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SUPREME COURT REPORTS ANNOTATED VOLUME 251

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Case Title:
EMERALD GARMENT
MANUFACTURING CORPORATION,
petitioner, vs. HON. COURT OF
APPEALS, BUREAU OF PATENTS,
TRADEMARKS AND TECHNOLOGY
TRANSFER and H.D. LEE COMPANY,
INC., respondents.
Citation: 251 SCRA 600
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600

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

G.R. No. 100098. December 29, 1995.

EMERALD GARMENT MANUFACTURING CORPORATION,

petitioner, vs. HON. COURT OF APPEALS, BUREAU OF
PATENTS, TRADEMARKS AND TECHNOLOGY TRANSFER and
H.D. LEE COMPANY, INC., respondents.
Trademarks and Tradenames; The reckoning point for the filing of a
petition for cancellation of certificate of registration of trademark is not
from the alleged date of use but from the date the certificate of registration
was published in the Official Gazette and issued to the registrant.
Petitioner alleges that it has been using its trademark STYLISTIC MR.
LEE since 1 May 1975, yet, it was only on 18 September 1981 that private
respondent filed a petition for cancellation of petitioners certificate of
registration for the said trademark. We reject petitioners contention.
Petitioners trademark is registered in the supplemental register. The
Trademark Law (R.A. No. 166) provides that marks and tradenames for
the supplemental register shall not be published for or be subject to
opposition, but shall be published on registration in the Official Gazette.
The reckoning point, therefore, should not be 1 May 1975, the date of
alleged use by petitioner of its assailed trademark but 27 October 1980,
the date the certificate of registration SR No. 5054 was published in the
Official Gazette and issued to petitioner.
Same; Estoppel; Laches; Actions; To be barred from bringing suit on
grounds of estoppel and laches, the delay must be lengthy.Corollarily,
private respondent could hardly be accused of inexcusable delay in filing
its notice of opposition to petitioners application for registration in the
principal register since said application was published only on 20
February 1984. From the time of publication to the time of filing the
opposition on 27 July 1984 barely five (5) months had elapsed. To be
barred from bringing suit on grounds of estoppel and laches, the delay
must be lengthy.
Same; 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 deducedeach case must
be decided on its own merits.Practical
_____________
*

FIRST DIVISION.

601

VOL. 251, DECEMBER 29, 1995

601

Emerald Garment Manufacturing Corporation vs. Court of Appeals

application of the provision of Section 22 of R.A. No. 166 (Trademark Law)
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.
Same; Infringements; The essential element of infringement is
colorable imitation.Proceeding to the task at hand, the essential element
of infringement is colorable imitation. This term has been defined as such
a close or ingenious imitation as to be calculated to deceive ordinary
purchasers, or such resemblance of the infringing mark to the original as
to deceive an ordinary purchaser giving such attention as a purchaser
usually gives, and to cause him to purchase the one supposing it to be the
other.
Same; Same; In determining whether colorable imitation exists,
jurisprudence has developed two kinds of teststhe Dominancy Test and
the Holistic Test.In determining whether colorable imitation exists,
jurisprudence has developed two kinds of teststhe Dominancy Test
applied in Asia Brewery, Inc. v. Court of Appeals and other cases and the
Holistic Test developed in Del Monte Corporation v. Court of Appeals and
its proponent cases.
Same; Same; Dominancy Test and Holistic Test, Compared.As its
title implies, the test of dominancy focuses on the similarity of the
prevalent features of the competing trademarks which might cause
confusion or deception and thus constitutes infringement. On the other
side of the spectrum, the holistic test mandates that the entirety of the
marks in question must be considered in determining confusing similarity.
Same; Same; Maong pants and jeans are not inexpensive, and as the
casual buyer is predisposed to be more cautious and discriminating in and
would prefer to mull over his purchase, confusion and deception is less
likely.The products involved in the case at bar are, in the main, various
kinds of jeans. These are not your ordinary household items like catsup,
soy sauce or soap which are of minimal cost. Maong pants or jeans are not
inexpensive. 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.
602

602

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

Same; Same; Words and Phrases; Ordinary Purchaser, Defined.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.
Same; Same; A personal name or surname may not be monopolized as
a trademark or tradename as against others of the same name or surname.
LEE is primarily a surname. Private respondent cannot, therefore,
acquire exclusive ownership over and singular use of said term . . . It has
been held that a personal name or surname may not be monopolized as a
trademark or tradename as against others of the same name or surname.
For in the absence of contract, fraud, or estoppel, any man may use his
name or surname in all legitimate ways. Thus, Wellington is a surname,
and its first user has no cause of action against the junior user of
Wellington as it is incapable of exclusive appropriation.
Same; Same; Actual use in commerce in the Philippines is an essential
prerequisite for the acquisition of ownership over a trademark.In

addition to the foregoing, we are constrained to agree with petitioners

contention that private respondent failed to prove prior actual commercial
use of its LEE trademark in the Philippines before filing its application
for registration with the BPTTT and hence, has not acquired ownership
over said mark. Actual use in commerce in the Philippines is an essential
prerequisite for the acquisition of ownership over a trademark pursuant to
Sec. 2 and 2-A of the Philippine Trademark Law (R.A. No. 166).
Same; Same; International Law; Conflict of Laws; Paris Convention
for the Protection of Industrial Property; Following universal acquiescence
and comity, our municipal law on trademarks regarding the requirements
of actual use in the Philippines must subordinate an international
agreement inasmuch as the apparent clash is being de603

VOL. 251, DECEMBER 29, 1995

603

Emerald Garment Manufacturing Corporation vs. Court of Appeals

cided by a municipal tribunal.The provisions of the 1965 Paris
Convention for the Protection of Industrial Property relied upon by private
respondent and Sec. 21-A of the Trademark Law (R.A. No. 166) were
sufficiently expounded upon and qualified in the recent case of Philip
Morris, Inc. v. Court of Appeals: Following universal acquiescence and
comity, our municipal law on trademarks regarding the requirement of
actual use in the Philippines must subordinate an international
agreement inasmuch as the apparent clash is being decided by a municipal
tribunal (Mortisen vs. Peters, Great Britain, High Court of Judiciary of
Scotland, 1906, 8 Sessions, 93; Paras, International Law and World
Organization, 1971 Ed., p. 20). Withal, the fact that international law has
been made part of the law of the land does not by any means imply the
primacy of international law over national law in the municipal sphere.
Under the doctrine of incorporation as applied in most countries, rules of
international law are given a standing equal, not superior, to national
legislative enactments.
Same; Evidence; A registration certificate serves merely as prima facie
evidenceit is not conclusive but can and may be rebutted by controverting
evidence.The credibility placed on a certificate of registration of ones
trademark, or its weight as evidence of validity, ownership and exclusive
use, is qualified. A registration certificate serves merely as prima facie
evidence. It is not conclusive but can and may be rebutted by controverting
evidence.
Same; Same; A supplemental register was created precisely for the
registration of marks which are not registrable on the principal register due
to some defects.Moreover, the aforequoted provision applies only to
registrations in the principal register. Registrations in the supplemental
register do not enjoy a similar privilege. A supplemental register was
created precisely for the registration of marks which are not registrable on
the principal register due to some defects.
Same; Same; Administrative Law; The findings of fact of the Director
of Patents are conclusive upon the Supreme Court provided they are
supported by substantial evidence.The determination as to who is the
prior user of the trademark is a question of fact and it is this Courts
working principle not to disturb the findings of the Director of Patents on
this issue in the absence of any showing of grave abuse of discretion. The
findings of facts of the Director of Patents are conclusive upon the
Supreme Court provided they are supported by substantial evidence.
604

604

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

PETITION for review on certiorari of a decision of the Court of

Appeals.
The facts are stated in the opinion of the Court.
Julio C. Contreras for petitioner.
Sycip, Salazar, Hernandez & Gatmaitan for private
respondent.
KAPUNAN, J.:
In this petition for review on certiorari under Rule 45 of the Revised
Rules of Court, Emerald Garment Manufacturing Corporation seeks
to annul the decision of the Court of Appeals dated 29 November
1990 in CA-G.R. SP No. 15266 declaring petitioners trademark to
be confusingly similar to that of private respondent and the
resolution dated 17 May 1991 denying petitioners motion for
reconsideration.
The record reveals the following antecedent facts:
On 18 September 1981, private respondent H.D. Lee Co., Inc., a
foreign corporation organized under the laws of Delaware, U.S.A.,
filed with the Bureau of Patents, Trademarks & Technology
Transfer (BPTTT) a Petition for Cancellation of Registration No. SR
5054 (Supplemental Register) for the trademark STYLISTIC MR.
LEE used on skirts, jeans, blouses, socks, briefs, jackets, jogging
suits, dresses, shorts, shirts and lingerie under Class 25, issued on
27 October 1980 in the name of petitioner Emerald Garment
Manufacturing Corporation, a domestic corporation organized and
existing under Philippine
laws. The petition was docketed as Inter
1
Partes Case No. 1558.
Private respondent, invoking Sec. 37 of R.A. No. 166 (Trademark
Law) and Art. VIII of the Paris Convention for the Protection of
Industrial Property, averred that petitioners trademark so closely
resembled its own trademark, LEE as previously registered and
used in the Philippines, and not abandoned, as to be likely, when
applied to or used in connection with petitioners
_____________
1

Rollo, pp. 3, 27, 63.

605

VOL. 251, DECEMBER 29, 1995

605

Emerald Garment Manufacturing Corporation vs. Court of Appeals

goods, to cause confusion, mistake and deception
on the part of the
2
purchasing public as to the origin of the goods.
In its answer dated 23 March 1982, petitioner contended that its
trademark was entirely and unmistakably different from that of
private respondent and that
its certificate of registration was
3
legally and validly granted.
On 20 February 1984, petitioner caused the publication of its
application for registration of4 the trademark STYLISTIC MR.
LEE in the Principal Register.
On 27 July 1984, private respondent filed a notice of opposition
to petitioners application for registration also on grounds that
petitioners5 trademark was confusingly similar to its LEE
trademark. The case was docketed as Inter Partes Case No. 1860.
On 21 June 1985, the Director of Patents, on motion filed by
private respondent dated 15 May 1985, issued an order
consolidating Inter Partes Cases Nos. 15586 and 1860 on grounds
that a common question of law was involved.
On 19 July 1988, the Director of Patents rendered a decision
granting private respondents petition for cancellation and
opposition to registration.
The Director of Patents found private respondent to be the prior
registrant of the trademark LEE in the Philippines and that it

had been using said mark in the Philippines.

Moreover, the Director of Patents, using the test of dominancy,
declared that petitioners trademark was confusingly similar to
private respondents mark because it is the word Lee which draws
the attention of the buyer and leads him to conclude that the goods
originated from the same manufacturer. It is undeni_______________
Id., at 27, 55.
Id., at 27, 54.
4 Id., at 3, 27.
5 Id., at 54.
6 Ibid.
7 Id., at 39.
2
3

606

606

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

8

ably the dominant feature of the mark.

On 3 August 1988, petitioner appealed to the Court of Appeals
and on 8 August 1988, it filed with the BPTTT a Motion to Stay
Execution of the 19 July 1988 decision of the Director of Patents on
grounds that the same would cause it great and irreparable damage
and injury. Private
respondent submitted its opposition on 22
9
August 1988.
On 23 September 1988, the BPTTT issued Resolution No. 88-33
granting petitioners motion to stay execution subject to the
following terms and conditions:
1. That under this resolution, Respondent-Registrant is authorized
only to dispose of its current stock using the mark STYLISTIC
MR. LEE;
2. That Respondent-Registrant is strictly prohibited from further
production, regardless of mode and source, of the mark in question
(STYLISTIC MR. LEE) in addition to its current stock;
3. That this relief Order shall automatically cease upon resolution of
the Appeal by the Court of Appeals and, if the Respondents appeal
loses, all goods bearing the mark STYLISTIC MR. LEE shall be
removed from the market, otherwise such goods shall be seized in
accordance with the law.
10

SO ORDERED.

On 29 November 1990, the Court of Appeals promulgated its

decision affirming the decision
of the Director of Patents dated 19
11
July 1988 in all respects.
In said decision the Court of Appeals expounded, thus:
xxx
xxx
x x x.
Whether or not a trademark causes confusion and is likely to deceive
the public is a question of fact which is to be resolved by applying the test
of dominancy, meaning, if the competing trademark
______________
8

Id., at 38.

Id., at 4.

10

Id., at 42.

11

Id., at 33.

607

VOL. 251, DECEMBER 29, 1995

Emerald Garment Manufacturing Corporation vs. Court of Appeals

607

contains the main or essential or dominant features of another by reason

of which confusion and deception are likely to result, then infringement
takes place; that duplication or imitation is not necessary, a similarity in
the dominant features of the trademark would be sufficient.
The word LEE is the most prominent and distinctive feature of the
appellants trademark and all of the appellees LEE trademarks. It is the
mark which draws the attention of the buyer and leads him to conclude
that the goods originated from the same manufacturer. While it is true
that there are other words such as STYLISTIC, printed in the
appellants label, such word is printed in such small letters over the word
LEE that it is not conspicuous enough to draw the attention of ordinary
buyers whereas the word LEE is printed across the label in big, bold
letters and of the same color, style, type and size of lettering as that of the
trademark of the appellee. The alleged difference is too insubstantial to be
noticeable. Even granting arguendo that the word STYLISTIC is
conspicuous enough to draw attention, the goods may easily be mistaken
for just another variation or line of garments under the appellees LEE
trademarks in view of the fact that the appellee has registered trademarks
which use other words in addition to the principal mark LEE such as
LEE RIDERS, LEESURES and LEE LEENS. The likelihood of
confusion is further made more probable by the fact that both parties are
engaged in the same line of business. It is well to reiterate that the
determinative factor in ascertaining whether or not the marks are
confusingly similar to each other is not whether the challenged mark
would actually cause confusion or deception of the purchasers but whether
the use of such mark would likely cause confusion or mistake on the part
of the buying public.
xxx
xxx
x x x.
The appellee has sufficiently established its right to prior use and
registration of the trademark LEE in the Philippines and is thus entitled
to protection from any infringement upon the same. It is thus axiomatic
that one who has identified a peculiar symbol or mark with his goods
thereby acquires a property right in such symbol or mark, and if another
infringes the trademark, he thereby invokes this property right.
The merchandise or goods being sold by the parties are not that
expensive as alleged to be by the appellant and are quite ordinary
commodities purchased by the average person and at times, by the
ignorant and the unlettered. Ordinary purchasers will not as a rule
examine the small letterings printed on the label but will simply be guided
by the presence of the striking mark LEE. Whatever differ608

608

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

ence there may be will pale in insignificance in the face of an evident

similarity in12 the dominant features and overall appearance of the labels of
the parties.
xxx
xxx
x x x.

On 19 December 1990, petitioner filed a motion for reconsideration

of the above-mentioned decision of the Court of Appeals. Private
respondent opposed said motion on 8 January 1991 on grounds that
it involved an impermissible change of theory on appeal. Petitioner
allegedly raised entirely new and unrelated arguments and
defenses not previously raised in the proceedings below such as
laches and a claim that private respondent appropriated the style
and appearance of petitioners trademark13 when it registered its
LEE mark under Registration No. 44220.
On 17 May 1991, the Court of Appeals issued a resolution
rejecting petitioners motion for reconsideration and ruled thus:
xxx
xxx
x x x.
A defense not raised in the trial court cannot be raised on appeal for the
first time. An issue raised for the first time on appeal and not raised
timely in the proceedings in the lower court is barred by estoppel.

The object of requiring the parties to present all questions and issues to
the lower court before they can be presented to this Court is to have the
lower court rule upon them, so that this Court on appeal may determine
whether or not such ruling was erroneous. The purpose is also in
furtherance of justice to require the party to first present the question he
contends for in the lower court so that the other party may not be taken by
surprise and may present evidence to properly meet the issues raised.
Moreover, for a question to be raised on appeal, the same must also be
within the issues raised by the parties in their pleadings. Consequently,
when a party deliberately adopts a certain theory, and the case is tried and
decided based upon such theory presented in the court below, he will not
be permitted to change his theory on appeal. To
______________
12

Id., at 31-33.

13

Id., at 175.

609

VOL. 251, DECEMBER 29, 1995

609

Emerald Garment Manufacturing Corporation vs. Court of Appeals

permit him to do so would be unfair to the adverse party. A question raised
for the first time on appeal, there having opportunity to raise them in the
court of origin constitutes a change of theory which is not permissible on
appeal.
In the instant case, appellants main defense pleaded in its answer
dated March 23, 1982 was that there was no confusing similarity between
the competing trademark involved. On appeal, the appellant raised a
single issue, to wit:
The only issue involved in this case is whether or not respondent-registrants
trademark STYLISTIC MR. LEE is confusingly similar with the petitioners
trademarks LEE or LEE RIDERS, LEE-LEENS and LEE-SURES.

Appellants main argument in this motion for reconsideration on the

other hand is that the appellee is estopped by laches from asserting its
right to its trademark. Appellant claims although belatedly that appellee
went to court with unclean hands by changing the appearance of its
trademark to make it identical to the appellants trademark.
Neither defenses were raised by the appellant in the proceedings before
the Bureau of Patents. Appellant cannot raise them now for the first time
on appeal, let alone on a mere motion for reconsideration of the decision of
this Court dismissing the appellants appeal.
While there may be instances and situations justifying relaxation of
this rule, the circumstance of the instant case, equity would be better
served by applying the settled rule it appearing that appellant has not
given any reason at all as to why the14defenses raised in its motion for
reconsideration was not invoked earlier.
xxx xxx
x x x.

Twice rebuffed, petitioner presents its case before this Court on the
following assignment of errors:
I. THE COURT OF APPEALS ERRED IN NOT FINDING
THAT
PRIVATE
RESPONDENT
CAUSED
THE
ISSUANCE OF A FOURTH LEE TRADEMARK
IMITATING THAT OF THE PETITIONERS ON MAY 5,
1989 OR MORE THAN EIGHT MONTHS AFTER THE
BUREAU OF PATENTS DECISION DATED JULY 19,
1988.
_______________
14

Id., at 23-25.
610

610

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

II. THE COURT OF APPEALS ERRED IN RULING THAT
THE DEFENSE OF ESTOPPEL BY LACHES MUST BE
RAISED IN THE PROCEEDINGS BEFORE THE BUREAU
OF PATENTS, TRADEMARKS AND TECHNOLOGY
TRANSFER.
III. THE COURT OF APPEALS ERRED WHEN IT
CONSIDERED
PRIVATE
RESPONDENTS
PRIOR
REGISTRATION
OF
ITS
TRADEMARK
AND
DISREGARDED
THE
FACT
THAT
PRIVATE
RESPONDENT HAD FAILED TO PROVE COMMERCIAL
USE THEREOF BEFORE
FILING OF APPLICATION FOR
15
REGISTRATION.
In addition, petitioner reiterates the issues it raised in the Court of
Appeals:
I. THE ISSUE INVOLVED IN THIS CASE IS WHETHER OR
NOT PETITIONERS TRADEMARK STYLISTIC MR. LEE,
IS CONFUSINGLY SIMILAR WITH THE PRIVATE
RESPONDENTS TRADEMARK LEE OR LEE-RIDER,
LEE-LEENS AND LEE-SURES.
II. PETITIONERS
EVIDENCES
ARE
CLEAR
AND
SUFFICIENT TO SHOW THAT IT IS THE PRIOR USER
AND ITS TRADEMARK IS DIFFERENT FROM THAT OF
THE PRIVATE RESPONDENT.
III. PETITIONERS TRADEMARK IS ENTIRELY DIFFERENT
FROM THE PRIVATE RESPONDENTS AND THE
REGISTRATION OF ITS TRADEMARK IS PRIMA FACIE
EVIDENCE OF GOOD FAITH.
IV. PETITIONERS STYLISTIC MR. LEE TRADEMARK
CANNOT
BE
CONFUSED
WITH
PRIVATE
16
RESPONDENTS LEE TRADEMARK.
Petitioner contends that private respondent is estopped from
instituting an action for infringement before the BPTTT under the
equitable principle of laches pursuant to Sec. 9-A of R.A. No. 166,
otherwise known as the Law on Trade-marks, Trade-names
_______________
15
16

Id., at 7, 14-15.
ibid.
611

VOL. 251, DECEMBER 29, 1995

611

Emerald Garment Manufacturing Corporation vs. Court of Appeals

and Unfair Competition
SEC. 9-A. Equitable principles to govern proceedings.In opposition
proceedings and in all other inter partes proceedings in the patent office
under this act, equitable principles of laches, estoppel, and acquiescence,
where applicable, may be considered and applied.

Petitioner alleges that it has been using its trademark STYLISTIC

MR. LEE since 1 May 1975, yet, it was only on 18 September 1981
that private respondent filed a petition for cancellation of
petitioners certificate of registration for the said trademark
Similarly, private respondents notice of opposition to petitioners
application for registration
in the principal register was belatedly
17
filed on 27 July 1984.
Private respondent counters by maintaining that petitioner was

barred from raising new issues on appeal, the only contention in the
proceedings below being the presence or absence
of confusing
18
similarity between the two trademarks in question.
We reject petitioners contention.
Petitioners trademark is registered in the supplemental register.
The Trademark Law (R.A. No. 166) provides that marks and
tradenames for the supplemental register shall not be published for
or be subject to opposition,
but shall be published on registration in
19
the Official Gazette. The reckoning point, there______________
Id., at 12, 158.
Id., at 193.
19 The whole paragraph reads as follows:
17
18

Chapter IV-A.The supplemental register.

SEC. 19-A.
xxx

xxx

x x x.

Marks and trade names for the supplemental register shall not be published for or be
subject to opposition, but shall be published on registration in the Official Gazette. Whenever
any person believes that he is or will be damaged by the registration of a mark or trade-name
on this register, he may at any time apply to the director to cancel such registration. Upon
receiving

612

612

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

fore, should not be 1 May 1975, the date of alleged use
by petitioner
20
of its assailed trademark but 27 October 1980, the date the
certificate of registration SR No. 5054 was published in the Official
Gazette and issued to petitioner.
It was only on the date of publication and issuance of the
registration certificate that private respondent may be considered
officially put on notice that petitioner has appropriated or is using
said mark, which, after all, is the function
and purpose of
21
registration in the supplemental register. The record is bereft of
evidence that private respondent was aware of petitioners
trademark before the date of said publication and issuance. Hence,
when private respondent instituted cancellation proceedings on 18
September 1981, less than a year had passed.
Corollarily, private respondent could hardly be accused of
inexcusable delay in filing its notice of opposition to petitioners
application for registration in the principal register 22 since said
application was published only on 20 February 1984. From the
time of publication to the time of filing the opposition on 27 July
1984 barely five (5) months had elapsed. To be barred from bringing
23
suit on grounds of estoppel and laches, the delay must be lengthy.
More crucial is the issue of confusing similarity between the two
trademarks. Petitioner vehemently contends that its trade______________
the application, the director shall give notice thereof to the registrant. If it is
found after a hearing that the registrant was not entitled to register the mark at
the time of his application for registration thereof, or that the mark was not used
by the registrant or has been abandoned, the registration shall be cancelled by the
director.
20 Supra, see Note 1.
21 Sec. 19-A, R.A. No. 166; La Chemise Lacoste, S.A. v. Fernandez, 129 SCRA 373
(1984).
22 Supra, see Note 4.
23 Ruben Agpalo, Trademark Law & Practice in the Philippines, 1990, p. 32,
citing La Insular v. Jao Oge, 47 Phil. 75, (1924); La Insular v. Yu So, 45 Phil. 398
(1923).

613

VOL. 251, DECEMBER 29, 1995

613

Emerald Garment Manufacturing Corporation vs. Court of Appeals

mark STYLISTIC MR. LEE is entirely different from and not
confusingly similar to private respondents LEE trademark.
Private respondent maintains otherwise. It asserts that
petitioners trademark tends to mislead and confuse the public and
thus constitutes an infringement of its own mark, since the
dominant feature therein is the word LEE.
The pertinent provision of R.A. No. 166 (Trademark Law) states
thus:
SEC. 22. Infringement, what constitutes.Any person who shall 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 imitable 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.

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.24
In Esso Standard Eastern, Inc. v. Court of Appeals, we held:
. . . But likelihood of confusion is a relative concept; to be determined only
according to the particular, and sometimes peculiar, circumstances of each
case. It is unquestionably true that, as stated in Coburn vs. Puritan Mills,
Inc.: In trademark cases, even more than in other litigation, precedent
must be studied in the light of the facts of the
______________
24

116 SCRA 336 (1982).

614

614

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

particular case.
xxx
xxx

x x x.

Likewise, it has been observed that:

In determining whether a particular name or mark is a colorable
imitation of another, no all-embracing rule seems possible in view of the
great number of factors which must necessarily be considered in resolving
this question of fact, such as the class of product or business to which the
article belongs; the products quality, quantity, or size, including its
wrapper or container; the dominant color, style, size, form, meaning of
letters, words, designs and emblems used; the nature of the package,
wrapper or container; the character of the products purchasers; location of
the business;25 the likelihood of deception or the mark or names tendency to
confuse; etc.

Proceeding to the task at hand, the essential element of

infringement is colorable imitation. This term has been defined as

such a close or ingenious imitation as to be calculated to deceive
ordinary purchasers, or such resemblance of the infringing mark to
the original as to deceive an ordinary purchaser giving such
attention as a purchaser usually gives, and
to cause him to
26
purchase the one supposing it to be the other.
Colorable imitation does not mean such similitude as amounts to identity.
Nor does it require that all the details be literally copied. Colorable
imitation refers to such similarity in form, content, words, sound,
meaning, special arrangement, or general appearance of the trademark or
tradename with that of the other mark or tradename in their over-all
presentation or in their essential, substantive and distinctive parts as
would likely mislead or confuse
persons in the ordinary course of
27
purchasing the genuine article.
______________
25 Jaime N. Salazar, Trademarks and Tradenames, 55 SCRA 422 (1974); See also
Colorable Imitation of Trademarks, Tradenames, Labels, Packages, Wrappers, etc.,
16 SCRA 502 (1966).
26 Etepha v. Director of Patents, 16 SCRA 495 (1966).
27 Ruben Agpalo, Trademark Law & Practice in the Philippines, 1990, p. 41.

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Emerald Garment Manufacturing Corporation vs. Court of Appeals

In determining whether colorable imitation exists, jurisprudence
has developed two kinds of teststhe 28Dominancy Test applied
in
29
Asia Brewery, Inc. v. Court of Appeals and other cases and the
Holistic Test developed in Del Monte Corporation v. Court of
30
31
Appeals and its proponent cases.
As its title implies, the test of dominancy focuses on the
similarity of the prevalent features of the competing trademarks
which might cause confusion or deception and thus constitutes
infringement.
xxx
xxx
x x x.
. . . . 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 it is necessary that the infringing label should suggest an effort to
imitate. [C. Neilman Brewing Co. v. Independent Brewing Co., 191 F., 489,
495, citing Eagle White Lead Co., vs. Pflugh (CC) 180 Fed. 579]. 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 mistakes in
the mind of the public or deceive purchasers. 32(Auburn Rubber Corporation
vs. Honover Rubber Co., 107 F. 2d 588; x x x.)
xxx
xxx
x x x.

On the other side of the spectrum, the holistic test mandates that
the entirety of the marks in question must be considered in
determining confusing similarity.
_____________
224 SCRA 437 (1993).
Co Tiong v. Director of Patents, 95 Phil. 1 (1954); Lim Hoa v. Director of
Patents, 100 Phil. 214 (1956); American Wire & Cable Co. v. Director of Patents, 31
SCRA 544 (1970); Phil. Nut Industry, Inc. v. Standard Brands, Inc., 65 SCRA 575
(1975); Converse Rubber Corp. v. Universal Rubber Products, Inc., 111 SCRA 154
(1987).
30 181 SCRA 410 (1990).
31 Mead Johnson & Co. v. N.V.J. Van Dorp, Ltd., 7 SCRA 771 (1963); Bristol
Myers Co. v. Director of Patents, 17 SCRA 128 (1966); Fruit of the Loom, Inc. v. CA,
28
29

133 SCRA 405 (1984).

32 Supra, see note 28.
616

616

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

xxx
xxx
x x x.
In determining whether the trademarks are confusingly similar, a
comparison of the words is not the only determinant 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
33
similar to the other.
xxx
xxx
x x x.

Applying the foregoing tenets to the present controversy and taking

into account the factual circumstances of this case, we considered
the trademarks involved as a whole and rule that petitioners
STYLISTIC MR. LEE is not confusingly similar to private
respondents LEE trademark.
Petitioners trademark is the whole STYLISTIC MR. LEE.
Although on its label the word LEE is prominent, the trademark
should be considered as a whole and not piecemeal. The
dissimilarities between the two marks become conspicuous,
noticeable and substantial enough to matter especially in the light
of the following variables that must be factored in.
First, the products involved in the case at bar are, in the main,
various kinds of jeans. These are not your ordinary household items
like catsup, soy sauce or soap which are of minimal cost. Maong
pants or jeans are not inexpensive. 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
34
less likely. In Del Monte Corporation v. Court of Appeals, we noted
that:
. . . . 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
______________
33

Fruit of the Loom, Inc. v. CA, supra, see note 31.

34

Supra, see note 30.

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617

Emerald Garment Manufacturing Corporation vs. Court of Appeals

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 . . . .

Second, like his beer, the average Filipino consumer generally buys
his jeans by brand. He does not ask the sales clerk for generic jeans
but for, say, a Levis, Guess, Wrangler or even an Armani. He is,
therefore, more or less knowledgeable and familiar with his
preference and will not easily be distracted.

Finally, in line with the foregoing discussions, more credit should

be given to the ordinary purchaser. Cast in this particular
controversy, the ordinary purchaser is not the completely unwary
consumer but is the ordinarily intelligent buyer considering the
type of product involved.
35
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.
There is no cause for the Court of Appeals apprehension that
petitioners products might be mistaken as another variation
or
36
line of garments under private respondents LEE trademark.
_____________
35
36

42 Phil. 190 (1921).

Supra, see note 12.
618

618

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

As one would readily observe, private respondents variation follows
a standard format LEERIDERS, LEESURES and LEELEENS.
It is, therefore, improbable that the public would immediately and
naturally conclude that petitioners STYLISTIC MR. LEE is but
another variation under private respondents LEE mark.
As we have previously intimated the issue of confusing similarity
between trademarks is resolved by considering the distinct
characteristics of each case. In the present controversy, taking into
account these unique factors, we conclude that the similarities in
the trademarks in question are not sufficient as to likely cause
deception and confusion tantamount to infringement.
Another way of resolving the conflict is to consider the marks
involved from the point of view of what marks are registrable
pursuant to Sec. 4 of R.A. No. 166, particularly paragraph 4(e):
CHAPTER II-A.The Principal Register
(Inserted by Sec 2, Rep Act No. 638.)
SEC. 4. Registration of trade-marks, trade-names and service-marks on the
principal register.There is hereby established a register of trade-marks,
trade-names and service-marks which shall be known as the principal
register. The owner of a trade-mark, trade-name or service-mark used to
distinguish his good, 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:
xxx
xxx
xxx
(e) Consists of a mark or trade-name which, when applied to or used in
connection with the goods, business or services of the applicant is merely
descriptive or deceptively misdescnptive of them, or when applied to or
used in connection with the goods, business or services of the applicant is
primarily geographically descriptive or deceptively misdescriptive of them,
or is primarily merely a surname; (Italics ours.)
xxx
xxx
xxx

LEE is primarily a surname. Private respondent cannot,

therefore, acquire exclusive ownership over and singular use of said
term.
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Emerald Garment Manufacturing Corporation vs. Court of Appeals

. . . . It has been held that a personal name or surname may not be
monopolized as a trademark or tradename as against others of the same
name or surname For in the absence of contract, fraud, or estoppel, any
man may use his name or surname in all legitimate ways. Thus,
Wellington is a surname, and its first user has no cause of action against
the junior user
of Wellington as it is incapable of exclusive
37
appropriation.

In addition to the foregoing, we are constrained to agree with

petitioners contention that private respondent failed to prove prior
actual commercial use of its LEE trademark in the Philippines
before filing its application for registration with the BPTTT and
hence, has not acquired ownership over said mark.
Actual use in commerce in the Philippines is an essential
prerequisite for the acquisition of ownership over a trademark
pursuant to Secs. 2 and 2-A of the Philippine Trademark Law (R.A.
No. 166) which explicitly provides that:
CHAPTER II. Registration of Marks and Trade-names.
Sec. 2. What are registrable.Trade-marks, trade-names, and service
marks owned by persons, corporations, partnerships or associations
domiciled in the Philippines and by persons, corporations, partnerships, or
associations domiciled in any foreign country may be registered in
accordance with the provisions of this act: Provided, That said trade
marks, trade names, or service marks are actually in use in commerce and
services not less than two months in the Philippines before the time the
applications for registration are filed: And Provided, further, That the
country of which the applicant for registration is a citizen grants by law
substantially similar privileges to citizens of the Philippines, and such fact
is officially certified, with a certified true copy of the foreign law translated
into the English language, by the government of the foreign country to the
Government of the Republic of the Philippines. (As amended.) (Italics
ours.)
SEC. 2-A. Ownership of trade marks, trade-names and service-marks,
how acquired.Anyone who lawfully produces or deals in
_______________
37

Ruben Agpalo, Trademark Law and Practice in the Philippines, 1990, p. 18, citing Ang

Si Heng v. Wellington Dept Store, Inc., 92 Phil. 448 (1953)

620

620

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

merchandise of any kind or who engages in lawful business, or who renders

any lawful service in commerce, by actual use hereof in manufacture or
trade, in business, and in the service rendered; may appropriate to his
exclusive use a trade-mark, a trade-name, or a service-mark not so
appropriated by another, to distinguish his merchandise, business or
services from others. The ownership or possession of trademark, tradename, service-mark, heretofore or hereafter appropriated, as in this
section provided, shall be recognized and protected in the same manner
and to the same extent as are other property rights to the law. (As
amended.) (Italics ours.)

The provisions of the 1965 Paris Convention for the Protection of

38

Industrial Property relied upon by private

respondent and Sec. 2139
A of the Trademark Law (R.A. No. 166) were sufficiently
______________
38

The Philippines became a signatory thereto on 27 September 1965.

The Paris Convention is essentially a compact among the various member countries to accord
in their own countries to citizens of the other contracting parties trademark and other rights
comparable to those accorded their own citizens by their domestic laws. The underlying
principle is that foreign nationals should be given the same treatment in each of the member
countries as that country makes available to its own citizens. In addition, the Convention
sought to create uniformity in certain respects by obligating each nation to assure to
nationals of countries of the Union an effective protection against unfair competition (Ruben
Agpalo, Trademark Law and Practice in the Philippines, 1990, pp. 200-201).
39 SEC 21-A. Any foreign corporation or juristic person to which a mark or tradename has been registered or assigned under this Act may bring an action
hereinunder for infringement, for unfair competition, or false designation of origin
and false description, whether or not it has been licensed to do business in the
Philippines under Act Numbered Fourteen hundred and fifty-nine, as amended,
otherwise known as the Corporation Law, at the time it brings complaint Provided,
That the country of which the said foreign or juristic person is a citizen, or in
which it is domiciled, by treaty, convention or law, grants a similar privilege to
corporate or juristic persons of the Philippines. (As amended.)

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Emerald Garment Manufacturing Corporation vs. Court of Appeals

expounded upon and qualified in the recent case of Philip Morris,
40
Inc. v. Court of Appeals:
xxx
xxx
x x x.
Following universal acquiescence and comity, our municipal law on
trademarks regarding the requirement of actual use in the Philip pines
must subordinate an international agreement inasmuch as the apparent
clash is being decided by a municipal tribunal (Mortisen vs. Peters, Great
Britain, High Court of Judiciary of Scotland, 1906, 8 Sessions, 93; Paras,
International Law and World Organization, 1971 Ed., p. 20). Withal, the
fact that international law has been made part of the law of the land does
not by any means imply the primacy of international law over national law
in the municipal sphere. Under the doctrine of incorporation as applied in
most countries, rules of international law are given a standing equal, not
superior, to national legislative enactments.
xxx
xxx
x x x.
In other words, (a foreign corporation) may have the capacity to sue for
infringement irrespective of lack of business activity in the Philippines on
account of Section 21-A of the Trademark Law but the question of whether
they have an exclusive right over their symbol as to justify issuance of the
controversial writ will depend on actual use of their trademarks in the
Philippines in line with Sections 2 and 2-A of the same law. It is thus
incongruous for petitioners to claim that when a foreign corporation not
licensed to do business in the Philippines files a complaint for
infringement, the entity need not be actually using the trademark in
commerce in the Philippines. Such a foreign corporation may have the
personality to file a suit for infringement but it may not necessarily be
entitled to protection due to absence of actual use of the emblem in the
local market.
xxx
xxx
x x x.

Undisputably, private respondent is the senior registrant, having

obtained several registration certificates for its various trademarks
LEE, LEE RIDERS, and LEESURES in both the supplemental
41
and principal registers, as early as 1969 to 1973. However,
registration alone will not suffice. In Sterling

___________
40
41

224 SCRA 576 (1993).

Rollo, p. 170; Exhibits A, B, C, & C-1.
622

622

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

Products
International,
Inc.
42
Aktiengesellschaft, we declared:

v.

Farbenfabriken

Bayer

xxx
xxx
x x x.
A rule widely accepted and firmly entrenched because it has come down
through the years is that actual use in commerce or business is a
prerequisite in the acquisition of the right of ownership over a trademark.
xxx
xxx
x x x.
It would seem quite clear that adoption alone of a trademark would not
give exclusive right thereto Such right grows out of their actual use.
Adoption is not use. One may make advertisements, issue circulars, give
out price lists on certain goods, but these alone would not give exclusive
right of use. For trademark is a creation of use. The underlying reason for
all these is that purchasers have come to understand the mark as
indicating the origin of the wares. Flowing from this is the traders right to
protection in the trade he has built up and the goodwill he has
accumulated from use of the trademark Registration of a trademark, of
course, has value: it is an administrative act declaratory of a pre-existing
right. Registration does not, however, perfect a trademark right. (Italics
ours.)
xxx
xxx
x x x.

To augment its arguments that it was, not only the prior registrant,
but also the prior user, private respondent invokes Sec. 20 of the
Trademark Law, thus:
SEC. 20. Certificate of registration prima facie evidence of validity.A
certificate of registration of a mark or tradename shall be a prima facie
evidence of the validity of the registration, the registrants ownership of
the mark or tradename, and of the registrants exclusive right to use the
same in connection with the goods, business or services specified in the
certificate, subject to any conditions and limitations stated therein.

The credibility placed on a certificate of registration of ones

trademark, or its weight as evidence of validity, ownership and
_____________
42 27 SCRA 1214 (1969), Reiterated in Kabushi Kaisha Isetan v. Intermediate
Appellate Court, 203 SCRA 583 (1991).

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623

Emerald Garment Manufacturing Corporation vs. Court of Appeals

exclusive use, is qualified. A registration certificate serves merely
as prima facie evidence. It is not conclusive but can and may be
rebutted by controverting evidence.
Moreover, the aforequoted
provision applies only to registrations
43
in the principal register. Registrations in the supplemental
register do not enjoy a similar privilege. A supplemental register
was created precisely for the registration of marks which
are not
44
registrable on the principal register due to some defects.
The determination as to who is the prior user of the trademark is
a question of fact and it is this Courts working principle not to
disturb the findings of the Director of Patents on this issue in the

absence of any showing of grave abuse of discretion. The findings of

facts of the Director of Patents are conclusive upon the 45Supreme
Court provided they are supported by substantial evidence.
In the case at bench, however, we reverse the findings of the
Director of Patents and the Court of Appeals. After a meticulous
study of the records, we observe that the Director of Patents and
the Court of Appeals relied mainly on the registration certificates as
proof of use by private respondent of the trademark LEE which,
as we have previously discussed are not sufficient. We cannot give
credence to private respondents claim that its LEE mark first
reached the Philippines in the 1960s through local sales46 by the Post
Exchanges of the U.S. Military Bases in the Philippines based as it
was solely on the self-serving statements of Mr. Edward Poste,
General Manager of Lee (Phils.), Inc., a wholly owned subsidiary of
47
the H.D. Lee, Co., Inc., U.S.A., herein private respondent.
Similarly, we give little weight to the numerous vouchers
representing various advertising expenses in
______________
La Chemise Lacoste, SA. v. Fernandez, 129 SCRA 373 (1984).
Ibid.
45 Unno Commercial Enterprises, Inc. v. General Milling Corp., 120 SCRA 804
(1983); Kabushi Kaisha Isetan v. Intermediate Appellate Court, 203 SCRA 583
(1991).
46 Rollo, p. 177.
47 Original Records, p. 52.
43
44

624

624

SUPREME COURT REPORTS ANNOTATED

Emerald Garment Manufacturing Corporation vs. Court of Appeals

48

the Philippines for LEE products. It is well to note that these

expenses were incurred only in 1981 and 1982 by LEE (Phils.), Inc.
after it entered into
a licensing agreement with private respondent
49
on 11 May 1981.
On the other hand, petitioner has sufficiently shown that it has
been in the business of selling jeans and other garments adopting
its STYLISTIC MR. LEE trademark since 1975 as evidenced
by
50
appropriate sales invoices to various stores and retailers.
51
Our rulings in Pagasa Industrial Corp. v. Court of Appeals and
52
Converse Rubber Corp. v. Universal Rubber Products, Inc.,
respectively, are instructive:
The Trademark Law is very clear. It requires actual commercial use of the
mark prior to its registration. There is no dispute that respondent
corporation was the first registrant, yet it failed to fully substantiate its
claim that it used in trade or business in the Philippines the subject mark;
it did not present proof to invest it with exclusive, continuous adoption of
the trademark which should consist among others, of considerable sales
since its first use. The invoices submitted by respondent which were dated
way back in 1957 show that the zippers sent to the Philippines were to be
used as samples and of no commercial value. The evidence for
respondent must be clear, definite and free from inconsistencies. Samples
are not for sale and therefore, the fact of exporting them to the Philippines
cannot be considered to be equivalent to the use contemplated by law.
Respondent did not expect income from such samples. There were no
receipts to establish sale, and no proof were presented to show that they
were subsequently sold in the Philippines.
xxx
xxx
x x x.
The sales invoices provide the best proof that there were actual sales of
petitioners product in the country and that there was actual use for a
protracted period of petitioners trademark or part thereof
______________

48

Exhibits F-1 to F-59.

49

Exhibit E.

50

Exhibits 1-e to l-o.

51

118 SCRA 526 (1982).

52

147 SCRA 154 (1987).

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VOL. 251, DECEMBER 29, 1995

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Emerald Garment Manufacturing Corporation vs. Court of Appeals

through these sales.

For lack of adequate proof of actual use of its trademark in the

Philippines prior to petitioners use of its own mark and for failure
to establish confusing similarity between said trademarks, private
respondents action for infringement must necessarily fail.
WHEREFORE, premises considered, the questioned decision and
resolution are hereby REVERSED and SET ASIDE.
SO ORDERED.
Bellosillo and Hermosisima, Jr., JJ., concur.
Padilla (Chairman), J., I dissent. I vote to deny the petition;
I agree with BPTTT and the CA that petitioners trademark
STYLISTIC MR. LEE is confusingly similar to private
respondents earlier registered trademarks LEE or LEE RIDER,
LEE-LEENS and LEE-SURES such that the trademark
STYLISTIC MR. LEE is an infringement of the earlier registered
trademarks.
Davide, Jr., J., I vote to deny the petition there being no
showing of an exemption to conclusiveness of findings of BPTTT
and of CA.
Decision and resolution reversed and set aside.
Note.Infringement of trade mark is a form of unfair
competition. (Asia Brewery, Inc. vs. Court of Appeals, 224 SCRA 437
[1994])
o0o
626

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