La Yebana Company, Inc. v. Alhambra Cigar and Cigarette Manufacturing Co.
REITERATIONFacts
The Antecedents: La Yebana Company, Inc. (appellant) sought to reverse a judgment from the Court of First Instance of Manila. This judgment had upheld an order from the Director of the Bureau of Commerce and Industry, which approved the registration of a trade-mark for Alhambra Cigar and Cigarette Manufacturing Co. (appellee) and denied La Yebana Company's opposition. The lower court also awarded damages to Alhambra for a preliminary injunction issued earlier in the case. The core dispute revolved around whether La Yebana Company, by registering a trade-mark for cigarette wrappers, had acquired the exclusive right to use the word "Chorritos" as a trade-mark against competitors. Procedural History: The case originated with the registration of trade-marks involving the word "Chorritos." Alhambra Fabrica de Tabacos, Cigarrillos y Picadura registered a label with "Alhambra 25 Chorritos" in 1904. Later, Enrique Ga. Caruana registered "20 Chorritos de Gamu" in 1922. La Yebana Company, Inc. secured its own registration for "La Yebana Chorritos" in 1925. Subsequently, Alhambra Cigar and Cigarette Mfg. Company, the successor to Alhambra Fabrica de Tabacos, applied to register the trade-mark "Alhambra Chorritos" in 1928. La Yebana Company opposed this application, leading to a decision by the Bureau of Commerce and Industry to accept Alhambra's application and overrule the opposition. This administrative decision was then challenged in the Court of First Instance of Manila, which ultimately ruled in favor of Alhambra. The Petition: La Yebana Company, Inc., as the appellant before this Court, argued that its prior registration of the trade-mark "La Yebana Chorritos" granted it the exclusive right to use the word "Chorritos" for cigarette wrappers. The appellant sought to overturn the lower court's decision, which had affirmed the registration of the "Alhambra Chorritos" trade-mark by the appellee and awarded damages. The appellant's thesis was that the word "Chorritos" was a distinctive mark that it had exclusively acquired the right to use. The Court considered whether the word "Chorritos" had become a generic term for a type of cigarette, and whether the appellee's use constituted an infringement or merely a continuation of its long-standing practice.
Issue(s)
Whether the registration of the trade-mark "Alhambra Chorritos" by the appellee constitutes an infringement of the appellant's trade-mark "La Yebana Chorritos". Whether the appellant acquired the exclusive right to use the word "Chorritos" as a trade-mark for cigarette wrappers.
Ruling
The Supreme Court affirmed the judgment of the Court of First Instance of Manila, upholding the registration of the trade-mark "Alhambra Chorritos" by the appellee and denying the opposition filed by the appellant. The Court also affirmed the award of damages to the appellee for the preliminary injunction.
Ratio Decidendi
On the issue of infringement and exclusive right to use the trade-mark "Chorritos": The Court held that the registration of the appellee's trade-mark does not constitute an infringement of the appellant's trade-mark. The word "Chorritos" was understood to have become a local name for a special kind of cigarettes, similar to how "Corona" or "Especiales" are used to designate shapes of cigars. The Court noted that other manufacturers, including Enrique Ga. Caruana, had also used "Chorritos" in their cigarette wrappers. Furthermore, the appellant was one of the last to use the word "Chorritos" as a trade-mark, and the appellee was perfecting a trade-mark originally registered many years prior. Therefore, the appellee, rather than the appellant, could more logically contend for the exclusive right to use the word. The Court also found an entire lack of deceitful similarity between the trade-marks upon superficial examination. The Court cited Baxter and G. Baxter & Co. vs. Zuazua and Alhambra Cigar and Cigarette Mfg. Co. vs. Compañia Gral. de Tabacos as corroborative authorities. On the award of damages: The Court found that the trial court's award of P1,176.10 as damages resulting from the issuance of the preliminary injunction was sufficiently established by the testimony. The Court also dismissed other points raised by the appellant as minor and not meriting particular consideration, including the relevance of Act No. 3202.
Main Doctrine
The registration of a trade-mark does not grant an exclusive right to use a generic term or a word that has become a local name for a specific type of product, especially when the term has been used by others prior to or concurrently with the applicant, and when there is no deceitful similarity between the marks.