CASE ANALYSIS: UFC PHILIPPINES VS. FIESTA BARRIO G.R. No.

198889

SUMMARY

Petitioner Nutri-Asia, Inc. is the existing owner of trademark “PAPA”,

“PAPA BANANA CATSUP” and “PAPA KETSARAP”.

Subsequently, Respondent Barrio Fiesta Manufacturing Corporation

filed Application No. 4-2002-002757 for the mark "PAPA BOY &
DEVICE" for its product "lechon sauce." in the Intellectual Property
Office (IPO).

Petitioner Nutri-Asia, Inc. opposed the application of Respondent Barrio

Fiesta Manufacturing Corporation contending that "PAPA BOY &
DEVICE" is confusingly similar to its "PAPA" marks inasmuch as the
former incorporates the term "PAPA," which is the dominant feature of
petitioner's Nutri-Asia, Inc. "PAPA" marks.

The case hinges on whether “PAPA BOY & DEVICE” is confusingly

similar with “PAPA BANANA KETSUP”.

The Supreme Court in using the Dominancy Test ruled in favor of

Petitioner Nutri-Asia, Inc.

It ruled that “PAPA BOY & DEVICE” is confusingly similar with “PAPA
BANANA KETSUP”, hence, Respondent Barrio Fiesta Manufacturing
Corporation cannot register its mark "PAPA BOY & DEVICE"

A. CRITIQUE/EVALUATION

The respective positions of Petitioner Nutri-Asia, Inc. and Respondent

Barrio Fiesta Manufacturing Corporation have been fairly presented.
Before rendering the decision, the honorable court through Justice
Leonardo-De Castro who penned the decision of this case discussed
thoroughly the merits of the arguments of both the opposing parties
and after that he gave a candid explanation on the ruling of the
Supreme Court.

The conflict of interest in this case hinges on the application of

Dominancy Test which is the main argument of Petitioner Nutri-Asia,
Inc. and that of the Holistic or Totality Test which is the main
argument of Respondent Barrio Fiesta Manufacturing Corporation.
The case of Mang Inasal Philippines, Inc. vs. IFP Manufacturing
Corporation G.R. 221717 discusses the difference between
Dominancy Test and Holistic or Totality Test, to wit:

“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.

There are currently no fixed rules as to which of the two tests

can be applied in any given case. However, recent case law on
trademark seems to indicate an overwhelming judicial
preference towards applying the dominancy test.”

Aside from the above stated jurisprudence, the Dominancy test is

now embodied in Section 155 of the Intellectual Property Law and is
therefore the controlling test.

In trademark controversies, each case must be scrutinized according

to its peculiar circumstances, such that jurisprudential precedents
should only be made to apply if they are specifically in point.

In Petitioner Nutri-Asia, Inc.’s trademark “PAPA”, “PAPA BANANA

CATSUP” and “PAPA KETSARAP”, the word “PAPA” is the dominant
feature of the trademark. On the other hand, the word "PAPA" is
also the dominant feature of Respondent Barrio Fiesta
Manufacturing Corporation’s "PAPA BOY & DEVICE" mark subject
of the application, such that "the word 'PAPA' is written on top of
and before the other words such that it is the first word/figure that
catches the eyes." Furthermore, the part of Respondent Barrio
Fiesta Manufacturing Corporation’s mark which appears
prominently to the eyes and ears is the phrase "PAPA BOY" and that
is what a purchaser of Respondent Barrio Fiesta Manufacturing
Corporation’s product would immediately recall, not the smiling hog.

A careful examination of Petitioner Nutri-Asia, Inc.’s and

Respondent Barrio Fiesta Manufacturing Corporation’s respective
marks shows that the word "PAPA" is the dominant feature. In
Petitioner Nutri-Asia, Inc.’s marks, the word "PAPA" is either the
mark by itself or the predominant word considering its stylized font
and the conspicuous placement of the word "PAPA" before the other
words. In Respondent Barrio Fiesta Manufacturing Corporation’s
mark, the word "PAPA" is written on top of and before the other
words such that it is the first word figure that catches the eyes. The
visual and aural impressions created by such dominant word "PAPA"
at the least is that the respective goods of the parties originated from
the other, or that one party has permitted or has been given license
to the other to use the word "PAPA" for the other party's product, or
that there is a relation/connection between the two parties when, in
fact, there is none. This is especially true considering that the
products of both parties belong to the same class and are closely
related: Catsup and lechon sauce or liver sauce are both gravy-like
condiments used to spice up dishes. Thus, confusion of goods and
of business may likely result.

The Court also cites the following examples in applying the

Dominancy Test in this case:

i. “McJoy” and “Big Mack” infringe the trademark of McDonald’s

and the latter’s dominant feature is “Mc” or “Mac” ( Mc
Donald’s Corp. v. McJoy, 514 SCRA 95 [2007]);

ii. “Master Flavor” is an infringement of the registered marks

“Master Roast” and “Master Blend” (Societe Des Produit Nestle
S.A. v. CA, 356 SCRA 207, 217);

iii. The use of the stylized “S” by Respondent Interpacific Industrial

Trading Corp. in its Strong rubber shoes infringes on the mark
already registered by Sketchers USA with the IPO. While it is
undisputed that Petitioner Sketchers USA’s “S” is within an
oval design, the Court ruled that the dominant feature of the
trademark is the stylized “S”, as it is precisely the stylized “S”
which catches the eye of the purchaser. Thus even if
Respondent Interpacific Industrial Trading Corp. did not use an
oval design, the mere fact that it used the same stylized “S” ,
 the same being the dominant feature of Sketcher USA’s
trademark, already constitutes infringement under the
Dominancy Test (Sketchers USA, Inc. v. Interpacific Industrial
Trading Corp., G.R. No. 164321, March 23, 2011)

The reader/critique supports the Court in applying the Dominancy

Test. In this case, it is more beneficial to the interest of justice and
fair play to apply the Dominancy Test rather than the Holistic Test.

Defendants in cases of infringement do not normally copy but only

make colorable changes. 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 (Foriertrans Manufacturing
Corp. v. Davindoff et cie, March 6, 2017).

If we apply the Holistic Test and argue that the trade mark “PAPA
BOY & DEVICE” of Respondent Barrio Fiesta Manufacturing
Corporation must be allowed considering that it is not exactly the
same (in terms of complete spelling, words used, pronunciation, etc.)
as that of the trade mark “ PAPA”, “PAPA BANANA CATSUP” and
“PAPA KETSARAP” of Petitioner Nutri-Asia, Inc, the reputation or
goodwill built up on the trademark “PAPA” by Petitioner Nutri-Asia,
Inc. and its predecessor in interest for more than 27 years will be
wasted. All the competitors of Petitioner Nutri-Asia, Inc.’s only needs
to add some random words to the word “PAPA” in order to be excused
from the consequences and liability of infringement. –This must not
be allowed as this is contrary to justice and fair play.

Moreover, the application of the Dominancy Test, in this case,

prevents the scenario of “confusion of goods” and “confusion of
business”.

Types of Confusion:

1. 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, the defendant’s goods are
then bought as the plaintiff’s and its poor quality reflects badly
on the plaintiffs’ reputation.

2. Confusion of business- wherein the goods of the parties are

different but the defendant’s products 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.
(Mighty Corporation v. E & J Callo, 434 SCRA 473 [2004]).

The ruling of the Supreme Court in this case benefits and protects the
public from being deceived that the lechon sauce with the mark “PAPA
BOY & DEVICE” is the same or related to the sauce with the mark “
PAPA”, “PAPA BANANA CATSUP” and “PAPA KETSARAP”.

To support this claim, the reader/ critique echoes the findings of the
court:

“We agree that respondent's mark cannot be registered. Respondent's

mark is related to a product, lechon sauce, an everyday all-purpose
condiment and sauce, that is not subjected to great scrutiny and care
by the casual purchaser, who knows from regular visits to the grocery
store under what aisle to find it, in which bottle it is contained, and
approximately how much it costs. Since petitioner's product, catsup,
is also a household product found on the same grocery aisle, in
similar packaging, the public could think that petitioner had
expanded its product mix to include lechon sauce, and that the
"PAPA BOY" lechon sauce is now part of the "PAPA" family of sauces,
which is not unlikely considering the nature of business that
petitioner is in. Thus, if allowed. registration, confusion of business
may set in, and petitioner's hard-earned goodwill may be associated
to the newer product introduced by respondent, all because of the
use of the dominant feature of petitioner's mark on respondent's
mark, which is the word "PAPA." The words "Barrio Fiesta" are not
included in the mark, and although printed on the label of
respondent's lechon sauce packaging, still do not remove the
impression that "PAPA BOY" is a product owned by the manufacturer
of "PAPA" catsup, by virtue of the use of the dominant feature. It is
possible that petitioner could expand its business to include lechon
sauce, and that would be well within petitioner's rights, but the
existence of a "PAPA BOY" lechon sauce would already eliminate this
possibility and deprive petitioner of its rights as an owner of a valid
mark included in the Intellectual Property Code.”

B. REACTION

The jurisprudence enlightens the reader/critique on matters relating to

commercial practice. It gives clear educational insight on the intricacies
of trademark/ tradename infringement. It gives assurance that every
good businessman has their rights protected. The State upholds the
 hard-earned goodwill and reputation of every commercial practitioner. It
encourages fair and equitable competition among all businessmen.

Trademark Infringement is defined as the unauthorized use of a

trademark or service mark. This practice leads to the confusion,
deception, or misunderstanding about the actual company product or
the company that manufactures the product. As a remedy, trademark
owners can take legal action if they believe that their marks are being
infringed. If infringement of a trademark is proved, a court order can
prevent a defendant from using the mark, and the owner may be
awarded with monetary relief.

In the instant case, the reader is impressed that the Supreme Court
affirmed the decision of the Bureau of Legal Affairs of the Intellectual
Property Office (IPO-BLA) and the decision of the Director General of the
Intellectual Property Office rejecting the Respondent Barrio Fiesta
Manufacturing Corporation’s Application No. 4-2002-002757 for the mark
"PAPA BOY & DEVICE".

The act of upholding the rights of Petitioner Nutri-Asia, Inc. over its
trademark “PAPA”, “PAPA BANANA CATSUP” and “PAPA KETSARAP”
epitomizes the administration of commercial fair play and justice.

This ruling of the Supreme Court evidences that our laws relating to
Trademark Infringement has its fangs and claws that is always ready to
devour anyone who goes against the sanctity of our Infringement Laws.

The protection of our commercial practitioners yields to a fruitful

economy. Where commercial rights are protected and commercial
violators punished, our economy is sure to flourish.

C. CONCLUSION/APPLICATION

Our Commercial Laws and jurisprudence must be designed in such a

way that the rights of every person engaged in commerce must be
protected and upheld. No one must be allowed to ride on the hard-earned
popularity or goodwill of another. Commercial practice based on equity,
justice, and fair play encourages every player in the field of commerce to
strive without fear that their business reputation or goodwill earned over
a long period will be wasted. It also encourages our local investors and
foreign investors to invest in our country causing economic growth.

All being told this Jurisprudence sends a message not only to the
commercial practitioners but to the general public that the State will not
sleep on its obligation to uphold the rights of commercial practitioners.
Honest business practice (e.g. doing away with trademark Infringement)
is vital to the growth of every business enterprise. Honesty is a key
characteristic of a business because it sets the tone for the kind of work
culture that one wants to create, provides consistency in workplace
behavior, and builds loyalty and trust in customers and prospects.

One cannot impose honesty among its employees, business partners,

and customers if he himself practices dishonesty such as trademark
infringement.