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    Western Equipments - Supply Co. v. Reyes

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    Iñigo Mathay Rojas
    1) Western Equipment and Supply Company, a foreign corporation, sued to prevent a Philippine corporation from using the name "Western Electric Company, Inc." as it was too similar to Western Electric Company, a well-known foreign manufacturer. 2) The court ruled in favor of Western Equipment, finding that Western Electric Company had established goodwill and reputation in the Philippines through decades of product sales, even though it did not directly do business there. 3) The court concluded that Western Electric Company had a right to protect its corporate name and reputation, and that the proposed local corporation intended to confuse customers and profit off Western Electric's good name through fraudulent means.

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    Western Equipments - Supply Co. v. Reyes

    Uploaded by

    Iñigo Mathay Rojas
    102 views3 pages
    1) Western Equipment and Supply Company, a foreign corporation, sued to prevent a Philippine corporation from using the name "Western Electric Company, Inc." as it was too similar to Western Electric Company, a well-known foreign manufacturer. 2) The court ruled in favor of Western Equipment, finding that Western Electric Company had established goodwill and reputation in the Philippines through decades of product sales, even though it did not directly do business there. 3) The court concluded that Western Electric Company had a right to protect its corporate name and reputation, and that the proposed local corporation intended to confuse customers and profit off Western Electric's good name through fraudulent means.

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    209. Western Equipments _ Supply Co. v. Reyes

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    1) Western Equipment and Supply Company, a foreign corporation, sued to prevent a Philippine corporation from using the name "Western Electric Company, Inc." as it was too similar to Western Electric Company, a well-known foreign manufacturer. 2) The court ruled in favor of Western Equipment, finding that Western Electric Company had established goodwill and reputation in the Philippines through decades of product sales, even though it did not directly do business there. 3) The court concluded that Western Electric Company had a right to protect its corporate name and reputation, and that the proposed local corporation intended to confuse customers and profit off Western Electric's good name through fraudulent means.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    102 views3 pages

    Western Equipments - Supply Co. v. Reyes

    Uploaded by

    Iñigo Mathay Rojas
    1) Western Equipment and Supply Company, a foreign corporation, sued to prevent a Philippine corporation from using the name "Western Electric Company, Inc." as it was too similar to Western Electric Company, a well-known foreign manufacturer. 2) The court ruled in favor of Western Equipment, finding that Western Electric Company had established goodwill and reputation in the Philippines through decades of product sales, even though it did not directly do business there. 3) The court concluded that Western Electric Company had a right to protect its corporate name and reputation, and that the proposed local corporation intended to confuse customers and profit off Western Electric's good name through fraudulent means.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    WESTERN EQUIPMENT AND SUPPLY COMPANY vs.

    CA
    GR No. 27897 – Dec. 2, 1927 – Johns

    SUBJECT: Tradenames; right of the tradename owner.

    FACTS:
    Western Equipment and Supply Company (plaintiff) is a foreign corporation organized under
    the laws of the State of Nevada. On or about May 4, 1925, through its duly authorized agent,
    Felix Reyes (plaintiff), Western Equipment applied to Fidel Reyes (defendant), the Director of
    the Bureau of Commerce and Industry, for the issuance of a license to engage in business in the
    Philippines. On May 20, 1926, said director issued in favor of Western Equipment a provisional
    license for that purpose which was made permanent on Aug. 23, 1926.

    Since May 20, 1926, Western Equipment has been and still is engaged in importing and selling
    in the Philippines electrical and telephone apparatus and supplies manufactures by Western
    Electric Company, also a foreign corporation organized under the laws of the State of New York.

    Western Electric Company has never been engaged in business in the Philippines. It is a
    manufacturer of electrical and telephone apparatus and supplies which have been sold in
    foreign and interstate commerce for the past 50 years, and have acquired high trade reputation
    throughout the world. Also, it has acquired a valuable goodwill and high reputation in the PH,
    through sale, by importers, and the extensive use with the country of its products bearing
    either its corporate name or trade-mark ‘Western Electric’. The words ‘Western Electric’ have
    been registered by Western Electric as a trade-mark under the provisions of the Act of Congress
    of Feb. 20, 1905, in the office of the Commissioner of Patents at Washington, DC, and said mark
    remains in force as the property of said plaintiff to this date.

    A Philippine corporation known as the Electric Supply Company, Inc.,’ has been importing the
    manufactures of Western Electric into the Philippines for the purpose of selling the same
    therein. Defendant Henry Herman is the President and General Manager of said corporation.

    On October 15, 1926, Defendants Henry Herman, Peter O’Brien, Manuel Diaz, Felipe Mapoy
    and Artemio Zamora signed and filed articles of incorporation with defendant Fidel Reyes, the
    Director of the Bureau of Commerce and Industry, with the intention of organizing a domestic
    corporation under the PH Corporation Law to be known as the ‘Western Electric Company, Inc.’
    for the purpose, among other things, of manufacturing, buying, selling and dealing generally in
    electrical and telephone apparatus and supplies. The filing was done with knowledge of the
    existence of the plaintiff Western Electric Company, Inc., of its corporate name, of its trade-
    mark, ‘Western Electric’ and of the fact that the manufactures of said plaintiff bearing its trade-
    mark or corporate name are in general use in the PH and in the US.

    On Oct. 18, 1926, plaintiff W.Z. Smith, President and General Manager of Western Equipment,
    lodged with the Director of the Bureau of Commerce and Industry its protest against the
    registration of the proposed incorporation by the defendants upon the ground among others,
    that the corporate name by which said defendants desire to be known, being identical with that
    of the plaintiff Western Equipment and Supply Company, will deceive and mislead the public
    purchasing electrical and telephone apparatus and supplies.

    On Oct. 20, 1926, plaintiff Smith filed a written application for the issuance of a license to
    engage in business in the PH with the defendant Director of the Bureau of Commerce and
    Industry.

    The Director of the Bureau of Commerce and Industry announced his intention to overrule said
    protest and will, unless judicially restrained therefrom, issue to the other defendants herein a
    certificate of incorporation, constituting said defendants a PH body politic and corporate under
    the name of ‘Western Electric Company, Inc.’

    CFI: ruled in favor of the plaintiffs.

    ISSUE: WON a foreign company, which has never engaged business in the PH, can restrain a
    Philippine citizen from organizing a corporation bearing the same name as such foreign
    corporation?

    HELD: Yes.
    A foreign corporation which has never done any business in the Philippine Islands and which is
    unlicensed and unregistered to do business here, but is widely and favorably known in the
    Islands through the use therein of its products bearing its corporate and trade name, has a legal
    right to maintain an action in the Islands to restrain the residents and inhabitants thereof from
    organizing a corporation therein bearing the same name as the foreign corporation, when it
    appears that they have personal knowledge of the existence of such a foreign corporation, and
    it is apparent that the purpose of the proposed domestic corporation is to deal and trade in the
    same goods as those of the foreign corporation. 


    An unregistered foreign corporation which has not personally transacted business in the
    Philippine Islands, but which has acquired valuable goodwill and high reputation therein
    through the sale by importers and the extensive use within the Islands of its products bearing
    either its corporate name or trade-mark, has a legal right to restrain an officer of the
    Government, who has full knowledge of those facts, from issuing a certificate of incorporation
    to residents of the Philippine Islands who are attempting to organize a corporation for the
    purpose of pirating the corporate name of the foreign corporation and of engaging in the same
    business, for the purpose of making the public believe that the goods which it proposes to sell
    are the goods of the foreign corporation and of defrauding it and its local dealers of their
    legitimate trade.

    The purpose of such a suit is to protect its reputation, corporate name and goodwill which have
    been established through the natural development of its trade over a long period of years, in
    the doing of which it does not seek to enforce any legal or contract rights arising from, or
    growing out of, any business which it has transacted in the Philippine Islands.
    Under such a state of facts, the, right to the use of the corporate and trade name of a foreign
    corporation is a property right, a right in rem, which it may assert and protect in any of the
    courts of the world even in countries where it does not personally transact any business.

    In such a case, it is the trade and not the mark that is to be protected, a trade-mark
    acknowledges no territorial boundaries of municipalities or states or nations, but extends to
    every market where the trader’s goods have become known and identified by the use of the
    mark.

    Western Electric Company, Inc., has been in existence as a corporation for over 50 years, during
    which time it has established a reputation all over the world including the Philippine Islands, for
    the kind and quality of its manufactured articles. It is very apparent that the whole purpose and
    intent of Herman and his associates in seeking to incorporate another corporation under the
    identical name of Western Electric Company, Inc., and for the same identical purpose as that of
    the plaintiff, is to trespass upon and profit by its good name and business reputation. The very
    fact that Herman and his associates have sought the use of that particular name for that
    identical purpose is conclusive evidence of the fraudulent intent with which it is done.

    Judgment of the lower court is affirmed.

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