trademarks.”

^[126] Supra note 103.

^[127] Id. at 627.

^[128] See
<https://www.ipophil.gov.ph/help-and-support/trademark/> under
the tab “What types of marks may be registered as a trademark in the
Philippines?”.

^[129] See W Land Holdings, Inc. v. Starwood Hotels and Resorts Worldwide, Inc., G.R. No. 222366, December 4, 2017, 847 SCRA 403, 432.

^[130] 222 F. 3d 943, 55 USPQ2d 1842 (Fed. Cir. 2000).

^[131] Id. at 949-950.

^[132] Mighty Corporation v. E. & J. Gallo Winery, supra note 65, at 509-511.

^[133] Concurring Opinion of Chief Justice Diosdado M. Peralta, pp. 3-7.

^[134] See TRADEMARK LAW, Sec. 6.

^[135] See IP CODE, Sec. 144.

^[136] Supra note 113.

^[137] See <https://www.wipo.int/classifications/nice/nclpub/en/fr/?class_number=9&lang=en&menulang=en&mode=flat¬ion=modifications&version=20170101> N.B.: The list of modifications shows 42 changes, transfers, and additions in the Alphabetical List of Goods.

^[138] See
<https://www.wipo.int/classifications/nice/nclpub/en/fr/?class_number=9&lang=en&menulang=en&mode=flat¬ion=modifications&version=2018010 1> N.B.: The list of modifications shows 39 changes and additions in the Alphabetical List of Goods.

^[139] See <https://www.wipo.int/classifications/nice/nclpub/en/fr/?class_number=9&lang=en&menulang=en&mode=flat¬ion=modifications&version=20190101> N.B.: The list of modifications shows that
the class headings and explanatory notes were changed. The list of
modifications also indicates 33 changes and additions in the
Alphabetical List of Goods.

^[140] See
<https://www.wipo.int/classifications/nice/nclpub/en/fr/?class_number=9&lang=en&menulang=en&mode=flat¬ion=modifications&version=20200101> N.B.: The list of modifications shows 15 changes/ additions in the Alphabetical List of Goods.

^[141] Rollo, p. 167.

^[142] Opposition No. 91185393, October 26, 2009, available at <https://ttabvue.uspto.gov/ttabvue/ttabvue-91185393-OPP-15.pdf>.

^[143] Id.

^[144] Rollo, pp. 167-168.

^[145] Beacon Mut. Ins. Co. v. Onebeacon Ins. Group, 376 F.3d 8, 18 (2004).

^[146] See TRADEMARK LAW, as amended, Sec. 22 and IP CODE, Sec. 155.

^[147] Supra note 37, at 562. Excerpt from the Taiwan Kolin case: “The BLA-IPO also noted that
there was proof of actual confusion in the form of consumers writing
numerous e-mails to respondent asking for information, service, and
complaints about petitioner’s products.” (Emphasis supplied)

^[148] See Christensen, Glenn L.; De Rosia, Eric D.; and Lee, Thomas R., Sophistication, Bridging the Gap, and the Likelihood of Confusion: An Empirical and Theoretical Analysis,
(2008). All Faculty Publications, available at <https://scholarsarchive.byu.edu/cgi/viewcontent.cgi?article=l914&context=facpub>.

^[149] G.R. No. 190065, August
16, 2010, 628 SCRA 356. Second Division case penned by Associate Justice
Antonio Eduardo B. Nachura and concurred in by Associate Justices
Antonio T. Carpio, Diosdado M. Peralta, Roberto A. Abad and Jose C.
Mendoza.

^[150] Id. at 367. Emphasis supplied.

^[151] Supra note 103.

^[152] Id. at 242.

^[153] G.R. No. 158589, June 27, 2006, 493 SCRA 333.

^[154] Id. at 358. Emphasis and underscoring supplied.

^[155] See rollo, pp.
167-168. The relevant excerpt reads: “More so, [KECI’s] evidence
consisting of various e-mails x x x it received from public consumers
reflecting their complaints, concerns, and other information about
[KPII’s] goods as televisions, air-conditioning units and DVD players,
are obvious showing of actual confusion of goods as well as confusion as
to origin or source [of] goods. These reveal factual confusion of the
buying public between the marks in controversy.”

^[156] See Greene, Timothy D. and Wilkerson Jeff; Understanding Trademark Strength,
16 STAN. TECH. L. REV. 535 (2013), accessed at
<https://cyberlaw.stanford.edu/files/publication/files/understandingtrademarkstrength.pdf>.

^[157] World Intellectual Property Office, Obtaining IP Rights: Trademarks, accessed at <https://www.wipo.int/sme/en/obtain_ip_rights/trademarks.html>.

^[158] For an alternate definition, see GSIS Family Bank-Thrift Bank (formerly Comsavings Bank, Inc.) v. BPI Family Bank, G.R. No. 175278, September 23,2015, 771 SCRA 284,299.

^[159] For an alternate definition, see id. at 299.

^[160] For an alternate definition and a concrete example, see McDonald’s Corporation v. L.C. Big Mak Burger, Inc., supra note 121, at 26.

^[161] IP CODE, SECTION 123. Registrability. – 123.1. A mark cannot be registered if it:

x x x x

(j) Consists exclusively of signs or of indications that may serve in
trade to designate the kind, quality, quantity, intended purpose, value,
geographical origin, time or production of the goods or rendering of
the services, or other characteristics of the goods or services[.]

^[162] For an alternate definition, see McDonald’s Corporation v. L.C. Big Mak Burger, Inc., supra note 121, at 26.

^[163] IP CODE, SECTION 123. Registrability. – 123.1. A mark cannot be registered if it:

x x x x

(h) Consists exclusively of signs that are generic for the goods or services that they seek to identify[.]

^[164] G.R. No. 211850, September 8, 2020.

^[165] Id. at 29.

^[166] Rollo, pp. 156, 160-161, 173 and 177.

^[167] Id. at 169.

^[168] Id. at 46.

^[169] G.R. No. 194307, November 20, 2013, 710 SCRA 474.

^[170] The relevant excerpt in Birkenstock reads:

In view of the foregoing circumstances, the Court finds the
petitioner to be the true and lawful owner of the mark “BIRKENSTOCK” and
entitled to its registration, and that respondent was in bad faith in
having it registered in its name. In this regard, the Court quotes with
approval the words of the IPO Director General, viz.:

The facts and evidence fail to show that [respondent] was in good faith in using and in registering the mark BIRKENSTOCK. BIRKENSTOCK,
obviously of German origin, is a highly distinct and arbitrary mark. It
is very remote that two persons did coin the same or identical marks.
To come up with a highly distinct and uncommon mark previously
appropriated by another, for use in the same line of business, and
without any plausible explanation, is incredible. The field from
which a person may select a trademark is practically unlimited. As in
all other cases of colorable imitations, the unanswered riddle is why,
of the millions of terms and combinations of letters and designs
available, [respondent] had to come up with a mark identical or so
closely similar to the [petitioner’s] if there was no intent to take
advantage of the goodwill generated by the [petitioner’s] mark. Being
on the same line of business, it is highly probable that the
[respondent] knew of the existence of BIRKENSTOCK and its use by the
[petitioner], before [respondent] appropriated the same mark and had it
registered in its name. (Emphasis supplied) Id. at 489-490.

^[171] IP CODE, SECTION 236. Preservation of Existing Rights.
Nothing herein shall adversely affect the rights on the enforcement of
rights in patents, utility models, industrial designs, marks and works,
acquired in good faith prior to the effective date of this Act. (n)

^[172] Societe Des Produits Nestle, SA. v. Dy, Jr.,
supra note 103: “The scope of protection afforded to registered
trademark owners is not limited to protection from infringers with
identical goods. The scope of protection extends to protection from
infringers with related goods, and to market areas that are the normal expansion of business of the registered trademark owners.” (Emphasis supplied)

^[173] IP CODE, SECTION 122. How Marks are Acquired.
– The rights in a mark shall be acquired through registration made
validly in accordance with the provisions of this law. (Sec. 2-A, R.A.
No. 166a)

^[174] Id., SECTION 236. Preservation of Existing Rights.
– Nothing herein shall adversely affect the rights on the enforcement
of rights in patents, utility models, industrial designs, marks and
works, acquired in good faith prior to the effective date of this Act.
(n)

SEPARATE CONCURRING OPINION
LEONEN, J.:

I concur in the result.

I agree with the ponencia‘s finding that Kolin Philippines
International, Inc.’s Application No. 4-2006-010021, for the mark
“KOLIN” in Class 9, should be rejected on the basis of Kolin Electronics
Co. Inc.’s valid and subsisting Registration No. 4-1993-087497 for the
mark “KOLIN” in Class 9.

Section 147.1 of Republic Act No. 8293, as amended, otherwise known as
the Intellectual Property Code, grants a registered mark’s owner the
exclusive right to prevent a third party from using an identical or
similar sign in the course of trade, if the use would result in a
likelihood of confusion.

Here, the “KOLIN” mark in Application No. 4-2006-010021 is demonstrably
identical or similar to the mark “KOLIN” in Registration No.
4-1993-087497.^[1] The intent
and purpose of Application No. 4-2006-010021 is for Kolin Philippines
International, Inc. to use its “KOLIN” mark in trade. The likelihood of,
and even actual confusion was noted by the Intellectual Property
Office-Bureau of Legal Affairs to be proven by queries from consumers
directed to Kolin Electronics Co. Inc. regarding Kolin Philippines
International, Inc.’s goods.^[2]
This likelihood of or actual confusion as to the origin of goods these
companies sell is the damage that may be or has been sustained by Kolin
Electronics Co. Inc., the oppositor to Kolin Philippines International,
Inc.’s trademark application.^[3]
The Bureau of Legal Affairs and the Director-General of the
Intellectual Property Office correctly sustained Kolin Electronics Co.
Inc.’s opposition.

Likewise, I concur that the March 25, 2015 Decision of this Court’s Third Division in Taiwan Kolin Corp. Ltd. v. Kolin Electronics Co., Inc.^[4] (Taiwan Kolin) is not res judicata to this case.^[5] Kolin Philippines International, Inc.’s status as an affiliate^[6] company of Taiwan Kolin Corp. Ltd., which owns Registration No. 4-1996-106310 for the mark “KOLIN” in Class 9 is immaterial.^[7] Taiwan Kolin
should not serve as a bar to Kolin Electronics Co. Inc. opposing
applications for, or seeking the cancellation of, any other mark which
may damage it or diminish its rights to Registration No. 4-1993-078497.
There is nothing in Taiwan Kolin that stipulated Taiwan Kolin
Corp. Ltd.’s Registration No. 4-1996-106310’s absolute dominion over any
and all marks for “KOLIN” in Class 9, to the exclusion of Kolin
Electronics Co. Inc.’s subsisting Registration No. 4-1993-078497. To
otherwise bar Kolin Electronics Co. Inc. from doing so is to diminish
its rights under Section 147.1 of the Intellectual Property Code,
resulting from its valid registration.^[8]

However, with all due respect, I disagree with the ponencia‘s
ruling on the longstanding issue of how likelihood of confusion is
determined in trade and service marks based on our jurisprudence in
relation to the Intellectual Property Code.

Entrenched in Article 8 of the Civil Code,^[9] the principle of stare decisis et non quieta movere requires our courts to follow rules established in this Court’s final decisions:

The principle of stare decisis enjoins adherence to
judicial precedents. It requires courts in a country to follow the rule
established in a decision of its Supreme Court. That decision becomes a
judicial precedent to be followed in subsequent cases by all courts in
the land. The doctrine is based on the principle that once a question of
law has been examined and decided, it should be deemed settled and
closed to further argument.^[10] (Citation omitted)

When this Court has laid down a legal principle applicable to a
particular set of facts, that principle must be applied to all
succeeding cases of similar factual antecedents, regardless of the
identity of the parties or objects under litigation. Predictable
application of judicial precedents ensures certainty in adjudication:

Under the doctrine, when the Supreme Court has once laid
down a principle of law as applicable to a certain state of facts, it
will adhere to that principle, and apply it to all future cases, where
facts are substantially the same; regardless of whether the parties and
property are the same. The doctrine of stare decisis is based upon the legal principle or rule involved and not upon the judgment which results therefrom. In this particular sense stare decisis differs from res judicata which is based upon the judgment.

The doctrine of stare decisis is one of policy grounded on the necessity for securing certainty and stability of judicial decisions, thus:

Time and again, the Court has held that it is a very
desirable and necessary judicial practice that when a court has laid
down a principle of law as applicable to a certain state of facts, it
will adhere to that principle and apply it to all future cases in which
the facts are substantially the same. Stare decisis et non quieta
movere. Stand by the decisions and disturb not what is settled. Stare
decisis simply means that for the sake of certainty, a conclusion
reached in one case should be applied to those that follow if the facts
are substantially the same, even though the parties may be different. It
proceeds from the first principle of justice that, absent any powerful
countervailing considerations, like cases ought to be decided alike.
Thus, where the same questions relating to the same event have been put
forward by the parties similarly situated as in a previous case
litigated and decided by a competent court, the rule of stare decisis is a bar to any attempt to relitigate the same issue.^[11] (Citations omitted, emphasis in the original)

Because of this, whenever possible, potentially conflicting doctrines
laid down by this Court are harmonized, read together, subjected to
exceptions, or distinguished, rather than outright abandoned.^[12]

Nonetheless, the salutary goal of consistency must not amount to stubbornly perpetuating errors. In Philippine Trust Company v. Mitchell:^[13]

Is the court with new membership compelled to follow blindly the doctrine of the Velasco case? The rule of stare decisis
is entitled to respect. Stability in the law, particularly in the
business field, is desirable. But idolatrous reverence for precedent,
simply as precedent, no longer rules. More important than anything else
is that the court should be right. And particularly is it not wise to
subordinate legal reason to case law and by so doing perpetuate error
when it is brought to mind that the views now expressed conform in
principle to the original decision and that since the first decision to
the contrary was sent forth there has existed a respectable opinion of
non-conformity in the court. Indeed, on at least one occasion has the
court broken away from the revamped doctrine, while even in the last
case in point the court was as evenly divided as it was possible to be
and still reach a decision.^[14]

The abandonment of established doctrines becomes necessary when motivated by strong and compelling reasons^[15] based on changes in law or public policy, evolving conditions, or the most pressing considerations of justice.

In Villaflor v. Summers,^[16] this Court refused to follow United States cases in deciding the extent of the right to self-incrimination in this country:

So much for the authorities. For the nonce we would prefer
to forget them entirely, and here in the Philippines, being in the
agreeable state of breaking new ground, would rather desire our decision
to rest on a strong foundation of reason and justice than on a weak one
of blind adherence to tradition and precedent. Moreover, we believe
that an unbiased consideration of the history of the constitutional
provision will disclose that our conclusion is in exact accord with the
causes which led to its adoption.^[17]

In Tan Chong v. Secretary of Labor,^[18]
this Court overturned prior cases that bestowed citizenship based on
jus soli because their application would violate the law which was then
in force:

The principle of stare decisis does not mean blind
adherence to precedents. The doctrine or rule laid down, which has been
followed for years, no matter how sound it may be, if found to be
contrary to law, must be abandoned. The principle of stare decisis
does not and should not apply when there is conflict between the
precedent and the law. The duty of this Court is to forsake and abandon
any doctrine or rule found to be in violation of the law in force.

….

Considering that the common law principle or rule of jus soli
obtaining in England and in the United States, as embodied in the
Fourteenth Amendment to the Constitution of the United States, has never
been extended to this jurisdiction (section 1, Act of 1 July 1902; sec.
5, Act of 29 August 1916); considering that the law in force and
applicable to the petitioner and the applicant in the two cases at the
time of their birth is sec. 4 of the Philippine Bill (Act of 1 July
1902), as amended by Act of 23 March 1912, which provides that only
those “inhabitants of the Philippine Islands continuing to reside
therein who were Spanish subjects on the 11th day of April, 1899; and
then resided in said Islands, and their children born subsequent
thereto, shall be deemed and held to be citizens of the Philippine
Islands,” we are of the opinion and so hold that the petitioner in the
first case and the applicant in the second case, who were born of alien
parentage, were not and are not, under said section, citizens of the
Philippine Islands.^[19]

In Urbano v. Chavez,^[20]
this Court abandoned a series of cases that had previously authorized
the Office of the Solicitor General to represent a public official at
any stage of a criminal case. It did so by finding anomalous the
consequences of this authority:

However, under the doctrine announced in Anti-Graft League of the Philippines, Inc. and Garrido,
the Office of the Solicitor General is authorized to enter its
appearance as counsel for any public official, against whom a criminal
charge had been instituted, during the preliminary investigation stage
thereof. Nevertheless, in the same case, this Court held that once an
information is filed against the public official, the Office of the
Solicitor General can no longer represent the said official in the
litigation. The anomaly in this paradigm becomes obvious when, in the
event of a judgment of conviction, the case is brought on appeal to the
appellate courts. The Office of the Solicitor General, as the appellate
counsel of the People of the Philippines, is expected to take a stand
against the accused. More often than not, it does. Accordingly, there is
a clear conflict of interest here, and one which smacks of ethical
considerations, where the Office of the Solicitor General, as counsel
for the public official, defends the latter in the preliminary
investigation stage of the criminal case, and where the same office, as
appellate counsel of the People of the Philippines, represents the
prosecution when the case is brought on appeal. This anomalous situation
could not have been contemplated and allowed by the law, its
unconditional terms and provisions notwithstanding. It is a situation
which cannot be countenanced by the Court.

Otherwise, if the Solicitor General who represents the state on appeal
in criminal cases can appear for the accused public official in a
preliminary investigation, then by the same token a provincial or city
fiscal, his assistant or any government prosecutor who represents the
People of the Philippines at the preliminary investigation of a case up
to the trial thereof can appear for an accused public official at the
preliminary investigation being conducted by another fiscal, prosecutor
or municipal judge. The situation would simply be scandalous, to say the
least.

There is likewise another reason, as earlier discussed, why the Office
of the Solicitor General cmmot represent an accused in a criminal case.
Inasmuch as the State can speak and act only by law, whatever it does
say and do must be lawful, and that which is unlawful is not the word or
deed of the State, but is the mere wrong or trespass of those
individual persons who falsely speak and act in its name. Therefore, the
accused public official should not expect the State, through the Office
of the Solicitor General, to defend him for a wrongful act which cannot
be attributed to the State itself. In the same light, a public official
who is sued in a criminal case is actually sued in his personal
capacity inasmuch as his principal, the State, can never be the author
of a wrongful act, much less commit a crime.

Thus, the Court rules that the Office of the Solicitor General is not
authorized to represent a public official at any stage of a criminal
case. For this reason, the doctrine announced in Anti-Grafl League of the Philippines, Inc. v. Hon. Ortega and Solicitor General v. Garrido,
and all decided cases affirming the same; in so far as they are
inconsistent with this pronouncement, should be deemed abandoned. The
principle of stare decisis notwithstanding, it is well-settled
that a doctrine which should be abandoned or modified should be
abandoned or modified accordingly. After all, more important than
anything else is that this Court should be right.^[21] (Citation omitted)

Thirty years after the promulgation of Gerona v. Secretary of Education,^[22] this Court overturned the compulsory nature of school flag salutes in Ebralinag v. The Division of Superintendent of Schools of Cebu^[23] as a recognition of the fundamental right to religious freedom:

Our task here is extremely difficult, for the 30-year-old
decision of this Court in Gerona upholding the flag salute law and
approving the expulsion of students who refuse to obey it, is not
lightly to be trifled with.

It is somewhat ironic however, that after the Gerona ruling had received
legislative cachet by its incorporation in the Administrative Code of
1987, the present Court believes that the time has come to reexamine it.
The idea that one may be compelled to salute the flag, sing the
national anthem, and recite the patriotic pledge, during a flag ceremony
on pain of being dismissed from one’s job or of being expelled from
school, is alien to the conscience of the present generation of
Filipinos who cut their teeth on the Bill of Rights which guarantees
their rights to free speech ** and the free exercise of religious
profession and worship[.]^[24]

Likewise, this Court in Ebralinag also found that the dire situations feared in Gerona did not actually occur:

The situation that the Court directly predicted in Gerona that:

“[T]he flag ceremony will become a thing of the past or
perhaps conducted with very few participants, and the time will come
when we would have citizens untaught and uninculcated in and not imbued
with reverence for the flag and love of country, admiration for national
heroes, and patriotism – a pathetic, even tragic situation, and all
because a small portion of the school population imposed its will,
demanded and was granted an exemption.”

has not come to pass. We are not persuaded that by exempting the
Jehovah’s Witnesses from saluting the flag, singing the national anthem
and reciting the patriotic pledge, this religious which admittedly
comprises a “small portion of the school population” will shake up our
part of the globe and suddenly produce a nation “untaught and
uninculcated in and unimbued with reverence for the flag, patriotism,
love of country and admiration for national heroes[.]” … After all,
what the petitioners seek only is exemption from the flag ceremony, not
exclusion from the public schools where they may study the Constitution,
the democratic way of life and form of government, and learn not only
the arts, science, Philippine history and culture but also receive
training for a vocation or profession and be taught the virtues of
patriotism, respect for human rights, appreciation for national heroes,
the rights and duties of citizenship, and moral and spiritual values…
as part of the curricula. Expelling or banning the petitioners from
Philippine schools will bring about the very situation that this Court
had feared in Gerona. Forcing a small religious group, through the iron
hand of the law, to participate in a ceremony that violates their
religious beliefs, will hardly be conducive to love of country or
respect for duly constituted authorities.^[25] (Citations omitted)

In Bustamante v. National Labor Relations Commission,^[26] this Court reconsidered its continued application of the 1974 case of Mercury Drug Co., Inc. v. Court of Industrial Relations^[27]
on the extent of an illegally dismissed employee’s entitlement to
backwages, because of the passage of a 1989 amendment to the Labor Code
of the Philippines. Thus:

In sum, during the effectivity of P.D. 442, the Court
enforced the Mercury Drug rule and, in effect, qualified the provision
under P.D. No. 442 by limiting the award of backwages to three (3)
years.

On 21 March 1989, Republic Act No. 6715 took effect, amending the Labor Code. Article 279 thereof states in part:

“ART. 279. Security of Tenure. – … An employee who is
unjustly dismissed from work shall be entitled to reinstatement without
loss of seniority rights and other privileges and to his full backwages,
inclusive of allowances, and to his other benefits or their monetary
equivalent computed from the time his compensation is withheld from him
up to the time of his actual reinstatement.”

In accordance with the above provision, an illegally dismissed employee
is entitled to his full backwages from the time his compensation was
withheld from him (which as a rule is from the time of his illegal
dismissal) up to the time of his actual reinstatement. It is true that
this Court had ruled in the case of Pines City Educational Center vs.
NLRC… that “in ascertaining the total amount of backwages payable to
them (employees), we go back to the rule prior to the Mercury Drug rule
that the total amount derived from employment elsewhere by the employee
from the date of dismissal up to the date of reinstatement, if any,
should be deducted therefrom.” The rationale for such ruling was that,
the earnings derived elsewhere by the dismissed employee while
litigating the legality of his dismissal, should be deducted from the
full amount of backwages which the law grants him upon reinstatement, so
as not to unduly or unjustly enrich the employee at the expense of the
employer.

The Court deems it appropriate, however, to reconsider such earlier
ruling on the computation of backwages as enunciated in said Pines City
Educational Center case, by now holding that conformably with the
evident legislative intent as expressed in Rep. Act No. 6715,
above-quoted, backwages to be awarded to an illegally dismissed
employee, should not, as a general rule, be diminished or reduced by the
earnings derived by him elsewhere during the period of his illegal
dismissal. The underlying reason for this ruling is that the employee,
while litigating the legality (illegality) of his dismissal, must still
earn a living to support himself and family, while full backwages have
to be paid by the employer as part of the price or penalty he has to pay
for illegally dismissing his employee. The clear legislative intent of
the amendment in Rep. Act No. 6715 is to give more benefits to workers
than was previously given them under the Mercury Drug rule or the
“deduction of earnings elsewhere” rule. Thus, a closer adherence to the
legislative policy behind Rep. Act No. 6715 points to “full backwages”
as meaning exactly that, i.e., without deducting from backwages the
earnings derived elsewhere by the concerned employee during the period
of his illegal dismissal. In other words, the provision calling for
“full backwages” to illegally dismissed employees is clear, plain and
free from ambiguity and, therefore, must be applied without attempted or
strained interpretation. Index animi sermo est.

Therefore, in accordance with R.A. No. 6715, petitioners are entitled to
their full backwages, inclusive of allowances and other benefits or
their monetary equivalent, from the time their actual compensation was
withheld from them up to the time of their actual reinstatement.^[28] (Citations omitted)

In Carpio Morales v. Court of Appeals (Sixth Division),^[29]
the textual strengthening of the Constitutional principle that public
office is a public trust underpinned this Court’s abandonment of the
condonation doctrine developed in Pascual v. Hon. Provincial Board of Nueva Ecija^[30], Aguinaldo v. Santos,^[31]
and other cases. A stronger legal norm towards the accountability of
public offers made untenable the notion that elections may bestow
absolution for administrative offenses:

Reading the 1987 Constitution together with the above-cited
legal provisions now leads this Court to the conclusion that the
doctrine of condonation is actually bereft of legal bases.

To begin with, the concept of public office is a public trust and the
corollary requirement of accountability to the people at all times, as
mandated under the 1987 Constitution, is plainly inconsistent with the
idea that an elective local official’s administrative liability for a
misconduct committed during a prior term can be wiped off by the fact
that he was elected to a second term of office, or even another elective
post. Election is not a mode of condoning an administrative offense,
and there is simply no constitutional or statutory basis in our
jurisdiction to support the notion that an official elected for a
different term is fully absolved of any administrative liability arising
from an offense done during a prior term. In this jurisdiction,
liability arising from administrative offenses may be condoned by the
President in light of Section 19, Article VII of the 1987 Constitution
which was interpreted in Llamas v. Orbos to apply to administrative
offenses[.]^[32] (Citation omitted)

In reexamining its own doctrines, this Court must actively and
judiciously thread the needle between predictable application of
established rules, and rejection of those same rules when justice
requires. We must base the abandonment of any established doctrine on a
nuanced and expansive review of why that doctrine existed in the first
place, and now, why our continuing reliance on it is fundamentally
untenable.

For a trade or service mark to be registered and its owner entitled to
all rights and protections granted under the Intellectual Property Code,
it must undergo the processes of examination and publication outlined
in the law:

Under the Intellectual Property Code, marks applied for
registration must undergo examination and publication, and the
application may be opposed by any person who believes that they may be
damaged by the registration. Examination, publication, and opposition
are integral to the registration process. By having all marks undergoing
all these steps, the Philippine Intellectual Property Office ensures
the integrity of the Philippine Trademark Database along with the
validity of all registered marks in it, protecting the rights of
existing trade and service mark registrants, as well as other relevant
stakeholders.^[33] (Citations omitted)

Once the application for a mark has been published, it may be opposed by
any person on the basis that they would be damaged by its registration:

SECTION 134. Opposition. – Any person who believes that he would be damaged by the registration of a mark
may, upon payment of the required fee and within thirty (30) days after
the publication referred to in Subsection 133.2, file with the Office
an opposition to the application. Such opposition shall be in writing
and verified by the oppositor or by any person on his behalf who knows
the facts, and shall specify the grounds on which it is based and
include a statement of the facts relied upon. Copies of certificates of
registration of marks registered in other countries or other supporting
documents mentioned in the opposition shall be filed therewith, together
with the translation in English, if not in the English language. For
good cause shown and upon payment of the required surcharge, the time
for filing an opposition may be extended by the Director of Legal
Affairs, who shall notify the applicant of such extension. The
Regulations shall fix the maximum period of time within which to file
the opposition. (Emphasis supplied)

“Any person” had been construed by this Court to include a prior and continuous user of the mark who is deemed its true owner,^[34]
though this Court has recently held that the rule of ownership of a
mark based on prior use is incompatible with the Intellectual Property
Code.^[35]

However, should a mark be registered without opposition, any person who
believes that they have been or will be damaged by its registration may
still file a petition to cancel its registration, under the Intellectual
Property Code:

SECTION 151. Cancellation. – 151.1. A petition to
cancel a registration of a mark under this Act may be filed with the
Bureau of Legal Affairs by any person who believes that he is or will be
damaged by the registration of a mark under this Act as follows:

(a) Within five (5) years from the date of the registration of the mark under this Act.

(b) At any time, if the registered mark becomes the generic name for the
goods or services, or a portion thereof, for which it is registered, or
has been abandoned, or its registration was obtained fraudulently or
contrary to the provisions of this Act, or if the registered mark is
being used by, or with the permission of, the registrant so as to
misrepresent the source of the goods or services on or in connection
with which the mark is used. If the registered mark becomes the generic
name for less than all of the goods and services for which it is
registered, a petition to cancel the registration for only those goods
or services may be filed. A registered mark shall not be deemed to be
the generic name of goods or services solely because such mark is also
used as a name of or to identify a unique product or service. The
primary significance of the registered mark to the relevant public
rather than purchaser motivation shall be the test for determining
whether the registered mark has become the generic name of goods or
services on or in connection with which it has been used.

(c) At any time, if the registered owner of the mark without legitimate
reason fails to use the mark within the Philippines, or cause it to be
used in the Philippines by virtue of a license during an uninterrupted
period of three (3) years or longer.

151.2. Notwithstanding the foregoing provisions, the court of the
administrative agency vested with jurisdiction to hear and adjudicate
any action to enforce the rights to a registered mark shall likewise
exercise jurisdiction to determine whether the registration of said mark
may be cancelled in accordance with this Act. The filing of a suit to
enforce the registered mark with the proper court or agency shall
exclude any other court or agency from assuming jurisdiction over a
subsequently filed petition to cancel the same mark. On the other hand,
the earlier filing of petition to cancel the mark with the Bureau of
Legal Affairs shall not constitute a prejudicial question that must be
resolved before an action to enforce the rights to same registered mark
may be decided.

The remedies of opposition to a trade or service mark application and
cancellation of a registration are distinct from the remedies of
infringement,^[36] unfair competition,^[37] and false designations of origin and false description or representation.^[38] All the same, the remedy of cancellation of registration is available in any action involving a registered mark.^[39]

Generally, the owner of a registered mark has the exclusive right to
prevent unauthorized third parties from using “identical or similar
signs” to their registered mark in “the course of trade,” when the use
would result in a likelihood of confusion:

SECTION 147. Rights Conferred. – 147.1. Except in
cases of importation of drugs and medicines allowed under Section 72.1
of this Act and of off-patent drugs and medicines, the owner of a
registered mark shall have the exclusive right to prevent all third
parties not having the owner’s consent from using in the course of trade
identical or similar signs to those in respect of which the trademark
is registered where such use would result in a likelihood of confusion.
In case of the use of an identical sign for identical goods or services,
a likelihood of confusion shall be presumed.

There shall be no infringement of trademarks or tradenames of imported
or sold patented drugs and medicines allowed under Section 72.1 of this
Act, as well as imported or sold off-patent drugs and medicines; Provided,
That, said drugs and medicines bear the registered marks that have not
been tampered, unlawfully modified, or infringed upon, under Section 155
of this Code.

Taking together Sections 134 and 147 of the Intellectual Property Code,
the owner of a registered mark, if they should so choose, may oppose
another’s application for trade or service mark registration if they
believe that they will be damaged by the other’s registration. Further,
Section 151 allows the owner to petition for the cancellation of the
other mark’s registration on a similar basis. This is founded on the
owner’s exclusive right in Section 147, which means the owner must show
that: first, the third party (in this instance, the applicant or other
registrant) is using an identical or similar sign as the registered
mark; second, the use is in the course of trade; and third, the use
would result in a likelihood of confusion. A presumption of likelihood
of confusion arises when an identical sign is used for identical goods
or services, which the applicant or other registrant must then rebut.

Although intertwined and often inseparable, the two distinct concepts of
a mark as defined in Section 121.1 of the Intellectual Property Code^[40] are (1) a “visible sign”^[41]
by itself and (2) its capability to distinguish an enterprise’s goods
or services. If the distinctions between the two concepts were
irrelevant, then the Intellectual Property Code in Section 147 would not
have needed to stipulate that both the sign, and the goods or services
for which the sign is used must be identical for a presumption of
likelihood of confusion to arise. Likewise, the registrability of a mark
can depend, alternately, on whether it is “identical with”, or
“identical with, or confusingly similar to” another mark.^[42]

Whether the issue concerns marks as visible signs by themselves, or
their capability to distinguish an enterprise’s goods or services, in
trade or service mark applications, registrations, or infringement, one
common element is likelihood of confusion.^[43]

Should the two visible signs at issue be absolutely identical in every
way, the case’s resolution may depend on another factor, such as the
determination of the true owner of the mark.^[44] However, once there are visible differences between the marks, the question then turns to the degree of similarity:

Next, before we consider the resemblances between these two
marks, we should have before us some of the applicable principles which
go to make up the law of trade-marks and unfair competition. Similarity,
as we have said, is the test of infringement of a trade-mark. Moreover,
this is not such similitude as amounts to identity. Exact copies could
hardly be expected to be found. If the form, marks, contents, words, or
other special arrangement or general appearance of the words of the
alleged infringer’s device, are such as would be likely to mislead
persons in the ordinary course of purchasing the genuine article, then
the similarity is such as entitles the injured party to equitable
protection, if he takes seasonable measures to assert his rights and
prevent their continued invasion. The deceptive tendency indicated by
copying or imitating the substantial and distinctive part of the
trade-mark, so as to pass off the goods of one man as those of another,
is sufficient to show infringement. In all cases the court will inspect
the trade-marks to discover both the differences and the resemblances.
Relief will ordinarily be granted when it is manifest from a comparison
of the two trade-marks or articles that one was copied from the other.

….

To quote the language of Lurton, J., “When there are found strong
resemblances, the natural inquiry for the court is, why do they exist?
If no sufficient answer appears, the inference is that they exist for
the purpose of misleading[.]”^[45] (Citations omitted)

To determine the degree of similarity necessary for a finding of
infringement, or entitlement to a denial of application or cancellation
of registration, of a mark, jurisprudence has historically evaluated
them in one of two ways.

As early as 1954, the test of dominancy has been used to determine whether a mark is confusingly similar to another. In Co Tiong Sa v. Director of Patents:^[46]

The first four assignments of error are related to each
other and may be considered together. There is no question that if the
details of the two trademarks are to be considered, many differences
would be noted that would enable a careful and scrutinizing eye to
distinguish one trademark from the other. Thus, we have the vignette of a
man wearing a tophat, which would distinguish the oppositor’s label
from the triangle with the letter on the right hand corner of
applicant’s label. Then we also have the rectangle enclosing the
applicant’s mark, which rectangle is absent in that of the oppositor’s.
But differences of variations in the details of one trademark and of
another are not the legally accepted tests of similarity in trademarks. It
has been consistently held that the question of infringement of a
trademark is to be determined by the test of dominancy. Similarity in
size, form, and color, while relevant, is not conclusive. If the
competing trademark contains the main or essential or dominant features
of another, and confusion and deception is likely to result,
infringement takes place. Duplication or imitation is not necessary; nor
is it necessary that the infringing label should suggest an effort to
imitate…. The question at issue in cases of infringement of
trademarks is whether the use of the marks involved would be likely to
cause confusion or mistake in the mind of the public or to deceive
purchasers[.]

When would a trademark cause confusion in the mind of the public or in
those unwary customers or purchasers? It must be remembered that
infringement of a trademark is a form of unfair competition… and
unfair competition is always a question of fact. The universal test has
been said to be whether the public is likely to be deceived[.]

When a person sees an object, a central or dominant idea or picture
thereof is formed in his mind. This dominant picture or idea is retained
in the mind, and the decorations or details are forgotten. When one
sees the city hall of Baguio, the dominant characteristics which are
likely to be retained in the mind are the portico in the middle of the
building, the tower thereon, the four columns supporting it, and the
wings on both sides. The features that are retained are the peculiar,
dominant features. When one sees the Legislative Building in Manila, the
picture that is retained is that of a majestic low building with
concrete columns all around. In this mindpicture the slight or minor
decorations are lost sight of, and the central figure only is retained.
So is it with a customer or purchaser who sees a label. He retains in
his mind the dominant characteristics or features or central idea in the
label, and does not retain or forgets the attendant decorations,
flourishes, or variations. The ordinary customer does not scrutinize the
details of the label; he forgets or overlooks these, but retains a
general impression, or a central figure, or a dominant characteristic[.]^[47] (Citations omitted, emphasis supplied)

Co Tiong Sa has been reiterated in Lim Hoa v. Director of Patents,^[48] Operators, Inc. v. Director of Patents,^[49] American Wire & Cable Company v. Director of Patents,^[50] Philippine Nut Industry v. Standard Brands Incorporated,^[51] Converse Rubber Corp. v. Universal Rubber Products, Inc.,^[52] and Asia Brewery, Inc. v. Court of Appeals,^[53] among others.

When the Intellectual Property Code took effect in 1998, Section 155^[54] codified the dominancy test.^[55] In ABS-CBN Publishing, Inc. v. The Director of the Bureau of Trademarks:^[56]

To determine whether a mark is to be considered as
“identical” or that which is confusingly similar with that of another,
the Court has developed two (2) tests: the dominancy and holistic tests.
While the Court has time and again ruled that the application of the
tests is on a case to case basis, upon the passage of the IPC, the trend
has been to veer away from the usage of the holistic test and to focus
more on the usage of the dominancy test. As stated by the Court in the
case of McDonald’s Corporation vs. L.C. Big Mak Burger, Inc., the
“test of dominancy is now explicitly incorporated into law in Section
155.1 of the Intellectual Property Code which defines infringement as
the ‘colorable imitation of a registered mark x x x or a dominant
feature thereof.'” This is rightly so because Sec. 155.1 provides that:

SECTION 155. Remedies; Infringement. – Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable
imitation of a registered mark or the same container or a dominant
feature thereof in connection with the sale, offering for sale,
distribution, advertising of any goods or services including other
preparatory steps necessary to carry out the sale of any goods or
services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or x x x.

In using this test, focus is to be given to the dominant features of the marks in question. In the 1954 case of Co Tiong Sa vs. Director of Patents, the Court, in using the dominancy test, taught that:

But differences of variations in the details of one trademark and of
another are not the legally accepted tests of similarity in trademarks.
It has been consistently held that the question of infringement of a
trademark is to be determined by the test of dominancy. Similarity in
size, form, and color, while relevant, is not conclusive. If the
competing trademark contains the main or essential or dominant features
of another, and confusion and deception is likely to result,
infringement takes place.

The Court, in Skechers, U.S.A., Inc. vs. Inter Pacific Industrial Trading Corp., and in once again using the dominancy test, reiterated Del Monte Corporation vs. Court of Appeals
in saying that “the defendants in cases of infringement do not normally
copy but only make colorable changes.” The Court emphasized that “the
most successful form of copying is to employ enough points of similarity
to confuse the public, with enough points of difference to confuse the
courts.”^[57] (Citations omitted)

Yet, decades before the Intellectual Property Code gave imprimatur to
the dominancy test, this Court had already set in place another test to
determine trademark similarity.

In the 1963 case of Mead Johnson & Company v. N.V.J. Van Dorp, Ltd.,^[58]
this Court was called upon to determine if the application for the
trademark “ALASKA and pictorial representation of a Boy’s Head within a
rectangular design (ALASKA disclaimed)”^[59]
should be denied due to a previously-registered and allegedly-similar
“ALACTA” mark. There, this Court found that the appearances of the
“ALASKA” and “ALACTA” marks were dissimilar as to allow “ALASKA”‘s
registration, because it examined not only the “predominant words” but
also the “other features” in both marks:^[60]

On the other hand, respondent contends that it is not
correct to say that in passing on the question as to whether the two
marks are similar only the words “ALASKA” and “ALACTA” should be taken
into account since this would be a most arbitrary way of ascertaining
whether similarity exists between two marks. Rather, respondent
contends, the two marks in their entirety and the goods they cover
should be considered and carefully compared to determine whether
petitioner’s opposition to the registration is capricious or well-taken.
In this connection, respondent invokes the following rules of
interpretation: (1) appellant’s mark is to be compared with all of the
oppositor’s marks in determining the point of confusion; (2) the
likelihood of confusion may be determined by a comparison of the marks
involved and a consideration of the goods to which they are attached;
and (3) the court will view the marks with respect to the goods to which
they are applied, and from its own observation arrive at a conclusion
as to the likelihood of confusion.

It is true that between petitioner’s trademark “ALACTA” and respondent’s
“ALASKA” there are similarities in spelling, appearance and sound for
both are composed of six letters of three syllables each and each
syllable has the same vowel, but in determining if they are confusingly
similar a comparison of said words is not the only determining factor.
The two marks in their entirety as they appear in the respective labels
must also be considered in relation to the goods to which they are
attached. The discerning eye of the observer must focus not only on the
predominant words but also on the other features appearing in both
labels in order that he may draw his conclusion whether one is
confusingly similar to the other. Having this view in mind, we believe
that while there are similarities in the two marks there are also
differences or dissimilarities which are glaring and striking to the eye
as the former. Thus we find the following dissimilarities in the two
marks:

(a) The sizes of the containers of the goods of petitioner differ from
those of respondent. The goods of petitioner come in one-pound container
while those of respondent come in three sizes, to wit: 14-ounce tin of
full condensed full cream milk; 14 1/2-ounce tin of evaporated milk; and
6- ounce tin of evaporated milk.

(b) The colors too differ. One of petitioner’s containers has one single
background color, to wit: light blue; the other has two background
colors, pink and white. The containers of respondent’s goods have two
color bands, yellowish white and red.

(c) Petitioner’s mark “ALACTA” has only the first letter capitalized and
is written in black. Respondent’s mark “ALASKA” has all the letters
capitalized written in white except that of the condensed full cream
milk which is in red.^[61] (Citations omitted)

Mead Johnson & Company was then cited by this Court in Bristol Myers Company v. Director of Patents^[62] in finding that the marks “BIOFERIN” and “BUFFERIN” were dissimilar, and in turn, Bristol Myers was cited in Fruit of the Loom, Inc. v. Court of Appeals^[63]
in this Court’s conclusion of dissimilarity between the marks “FRUIT OF
THE LOOM” and “FRUIT FOR EVE.” This test for similarity was further
developed in Del Monte Corporation v. Court of Appeals,^[64] with the term “holistic test” coined in Emerald Garment Manufacturing Corp. v. Court of Appeals.^[65]

The holistic test has been used in American Cyanamid Company v. The Director of Patents,^[66] Ethepa A.G. v. Director of Patents,^[67] Diaz v. People of the Philippines,^[68] and Philip Morris, Inc. v. Fortune Tobacco Corp.^[69] The holistic test was even used alongside the dominancy test to support a particular finding, in Amigo Manufacturing, Inc. v. Cluett Peabody Co.,^[70] Coffee Partners, Inc. v. San Francisco Coffee & Roastery, Inc.,^[71] Dy v. Koninklijke Philips Electronics, N.V.,^[72] Berris Agricultural Co., Inc. v. Abyadang,^[73] San Miguel Purefoods Company, Inc. v. Foodsphere, Inc.,^[74] and Mighty Corp. E. & J. Gallo Winery.^[75]

This Court has criticized the holistic test for being contrary to the ethos of the law of trademarks and unfair competition. In Societe Des Produits Nestle, S.A. v. Court of Appeals:^[76]

Moreover, the totality or holistic test is contrary to the
elementary postulate of the law on trademarks and unfair competition
that confusing similarity is to be determined on the basis of visual,
aural, connotative comparisons and overall impressions engendered by the
marks in controversy as they are encountered in the realities of the
marketplace. The totality or holistic test only relies on visual
comparison between two trademarks whereas the dominancy test relies not
only on the visual but also on the aural and connotative comparisons and
overall impressions between the two trademarks.^[77] (Citation omitted)

This criticism has been echoed more recently, in Somboonsakdikul v. Orlane S.A.:^[78]

The CA’s use of the dominancy test is in accord with our more recent ruling in UFC Philppines, Inc. (now merged with Nutria-Asia, Inc. as the surviving entity) v. Barrio Fiesta Manufacturing Corporation. In UFC Philippines, Inc., we relied on our declarations in McDonald’s
Corporation v. L.C. Big Mak Burger, Inc., Co Tiong Sa v. Director of
Patents, and Societe Des Produits Nestle, S.A. v. Court of Appeals
that the dominancy test is more in line with the basic rule in
trademarks that confusing similarity is determined by the aural, visual
and connotative and overall impressions created by the marks. Thus,
based on the dominancy test, we ruled that there is no confusing
similarity between “PAPA BOY & DEVICE” mark, and “PAPA KETSARAP” and
“PAPA BANANA CATSUP.”^[79] (Citations omitted)

Yet, despite all these pronouncements, this Court did not explicitly abandon the holistic test. Although McDonald’s Corp. v. L.C. Big Mak Burger, Inc.^[80] stated that Societe Des Produits Nestle, S.A. was an explicit rejection of the holistic test, Societe Des Produits Nestle, S.A. was not an en banc case that could have reversed the existing doctrines established in Mead Johnson & Company, and its succeeding cases. An “overwhelming judicial preference”^[81]
for the dominancy test was not an abandonment of the holistic test.
Instead, this Court continued to permit the Intellectual Property Office
and courts to decide for themselves, sans any meaningful criteria, if
they should apply the dominancy test or the holistic test in each case
before them, then use the other test altogether when the case reaches
this Court. This Court’s sole guidance was that “in trademark cases,
jurisprudential precedents should be applied only to a case if they are
specifically in point[,]”^[82] which is abhorrent to ensuring adjudicatory consistency.

This manner of adjudication often led to essentially pro hac vice
rulings, with selective and unpredictable applications of
often-incompatible doctrines, without coherent and consistent precedents
to guide the bench and bar.^[83] As admitted by this Court in Emerald Garment Manufacturing Corp.:^[84]

Practical application, however, of the aforesaid provision
is easier said than done. In the history of trademark cases in the
Philippines, particularly in ascertaining whether one trademark is
confusingly similar to or is a colorable imitation of another, no set rules can be deduced. Each case must be decided on its own merits.^[85] (Emphasis supplied)

Moreover, despite this Court stating that the dominancy and holistic
tests are two different tests, the instances when an application of both
leads to the same conclusion made the choice between the two seemingly
ineffectual.

Taiwan Kolin^[86] used the holistic test, if not by name then by its method of examining the marks in the case:

While both competing marks refer to the word “KOLIN” written
in upper case letters and in bold font, the Court at once notes the
distinct visual and aural differences between them: Kolin Electronics’
mark is italicized and colored black while that of Taiwan Kolin is white
in pantone red color background. The differing features between the
two, though they may appear minimal, are sufficient to distinguish one
brand from the other.^[87]

Based on the existing standards in our cases, this Court in Taiwan Kolin
was not incorrect in using the holistic test and arriving at the
conclusion it reached. As the case itself observed, this Court had in
the past tolerated the co-existence of trademark registrations by two
unrelated entities of identical marks.^[88]

Contrary to the conclusion reached in the ponencia, Taiwan Kolin‘s use of the holistic test was not “improper precedent[,]”^[89]
notwithstanding Section 155 of the Intellectual Property Code. At the
time it was decided, our caselaw on the holistic test was good law. Taiwan Kolin was not some stray case^[90]
or an aberration in our jurisprudence. Neither did it lay down some
novel principle of law that modified or reversed prior doctrines,
because under our Constitution, only this Court en banc^[91] has that power.^[92] Instead, Taiwan Kolin
was a successor, taken to its logical extremes, to an extant line of
trademark cases that had not been expressly abandoned. Even Kensonic, Inc. v. Uni-Line Multi-Resources, Inc., (Phil.),^[93] the sole case that cites Taiwan Kolin prior to the present case, recognized that Taiwan Kolin is in keeping with Mighty Corp. v. E. & J. Gallo Winery:^[94]

Uni-Line posits that its goods under Class 9 were unrelated
to the goods of Kensonic; and that the CA’s holding of the goods being
related by virtue of their belonging to the same class was unacceptable.

In Taiwan Kolin Corporation, Ltd v. Kolin Electronics, Co., Inc.,
the Court has opined that the mere fact that goods belonged to the same
class does not necessarily mean that they are related; and that the
factors listed in Mighty Corporation v. E. & J. Gallo Winery should be taken into consideration, to wit:

As mentioned, the classification of the products under the
NCL is merely part and parcel of the factors to be considered in
ascertaining whether the goods are related. It is not sufficient to
state that the goods involved herein are electronic products under Class
9 in order to establish relatedness between the goods, for this only
accounts for one of many considerations enumerated in Mighty
Corporation. x x x

Clearly then, it was erroneous for respondent to assume over the CA to
conclude that all electronic products are related and that the coverage
of one electronic product necessarily precludes the registration of a
similar mark over another. In this digital age wherein electronic
products have not only diversified by leaps and bounds, and are geared
towards interoperability, it is difficult to assert readily, as
respondent simplistically did, that all devices that require plugging
into sockets are necessarily related goods.

It bears to stress at this point that the list of products included in
Class 9 can be sub-categorized into five (5) classifications, namely:
(1) apparatus and instruments for scientific or research purposes, (2)
information technology and audiovisual equipment, (3) apparatus and
devices for controlling the distribution and use of electricity, (4)
optical apparatus and instruments, and (5) safety equipment. From this
sub-classification, it becomes apparent that petitioner’s products,
i.e., televisions and DVD players, belong to audiovisual equipment,
while that of respondent, consisting of automatic voltage regulator,
converter, recharger stereo booster, AC-DC regulated power supply,
step-down transformer, and PA amplified AC-DC, generally fall under
devices for controlling the distribution and use of electricity.

Based on the foregoing pronouncement in Taiwan Kolin Corporation, Ltd. v. Kolin Electronics, Co., Inc.,
there are other subclassifications present even if the goods are
classified under Class 09. For one, Kensonic’s goods belonged to the
information technology and audiovisual equipment sub-class, but
Uni-Line’s goods pertained to the apparatus and devices for controlling
the distribution of electricity subclass. Also, the Class 09 goods of
Kensonic were final products but UniLine’s Class 09 products were spare
parts. In view of these distinctions, the Court agrees with Uni-Line
that its Class 09 goods were umelated to the Class 09 goods of Kensonic.^[95]

While the ponencia has laudably sought to bring jurisprudential
stability through the unequivocal abandonment of the holistic test, I
urge this Court to also seriously refine the existing standards for
determining the likelihood of confusion of goods and business.^[96] Admittedly, likelihood of confusion is highly fact-specific based on the circumstances of each case.^[97]
Yet, considering the advances in the fields of competition and
economics, this Court should improve the standards by which likelihood
of confusion is measured.^[98]

Evaluations of likelihood of confusion cannot be left to the subjective
determination by the Intellectual Property Office or the courts, which
may often rely on ad hoc inferences of similarity in class,
physical attributes or descriptive properties, purpose, or points of
sale of the goods or services.^[99] Often, this Court has resorted to unsubstantiated assumptions and generalizations about consumers and their behavior,^[100] arbitrary categorizations of goods and services,^[101] and even outright derogatory classist stereotypes.^[102] In this case, the ponencia
describes a distinction between “sophisticated” and “ordinary” buyers
without any real basis for the respective consumption and commercial
habits assigned to each sector, resulting in broad caricatures about
both the goods covered by the marks and their markets.^[103]

Relativity in likelihood of confusion must g1ve way to objective, scientific, and economic standards:

There should be objective, scientific, and economic
standards to determine whether goods or services offered by two parties
are so related that there is a likelihood of confusion. In a market, the
relatedness of goods or services may be determined by consumer
preferences. When two goods are proved to be perfect substitutes, where
the marginal rate of substitution, or the “consumer’s willingness to
substitute one good for another while maintaining the same level of
satisfaction” is constant, then it may be concluded that the goods are
related for the purposes of determining likelihood of confusion. Even
goods or services, which superficially appear unrelated, may be proved
related if evidence is presented showing that these have significant
cross-elasticity of demand, such that changes of price in one party’s
goods or services change the price of the other party’s goods and
services. Should it be proved that goods or services belong to the same
relevant market, they may be found related even if their classes,
physical attributes, or purposes are different.^[104] (Citations omitted)

This Court should build on past jurisprudence that squarely confront claims of economic or market losses, such as Shell Company of the Philippines, Ltd. v. Insular Petroleum Refining Co., Ltd.:^[105]

It was found by the Court of Appeals that in all
transactions of the low-grade Insoil, except the present one, all the
marks and brands on the containers used were erased or obliterated. The
drum in question did not reach the buying public. It was merely a Shell
dealer or an operator of a Shell Station who purchased the drum not to
be resold to the public, but to be sold to the petitioner company, with a
view of obtaining evidence against someone who might have been
committing unfair business practices, for the dealer had found that his
income was dwindling in his gasoline station. Uichangco, the Shell
dealer, testified that Lozano (respondent’s agent) did not at all make
any representation that he (Lozano) was selling any oil other than
Insoil motor oil, a fact which finds corroboration in the receipt issued
for the sale of the drum. Uichangco was apprised beforehand that Lozano
would sell Insoil oil in a Shell drum. There was no evidence that
defendants or its agents attempted to persuade Uichangco or any Shell
dealer, for that matter, to purchase its low-grade oil and to pass the
same to the public as Shell oil. It was shown that Shell and other oil
companies, deliver oil to oil dealers or gasoline stations in drums,
these dealers transfer the contents of
the drums to retailing dispensers known as “tall boys,” from which the
oil is retailed to the public by liters.

This Court is not unaware of the decisions cited by petitioner to
bolster its contention. We find those cases, however, not applicable to
the one at bar. Those cases were predicated on facts and circumstances
different from those of the present. In one case, the trade name of
plaintiff was stamped on the goods of defendant and they were being
passed as those of the plaintiff. This circumstance does not obtain
here. From these cases, one feature common to all comes out in bold
relief and that is, the competing product involving the offending
bottles, wrappers, packages or marks reached the hands of the ultimate
consumer, so bottled, wrapped, packaged or marked. In other words, it is
the form in which the wares or products come to the ultimate consumer
that was significant; for, as has been well said, the law of unfair
competition does not protect purchasers against falsehood which the
tradesmen may tell; the falsehood must be told by the article itself in
order to make the law of unfair competition applicable.

Petitioner contends that there had been a marked decrease in the volume
of sales of low-grade oil of the company, for which reason it argues
that the sale of respondent’s low-grade oil in Shell containers was the
cause. We are reluctant to share the logic of the argument. We are more
inclined to believe that several factors contributed to the decrease of
such sales. But let us assume, for purposes of argument, that the
presence of respondent’s low-grade oil in the market contributed to such
decrease. May such eventuality make respondent liable for unfair
competition? There is no prohibition for respondent to sell its goods,
even in places where the goods of petitioner had long been sold or
extensively advertised. Respondent should not be blamed if some of
petitioner’s dealers buy Insoil oil, as long as respondent does not
deceive said dealers. If petitioner’s dealers pass off Insoil oil as
Shell oil, that is their responsibility. If there was any such effort to
deceive the public, the dealers to whom the defendant (respondent) sold
its products and not the latter, were legally responsible for such
deception. The passing of said oil, therefore, as product of Shell was
not performed by the respondent or its agent, but petitioner’s dealers,
which act respondent had no control whatsoever. And this could easily be
done, for, as respondents’ counsel put it –

“The point we would like to drive home is that if a Shell
dealer wants to fool the public by passing off INSOIL as SHELL oil he
could do this by the simple expedient of placing the INSOIL oil or any
other oil for that matter in the ‘tall boys’ and dispense it to the
public as SHELL oil. Whatever container INSOIL uses would be of no
moment … absence of a clear showing that INSOIL and the SHELL dealer
connived or conspired, we respectfully maintain that the responsibility
of INSOIL ceases from the moment its oil, if ever it has ever been done,
is transferred by a shell dealer to a SHELL ‘tall boy!^‘”^[106]

Rule 18, Section 5 of A.M. No. 10-3-10-SC, or the 2020 Revised Rules of
Procedure for Intellectual Property Rights Cases, enumerates several
factors to be considered as evidence of likelihood of confusion in
trademark and unfair competition cases:

SECTION 5. Likelihood of confusion in other cases. –
In determining whether one trademark is confusingly similar to or is a
colorable imitation of another, the court must consider the general
impression of the ordinary purchaser, buying under the normally
prevalent conditions in trade, and giving the attention such purchasers
usually give in buying that class of goods. Visual, aural, connotative
comparisons and overall impressions engendered by the marks in
controversy as they are encountered in the realities of the marketplace
must be taken into account. Where there are both similarities and
differences in the marks, these must be weighed against one another to
determine which predominates.

In determining likelihood of confusion between marks used on
nonidentical goods or services, several factors may be taken into
account, such as, but not limited to:

a) the strength of plaintiffs mark;

b) the degree of similarity between the plaintiffs and the defendant’s marks;

c) the proximity of the products or services;

d) the likelihood that the plaintiff will bridge the gap;

e) evidence of actual confusion;

f) the defendant’s good faith in adopting the mark;

g) the quality of defendant’s product or service; and/or

h) the sophistication of the buyer

“Colorable imitation” denotes such a close or ingenious imitation as to
be calculated to deceive ordinary persons, or such a resemblance to the
original as to deceive an ordinary purchaser giving such attention as a
purchaser usually gives, as to cause him or her to purchase the one
supposing it to be the other.

Absolute certainty of confusion or even actual confusion is not required
to accord protection to trademarks already registered with the IPO.

Among other pieces of evidence, these factors must be proven by
testimonies of witnesses stringently qualified to show their knowledge,
skill, experience, or training on the subject matter of their testimony;^[107]
or by the presentation of scientific surveys, conducted with the
appropriate methodology and with the proper sampling and scope, of the
relevant market or trade conditions, as stated in Rule 18, Section 9 of
the 2020 Revised Rules of Procedure for Intellectual Property Rights
Cases:

SECTION 9. Market Survey. – A market survey is a
scientific market or consumer survey which a party may offer in evidence
to prove (a) the primary significance of a mark to the relevant public,
including its distinctiveness, its descriptive or generic status, its
strength or well-known status and/or (b) likelihood of confusion.

Admittedly, market-based evidence on likelihood of confusion may be more
difficult to obtain if one of the marks is still undergoing the
registration process and has not yet actually been introduced to the
public. However, Section 147 of the Intellectual Property Code may guide
oppositors who assert their ownership of registered marks. If the mark
applied for is found identical to the registered mark and the use is for
identical goods or services, the oppositor has in their favor a
presumption of likelihood of confusion. The applicant then bears the
burden of overcoming the presumption by sufficient evidence.

In other instances-such as similar signs for similar goods or services;
identical signs for similar goods or services; or similar signs for
identical goods or services-the likelihood of confusion must be proved
with evidence by owner of the registered mark. One such instance is the
present case, where the Bureau of Legal Affairs evaluated e-mails from
Kolin Electronics Co. Inc.’s customers asking about Kolin Philippines
International, Inc.’s goods, implying confusion of origin or their
respective items for sale.^[108] As for “any person”^[109]
not an owner of a registered mark, the damage must be proven in other
ways-what that contemplates is outside the scope of this case.

III

As a final note, overreliance on rules and findings of foreign
jurisdictions to resolve domestic intellectual property disputes should
be discouraged. If this Court adopts or applies a foreign agency’s
findings on matters of trademark registration on behalf of the
Philippine Intellectual Property Office, it would unduly encroach upon
the Office’s power to devise its own manual of examination procedure for
trademarks.^[110] Worse,
Article 8 of the Civil Code and the deference accorded by administrative
agencies to judicial decisions may lead to this Court imposing its own
formulation of administrative intellectual property guidelines upon the
Philippine Intellectual Property Office. There is also a danger that
swiftly-moving foreign caselaw may leave this Court futilely struggling
to reconcile overturned cases with later established precedents which
have histories and developments unfamiliar to this jurisdiction.^[111]

Moreover, the social value placed by our Constitution upon private
property-including intellectual property-must be taken into
consideration in ways that foreign rules and rulings perhaps do not. By
uncritically adopting foreign interpretations of intellectual property
concepts, without any substantive anchor or reference to our existing
laws and rules, we may be undermining the very rules and doctrines that
we pass.

Trade and service marks are not intended to unduly restrict free trade,
foster monopolistic practices, or unfairly exclude competitors from the
market.^[112] Thus, the
doctrines and precedents this Court lays down should not be used
to-consciously or unwittingly-interfere with free and fair competition,
under the guise of consumer protection and fraud prevention.^[113]

Like all forms of intellectual property, trade and service marks are not
only objects of private ownership. They also bear a social function
that shall contribute to a common good.^[114]
As such, our disposition of intellectual property cases must not merely
treat them as private commercial constructs, but as legal concepts that
perform holistic public functions,^[115] held to rigorous and exacting standards on which the bench, bar, and the public may safely rely on and trust.

ACCORDINGLY, I vote to GRANT the Petition.

^[1] Draft Decision, pp. 29, 32.

^[2] Id. at 14, citing the Bureau of Legal Affairs Decision.

^[3] INTELLECTUAL PROPERTY CODE, sec. 134.

^[4] G.R. No. 209843, March 25, 2015, [Per J. Velasco, Jr., Third Division].

^[5] Draft Decision, pp. 17-23.

^[6] Id. at 17, citing the Court of Appeals Decision.

^[7] Id. at 18.

^[8] INTELLECTUAL PROPERTY CODE, sec. 122 provides:

SECTION 122. How Marks are Acquired. – The rights in a mark shall be
acquired through registration made validly in accordance with the
provisions of this law.

^[9] CIVIL CODE, art. 8 provides:

Art. 8. Judicial decisions applying or interpreting the laws or the
Constitution shall form part of the legal system of the Philippines.

^[10] Government Service Insurance System v. Buenviaje-Carreon, 692 Phil. 399, 405 (2012) [Per J. Perez, En Banc].

^[11] Department of Transportation and Communications v. Cruz, 581 Phil. 602, 610-611 (2008) [Per J. Austra-Martinez, En Banc].

^[12] People v. Lee, Jr., G.R. No. 234618, September 19, 2019, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/65713> [Per J. Peralta, Third Division]; Guy v. Ignacio, 636 Phil. 689 (2010) [Per J. Peralta, Second Division]; People v. Hon. Garfin, 470 Phil. 211 (2004) [Per J. Puno, Second Division]; Alfonso v. Land Bank of the Philippines, 801 Phil. 217 (2016) [Per J. Jardeleza, En Banc]; People v. Obsania, 132 Phil. 682 (1968) [Per J. Castro, En Banc]; Zuneca Pharmaceutical v. Natrapharm, Inc., G.R. No. 211850, September 8, 2020, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/66500> [Per J. Caguioa, En Banc].

^[13] 59 Phil. 30 (1933) [Per J. Malcolm, Second Division].

^[14] Id. at 36.

^[15] Quintanar v. Coca-Cola Bottlers, Philippines, Inc., G.R. No. 210565, June 28, 2016, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/l/62078> [Per J. Mendoza, En Banc], citing Pepsi-Cola Products Philippines, Incorporated v. Pagdanganan, 535 Phil. 540-555 (2006) [Per J. Chico-Nazario, First Division].

^[16] 41 Phil. 62 (1920) [Per J. Malcolm, En Banc].

^[17] Id. at 68.

^[18] 79 Phil. 249 (1947) [Per J. Padilla, First Division].

^[19] Id. at 257-258.

^[20] 262 Phil. 374 (1990) [Per J. Gancayco, En Banc].

^[21] Id. at 383-385.

^[22] 106 Phil. 2 (1959) [Per J. Montemayor, En Banc].

^[23] G.R. No. 95770, March 1, 1993 [Per J. Griño-Aquino, En Banc].

^[24] Id.

^[25] Id.

^[26] 332 Phil. 833 (1996) [Per J. Padilla, En Banc].

^[27] 155 Phil. 636 (1974) [Per J. Makasiar, En Banc].

^[28] Id. at 841-843.

^[29] 772 Phil. 672 (2015) [Per J. Perlas-Bernabe, En Banc].

^[30] 106 Phil. 466 (1959) [Per J. Gutierrez-David, En Banc].

^[31] 287 Phil. 851 (1992) [Per J. Nocon, En Banc].

^[32] Carpio Morales v. Court of Appeals, 772 Phil. 672, 769-770 (2015) [Per J. Perlas-Bernabe, En Banc].

^[33] J. Leonen, Dissenting Opinion, Prosel Pharmaceuticals v. Tynor Drug House, G.R. No. 248021, September 30, 2020 [Per J. Carandang, Third Division].

^[34] E.Y. Industrial Sales, Inc. v. Shen Dar Electricity and Machinery Co. Ltd., 648 Phil. 572 (2010) [Per J. Velasco, Jr., First Division].

^[35] Zuneca Pharmaceutical v. Natrapharm, Inc., G.R. No. 211850, September 8, 2020, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/66500> [Per J. Caguioa, En Banc].

^[36] INTELLECTUAL PROPERTY CODE, secs. 155-156.

^[37] INTELLECTUAL PROPERTY CODE, sec. 168.

^[38] INTELLECTUAL PROPERTY CODE, sec. 169.

^[39] Intellectual Property Code, sec. 161 provides:

SECTION 161. Authority to Determine Right to Registration. – In any action involving a registered mark,
the court may determine the right to registration, order the
cancellation of a registration, in whole or in part, and otherwise
rectify the register with respect to the registration of any party to
the action in the exercise of this. Judgment and orders shall be
certified by the court to the Director, who shall make appropriate entry
upon the records of the Bureau, and shall be controlled thereby.
(Emphasis supplied)

^[40] INTELLECTUAL PROPERTY CODE, Sec. 121.1 states:

SECTION 121. Definitions. – As used in Part III, the following terms have the following meanings:

121.1. “Mark” means any visible sign capable of distinguishing the goods
(trademark) or services (service mark) of an enterprise and shall
include a stamped or marked container of goods[.]

^[41] A “visible sign” encompasses any word, name, symbol, emblem, sign, device, drawing, or figure (Arce Sons and Company v. Selecta Biscuit Company, Inc.,
110 Phil. 858, 867-868 (1961) [Per J. Bautista Angelo, En Banc]), so
long as it is otherwise not prohibited by the Intellectual Property Code
from being registrable.

^[42] INTELLECTUAL PROPERTY CODE, sec. 123(d), (e), and (f).

^[43] Footnote 68 of Somboonsakdikul v. Orlane S.A.,
805 Phil. 37-58 (2017) [Per J. Jardeleza, Third Division], which noted:
“… We note that while in Mighty Corporation, likelihood of confusion
was discussed in relation to trademark infringement, the concept is
similarly applicable to an application for trademark registration under
Section 123.1(d). Thus, in Great White Shark Enterprises, Inc. v.
Caralde, Jr., supra note 65, which originated from a trademark
application case, we discussed the dominancy test and holistic test as
modes of determining similarity or likelihood of confusion and
consequently, determining whether a mark is capable of registration
under Section 123.1(d).”

^[44] E.Y. Industrial Sales, Inc. v. Shen Dar Electricity and Machinery Co., Ltd., 648 Phil. 572 (2010) [Per J. Velasco, Jr., First Division].

^[45] Forbes, Munn & Co. (Ltd) v. Ang San To, 40 Phil. 272, 275-277 (1919)[Per J. Malcolm, First Division].

See also Sapolin Co., Inc. v. Balmaceda, 67 Phil. 705
(1939) [Per J. Diaz, En Banc], which pointed out that an exact copy need
not be proved, only that the “essential characteristics have been
imitated or copied[;]” and “La Insular” Cigar and Cigarette factory, Inc. v. Oge,
42 Phil. 366 [Per J. Street, Second Division], which recognized that if
“colorable imitations, or suggestive reproductions of the trade-mark
which they intend to appropriate” were not considered, the remedies
available to a mark’s owner would be unduly restricted.

^[46] 95 Phil. 1 (1954) [Per J. Labrador, En Banc].

^[47] Id. at 3-5.

^[48] 100 Phil. 214 (1956) [Per J. Montemayor, En Banc].

^[49] 122 Phil. 556 (1965) [Per J. Makalintal, En Banc].

^[50] 142 Phil. 523 (1970) [Per J. Reyes, J.B.L., First Division].

^[51] 160 Phil. 581 (1975) [Per J. Muñoz Palma, First Division].

^[52] 231 Phil. 149 (1987) [Per J. Fernan, Second Division].

^[53] G.R. No. 103543, July 5, 1993 [Per J. Griño-Aquino, En Banc].

^[54] Intellectual Property Code, sec. 155 states:

SECTION 155. Remedies; Infringement. – Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable
imitation of a registered mark or the same container or a dominant
feature thereof in connection with the sale, offering for sale,
distribution, advertising of any goods or services including other
preparatory steps necessary to carry out the sale of any goods or
services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive; or

155.2. Reproduce, counterfeit, copy or colorably imitate a registered
mark or a dominant feature thereof and apply such reproduction,
counterfeit, copy or colorable imitation to labels, signs, prints,
packages, wrappers, receptacles or advertisements intended to be used in
commerce upon or in connection with the sale, offering for sale,
distribution, or advertising of goods or services on or in connection
with which such use is likely to cause confusion, or to cause mistake,
or to deceive, shall be liable in a civil action for infringement by the
registrant for the remedies hereinafter set forth: Provided, That the
infringement takes place at the moment any of the acts stated in
Subsection 155.1 or this subsection are committed regardless of whether
there is actual sale of goods or services using the infringing material.

^[55] McDonald’s Corp. v. L.C. Big Mak Burger, Inc., 480 Phil. 402 (2004) [Per J. Carpio, First Division]; Dermaline, Inc. v. Myra Pharmaceuticals, Inc., 642 Phil. 503 (2010) [Per J. Nachura, Second Division]; and Societe Des Produits Nestle, S.A. v. Puregold Price Club, 817 Phil. 1030 [Per Acting C.J. Carpio, Second Division].

^[56] G.R. No. 217916, June 20, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/l /64282> [Per J. Reyes, Jr., Second Division].

^[57] Id.

^[58] 117 Phil. 779 (1963) [Per J. Bautista Angelo, En Banc].

^[59] Id. at 780.

^[60] Id. at 783.

^[61] Id. at 782-783.

^[62] 123 Phil. 994 (1966) [Per J. Bengzon, J.P., En Banc].

^[63] 218 Phil. 375 (1984) [Per J. Makasiar, Second Division].

^[64] 260 Phil. 435 (1990) [Per J. Cruz, First Division].

^[65] 321 Phil. 1001, 1002 (1995) [Per J. Kapunan, First Division].

^[66] 167 Phil. 287 (1977) [Per J. Muñoz Palma, First Division].

^[67] 123 Phil. 329 (1966) [Per J. Sanchez, En Banc].

^[68] 704 Phil. 146 (2013) [Per J. Bersamin, First Division].

^[69] 526 Phil. 300 (2006) [Per J. Garcia, Second Division].

^[70] 406 Phil. 905 (2001) [Per J. Panganiban, Third Division].

^[71] 628 Phil. 13 (2010) [Per J. Carpio, Second Division].

^[72] 807 Phil. 819 (2017) [Per C.J. Sereno, First Division].

^[73] 647 Phil. 517 (2010) [Per J. Nachura, Second Division].

^[74] G.R. No. 217781, June 20, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64285> [Per J. Peralta, Second Division].

^[75] 478 Phil. 615 (2004) [Per J. Corona, Third Division].

^[76] 408 Phil. 307 (2001) [Per J. Ynares-Santiago, First Division].

^[77] Id. at 324.

^[78] 805 Phil. 37 (2017) [Per J. Jardeleza, Third Division].

^[79] Id. at 54.

^[80] 480 Phil. 402 (2004) [Per J. Carpio, First Division].

^[81] Mang Inasal Philippines, Inc. v. IFP Manufacturing Corp., 811 Phil. 261, 273 (2017) [Per J. Velasco, Jr., Third Division]. See also ABS-CBN Publishing, Inc. v. Director of the Bureau of Trademarks, G.R. No. 217916, June 20, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64282> [Per J. Reyes, Jr., Second Division].

^[82] McDonald’s Corp. v. Macjoy Fastfood Corp., 543 Phil. 90 (2007) [Per J. Garcia, First Division].

^[83] J. Leonen, Dissenting Opinion, Prosel Pharmaceuticals v. Tynor Drug House, G.R. No. 248021, September 30, 2020 [Per J. Carandang, Third Division].

^[84] 321 Phil. 1001 (1995) [Per J. Kapunan, First Division]. See also Esso Standard Eastern, Inc. v. Court of Appeals, 201 Phil. 803 (1982) [Per J. Teehankee, First Division].

^[85] Id. at 1014.

^[86] G.R. No. 209843, March 25, 2015, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/59645> [Per J. Velasco, Jr., Third Division].

^[87] Id.

^[88] Taiwan Kolin, citing Philippine Refining Co., Inc. v. Ng Sam, 201 Phil. 61 (1982) [Per J. Escolin, Second Division]; Hickok Manufacturing Co., Inc. v. Court of Appeals, 201 Phil. 853 (1982) [Per J. Teehankee, First Division]; Acoje Mining Co., Inc. v. The Director of Patents, 148 Phil. 494 (1971) [Per J. Fernando, En Banc].

^[89] Draft Decision, p. 29.

^[90] This Court has not yet
defined when one of its rulings should be considered a “stray case.” But
this Court has noted that a division case that expressly contradicts a
doctrine established in an en banc case is a stray case. See Lorenzo v. Government Service Insurance System, 718 Phil. 596 (2013) [Per J. Perez, Second Division]; and Quimvel v. People of the Philippjnes, 808 Phil. 889 (2017) [Per J. Velasco, Jr., En Banc].

^[91] Notably, not even Congress may change an interpretation of the Constitution or a law once this Court has made it See, Calderon v. Carale, 284 Phil. 385 (1992) [Per J. Padilla, En Banc].

^[92] CONST. art. 8, sec. 4(3) provides:

SECTION 4….

(3) Cases or matters heard by a division shall be decided or resolved
with the concurrence of a majority of the Members who actually took part
in the deliberations on the issues in the case and voted thereon, and
in no case, without the concurrence of at least three of such Members.
When the required number is not obtained, the case shall be decided en
banc: Provided, that no doctrine or principle of law laid down by the
court in a decision rendered en banc or in division may be modified or
reversed except by the court sitting en banc. (Emphasis supplied)

^[93] G.R. Nos. 211820-21, June 6, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64270> [Per J. Bersamin, Third Division].

^[94] 478 Phil. 615 (2004) [Per J. Corona, Third Division].

^[95] Kensonic, Inc. v. Uni-Line Multi-Resources. Inc., (Phil.) v. Uni-Line Multi-Resources, Inc., G.R. Nos. 211820-21, June 6, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64270> [Per J. Bersamin, Third Division].

^[96] Canon Kabushiki Kaisha v. Court of Appeals, 391 Phil. 154 (2000) [Per J. Gonzaga-Reyes, Third Division].

^[97] Shell Co. of the Philippines, Ltd. v. Ins. Petroleum Refining Co., Ltd and CA, 120 Phil. 434 (1964) [Per J. Paredes, En Banc].

^[98] J. Leonen, Concurring Opinion, Asia Pacific Resources International Holdings, Ltd v. Paperone, Inc.,
G.R. Nos. 213365-66, December 10, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64829> [Per J. Gesmundo, Third Division].

^[99] Id.

^[100] Emerald Garment Manufacturing Corp. v. Court of Appeals,, 321 Phil. 1001 (1995) [Per J. Kapunan, First Division]; Del Monte Corp. v. Court of Appeals, 260 Phil. 435 (1990) [Per J. Cruz, First Division]; Asia Brewery, Inc. v. Court of Appeals, G.R. No. 103543, July 5, 1993 [Per J. Griño-Aquino, En Banc]; Levi Strauss (Phils.), Inc. v. Lim, 593 Phil. 435 (2009) [Per J. Reyes, R.T., Third Division]; and Converse Rubber Corp. v. Jacinto Rubber & Plastics Co., Inc., 186 Phil. 85 (1980) [Per J. Barredo, Second Division].

^[101] Mighty Corp. v. E. & J. Gallo Winery, 478 Phil. 615 (2004) [Per J. Corona, Third Division]; Taiwan Kolin Corp., Ltd v. Kolin Electronics Co. Inc., G.R. No. 209843, March 25, 2015, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/59645> [Per J. Velasco, Jr., Third Division]; and Mang Inasal Philippines, Inc. v. IFP Manufacturing Corp., 811 Phil. 261 (2017) [Per J. Velasco, Jr., Third Division].

^[102] In Lim Hoa v. Director of Patents,
100 Phil. 214 (1956) [Per J. Montemayor, En Banc], this Court stated:
The danger of confusion in trademarks and brands which are similar may
not be so great in the case of commodities or articles of relatively
great value, such as, radio and television sets, air conditioning units,
machinery, etc., for the prospective buyer, generally the head of the
family or a businessman, before making the purchase, reads the pamphlets
and all literature available, describing the article he is planning to
buy, and perhaps even makes comparisons with similar articles in the
market. He is not likely to be deceived by similarity in the trademarks
because he makes a more or less thorough study of the same and may even
consult his friends about the relative merit and performance of the
article or machinery, as compared to others also for sale. But in the
sale of a food seasoning product, a kitchen article of everyday
consumption, the circumstances are far different. Said product is
generally purchased by cooks and household help, sometimes illiterate
who are guided by pictorial representations and the sound of the word
descriptive of said representation. The two roosters appearing in the
trademark of the applicant and the hen appearing on the trademark of the
oppositor, although of different sexes, belong to the same family of
chicken, known as manokin all the principal dialects of the Philippines,
and when a cook or a household help or even a housewife buys a food
seasoning product for the kitchen the brand of “Manok” or “Marca Manok”
would most likely be upper most in her mind and would influence her in
selecting the product, regardless of whether the brand pictures a hen or
a rooster or two roosters. To her, they are all manok. Therein lies the confusion, even deception.

^[103] Draft Decision, p. 39.

^[104] J. Leonen, Concurring Opinion, Asia Pacific Resources International Holdings, Ltd. v. Paperone, Inc., G.R. Nos. 213365-66, December 10, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/64829> [Per J. Gesmundo, Third Division].

^[105] 120 Phil. 434 (1964) [Per J. Paredes, En Banc].

^[106] Id. at 441-443.

^[107] See, e.g., Tortona v. Gregorio, G.R. No. 202612, January 17, 2018, <https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/63831> [Per J. Leonen, Third Division].

^[108] Draft Decision, p. 14.

^[109] Id. at 20. See footnote 95 of the Draft Decision.

^[110] See INTELLECTUAL PROPERTY CODE, Section 5(b) in relation to Section 7(a).

^[111] See this Court’s extended discussion on the applicability of United States cases of Mancuso v. Taft, United States Civil Service Commission v. National Association of Letter Carriers AFL-CIO, 476 F.2d 187 (1973); and Broadrick v. State of Oklahoma in Quinto v. Commission on Elections, 627 Phil. 193 (2010) [Per C.J. Puno, En Banc].

^[112] J. Leonen, Dissenting Opinion, Prosel Pharmaceuticals v. Tynor Drug House, G.R. No. 248021, September 30, 2020 [Per J. Carandang, Third Division].

^[113] Alhambra Cigar and Cigarette Manufacturing Co. v. Mojica, 27 Phil. 266 (1914) [Per J. Moreland, First Division].

^[114] J. Leonen, Dissenting Opjnion, Zuneca Pharmaceutical v. Natrapharm, Inc., G.R. No. 211850, September 8, 2020,

<https://elibrary.judiciary.gov.ph/thebookshelf/showdocs/1/66500> [Per J. Caguioa, En Banc] in relation with CONST., art. 12, sec. 6,
which states:

SECTION 6. The use of property bears a social function, and all economic
agents shall contribute to the common good. Individuals and private
groups, including corporations, cooperatives, and similar collective
organizations, shall have the right to own, establish, and operate
economic enterprises, subject to the duty of the State to promote
distributive justice and to intervene when the common good so demands.

^[115] Id.

SEPARATE CONCURRING OPINION
M. LOPEZ, J.:

The present case involves respondent Kolin Philippines International, Inc.’s (KPII) application for registration of the kolin mark based on Taiwan Kolin Corporation, Ltd.’s (TKC) (KPII’s predecessor in interest) ownership over the

Normal
0

false
false
false

EN-US
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X-NONE

KOLIN mark. Petitioner Kolin Electronics Co. Inc. (KECI) opposed KPII’s application based on its ownership over the

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false
false
false

EN-US
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X-NONE

KOLIN mark.

As discussed in the ponencia, the Court’s Third Division (Third Division) ruled that (image supposed to be here) is not confusingly similar to

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false

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X-NONE

KOLIN in Taiwan Kolin Corporation, Ltd. v. Kolin Electronics Co., Inc. (Taiwan Kolin),^[1] even if the subject of the trademark (TM) application is the

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false
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false

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KOLIN mark. As a result, the

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X-NONE

KOLIN mark was allowed registration. The Third Division also ruled that KECI and TKC’s goods are not related.

I agree with the ponencia that the KOLIN marks are visually,
aurally, and connotatively similar, and the goods that they cover are
related. Additionally, this case provides the Court with the opportunity
to correct the misconception and use of the phrases “same descriptive properties” and “same class of merchandise,”
which have affected the application of the related goods doctrine, and
which may have prejudiced the rights of more than one intellectual
property rights holder. With this, the use of the “same descriptive properties” and “same class of merchandise” as factors in determining the relatedness of goods must be abandoned.

I.
The doctrine of res judicata is not applicable in this case.

The ponencia sufficiently discussed why there is no identity of
causes of action in this case. KECI’s cause of action in the case at bar
is based on its right as the registered TM owner of KOLIN to prevent the registration of TM Application No. 4-2006-010021 covering kolin for use on televisions and DVD players. On the other hand, KECI’s cause of action in Taiwan Kolin is based on its right as the registered TM owner of

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false

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KOLIN to prevent the registration of TM Application No. 4-1996-106310 covering

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false

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X-NONE

KOLIN for use on televisions and DVD players. Clearly, the first concept of res judicata is not applicable.

As regards the second concept of res judicata, the Court explained conclusiveness of judgment in Social Security Commission v. Rizal Poultry and Livestock Association, Inc.,^[2] thus:

But where there is identity of parties in the first and second cases, but no identity of causes of action, the first
judgment is conclusive only as to those matters actually and directly
controverted and determined and not as to matters merely involved
therein. This is the concept of res judicata known as “conclusiveness of judgment.” Stated differently, any
right, fact or matter in issue directly adjudicated or necessarily
involved in the determination of an action before a competent court in
which judgment is rendered on the merits is conclusively settled by the
judgment therein and cannot again be lit gatd between the parties and
their privies, whether or not the claim, demand, purpose, or subject matter of the two actions is the same.

Thus, if a particular point or question is in issue in the second
action, and the judgment will depend on the determination of that
particular point or question, a former judgment between the same parties
or their privies will be final and conclusive in the second if that
same point or question was in issue and adjudicated in the first suit. Identity of cause of action is not required but merely identity of issue.^[3]
(Emphases supplied; citations omitted.)

The issue of actual confusion was raised in Taiwan Kolin, but the
Third Division disregarded the evidence of confusion presented by KECI
and decided only on the issue of confusing similarity in resolving the
issue of ownership of the

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false

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KOLIN mark in favor of TKC. There is no resolution or direct adjudication on whether there is actual confusion.

Here, KECI again raised the issue of actual confusion. Considering that the Third Division did not pass upon this issue in Taiwan Kolin, I believe conclusiveness of judgment is not applicable. For this reason, Taiwan Kolin
may not bar the Court’s determination of actual confusion between the
KOLIN marks. If there is an evidence of actual confusion in the present
case which is not available when Taiwan Kolin was filed, then
there is more reason for the Court to decide on the issue of actual
confusion. Otherwise, the Court will be setting a dangerous precedent
where a registered trademark owner can no longer allege and prove actual
confusion to oppose the registration of another confusingly similar
mark or to cancel the registration of a junior trademark user just
because there has been an initial determination of lack of confusing
similarity. It bears emphasis that actual confusion is different from
confusing similarity. In my opinion, a finding of lack of confusing
similarity cannot preclude the existence of actual confusion later.

II.
The KOLIN marks are visually, aurally, and connotatively identical.

I agree with the ponencia that KPII’s application should not be allowed registration because of KECI’s registration of the

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false

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X-NONE

KOLIN mark. Also, KPII’s kolin mark appropriate the dominant feature of KECI’s trade name, i.e., the word “Kolin.”

Section 123.1(d) of the IP Code prohibits the registration of marks which:

(d)

Is identical with a
registered mark belonging to a different proprietor or a mark with an
earlier filing or priority date, in respect of:

(i)

The same goods or services, or

(ii)

Closely related goods or services, or

(iii)

If it nearly resembles such a mark as to be likely to deceive or cause confusion[.] (Emphases supplied.)

Section 165.2 also considers the use of a party’s trade name or business
name by third parties if such use will likely mislead the public, viz.:

SEC. 165. Trade Names or Business Names. – x x x x

165.2. (a) Notwithstanding any laws or regulations providing for any obligation to register trade names, such names shall be protected, even prior to or without registration, against any unlawful act committed by third parties.

(b) In particular, any subsequent use of the trade name by a third party, whether as a trade name or a mark or collective mark, or any such use of a similar trade name or mark, likely to mislead the public, shall be deemed unlawful. (Emphases supplied.)

To determine likelihood of confusion, Section 4,^[4] Rule 18 of the Rules of Procedure for Intellectual Property Rights (IPR) Cases provides:

SEC. 4. Likelihood of confusion in other cases.
– In determining whether one trademark is confusingly similar to or is a
colorable imitation of another, the court must consider the general
impression of the ordinary purchaser, buying under the normally
prevalent conditions in trade and giving the attention, such purchasers
usually give in buying that class of goods. Visual, aural, connotative comparisons and overall impressions engendered by the marks in controversy as they are encountered in the realities of the marketplace must be taken into account. Where
there are both similarities and differences in the marks, these must be
weighed against one another to see which predominates.

x x x x (Emphasis supplied.)

Applying the foregoing guidelines, a comparison of marks will show that they are visually, aurally, and connotatively identical.

a. Visual Comparison – This case involves the following KOLIN marks:

KECI’s mark

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KOLIN

KPII’s marks

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kolin

From the above comparison, one can readily observe the dominant feature of the marks, i.e.,
the word “Kolin.” Replacing the letter “i” with an italicized letter
“i,” does not outweigh the glaring similarities between the marks.

Relevantly, in Dermaline, Inc. v. Myra Pharmaceuticals, Inc.,^[5]
the Court refused the registration of Dermaline, Inc.’s (image supposed to be here) mark on the ground that it is confusingly similar to Myra
Pharmaceuticals, Inc.’s registered (image supposed to be here) mark. The Court observed
that confusing similarity is still apparent even if the marks are
presented differently since the marks are almost spelled in the same
way.

Here, the marks are also presented differently, but they are spelled in
the same way. Hence, there is more reason to rule that the KOLIN marks
are identical.

Also, KECI’s registered

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KOLIN mark is a plain word mark. Word
marks are marks which have no special characteristics, such as design,
style of lettering, color, diacritical marks, or unusual forms of
punctuations. They are represented in standard characters.^[6]
It protects the word itself without limiting the mark to a particular
font, style, size or color. Standard marks give trademark applicants a
broader protection.^[7] Accordingly, KECI’s registration covers all forms and style of the word “Kolin,” including KPII’s kolin mark.

b. Aural Comparison – In various cases, the aural effects of the
marks were considered in determining confusing similarity. The Court
denied the registration of “LIONPAS” mark because it is confusingly in
sound with the registered “SALONPAS” mark.^[8] In another case, the Court found that “NANNY” and the registered “NAN” mark have the same aural effect.^[9] Likewise, the Court found “Big Mac” and “Big Mak” to be phonetically the same.^[10]

In this case, KPII does not claim that kolin is pronounced differently form KECI’s

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KOLIN mark. Considering that the KOLIN marks are spelled in the same way, it reasonably follows that they are aurally identical.

c. Connotative Comparison – The similarity between two marks may
be caused by a similarity in the concept or meaning of the mark, as
understood by the ordinary consumer.^[11]

KECI’s

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KOLIN mark has no standard meaning. As such, it is
considered as a coined or fanciful mark. A coined or fanciful mark is
inherently distinctive,^[12]
and, therefore, it has a stronger consumer recall. In other words, the
distinctiveness of a mark measures its capacity to indicate the source
of the goods or services on which it is used.^[13]

KECI’s

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KOLIN mark has no standard meaning and an ordinary
consumer will likely associate it with automatic voltage regulators,
converters, rechargers, stereo boosters, amplifiers, power supplies, and
other electrical products. Similarly, KPII’s kolin

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mark has no standard meaning and an ordinary consumer will likely
associate it to televisions, DVD players, and other electrical products.
Considering that an ordinary consumer will likely associate the word
“Kolin” with electrical products, the consumer might mistakenly believe
that all electric products bearing the word “Kolin” emanate from one
company.

Taken together, it is more likely that the public will be confused when
confronted with identical KOLIN marks because the word “Kolin” leaves
the same visual, aural, and commercial impression in the minds of the
public. If KPII’s kolin mark is allowed registration, the distinctiveness of KECI’s

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KOLIN
mark, which is also its trade name, will diminish because the public
will likely associate the word “Kolin” with electronic products produced
by another company which also uses the word “Kolin” as its trade name.^[14]

III.
The goods covered by the KOLIN marks are related goods.

A. Abandonment of “same
descriptive properties” and “same class of merchandise” as factors in
determining the relatedness of goods

Relative to the question of confusion of marks, the Court noted two
types of confusion, namely: (1) confusion of goods; and (2) confusion of
business. Confusion of goods exists when an ordinary prudent purchaser
would be induced to buy a product of a manufacturer under the belief
that it is the product of another manufacturer. On the other hand,
confusion of business exists when the product of a manufacturer,
although different from the other, is such as might reasonably be
assumed to originate from the other or when the public would be deceived
that there is some connection between the two manufacturers even if
such connection does not exist.^[15]
Simply stated, there is confusion of goods when the goods covered by
the subject marks are the same or competing goods. Meanwhile, there is
confusion of business when the goods are so related that the public
would likely assume that they are produced by the same manufacturer or
that there is some connection between the manufacturers.

In Taiwan Kolin, the parties’ goods are different. KECI’s goods
are power supplies and stereo boosters while TKC’s goods are televisions
and DVD players. Thus, there is no confusion of goods. What was left
for the Third Division to decide is whether the goods are so related
that confusion of source or business might occur. Taiwan Kolin cited the following factors enumerated in Mighty Corporation v. E. & J. Gallo Winery^[16] (Mighty Corporation) in determining whether the goods are related:

(a)

the business (and its location) to which the goods belong;

(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 and sold.^[17]

The Third Division continued by discussing the three cases cited in Mighty Corporation.
But then, a scrutiny of the Court’s decisions in these cases only
highlights the fact that the Court did not rely on the descriptive
properties or inherent nature of the subject goods in determining their
relatedness.

Acoje Mining Co. Inc. v. Director of Patents^[18]
– In allowing the registration of the LOTUS mark for use on soy sauce
despite its use on edible oil, the Court dismissed confusing similarity
because of the appearance of the LOTUS mark in their respective labels
and not because soy sauce and oil have different descriptive properties
or physical attributes, thus:

[T]here is no denying that the possibility of confusion
is remote considering the difference in the type used, the coloring, the
petitioner’s trademark being in yellow and red while that of the
Philippine Refining Company being in green and yellow, and the much
smaller size of petitioner’s trademark. When regard is had for
the principle that the two trademarks in their entirety as they appear
in their respective labels should be considered in relation to the goods
advertised before registration could be denied, the conclusion is
inescapable that respondent Director ought to have reached a different
conclusion. Petitioner has successfully made out a case for registration.^[19] (Emphasis supplied; citation omitted.)
Philippine Refining Co., Inc. v. Ng Sam^[20]
– The Court held that ham is not related to lard, butter, cooking oil,
abrasive detergents, polishing materials and soap such that consumers
would not likely mistake one as the source or origin of the product of
the other. Although the Court additionally described the inherent
properties of the products, it all boils down to the question of whether
there is confusion of source. The Court ruled that there will be no
confusion of source in this wise:

The observation and conclusion of the Director of Patents are correct. The
particular goods of the parties are so unrelated that consumers would
not in any probability mistake one as the source or origin of the
product of the other. “Ham” is not a daily food fare for the average
consumer. One purchasing ham would exercise a more cautious inspection
of what he buys on account of its price. Seldom, if ever, is the
purchase of said food product delegated to household helps, except
perhaps to those who, like the cooks, are expected to know their
business. Besides, there can be no likelihood for the consumer of
respondent’s ham to confuse its source as anyone but respondent. The
facsimile of the label attached by him on his product, his business name
“SAM’S HAM AND BACON FACTORY” written in bold white letters against a
reddish orange background, is certain to catch the eye of the class of
consumers to which he caters.

In addition, the goods of petitioners are basically derived from
vegetable oil and animal fats, while the product of respondent is
processed from pig’s legs. A consumer would not reasonably assume that petitioner has so diversified its business as to include the product of respondent.^[21] (Emphases supplied; citation omitted.)
Hickok Manufacturing Co., Inc. v. CA^[22]
– The Court’s primary basis for discounting confusing similarity
between the diverse articles of men’s wear and shoes is the label of the
latter which clearly identifies its source. Again, the Court did not
rely on the descriptive properties factor of the goods involved.

Taking into account the facts of record that petitioner, a
foreign corporation registered the trademark for its diverse articles
of men’s wear such as wallets, belts and men’s briefs which are all
manufactured here in the Philippines by a licensee Quality House, Inc. (which pays a royalty of 1-1/2% of the annual net sales) but are so labelled as to give the misimpression that the said goods are of foreign (stateside) manufacture and that respondent secured its trademark registration exclusively for shoes (which neither petitioner nor the licensee ever manufactured or traded in) and which are clearly labelled in block letters as “Made in Marikina, Rizal, Philippines,”
no error can be attributed to the appellate court in upholding
respondent’s registration of the same trademark for his unrelated and
non-competing product of Marikina shoes.^[23] (Emphasis supplied; citation omitted.)

Taiwan Kolin emphasized that the similarity of the products, and
not their arbitrary classification, must be considered. In the same
breath, it subcategorized the goods in Class 9 to demonstrate the
differences in the goods.

It bears to stress at this point that the list of
products included in Class 9 can be sub-categorized into five (5)
classifications, namely: (1) apparatus and instruments for scientific or
research purposes, (2) information technology and audiovisual
equipment, (3) apparatus and devices for controlling the distribution
and use of electricity, (4) optical apparatus and instruments, and (5)
safety equipment. From this subclassification, it becomes apparent that petitioner’s products, i.e., televisions and DVD players, belong to audiovisual equipment,
while that of respondent, consisting of automatic voltage regulator,
converter, recharger, stereo booster, AC-DC regulated power supply,
step-down transformer, and PA amplified AC-DC, generally fall under
devices for controlling the distribution and use of electricity.^[24] (Emphasis supplied; citations omitted.)

Although Mighty Corporation cited various factors, it appears
that the Third Division mainly considered the absence of similarities in
the descriptive properties and physical attributes of the goods in
concluding that the goods are unrelated by sub-categorizing Class 9. The
goods’ descriptive properties, physical attributes or essential
characteristics with reference to their form, composition, texture or
quality (descriptive properties factor) is one of the factors enumerated in Mighty Corporation; however, it bears stressing that exact similarity, as Taiwan Kolin
suggests, should not be required for the goods to be considered
related. Otherwise, the goods are identical rather than related.

To better understand the descriptive properties factor, the Court’s basis in Mighty Corporation must be discussed. In ESSO Standard Eastern, Inc. v. Court of Appeals,^[25] (Esso Standard) the Court adopted the following factors enumerated by Callman in determining the relatedness of goods (Calllman’s factors):

Goods are related when they belong to the same class or have the same descriptive properties; when they possess the same physical attributes or essential characteristics with reference to their form, composition, texture or quality. They may also be related because they serve the same purpose or are sold in grocery stores.^[26] (Emphasis and underscoring supplied; citation omitted.)

Interestingly, the phrase “same descriptive properties” was used
in the United States’ old 1905 Federal Trademark Act which provides that
the applicant’s mark will not be registered if such mark is also used
by another on goods of the “same descriptive properties” as to be
likely to cause confusion. However, the 1946 Lanham Act has done away
with the old concept of “goods of the same descriptive properties” and
removed such restriction.^[27]
But then, the basis of extending the trademark rights to include the
protection of noncompetitive but related goods in the United States is
the “Aunt Jemima doctrine” decided by the Second Circuit court in 1917,
way before the 1946 Lanham Act.^[28]
The court protected the AUNT JEMIMA mark being used on pancake batter
from its use on pancake syrup. The court rejected the “competitive
goods” doctrine and ruled that a mark will still be protected if used on
any goods which the buyers would likely think to originate from the
same source.^[29]

In the Philippines, Section 13 of the Protection and Registration of Trade-Marks and Trade-Names (Act No. 666)^[30]
provides that “no alleged trade-mark or trade-name shall be registered
which x x x is identical With a registered or known trade-mark owned by
another and appropriate to the same class of merchandise x x x as
to be likely to cause confusion or mistake in the mind of the public,
or to deceive purchasers.” Act No. 666 used the phrase “same class of merchandise” instead of “same descriptive properties.”
A plain reading of Act No. 666 indicates that trademark protection only
extends to goods or merchandise of the same class. The phrase “same class of merchandise” was also omitted in RA No. 166.^[31] Nevertheless, the Court has recognized the confusion of business or source doctrine in Kalaw Ng Khe v. Lever Brothers Co.^[32] (Ng Khe) and Ang v. Teodoro,^[33] (Teodoro) decided in 1941 and 1942, respectively, or before the approval of RA No. 166 in 1947. In Ng Khe,
the Court held that while hair pomade and soap are noncompetitive, they
are similar or belong to the same class of toiletries. As such, the
marks “LUX” and “LIFEBUOY” may not be used on hair pomade. In Teodoro,
the Court considered shoes and shirts as related goods because the
trademark and trade name “Ang Tibay” has come to indicate the origin and
ownership of the goods.

To reconcile the seeming conflict between the aforementioned laws and
relevant jurisprudence on related goods, a review of the US and
Philippine jurisprudence reveals that the phrases “same descriptive properties” and “same class of merchandise” should not be taken literally because they have no connection with the inherent nature of the goods.

The phrases “same descriptive properties” and “same class of merchandise”
are not determinative of the relatedness of goods as suggested by
Callman. Rather, it is the result of the relatedness of goods. Goods are
considered to have the “same descriptive properties” and to be of the “same class of merchandise” when they are so related that the public will likely assume that they come from the same source. In Ng Khe, the Court quoted the Court of Appeals’ ruling that pomade and soap are goods of similar kind, viz.:

The next point to be determined is whether pomade and soap are goods of similar kind. We are of the opinion that they are. Both are toilet articles.

“The owner of a trade-mark which is arbitrary, strange,
and fanciful is entitled to a monopoly of use for his mark in a wider
field than is he who employs a mark not of that character. Also, the nature
of the business in which the trade-mark is used is, in some measure,
determinative of whether certain goods are within the general class. It has been said that classification depends more on commercial custom than the inherent nature of the products.“ (63 CJ, 318-319.)

“The phrase ‘same descriptive properties‘ must be construed to effectuate the dominant purpose of a section to prevent confusion and deception, as indicated by the first paragraph authorizing registration of a mark by which the goods of the owner may be distinguished from other goods of the same class, so that, whenever it appears that confusion might result, the goods have the same descriptive properties. California Packing Corporation vs. Price Booker Mfg. Co. (1923) 285 F. 993, 52 App. D. C. 259, holding that pickles and condiments are goods of the same descriptive properties as canned fruits and vegetables, since they are sold in the same stores, put out in similar containers, and used in connection with each other, and a person seeing a trade-mark on a container of pickles would
be likely to assume they were produced by the same concern as that
which produced canned fruit or vegetables bearing a similar mark.

x x x x

“If the use of the marks by the contending parties would be likely
to lead the public to believe that the goods to which they are applied
were produced by the same concern or person, the goods possess the ‘same
descriptive properties.’ Application of BF Goodrich Co., (1923)
285 995, 52 App. D. C., 261, holding that pneumatic tires for
automobiles and rubber hose and belting have the same descriptive
properties.^[34] (Emphases and underscoring supplied.)

The CA’s basis that the goods are related if the use of the marks will
likely mislead the public as to its source is supported by US
jurisprudence. The courts do not regard goods as related because of
their inherent common quality. What is paramount is the confusion of
source or the assumed connection between the parties.^[35]

As regards the use of the phrase “same class of merchandise” in Act No. 666, the Court’s ruling in Teodoro is enlightening:

We have underlined the key words used in the statute: “goods of a similar kind,” “general class of merchandise,” “same class of merchandise,” “classes of merchandise,” and “class of articles,” because it is upon their implications that the result of the case hinges. These phrases, which refer to the same thing, have the same meaning as the phrase “merchandise of the same descriptive properties“ used in the statutes and jurisprudence of other jurisdictions.

x x x x

In the present state of development of the law on Trade-Marks, Unfair Competition, and Unfair Trading, the
test employed by the courts to determine whether noncompeting goods are
or are not of the same class is confusion as to the origin of the goods
of the second user. Although two noncompeting articles may be classified under two different classes by the Patent Office because they are deemed not to possess the same descriptive properties, they
would, nevertheless, be held by the courts to belong to the same class
if the simultaneous use on them of identical or closely similar
trade-marks would be likely to cause confusion as to the origin, or
personal source, of the second user’s goods. They would be considered as not
falling under the same class only if they are so dissimilar or so
foreign to each other as to make it unlikely that the purchaser would
think the first user made the second user’s goods.^[36] (Emphases and underscoring supplied).

In Ng Khe, the CA’s review of US jurisprudence demonstrates that the phrase “same descriptive properties” does not pertain to the inherent nature of the goods. To determine whether the goods have the “same descriptive properties,” the courts consider the prevalent commercial custom. In Teodoro, to determine whether the goods are of the “same class of merchandise,” the courts consider confusion as to the origin of the goods of the second user. If the present concept of “same descriptive properties” is applied in Ng Khe and Teodoro, hair pomade and soap and shoes and shirts do not have the “same descriptive properties”
because their physical attributes or essential characteristics with
reference to their form, composition, texture or quality are indubitably
different.

Contrary to Callman’s factors, goods are not considered related because
they belong to the same class or have the same properties. Instead,
goods are considered related if the parties’ use of the marks will
likely lead the public to believe that the goods covered by the marks
come from the same source. Simply put, the relatedness of goods depends
on whether there is confusion of source or of business. If there is
confusion of source, then the goods are considered to have the “same
descriptive properties” and to be of the “same class of merchandise.”

It appears that Esso Standard‘s citation of Callman’s factors in determining the relatedness of goods paved the way for the interpretation that the phrase “same descriptive properties” pertains to the inherent nature of the goods and the phrase “same class of merchandise” pertains to the Nice Classification of goods. Notably, some of the Court’s rulings since Ng Khe and Teodoro applied the phrases “same descriptive properties” and “same class of merchandise” literally. The Court, in Mighty Corporation, showed the difference of the subject goods by describing their properties as follows:

Wines are bottled and consumed by drinking while cigarettes are packed in cartons or packages and smoked.
There is a whale of a difference between their descriptive properties,
physical attributes or essential characteristics like form, composition,
texture and quality.^[37] (Emphasis supplied.)

The Court likewise considered the inherent nature and properties of milk
products and its classification under the Nice Classification System in
Societe des Produits Nestle, S.A. v. Dy, Jr.,^[38] thus:

NANNY and NAN have the same classification, descriptive properties and physical attributes. Both are classified under Class 6, both are milk products, and both are in powder form. x x x.^[39] (Emphasis supplied.)

The present use of the phrases “same descriptive properties” and “same class of merchandise”
are no longer the result of the relatedness of goods. These phrases
have now become factors in determining whether the goods are related.
Particularly, if the phrase “same descriptive properties” is to be applied literally, then only identical or competing goods will be considered as related. This
interpretation is restrictive and inconsistent with the doctrine of
confusion of business which presupposes that the goods, although
different, are so related that the public will likely assume that they
come from the same source.

In sum, I believe the literal application of “same descriptive properties” and “same class of merchandise”
should be abandoned because they limit the application of the related
goods doctrine and adversely affect the findings of relatedness of goods
and confusion of source or business as demonstrated in Taiwan Kolin. In Ng Khe and Teodoro, the Court interpreted “same class of merchandise” and “same descriptive properties” as the result of the relatedness of goods and not as factors in determining relatedness of goods. The phrase “same class of merchandise”
does not pertain to the Nice Classification of goods since the Nice
Agreement, which established the international classification of goods,
was only concluded in 1957,^[40] or before the promulgation of Ng Khe and Teodoro. On the other hand, the phrase “same descriptive properties” does not pertain to the inherent nature of goods. Clearly, “same class of merchandise” and “same descriptive properties” should not be used as factors in determining the relatedness of goods.

B. The Present Case

KECI’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark is registered for use on automatic
voltage regulator, converter, recharger, stereo booster, AC-DC regulated
power supply, step-down transformer, and PA amplified AC-DC. Meanwhile,
KPII proposes the use of kolin on television and
DVD players. Evidently, KECI and KPII’s goods are not in competition.
This, however, does not preclude confusing similarity since the parties’
goods are so related that an ordinary consumer would likely be confused
as to their source or would likely assume a connection between the two
companies, when actually there is none. The IPO-BLA’s observation on
this matter deserves credence.

In the instant case, the foregoing are deemed related
goods. Home appliance is no far different from any electronic equipment.
The terms, in fact are used interchangeably as most of the home
appliance[s] are electronically operated, or home appliances are
operated with electrical equipment or power supplies. Buyers of these goods go to the same channels of trade such as department stores or appliance stores where both goods are available for sale. The apparent conclusion is public
confusion that opposer’s and respondent’s respective goods are
variation of each other and also the assumption that the goods
originated from one manufacturer or source, when in fact, they did not.

More so, opposer’s evidence consisting of various e-mails (Exhibit “Q” and its sub-markings) it received from public consumers reflecting their complaints, concerns and other information about
respondent’s applicant’s goods as televisions, air-conditioning units
and DVD players, are obvious showing of actual confusion of goods as
well as to origin or source of goods. These reveal factual confusion of
the buying public between the marks in controversy.^[41] (Emphases supplied.)

The relatedness of the parties’ goods in this case and the resulting
confusion of source or business are clearly supported by evidence on
record. The various emails received by KECI pertaining to televisions
and DVD players proved that the public was actually confused by the use
of a mark bearing the word “Kolin” manufactured by another company. Hence,
KECI’s automatic voltage regulator, converter, recharger, stereo
booster, AC-DC regulated power supply, step-down transformer, and PA
amplified ACDC and KPII’s television and DVD players are deemed to have
the same descriptive properties and to belong to the same class of
merchandise pursuant to the Court’s ruling in Ng Khe and Teodoro.

IV.
The application of intelligent buyer doctrine will not reduce confusing similarity.

In determining confusing similarity, another important factor is the
“ordinary purchaser” who will likely be deceived or confused with the
goods or its source. The Court attempted to describe an “ordinary
purchaser” in various cases. In Fruit of the Loom, Inc. v. CA,^[42] the Court, citing US cases,^[43]
thought of an “ordinary purchaser” as one who must be credited with at
least a modicum of intelligence to be able to perceive the obvious
differences between the marks.^[44] Meanwhile, in Dy Buncio v. Tan Tiao Bok,^[45]
the Court supposed that an “ordinary purchaser” is one who is
accustomed to buy the subject goods and is somehow familiar with it.^[46] Likewise, the Court, in Emerald Garment Manufacturing Corp. v. CA,^[47] (Emerald Garment)
regarded an “ordinary purchaser” as one who is not the completely
unwary consumer but an ordinarily intelligent buyer considering the type
of product involved.^[48]

In Taiwan Kolin, the Third Division relied on the ordinary intelligent buyer concept in Emerald Garment
and considered electronic products as luxury items to conclude that an
ordinary purchaser is predisposed to be more cautious and discriminating
in making a purchase. The relevant portions of the decision are as
follows:

It cannot be stressed enough that the products involved
in the case at bar are, generally speaking, various kinds of electronic
products. These are not ordinary consumable household items, like catsup, soy sauce or soap which are of minimal cost. The
products of the contending parties are relatively luxury items not
easily considered affordable. Accordingly, the casual buyer is
predisposed to be more cautious and discriminating in and would prefer
to mull over his purchase. Confusion and deception, then, is less likely. As further elucidated in Del Monte Corporation v. Court of Appeals:

x x x Among these, what essentially determines the attitudes
of the purchaser, specifically his inclination to be cautious, is the
cost of the goods. To be sure, a person who buys a box of candies will
not exercise as much care as one who buys an expensive watch. As a
general rule, an ordinary buyer does not exercise as much prudence in
buying an article for which he pays a few centavos as he does in
purchasing a more valuable thing. Expensive and valuable items are
normally bought only after deliberate, comparative and analytical
investigation. But mass products, low priced articles in wide use, and
matters of everyday purchase requiring frequent replacement are bought
by the casual consumer without great care x x x. (Emphasis supplied.)

Respondent has made much reliance on Arce & Sons, Chua Che, Ang, and Khe,
oblivious that they involved common household items – i.e., biscuits
and milk, cosmetics, clothes, and toilet articles, respectively –
whereas the extant case involves luxury items not regularly and
inexpensively purchased by the consuming public. In accord with common
empirical experience, the useful lives of televisions and DVD players
last for about five (5) years, minimum, making replacement purchases
very infrequent. The same goes true with converters and regulators that
are seldom replaced despite the acquisition of new equipment to be
plugged onto it. In addition, the amount the buyer would be parting
with cannot be deemed minimal considering that the price of televisions
or DVD players can exceed today’s monthly minimum wage. In light of
these circumstances, it is then expected that the ordinary intelligent
buyer would be more discerning when it comes to deciding which
electronic product they are going to purchase, and it is this standard
which this Court applies herein in determining the likelihood of
confusion should petitioner’s application be granted.

To be sure, the extant case is reminiscent of Emerald Garment Manufacturing Corporation v. Court of Appeals,
wherein the opposing trademarks are that of Emerald Garment
Manufacturing Corporation’s “Stylistic Mr. Lee” and H.D. Lee’s “LEE.” In
the said case, the appellate court affirmed the decision of the
Director of Patents denying Emerald Garment’s application for
registration due to confusing similarity with H.D. Lee’s trademark. This
Court, however, was of a different beat and ruled that there is no
confusing similarity between the marks, given that the products covered
by the trademark, i.e., jeans, were, at that time, considered pricey,
typically purchased by intelligent buyers familiar with the products and
are more circumspect, and, therefore, would not easily be deceived. x x x.^[49] (Emphases supplied; citations omitted.)

In my opinion, Taiwan Kolin again failed to consider the
particular circumstances of the case in concluding that there is no
confusing similarity pursuant to the ordinary intelligent buyer
doctrine. Granting that various electronic products are expensive enough
to make an ordinary buyer more cautious and discerning of his or her
purchase, the unanswered question is whether a further examination of
the goods will reduce confusing similarity. Obviously, the various
emails received by KECI requesting for information or service and
complaints about TKC’s goods answer this question in the negative.

Even if ordinary consumers of electronic products are cautious and
discerning enough to further investigate about the goods and their
source, they will be confronted with two companies which both use the
word “Kolin” as their trade names. Instead of concluding that the
electronic products came from different companies, human nature and
experience dictate that ordinary consumers will only assume a reasonable
connection between Taiwan Kolin Corporation, LTD. and Kolin Electronics
Co., Inc. especially since they both produce electronic goods under the
KOLIN marks and trade names.

It must be stressed that the determination of confusing similarity
should not end in identifying whether ordinary purchasers are cautious
enough to investigate and examine the differences between the marks and
the goods that they cover. I believe the courts must also consider
whether a careful examination of goods will reduce or increase confusing
similarity. To reiterate, each case of determining confusing similarity
must be decided based on its particular circumstances which include the
ordinary purchaser’s attitude. After all, it would be unfair to place
the burden of distinguishing the goods of one manufacturer from the
other on ordinary consumers. The law on trademarks does not only protect
the rights of trademark owners to use their marks on their goods. More
importantly, it seeks to protect the welfare of the consuming public by
eliminating confusion of goods and of business even before they occur.

Accordingly, I vote to GRANT the petition.

^[1] Taiwan Kolin Cotporation, Ltd v. Kolin Electronics Co., Inc.,
757 Phil. 326 (2015); penned by Associate Justice Presbiterio J.
Velasco, Jr., with the concurrence of Associate Justices Diosdado M.
Peralta (now Chief Justice), Martin S. Villarama, Jr., Bienvenido L.
Reyes, and Francis H. Jardeleza (retired Member of this Court).

^[2] 665 Phil. 198 (2011).

^[3] Id. at 205-206.

^[4] Now Section 5 of Rule 18
of A.M. No. 10-3-10-SC, otherwise known as THE 2020 REVISED RULES OF
PROCEDURE FOR INTELLECTUAL PROPERTY RIGHTS CASES; dated October 6, 2020.

^[5] 642 Phil. 503 (2010).

^[6] IPO Memorandum Circular
No. 17-010 (2017) or the RULES AND REGULATIONS ON TRADEMARKS, SERVICE
MARKS, TRADE NAMES AND MARKED OR STAMPED CONTAINERS OF 2017; done on
July 7, 2017.

Rule 402. Reproduction of the Mark – x x x

In the case of word marks or if no special characteristics have to be
shown, such as design, style of lettering, color, diacritical marks, or
unusual forms of punctuation, the mark must be represented in standard
characters x x x.

x x x x

^[7] United States Patent and Trademark Office, Protecting Your Trademark ENHANCING YOUR RIGHTS THROUGH FEDERAL REGISTRATION, p. 17. Accessed on November 16, 2020 at https://www.uspto.gov/sites/default/files/documents/BasicFacts.pdf.

^[8] Marvex Commercial Co. Inc. v. Petra Hawpia & Co., 125 Phil. 295, 301-302 (1966).

^[9] Societe Produits Nestle, S.A. v. Dy, Jr., 641 Phil. 345, 364 (2010).

^[10] Mcdonald’s Corp. v. L.C. Big Mak Burger, Inc., 480 Phil. 402, 435 (2004).

^[11] See 2.2.2.2.3 of the ASEAN Common Guidelines for Substantive Examination of Trademarks.

2.2.2.2.3 Conceptual Comparison

Signs with Semantic Content

Similarity between two marks may be caused by a similarity in the
concept or meaning of the signs, as understood by the average consumers
in the country concerned.

x x x x

^[12] 2.4.2 of the ASEAN Common Guidelines for Substantive Examination of Trademarks.

^[13] Estee Lauder Inc. v. The Gap Inc., 108 F.3d 1503 (2d Cir. 1997).

^[14] See Ang v. Teodoro, 74 Phil. 50 (1942).

^[15] Sterling Products International. Inc. v. Farbenfabriken Bayer Aktiengesellschaft, 137 Phil. 838, 852 (1969), citing 2 Callmann, op. cit., pp. 1323-1324.

^[16] 478 Phil. 615 (2004).

^[17] Id. at 662-663.

^[18] 148 Phil. 494 (1971).

^[19] Id. at 497-498.

^[20] 201 Phil. 61 (1982).

^[21] Id. at 67.

^[22] 201 Phil. 853 (1982).

^[23] Id. at 856-857.

^[24] Supra note 1, at 341.

^[25] 201 Phil. 803 (1982).

^[26] Id. at 808.

^[27] J. Thomas McCarthy (1984), Trademarks and Unfair Competition, 2^nd ed., Clark Boardman Callaghan, pp. 163-164.

^[28] Aunt Jemima Mills Co. v. Rigney & Co., 247 F. 407 (2d Cir., 1917).

^[29] J. Thomas McCarthy (1984), Trademarks and Unfair Competition, 2^nd ed., Clark Boardman Callaghan, p. 164.

^[30] AN ACT DEFINING PROPERTY
IN TRADE-MARKS AND IN TRADE-NAMES AND PROVIDING FOR THE PROTECTION OF
THE SAME, DEFINING UNFAIR COMPETITION AND PROVIDING REMEDIES AGAINST THE
SAME, PROVIDING REGISTRATION FOR TRADE-MARKS AND TRADE-NAMES, AND
DEFINING THE EFFECT TO BE GIVEN TO REGISTRATION UNDER THE SPANISH ROYAL
DECREE OF EIGHTEEN HUNDRED AND EIGHTY-EIGHT RELATING TO THE REGISTRATION
OF TRADE-MARKS, AND THE EFFECT TO BE GIVEN TO REGISTRATION UNDER THIS
ACT; enacted on March 6, 1903.

^[31] See Section 4(d).

^[32] 83 Phil. 947 (1941).

^[33] 74 Phil. 50 (1942).

^[34] Supra note 32, at 956-957.

^[35] J. Thomas McCarthy (1984), Trademarks and Unfair Competition, 2^nd ed., Clark Boardman Callaghan, p. 183.

^[36] Supra note 33, at 54.

^[37] Supra note 16, at 667.

^[38] 641 Phil. 345 (2010).

^[39] Id. at 366.

^[40] World Intellectual Property Office, Summary
of the Nice Agreement Concerning the International Classification of
Goods and Services for the Purposes of the Registration of Marks (1957). Accessed on December 7, 2020 at https://www.wipo.int/treaties/en/classification/nice/summary_nice.html.

^[41] Kolin Electronics Co. Inc. v. Kolin Philippines Int’l Inc., IPC No. 14-2007-00167, Decision No. 2009-109, pp. 13-14.

^[42] 218 Phil. 375 (1984).

^[43] Carnation Co. v. California Growers Wineries, 97 F. 2d 80; Hyram Walke and Sons vs. Penn-Maryland Corp., 79 F. 2d 836.

^[44] Supra note 42, at 382.

^[45] 42 Phil. 190 (1921).

^[46] Id. at 196-197.

^[47] 321 Phil. 1001 (1995).

^[48] Id. at 1018.

^[49] Supra note 1, at 342-344.

CONCURRING OPINION
PERALTA, C.J.:

As one of the former members of the Court’s Third Division who concurred in the ponencia of Mr. Justice Velasco in Taiwan Kolin Corp., Ltd. (TKC) v. Kolin Electronics, Co., Inc. (KECI) (Taiwan Kolin case),^[1] I deem it incumbent upon me to acknowledge the shortcomings of said decision, as eloquently pointed out in the present ponencia
of Mr. Justice Caguioa, and correct, with the present concurrence, what
has been deemed a sore thumb in our jurisprudence on trademarks for the
past half-decade.

Admittedly, the Taiwan Kolin case failed to apply the Dominancy Test, which I had applied in the prior case of Skechers, U.S.A., Inc. v. Inter Pacific Industrial Trading Corp.^[2] and which has been incorporated in the current law on trademarks,^[3] to determine whether the competing marks are confusingly similar. I agree with the ponencia that applying said test, KECI’s KOLIN
mark is clearly confusingly similar in terms of its appearance to TKC’s
KOLIN mark because the work “KOLIN” is the prevalent feature of the
former’s mark which is reproduced entirely in the latter’s mark.
Further, while there may be minor visual differences in terms of font,
color, and background, they are phonetically or aurally identical.^[4]
Indeed, in several cases, the aural similarity of the competing marks
was found sufficient to support a finding of confusing similarity. For
instance, We applied the dominancy test in holding that “PCO-GENOLS” and
“PYCOGENOL,”^[5] “MACJOY” and “MCDONALD’S,”^[6] “DERMALINE DERMALINE INC.” and “DERMALIN,”^[7] “BIG MAC” and “BIG MAK,”^[8] and “NANNY” and “NAN”^[9] are confusingly similar.

The Taiwan Kolin case also failed to determine confusion of business. As pointed out in Skechers,
confusion of business (source or origin confusion), where, although the
goods of the parties are different, the product, the mark of which
registration is applied for by one party, is such as might reasonably be
assumed to originate with the registrant of an earlier product, and the
public would then be deceived either into that belief or into the
belief that there is some connection between the two parties, though
inexistent.^[10] The mark of
which registration is applied for by TKC is such as might reasonably be
assumed to originate from KECI, considering that it is not impossible
for their respective products to be sold in home goods and appliance
stores and, therefore, lead consumers to believe that there is some
connection between the two parties, though inexistent, thus, resulting
in confusion of business.

In In Re Shell Oil Co.,^[11] the U.S. Court of Appeals for the Federal Circuit^[12]
held that “even when goods or services are not competitive or
intrinsically related, the use of identical marks can lead to the
assumption that there is a common source.” Citing said case, the Trademark Manual of Examining Procedure (TMEP) of the United States Patent and Trademark Office (USPTO) states:

1207.01(a) Relatedness of the Goods or Services

In assessing the relatedness of the goods and/or services, the more
similar the marks at issue, the less similar the goods or services need
to be to support a finding of likelihood of confusion. In re Shell Oil Co., 992 F.2d 1204, 1207, 26 USPQ2d 1687, 1689 (Fed. Cir. 1993); Gen. Mills, Inc. v. Fage Dairy Processing Indus. S.A., 100 USPQ2d 1584, 1597 (TTAB 2011); In re lola Techs., LLC, 95 USPQ2d 1498, 1499 (TTAB 2010); In re Opus One Inc., 60 USPQ2d 1812, 1815 (TTAB 2001). If
the marks of the respective parties are identical or virtually
identical, the relationship between the goods and/or services need not
be as close to support a finding of likelihood of confusion as would be
required if there were differences between the marks. Shell Oil, 992 F.2d at 1207, 26 USPQ2d at 1689; In re Davey Prods. Pty Ltd., 92 USPQ2d 1198, 1202 (TTAB 2009); In re Thor Tech, Inc., 90 USPQ2d 1634, 1636 (TTAB 2009).^[13]

In the case at bench, applying the Dominancy Test, there is no doubt
that the marks of KECI and KPII are confusingly similar since the
latter’s mark appropriates the former’s mark in its entirety, thus
making origin confusion more likely. Further, applying the factors for
determining relatedness of goods in Mighty Corporation v. E. & J. Gallo Winery,^[14] as comprehensively discussed in the ponencia, one can reasonably conclude that KECI’s and KPII’s goods are related.

At this point, however, I wish to note that in hindsight, the Taiwan Kolin case should not have considered Class 9 subcategorization as a factor in determining relatedness, just as the Mighty Corporation case should not have considered product classification. While Mighty Corporation
included “the class of product to which the goods belong” for the first
time in the enumeration of factors to be considered in arriving at a
sound conclusion on the question of relatedness, a review of the
relevant laws, regulations, and related literature would reveal that
there was no legal basis therefor.

Section 6 of Republic Act (R.A.) No. 166,^[15] one of the precursors of R.A. No. 8293, or the Intellectual Property Code of the Philippines, provides:

Section 6. Classification of goods and services. – The Director shall establish a classification of goods and services, for the convenience of the Patent Office administration, but not to limit or extend the applicant’s rights. x x x.^[16]

The above provision was reproduced substantially from Section 30 of the Lanham Act, also known as the Trademark Act of 1946, which is codified at 15 U.S.C. §1112, as amended, as follows:

§1112. Classification of goods and services; registration in plurality of classes

The Commissioner may establish a classification of goods and services, for convenience of Patent and Trademark Office administration, but not to limit or extend the applicant’s or registrant’s rights. x x x.^[17]

In Jean Patou, Inc. v. Theon, Inc.,^[18]
the U.S. Court of Appeals for the Federal Circuit had the opportunity
to discuss the irrelevance of classification with respect to
registrability of marks, to wit:

The benefits of a Principal Register registration apply with
respect to the goods named in the registration without regard to the
class or classes named in the registration. The statute authorizing the
establishment of a classification is 15 U.S.C. § 1112 which provides:

The Commissioner may establish a classification of goods and services, for
the convenience of the Patent and Trademark Office administration, but
not to limit or extend the applicant’s or registrant’s rights.

It is elementary that a registrant has rights under the statute only
with respect to goods on which the trademark has been used. Trademark
ownership results only from use, not from registration. Classification is to facilitate searching for registered marks which is primarily what is meant by “the convenience of the” PTO. See also 37 CFR Sec. 2.85(g) (“Classification schedules shall not limit or extend the applicant’s rights.”).

In our view, all of the TTAB’s reasoning with respect to what it viewed
as the Class 3 goods applies with equal force to registration in Class
5 and leads to the same result, namely, likelihood of confusion and
sustaining of the opposition. The result reached by the TTAB with
respect to registration in class 5 is incongruous. With respect to
applicant’s single product the decision was that the mark DERMAJOY is
both registrable and not registrable, depending on the classification
designated. However, classification is wholly irrelevant to the issue of registrability under section 1052(d), which makes no reference to classification. x x x.^[19]

Notably, the TMEP has, likewise, cited the above case in determining the import of classification in trademark evaluations, viz.:

1207.01(d)(v) Classification of Goods/Services

The classification of goods and services has no bearing on the question of likelihood of confusion. See Jean Patou, Inc. v. Theon Inc., 9 F.3d 971, 975, 29 USPQ2d 1771, 1774 (Fed. Cir. 1993). Rather, it is the manner in which the applicant and/or registrant have identified their goods or services that is controlling. See Nat’l Football League v. Jasper Alliance Corp., 16 USPQ2d 1212, 1216 & n.5 (TTAB 1990).^[20]

Even prior to Jean Patou, the U.S. Trademark Trial and Appeal Board (TTAB) in INB National Bank v. Metrohost, Inc.^[21]
had already held that “it is well recognized that the system of
dividing goods [and services] into classes is purely a manner of
convenience and that a determination on the question of likelihood of
confusion cannot be restricted by the artificial boundary created by
classification.”

With the enactment of R.A. No. 8293, Section 6 of R.A. No. 166 became what is now Section 144 of the Intellectual Property Code:

Section 144. Classification of Goods and Services. – x x x

144.2. Goods or services may not be considered as being similar or
dissimilar to each other on the ground that, in any registration or
publication by the Office, they appear in different classes of the Nice
Classification. (Sec. 6, R.A. No. 166a)^[22]

In turn, Section 144.2 of R.A. No. 8293 was patterned after Rule 2(4) of Commission Regulation (EC) No. 2868/95 implementing Council Regulation No. 40/94 on the Community trade mark,^[23] as amended, which states as follows:

(4) The classification of goods and services shall serve exclusively
administrative purposes. Therefore, goods and services may not be
regarded as being similar to each other on the ground that they appear
in the same class under the Nice Classification, and goods and services
may not be regarded as being dissimilar from each other on the ground
that they appear in different classes under the Nice Classification.^[24]

In fine, the fact that goods or services are listed in the same
or different classes of the NCL, or same or different subcategories
thereof for that matter, is not, in itself, an indication of similarity or dissimilarity. For instance, live animals and flowers both belong to Class 31, yet are dissimilar. Advertising and office functions are found in Class 35, yet are also dissimilar. On the other hand, meat extracts (Class 29) and spices (Class 30) belong to different classes, yet are similar. Travel arrangement (Class 39) and providing temporary accommodation (Class 43) are likewise found in different classes, yet are also similar.^[25]

Fundamentally, the NCL serves purely administrative purposes, i.e.,
the harmonization of national classification practices, and does not,
in itself, provide a basis for drawing conclusions as to the similarity
of goods and services.^[26] It
is merely a way for trademark offices to organize the thousands of
applications that are filed each year. Use of the NCL by national
offices has the advantage that trademark applications are coordinated
with reference to a single classification system. Filing is thereby
greatly simplified, as the goods and services to which a given mark
applies will be classified the same in all countries that have adopted
the system.^[27]

Despite the purely administrative purpose of the NCL, the Court, in Mighty Corporation
and in subsequent cases, saw fit to use the classification therein as
one of the factors in determining relatedness, perhaps due to the
convenience and expediency that such a system provides. After all, the
NCL does not randomly categorize goods or services together. By the fact
that goods are organized by class instead of alphabetically, it is not
unreasonable to infer that there is some unifying theme among goods of
the same class that makes them similar in a certain respect. However, as
discussed, that does not mean that all goods in a particular class are
legally related, and that goods belonging to different classes are
legally unrelated.

Indeed, ours is the only jurisdiction that considers international
classification as a factor in determining relatedness. In the United
Kingdom, the following factors are taken into account in assessing the
similarity of goods and services:

a)

the uses of the respective goods or services;

b)

the users of the respective goods or services;

c)

the physical nature of the goods or acts of service;

d)

the trade channels through which the goods or services reach the market;

e)

in the case of self-serve consumer items,
where in practice they are respectively found or likely to be found in
supermarkets and in particular whether they are, or are likely to be,
found on the same or different shelves;

f)

the extent to which the respective goods or services are in competition with each other.^[28]

The French Government likewise considers that, in assessing the
similarity of goods and services, the factors to be taken into account
should include the nature of the goods or service, their intended
destination and clientele, their normal use, and the usual manner of
their distribution.^[29]

The EUIPO Guidelines, Part C, Section 2, Chapter 2,^[30] have adopted and summarized the above factors as follows:

Canon factors Additional factors

• nature,
• intended purpose,
• method of use,
• complementarity,
• in competition. • distribution channels,
• relevant public,
• the usual origin of the goods/services.

The ASEAN Common Guidelines for the Substantive Examination of Trademarks^[31] have likewise adopted the above factors and state that they “should be taken into account to establish similarity of goods and services.”

What is clear is that none of the foregoing laws, jurisprudence, and
guidelines make reference to international classification of goods as a
factor in determining relatedness. Given the foregoing discussion, it
would be more in keeping with the purpose of the NCL for the Court to
abandon product classification as a factor in determining relatedness.
The rest of the factors enumerated in Mighty Corporation are sufficient for that purpose.

^[1] 757 Phil. 326 (2015).

^[2] 662 Phil. 11 (2011).

^[3] R.A. No. 8293, § 155.1.

^[4] Ponencia, p. 38.

^[5] Prosource International, Inc. v. Horphag Research Management SA, 620 Phil. 539 (2009).

^[6] McDonald’s Corporation v. MacJoy Fastfood Corporation, 543 Phil. 90 (2007).

^[7] Dermaline, Inc. v. Myra Pharmaceuticals, Inc., 642 Phil. 503, 512 (2010).

^[8] McDonald’s Corporation v. L.C. Big Mak Burger, Inc., 480 Phil. 402 (2004).

^[9] Societe des Produits Nestle, S.A. v. Dy, Jr., 641 Phil. 345, 361 (2010).

^[10] Skechers, U.S.A., Inc. v. Inter Pacific Industrial Trading Corp., supra note 2, at 20, citing McDonald’s Corp. v. L.C. Big Mak Burger, Inc., supra note 8, at 428.

^[11] In re Shell Oil Co., 992 F.2d 1204, 1207, 26 USPQ2d 1687, 1689 (Fed. Cir. 1993), citing Philip Morris Inc. v. K2 Corp., 555 F.2d 815, 816, 194 USPQ 81, 82 (CCPA 1977). (Emphasis ours)

^[12] The Federal Circuit is
unique among the courts of appeals in the United States as it is the
only court that has its jurisdiction based wholly upon subject matter
rather than geographic location. It has exclusive jurisdiction over
appeals from the U.S. Trademark Trial and Appeal Board (TTAB).

^[13] Emphases supplied.

^[14] 478 Phil. 615 (2004).

^[15] An Act to Provide for
the Registration and Protection of Trade-marks, Trade-names and
Service-marks, Defining Unfair Competition and False Marking and
Providing Remedies Against the Same, and for Other Purposes.

^[16] Emphasis supplied.

^[17] Emphasis supplied.

^[18] 9 F.3d 971 (Fed. Cir. 1993).

^[19] Section 123 (d) of R.A.
No. 8293, which was patterned after 15 U.S.C. §1052 (d), likewise makes
no reference to classification. (Emphases and underscoring supplied.)

^[20] Available at https://tmep.uspto.gov/RDMS/TMEP/Oct2016#/0ct2016/TMEP-1200dle 5044.html, last accessed on November 23, 2020. (Emphases and underscoring supplied.)

^[21] 22 USPQ2d 1585, 1586 (TTAB 1992).

^[22] Emphasis supplied.

^[23] Available at https://euipo.europa.eu/tunnel-web/secure/webdav/guest/document_library/contentPdfs/law_and_practice/ctm_legal_basis/2868_codified_en.pdf, last accessed on November 23, 2020.

^[24] Emphases and underscoring supplied.

^[25] Guidelines for
Examination in the Office for Harmonization in the Internal Market
(Trade Marks and Designs) on Community Trade Marks (“EUIPO Guidelines”),
Part C, § 2, Ch. 2, p. 6, available at https://euipo.europa.eu/tunnel-web/secure/webdav/guest/document_library/contentPdfs/trade_marks/Guidelines/09_part_c_opposition_section_2_identity_and_likelihood_of_confusion_chapter_2_comparison_of_goods_and_services_en.pdf.

^[26] Id.

^[27] Frequently Asked Questions: Nice Classification, WIPO website, available at https://www.wipo.int/classifications/nice/en/faq.html, last accessed on November 23, 2020.

^[28] Canon Kabushiki Kaisha v. Metro-Goldwyn-Mayer, Inc., formerly Pathe Communications Corp., Case C-39/97 [1998] ECR I-5507, [1999] ETMR 1, Opinion of Advocate General Jacobs citing British Sugar PLC v. James Robertson and Sons [1996] EWHC 387 (Ch) (February 7, 1996).

^[29] Id.

^[30] Supra note 25, at 19.

^[31] Available at https://asean.org/storage/2017/12/35.-November-2017-Common-Guidelines-for-the-Substantive-Examination-of-Trademarks.pdf, last accessed on November 23, 2020.

SEPARATE CONCURRING OPINION

PERLAS-BERNABE, J.:

I concur. The petition should be granted.

Contrary to the Courts of Appeals’ (CA) ruling, res judicata
whether in the concept of “bar by prior judgment” or “conclusiveness of
judgment” – holds no application in this case. Thus, it erred in
granting respondent Kolin Philippines International, Inc.’s (KPII)
Trademark Application No. 4-2006-010021 for the mark

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kolin over the opposition of petitioner Kolin Electronics Co., Inc. (KECI), the registered owner^[1] of the word mark KOLIN.

To recount, the CA’s application of the res judicata doctrine was based on the final judgment in Taiwan Kolin Corporation, Ltd. (TKC) v. Kolin Electronics Co., Inc.^[2] (2015 Taiwan Kolin), which was decided by the Court’s then-Third Division on March 25, 2015.

In 2015 Taiwan Kolin, the Court upheld the Intellectual Property Office’s (IPO) ruling to give due course to TKC’s application for the

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KOLIN mark covering “television and DVD player“^[3] notwithstanding KECI’s ownership of the KOLIN mark covering the goods “automatic
voltage regulator, converter, recharger, stereo booster, AC-DC
regulated power supply, step-down transformer, PA amplified AC-DC.”^[4] Notably, it is observed that KECI’s KOLIN mark is a word mark,^[5]
which means that the word “Kolin” itself is protected for the use of
the said mark to represent the same/related goods and products for which
such registration was granted.

In this case, the CA found that KPII was an affiliate of TKC, who had been expressly authorized to adopt and use the

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KOLIN mark in the Philippines, which mark TKC owns by virtue of 2015 Taiwan Kolin. Thus, considering TKC’s ownership of the

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KOLIN
mark, and TKC’s authorization in favor of KPII to adopt and use the
same, the CA concluded that KPII should be allowed to register its own Kolin mark covering “television set and DVD players” despite the opposition of KECI. According to the CA, the doctrine of res judicata forbids it from reaching a conclusion contrary to the 2015 Taiwan Kolin final judgment, viz.:

In fact, in the recent case of Taiwan Kolin Corporation, Ltd. v. Kolin Electronics, Co., Inc.
(TKCL case), a case substantially similar to the present case, the
Supreme Court already ruled that [TKC], to which KPII is affiliated, can
register the mark “KOLIN” for the goods television and DVD player
despite the opposition of KECI. The ruling of the Court is instructive, thus:

x x x x

From the foregoing, it is clear that KPII may register the mark “KOLIN” for its television set and DVD players. The doctrine of res judicata forbids us from arriving at a contrary conclusion. A longestablished doctrine on litigation, res judicata
is an old axiom of law, dictated by wisdom and sanctified by age, and
founded on the broad principle that it is to the interest of the public
that there should be an end to litigation by the same parties over a
subject once fully and fairly adjudicated. It has been appropriately
said that the doctrine is a rule pervading every well-regulated system
of jurisprudence, and is put upon two grounds embodied in various maxims
of the common law; one, public policy and necessity, which makes it to
the interest of the State that there should be an end to litigation – interes republicae ut sit finis litium; the other, the hardship on the individual that he should be vexed twice for one and the same cause nemo debet bis vexari pro una et eadem causa.
A contrary doctrine would subject the public peace and quiet to the
will and neglect of individuals and prefer the gratification of the
litigious disposition on the part of suitors to the preservation of the
public tranquility and happiness. The elements of res judicata
are: (1) the former judgment must be final; (2) the former judgment must
have been rendered by a court having jurisdiction of the subject matter
and the parties; (3) the former judgment must be a judgment on the
merits; and (4) there must be between the first and subsequent actions
(i) identity of parties or at least such as representing the same
interest in both actions; (ii) identity of subject matter; or of the
rights asserted and relief prayed for, the relief being founded on the
same facts; and, (iii) identity of causes of action in both actions such
that any judgment that may be rendered in the other action will,
regardless of which party is successful, amount to res judicata in the action under consideration.

All of these requisites are fulfilled in the instant case. While KPII
may not be involved in the TKCL case, it must be noted that KPII is an
affiliate company of [TKC], as admitted by KECI. An absolute identity of
parties is not required for res judicata to apply, for as long as there exists an identity or community of interest.^[6] (Emphases and underscoring supplied)

The CA is mistaken. Res judicata does not apply in this case.

II.

Res judicata means “‘a matter adjudged; a thing judicially acted
upon or decided; a thing or matter settled by judgment.’ It lays the
rule that an existing final judgment or decree rendered on the merits,
without fraud or collusion, by a court of competent jurisdiction, upon
any matter within its jurisdiction, is conclusive of the rights of the
parties or their privies, in all other actions or suits in the same or
any other judicial tribunal of concurrent jurisdiction on the points and
matters in issue in the first suit.”^[7]

As earlier intimated, res judicata contemplates two (2) concepts. These are:

(a) bar by prior judgment, which means that
“the judgment or decree of the court of competent jurisdiction on the
merits concludes the litigation between the parties, as well as their
privies, and constitutes a bar to a new action or suit involving the same cause of action before the same or any other tribunal”;^[8] and

(b) conclusiveness of judgment, which means that “any right, fact or matter in issue directly adjudicated or necessarily involved in the determination of an action before a competent court in which judgment is rendered on the merits is conclusively settled by the judgment therein and cannot again be litigated between the parties and their privies, whether or not the claim, demand, purpose, or subject matter of the two actions is the same.”^[9]

While “bar by prior judgment” requires an identity of parties, subject matter, and causes of action,^[10] “conclusiveness of judgment” only requires identity of issues and parties.

At this juncture, I deem it apt to clarity that some formulations of
“conclusiveness of judgment” in case law as loosely referring to
“identity of subject matter”^[11] are inaccurate. I find that this clarification is relevant to this case because in its petition, KECI asserts^[12] that there is no “conclusiveness of judgment” since the subject matter in 2015 Taiwan Kolin is the registration of the

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KOLIN mark, while the subject matter of this case is KPII’s

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kolin. In other words, KECI postulates that the subject matter in general of both cases
are different and hence, “conclusiveness of judgment” does not apply in this case.

However, this is misnomer; contrary to the posturing of KECI,^[13]
identity of the subject matter of litigation in general is not required
for “conclusiveness of judgment.” The definition cited above, in fact,
makes it clear that “conclusiveness of judgment” means that “any right,
fact or matter in issue directly adjudicated or necessarily involved in
the determination of an action before a competent court in which
judgment is rendered on the merits is conclusively settled by the
judgment therein and cannot again be litigated between the parties and
their privies, whether or not the claim, demand, purpose, or subject matter of the two actions is the same.”^[14]

Rather, only the identity of a particular matter, fact or issue raised in litigation – as opposed to the subject matter of the litigation in general
– is required for “conclusiveness of judgment” to operate. This
narrower limitation is more in accord with the concept’s essence which
is to preclude a re-litigation of “any right, fact or matter in issue directly adjudicated or necessarily involved in the determination of an action.”
This is in contrast with the broader import of “identity of subject
matter” as used in “bar by prior judgment,” which should refer to the
identity of the subject matter of litigation in general because this
latter concept of res judicata does not merely preclude raising
an issue in litigation but instead, constitutes an affirmative defense,
(usually raised in a motion to dismiss) that forecloses the entire action itself.

In Degayo v. Magbanua-Dinglasan,^[15]
the Court had the occasion to explain the narrow precluding effect of
conclusiveness of judgment based on its discussion that “only the
identities of parties and issues are required for the operation of the principle of conclusiveness of judgment,” viz.:

Conclusiveness of judgment finds application when a fact or
question has been squarely put in issue, judicially passed upon, and
adjudged in a former suit by a court of competent jurisdiction. The fact
or question settled by final judgment or order binds the parties to
that action (and persons in privity with them or their
successors-in-interest), and continues to bind them while the judgment
or order remains standing and unreversed by proper authority on a timely
motion or petition; the conclusively settled fact or question
furthermore cannot again be litigated in any future or other action
between the same parties or their privies and successors-in-interest, in
the same or in any other court of concurrent jurisdiction, either for
the same or for a different cause of action. Thus, only the identities of parties and issues are required for the operation of the principle of conclusiveness of judgment.

While conclusiveness of judgment does not have the same barring effect
as that of a bar by former judgment that proscribes subsequent actions, the
former nonetheless estops the parties from raising in a later case the
issues or points that were raised and controverted, and were
determinative of the ruling in the earlier case. In other words, the
dictum laid down in the earlier final judgment or order becomes
conclusive and continues to be binding between the same parties, their
privies and successors-in-interest, as long as the facts on which that
judgment was predicated continue to be the facts of the case or incident
before the court in a later case; the binding effect and
enforceability of that earlier dictum can no longer be re-litigated in a
later case since the issue has already been resolved and finally laid
to rest in the earlier case.^[16] (Emphases and underscoring supplied)

KECI’s misconception of “conclusiveness of judgment” notwithstanding,
still, the CA’s ruling remains riddled with error because both concepts
of res judicata hold no application in this case.

To be sure, res judicata in the concept of “bar by prior
judgment” does not apply since the subject matters of litigation and
necessarily, the causes of action between 2015 Taiwan Kolin and the present case are not identical. In particular, the 2015 Taiwan Kolin case involves TKC’s Trademark Application No. 4-1996-106310 for

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KOLIN
covering televisions and DVD players, while the present case involves
KPII’s own act of filing a different Trademark Application No.
4-2006-010021 for the mark

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kolin, albeit also covering the same goods, i.e.,
televisions and DVD players. When distinct trademark applications
seeking for different trademark registrations are filed in separate
cases – as in this case – res judicata in the concept of “bar by
prior judgment” cannot apply due to the basic lack of identity in
subject matters and causes of action.

In fact, while it is not explicitly stated in the CA’s decision, it is highly apparent that the CA did not apply res judicata
in the concept of “bar by prior judgment” for to do so would be to bar
KPII’s subsequent trademark application and hence, its petition before
the CA in this case. Quite the opposite, the CA actually ruled in favor
of KPII and thus allowed its action. Further, the CA utilized the 2015 Taiwan Kolin
final judgment, and held that it could not have deviated from the
findings in the said case. Hence, what the CA truly applied was res judicata
in the concept of “conclusiveness of judgment” under the notion that
the ownership of the mark “Kolin” has already been settled in favor of
TKC and in turn, should now benefit KPII as the former’s
assignee/affiliate. In the end, the CA ruled that KPII should be allowed
to register its own

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kolin mark over the opposition of KECI.

However, it should be discerned that the CA’s application of res judicata in the concept of conclusiveness of judgment failed to take into account the nature of TKC’s

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KOLIN mark as a mere design mark, which attribution should consequently limit the legal effects of the 2015 Taiwan Kolin final judgment. As will be discussed below, TKC
– having been adjudged as the owner of a mere design mark – could have
only assigned to KPII the right to adopt and use its mark under the
specific stylization and design of

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KOLIN. As the owner of a mere
design mark, TKC was not accorded any exclusive right to use the word
“Kolin” in whatever future stylizations it may deem fit for the pursuit
of its trade or business. This is unlike the owner of a word mark who
enjoys exclusive protection over the words, letters, or numbers
themselves in the registered mark and, hence, gives it (as well as its
privies) the right to adopt the protected word, letters, or numbers in
whatever stylized versions for the same type of goods and services.

III.

Based on widely-accepted intellectual property law principles, the
protection of the rights accorded under a word mark is far greater than
that accorded under a design or a stylized mark.

As defined by the World Intellectual Property Organization (WIPO), a
design mark or stylized mark is a mark which consists of not only
characters, but also a specific design, color, or some other distinctive
element.^[17]

On the other hand, a word mark is defined by the WIPO as a mark composed
of only words, letters, numbers, or a combination of them.^[18]
While our own trademark rules do not expressly define a word mark, it
nonetheless describes what a word mark does not constitute:

In the case of word marks or if no special
characteristics have to be shown, such as design, style of lettering,
color, diacritical marks, or unusual forms of punctuation, the mark must
be represented in standard characters. The specification of the mark to be reproduced will be indicated in the application form and/ or published on the website.^[19]

Based on the foregoing, what therefore sets apart a design mark from a
word mark is the lack of special characteristics and that it is plainly
exhibited in standard characters only. This lack of any peculiar
characterization of style or design evinces that the word in itself (and
not its style representation) is intended to be protected.

At this juncture, the nature of TKC’s

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KOLIN mark must be examined since KPII’s

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kolin mark merely rides on the strength of

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KOLIN. In fact, this is the exact import of the CA’s ratiocination as demonstrated by its application of the res judicata doctrine.

IV.

While the records of this case do not include the trademark application
and registration of TKC (as this is a case between KECI and KPII), it
can still be reasonably inferred that TKC’s

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KOLIN mark is a
design mark and not a word mark because of its obvious specific
stylization and design appearing on its face. As previously discussed,
the indication of what constitutes a word mark is that no special
characteristics have to be shown, such as design, style of lettering,
color, diacritical marks, or unusual forms of punctuation, and that the
mark is merely represented in standard characters, which description
does not square with TKC’s

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KOLIN.

In fact, the Court, in 2015 Taiwan Kolin, explicitly characterized TKC’s

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KOLIN mark based on its special design, describing the same as “[colored] white in pantone red color background.”^[20] Meanwhile, nowhere in 2015 Taiwan Kolin was

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KOLIN referred to as a word mark, nor was there any reference to

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KOLIN as covering the word “Kolin” itself.

While the ponencia incisively pointed out^[21] that the Court’s then-Third Division committed a mistake by describing TKC’s other “Kolin” mark (i.e., (image supposed to be here), under Application No. 4-2002-011002 which was already “refused [registration by the IPO] for non-filing of DAU/DNU”^[22]), instead of

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KOLIN which was the true subject matter of TKC’s application in 2015 Taiwan Kolin,
this mistake does not negate the fact that the Court still accorded a
specific description to TKC’s mark and hence, implicitly characterized
it as a design mark. To my mind, the fact of according a specific description to a mark evinces
that what was applied for was a design or stylized mark, as compared to
a word mark which needs to be presented in standard characters only. This intent is what appears on the face of the ruling in 2015 Taiwan Kolin
and thus, it must be assumed that the reference to the other (image supposed to be here) mark
was a mere inadvertent error which does not take anything away from the
Court’s implicit appreciation of

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KOLIN as a design mark itself. Besides, it should be stressed that the only difference between

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KOLIN
and (image supposed to be here) is the red color background and the color of the word
“Kolin.” The representation of “Kolin” in a special font, and not a
default standard font, perceptibly squares with the character of
stylized marks as was discussed here.

In comparison, there is evidence to show that KECI’s

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KOLIN mark is a word mark based on its Certificate of Registration^[23]
which is part of the records of this case. The certificate does not
describe KECI’s mark under any specific characterization and in fact,
states that: “Claim of color: None,” “Disclaimer: None,” and
“Translation or transliteration: None.”^[24]
Likewise, perusing the rulings of the Bureau of Trademarks, the Office
of the President, and the final CA Decision in the case between KECI and
TKC over

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KOLIN, no specific description was taken into account by these bodies with respect to

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KOLIN. This is, again, in contrast to TKC’s

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KOLIN which was specially described by the Court based on a peculiar design and styling.

In fact, the established nature of KECI’s

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KOLIN as a word mark strengthens the conclusion that TKC’s

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KOLIN
is a mere design mark. This is because a word mark accords protection
to the words, letters, and numbers themselves; hence, it could not have
been the intention of the Court’s Third Division in 2015 Taiwan Kolin to have two (2) word marks subsisting at the same time since it was already made aware of KECI’s ownership of the

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KOLIN word mark, which was submitted as evidence in that case. A further exposition is fitting.

According to the WIPO, a word mark “often provides broad
protection because it allows the owner to limit a competitor’s use of
any figurative version of the trademark that is confusingly similar for
the same type of goods or services.”^[25] Otherwise stated, “[t]he words and/or letters or numbers themselves are protected.”^[26]

On the other hand, stylized marks offer narrow protection because
“should the image change in any way, the registration loses its
enforceability to an extent since it pertains to that exact
registration.”^[27] Simply put, the
registrant of a stylized mark only gains rights and protection over the
particular and specific stylization of the registered mark.

Bearing in mind the varied scope of protection of design marks and word
marks, it should be presumed that the Court’s then-Third Division was
well aware of KECI’s ownership of the

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KOLIN word 1nark because its trademark registration therefor was the main subject of its opposition to TKC’s

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KOLIN, which fact was not only supported by evidence, but also settled by a final and executory judgment.^[28] Hence, in my humble opinion, the
Court’s then-Third Division could not have envisioned two (2)
diametrically-opposed final and executory rulings awarding trademark
ownership over the word “Kolin” to two (2) different entities. Verily,
not only would this scenario amount to an injustice on the part of KECI
as the adjudged owner of the word mark, but likewise, propagate
anomalous jurisprudence that defeats the very purpose of trademarks as
source indicators in contravention of the policy of commercial stability
underlying our trademark system.

In this relation, it is noted that the characterization of TKC’s

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KOLIN mark (whether as a word or design mark) was not at issue in 2015 Taiwan Kolin
and consequently, was never traversed in the ruling of the Court’s
thenThird Division; hence, the present interpretation concerning the
true nature of

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KOLIN does not technically contravene the immutability of judgment principle because nothing therein has been modified or reversed.

Meanwhile, the nature of TKC’s

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KOLIN mark – while likewise not
squarely raised as an issue here – is nonetheless necessary to arrive at
a just disposition of this case; this is because of the indelible fact
that KPII’s

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kolin mark application rides on the strength of TKC’s

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KOLIN. As case law holds:

[T]he appellate court in deciding the case shall consider
only the assigned errors, however, it is equally settled that the Court
is clothed with ample authority to review matters not assigned as
errors in an appeal, if it finds that their consideration is necessary
to arrive at a just disposition of the case.^[29] (Emphasis supplied)

Hence, by all the foregoing indications as well as the reasons above-explained, TKC’s

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KOLIN mark should be deemed as a mere design mark,
while KECI’s KOLIN a word mark, which facts are pertinent to the disposition of the present case.

VI.

Proceeding from the premise that TKC’s

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KOLIN is a mere design or stylized mark, the issue anent the right to use the word “Kolin” in so far as KPII’s Trademark Application No. 4-2006-010021 for the mark

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kolin is concerned has thus – contrary to the CA’s ruling – not been conclusively settled. This therefore negates the application of the principle of “conclusiveness of judgment.”

To explain, when TKC expressly authorized KPII to adopt and use its

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0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark in the Philippines and register the same in its business dealings, KPII only obtained rights over the specific stylized

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

KOLIN mark of TKC, and not to the use of the word “Kolin” for the same goods or services. Thus,
KPII’s new application should be indepedently treated as its own case
without the benefit of the “conclusiveness of judgment principle” – at
least insofar as the right to use the “Kolin” word in its Kolin mark application filed in this case.

In other words, KPII’s own stylized

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin mark-described
as “‘kolin’ in small-case letters; letter ‘i’ is [colored] orange while
[letters] ‘k, o, l, n’ are in plain black”^[30] –
must be treated as a fresh design mark application that must rise and
fall on its own merits vis-a-vis KECI’s opposition hinged upon the word
mark KOLIN. Accordingly, the new stylization of the

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin mark and all factors related to such use constitute a new set of facts different from that in 2015 Taiwan Kolin,
to which intellectual property principles on likelihood of confusion,
product relatedness, and expansion of business, among others, should be
applied anew relative to the KOLIN word mark of KECI. All told, res judicata – either by “bar by prior judgment” or “conclusiveness of judgment” – does not apply in this case.

With the non-application of res judicata now having been settled, I express my concurrence with the ponencia’s exhaustive discussion against the registration of KPII’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin. As the ponencia amply explained, KPII’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin mark should not be registered due to the undisputed registration of KECI’s KOLIN. Using the dominancy test^[31] – which is now explicitly incorporated into law under Section 155^[32] of Republic Act No. 8293,^[33] otherwise known as the “Intellectual Property Code of the Philippines” – KPII’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin mark is confusingly similar with KECI’s KOLIN
mark. Without a doubt, the dominant feature in both marks is the word
“Kolin” and are in fact, phonetically/aurally the same, hence, resulting
into the confusion of the product source to the public.

On this score, it should be pointed out that although KECI’s KOLIN
covers “automatic voltage regulator, converter, recharger, stereo
booster, ACDC regulated power supply, step-down transformer, PA
amplified AC-DC,” the potential expansion of business doctrine protects KECI’s mark equally for the products of “television and DVD players,” which KPII’s

Normal
0

false
false
false

EN-US
X-NONE
X-NONE

kolin mark intends to cover in this case. In McDonald’s Corporation v. L.C. Big Mak Burger, Inc.,^[34] this Court held that:

Modern law recognizes that the protection to which the owner
of a trademark is entitled is not limited to guarding his goods or
business from actual market competition with identical or similar
products of the parties, but extends to all cases in which the use by a
junior appropriator of a trademark or trade-name is likely to lead to a
confusion of source, as where prospective purchasers would be misled
into thinking that the complaining party has extended his business into
the field (see 148 ALR 56 et seq; 53 Am. Jur. 576) or is in any way
connected with the activities of the infringer; or when it forestalls
the normal potential expansion of his business (v. 148 ALR 77, 84; 52
Am. Jur. 576, 577).^[35]

In fine, KPII cannot register for itself a stylized mark which – applying the now prevailing dominancy test – is confusingly similar to KECI’s KOLIN,
and covers related goods for which the latter word mark was registered
by KECI. In the end, KECI’s word mark should be respected in this case.

Based on the foregoing reasons, the petition should be GRANTED.

^[1] Under Registration No. 4-1993-87497. See Certificate of Registration dated August 2, 2004; rollo, p. 52.

^[2] 757 Phil. 326 (2015).

^[3] The dispositive portion of the IPO’s ruling, which was upheld by the Court’s Third Division in 2015 Taiwan Kolin (id. at 333), reads:

Wherefore, premises considered, the appeal is hereby GRANTED. The Appellant’s Trademark Application No. 4-1996-106310 is hereby GIVEN DUE COURSE
subject to the use limitation or restriction for the goods “television
and DVD player”. Let a copy of this Decision as well as the trademark
application and records be furnished and returned to the Director of the
Bureau of Legal Affairs for appropriate action. Further, let the
Director of the Bureau of Trademarks and the library of the
Documentation, Information and Technology Transfer Bureau be furnished a
copy of this Decision for information, guidance, and records purposes.

SO ORDERED.

^[4] See ponencia, p. 2.

^[5] See rollo, p. 52.

^[6] Rollo, pp. 35-45.

^[7] See Monterona v. Coca-Cola Bottlers Philippines, Inc., G.R. No. 209116, January 14, 2019, citing Spouses Selga v. Brar, 613 Phil. 581, 591 (2011).

^[8] See id., citing Oropeza Marketing Corporation v. Allied Banking Corporation, 441 Phil. 551, 564 (2002); emphasis and underscoring supplied.

^[9] See id.; emphasis and underscoring supplied.

^[10] See id.

^[11] See Ley Construction & Development Corporation v. Philippine Commercial & International Bank, 635 Phil. 503 (2010); and Alcantara v. Department of Environment and Natural Resources, 582 Phil. 717 (2008).

^[12] See rollo, pp. 16-17.

^[13] See id.

^[14] See Monterona v. Coca-Cola Bottlers Philippines, Inc., supra, citing Oropeza Marketing Corporation v. Allied Banking Corporation, supra; emphasis and underscoring supplied.

^[15] 757 Phil. 376 (2015).

^[16] Id. at 385-386; citations omitted.

^[17] See World Intellectual
Property Organization, “Making a Mark: An Introduction to Trademarks for
Small and Medium-sized Enterprises,” p. 9. WIPO Publication No. 900.1E <https://www.wipo.int/edocs/pubdocs/en/wipo_pub_900_l.pdf> (last visited February 11, 2021).

^[18] See id.

^[19] See Rule 402 of the Trademark Regulations of 2017.

^[20] Taiwan Kolin Corporation, Ltd. v. Kolin Electronics Co., Inc. supra note 2, at 342.

^[21] See ponencia, pp. 7-8.

^[22] See id. at 7.

^[23] Rollo, p. 52.

^[24] Id.

^[25] See World Intellectual
Property Organization. “Making a Mark: An Introduction to Trademarks for
Small and Medium-sized Enterprises,” p. 9. WIPO Publication No. 900.1E <https://www.wipo.int/edocs/pubdocs/en/wipo_pub_900_1.pdf> (last visited February 11, 2021).

^[26] Id.; emphasis supplied.

^[27] Id.; emphasis and underscoring supplied.

^[28] See Court of Appeal’s Decision dated July 31, 2016 in CA-G.R. SP No. 80641 (rollo, pp. 78-102) and Entry of Judgment dated November 16, 2007 in G.R. No. 179007 (id. at 103).

^[29] Spouses Cuyco v. Spouses Cuyco, 521 Phil. 796, 806-807 (2006).

^[30] See rollo, p. 31.

^[31] “The Dominancy Test
focuses on the similarity of the prevalent features of the competing
trademarks which might cause confusion or deception, and thus
infringement. If the competing trademark contains the main, essential or
dominant features of another, and confusion or deception is likely to
result, infringement takes place. Duplication or imitation is not
necessary; nor is it necessary that the infringing label should suggest
an effort to imitate. The question is whether the use of the marks
involved is likely to cause confusion or mistake in the mind of the
public or deceive purchasers.” (Mang Inasal Philippines, Inc. v. IFP Manufacturing Corporation, 811 Phil. 261 [2017], citing Mighty Corporation v. E. & J. Gallo Winery, 478 Phil. 615 [2004].)

^[32] Section 155 of RA 8293 reads:

SECTION 155. Remedies; Infringement. – Any person who shall, without the consent of the owner of the registered mark:

155.1. Use in commerce any reproduction, counterfeit, copy, or colorable imitation of a registered mark or the same container or a dominant feature thereof
in connection with the sale, offering for sale, distribution,
adve1iising of any goods or services including other preparatory steps
necessary to carry out the sale of any goods or services on or in
connection with which such use is likely to cause confusion, or to cause
mistake, or to deceive; or

155.2. Reproduce, counterfeit, copy or colorably imitate a registered mark or a dominant feature thereof
and apply such reproduction, counterfeit, copy or colorable imitation
to labels, signs, prints, packages, wrappers, receptacles or
advertisements intended to be used in commerce upon or in connection
with the sale, offering for sale, distribution, or advertising of goods
or services on or in connection with which such use is likely to cause
confusion, or to cause mistake, or to deceive, shall be liable in a
civil action for infringement by the registrant for the remedies
hereinafter set forth: Provided, That the infringement takes
place at the moment any of the acts stated in Subsection 155.1 or this
subsection are committed regardless of whether there is actual sale of
goods or services using the infringing material. (Emphases and
underscoring supplied)

^[33] Entitled “AN ACT
PRESCRIBING THE INTELLECTUAL PROPERTY CODE AND ESTABLISHING THE
INTELLECTUAL PROPERTY OFFICE, PROVIDING FOR ITS POWERS AND FUNCTIONS,
AND FOR OTHER PURPOSES” (January 1, 1998).

^[34] 480 Phil. 402 (2004).

^[35] Id. at 432, citing Sta. Ana v. Maliwat, 133 Phil. 1006, 1013 (1968).

	KECI’s mark	TKC’s opposed trademark application	TKC’s “revived” application
Marks	Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN*^[60]	Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN*^[61]	(image)^[62]
Application No.	4-1993-087497	4-1996-106310	4-2002-011002
Filing Date	August 17, 1993	February 29, 1996	December 27, 2002
Current Status	Registered	Registered	Refused for non-filing of DAU/DNU
Class Covered	9	9	9
Goods Covered	Automatic Voltage Regulator, Converter, Recharger, Stereo Booster, AC-DC Regulated Power Supply, Step-Down Transformer, PA Amplified AC-DC	Television and DVD player	Television Sets, Audio/Video Electronic Equipment and Similar Appliances

Parties	KECI	KPII
Marks	Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN*^[80]	Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} Normal 0 false false false EN-US X-NONE X-NONE / Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} kol*in^[81]
Application No.	4-1993-087497	4-2006-010021
Status	Registered	Trademark Application subject of opposition by KECI
Classes Covered	9	9
Goods Covered	Automatic Voltage Regulator, Converter, Recharger, Stereo Booster, AC-DC Regulated Power Supply, Step-Down Transformer, PA Amplified AC-DC	Televisions, DVD Players

TKC’s opposed Trademark Application No. 4-1996-106310, which was granted registration in the Taiwan Kolin case	TKC’s Trademark Application No. 4-2002-011002, the alleged “revived version” in the Taiwan Kolin case
Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN*^[107]	(image)^[108]
The two marks overlayed
(image)

x x x x

(d)	Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority date, in respect of:

	(i)	The same goods or services, or

	(ii)	Closely related goods or services, or

	(iii)	If it nearly resembles such a mark as to be likely to deceive or cause confusion;

	x x x x

(a)	the business (and its location) to which the goods belong

(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 and sold.

(d) the nature and cost of the articles	Goods covered by Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* and kolin are electronic m nature, relatively expensive, and rarely bought. It will likely take several years before consumers would make repeat purchases of the goods involved.
(e) the descriptive properties, physical attributes or essential characteristics with reference to their form, composition, texture or quality	Considering that they are electronic goods, goods covered by Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* and kolin are likely made of metal. It is also likely that such goods cannot be easily carried around and are usually brought back to the consumer’s place after being bought.
(f) the purpose of the goods	The audiovisual goods covered by kolin (Television and DVD players) and Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* (stereo booster) marks can be used for entertainment purposes.
(g) whether the article is bought for immediate consumption, that is, day-to-day household items	Goods covered by Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* and kolin are not bought for immediate consumption.
(i) the conditions under which the article is usually purchased, and	Because they are relatively expensive and they last for a long time, goods covered by KOLIN and kolin are rarely bought. They are non-essential goods.
(j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed and sold.	The goods covered by Normal 0 false false false EN-US X-NONE X-NONE /* Style Definitions / table.MsoNormalTable {mso-style-name:”Table Normal”; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-qformat:yes; mso-style-parent:””; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin-top:0cm; mso-para-margin-right:0cm; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0cm; line-height:115%; mso-pagination:widow-orphan; font-size:11.0pt; font-family:”Calibri”,”sans-serif”; mso-ascii-font-family:Calibri; mso-ascii-theme-font:minor-latin; mso-fareast-font-family:”Times New Roman”; mso-fareast-theme-font:minor-fareast; mso-hansi-font-family:Calibri; mso-hansi-theme-font:minor-latin; mso-bidi-font-family:”Times New Roman”; mso-bidi-theme-font:minor-bidi;} KOLIN* and kolin marks will likely be offered in “the same channels of trade such as department stores or appliance stores”.^[141]

x x x x

(d)		Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority date, in respect of:
	(i)	The same goods or services, or
	(ii)	Closely related goods or services, or
	(iii)	If it nearly resembles such a mark as to be likely to deceive or cause confusion[.]

	x x x x

(d)	Is identical with a registered mark belonging to a different proprietor or a mark with an earlier filing or priority date, in respect of:

	(i)	The same goods or services, or

	(ii)	Closely related goods or services, or

	(iii)	If it nearly resembles such a mark as to be likely to deceive or cause confusion[.] (Emphases supplied.)

a)	the uses of the respective goods or services;
b)	the users of the respective goods or services;
c)	the physical nature of the goods or acts of service;
d)	the trade channels through which the goods or services reach the market;
e)	in the case of self-serve consumer items, where in practice they are respectively found or likely to be found in supermarkets and in particular whether they are, or are likely to be, found on the same or different shelves;
f)	the extent to which the respective goods or services are in competition with each other.^[28]

Canon factors	Additional factors
• nature, • intended purpose, • method of use, • complementarity, • in competition.	• distribution channels, • relevant public, • the usual origin of the goods/services.

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