ESSO STANDARD VS COURT OF APPEALS

ESSO STANDARD VS COURT OF APPEALS

G.R. NO. L- 29971

DATE AUG. 31, 1992

PONENTE TEEHANKEE, J.

FACTS: Esso Standard Eastern, Inc., then a foreign corporation duly licensed to do business in the Philippines, is engaged in the sale of petroleum products which are Identified with its trademark ESSO United Cigarette Corporation is a domestic corporation then engaged in the manufacture and sale of cigarettes, after it acquired in November, 1963 the business, factory and patent rights of its predecessor La Oriental Tobacco Corporation, one of the rights thus acquired having been the use of the trademark ESSO on its cigarettes, for which a permit had been duly granted by the Bureau of Internal Revenue.

The complaint of ESSO alleged that it had been for many years engaged in the sale of petroleum products and its trademark ESSO had acquired a considerable goodwill to such an extent that the buying public had always taken the trademark ESSO as equivalent to high quality petroleum products. It asserted that the continued use by United Cigarettes Corporation of the same trademark ESSO on its cigarettes was being carried out for the purpose of deceiving the public as to its quality and origin to the detriment and disadvantage of its own products.

Unite Cigarettes Corporation admitted that it used the trademark ESSO on its own product of cigarettes, which was not Identical to those produced and sold by the petitioner and therefore did not in any way infringe on or imitate petitioner's trademark. It further argues that in order that there may be trademark infringement, it is indispensable that the mark must be used by one person in connection or competition with goods of the same kind as the complainant's.

ISSUE/S: Is there trademark infringment?

RULING: None.

It is undisputed that the goods on which petitioner uses the trademark ESSO, petroleum products, and the product of respondent, cigarettes, are non-competing. But as to whether trademark infringement exists depends for the most part upon whether or not the goods are so related that the public may be, or is actually, deceived and misled that they came from the same maker or manufacturer. For non-competing goods may be those which, though they are not in actual competition, are so related to each other that it might reasonably be assumed that they originate from one manufacturer. Non-competing goods may also be those which, being entirely unrelated, could not reasonably be assumed to have a common source. in the former case of related goods, confusion of business could arise out of the use of similar marks; in the latter case of non-related goods, it could not. The vast majority of courts today follow the modern theory or concept of "related goods" which the Court has likewise adopted and uniformly recognized and applied.

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.

In the present case, the goods are obviously different from each other with "absolutely no iota of similitude" as stressed in respondent court's judgment. They are so foreign to each other as to make it unlikely that purchasers would think that petitioner is the manufacturer of respondent's goods.ºThe mere fact that one person has adopted and used a trademark on his goods does not prevent the adoption and use of the same trademark by others on unrelated articles of a different kind.

Considering the general appearances of each mark as a whole, the possibility of any confusion is unlikely. A comparison of the labels of the samples of the goods submitted by the parties shows a great many differences on the trademarks used. Even the lower court, which ruled initially for petitioner, found that a "noticeable difference between the brand ESSO being used by the defendants and the trademark ESSO of the plaintiff is that the former has a rectangular background, while in that of the plaintiff the word ESSO is enclosed in an oval background."