Commercial Law

Converse Rubber Corporation vs Universal Rubber Products, Inc.

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G.R. No. L-27906 – 147 SCRA 154 – Mercantile Law – Intellectual Property Law – Law on Trademarks, Service Marks and Trade Names – Trade Name Infringement – Convention of the Union of Paris for the Protection of Industrial Property

Converse Rubber Corporation is an American corporation while Universal Rubber Products, Inc. is a corporation licensed to do business in the country. Converse has been operating since 1946. Universal Rubber has been operating since 1963. Later, Universal Rubber filed an application for the trademark “Universal Converse and Device” before the Philippine Patent Office. Converse Rubber opposed the application as it averred that the word “Converse” which is part of its corporate name cannot be granted as part of Universal Rubber’s trademark or trade name because it will likely deceive purchasers of Universal Rubber’s products as it may be mistaken by unwary customers to be manufactured by Converse Rubber. The Director of Patents denied the opposition by Converse Rubber on the ground that Converse Rubber has no standing to sue in the Philippines because it is not registered here.

ISSUE: Whether or not the decision of the Director of Patents is correct.

HELD: No. From a cursory appreciation of the Converse Rubber’s corporate name “CONVERSE RUBBER CORPORATION” it is evident that the word “CONVERSE” is the dominant word which identifies Converse Rubber from other corporations engaged in similar business. Universal Rubber, in the stipulation of facts, admitted Converse Rubber’s existence since 1946 as a duly organized foreign corporation engaged in the manufacture of rubber shoes. This admission necessarily betrays its knowledge of the reputation and business of petitioner even before it applied for registration of the trademark in question. Knowing, therefore, that the word “CONVERSE” belongs to and is being used by Converse Rubber, and is in fact the dominant word in its corporate name, Universal Rubber has no right to appropriate the same for use on its products which are similar to those being produced by Converse Rubber.

The Director of Patents is wrong in ruling that Converse Rubber cannot sue here. A foreign corporation which has never done any business in the Philippines and which is unlicensed and unregistered to do business here, but is widely and favorably known in the Philippines through the use therein of its products bearing its corporate and tradename, has a legal right to maintain an action in the Philippines 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. This is in keeping with the Convention of the Union of Paris for the Protection of Industrial Property to which the Philippines became a party in 1965.

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