Kensonic, Inc. v. Uni-Line Multi-Resources, Inc.

GR Nos. 211820-21, G.R. Nos. 211834-35

Facts:

The case concerns the cancellation of the registration of the trademark SAKURA
for the goods of Uni-Line being sought by Kensonic on the ground that the latter had
prior use and registration of the SAKURA mark.

Uni-line applied for 2 applications for the registration of the mark “Sakura”.

IPC 1- application for the registration of the mark "SAKURA" for amplifier,
speaker, cassette, cassette disk, video cassette disk, car stereo, television,
digital video disk, mini component, tape deck, compact disk charger, VHS, and
tape rewinder falling under Class 9 of the Nice International Classification of
Goods.

IPC 2- application and was issued a certificate of registration for the mark
"SAKURA & FLOWER DESIGN" for use on recordable compact disk (CD-R)
computer, computer parts and accessories falling under Class 9.

All of the above applications were opposed by Kensonic claiming that it had prior
use and registration of the Sakura Mark. In both IPCs, the Director of the Bureau of
Legal Affairs (BLA) favored Kensonic finding the latter as the first to adopt and use the
mark and hence rejecting Uni-line’s application.

Later, Uni-Line filed an application for the registration of the trademark SAKURA
for use on the following:

Nice
Goods
Classification

Washing machines, high pressure washers, vacuum cleaners, floor Class 07

polishers, blender, electric mixer, electrical juicer

Television sets, stereo components, DVD/VCD players, voltage Class 09

regulators, portable generators, switch breakers, fuse

Refrigerators, air conditioners, oven toaster, turbo broiler, rice Class 11

cooker, microwave oven, coffee maker, sandwich/waffle maker,
electric stove, electric fan, hot & cold water dispenser, airpot, electric
griller and electric hot pot

Uni-Line's application was thereafter published, and there being no opposition, a

Certificate of Registration for the mark SAKURA was issued. Kensonic then filed with the
BLA a Petition for Cancellation of Uni-Line's Certificate of Registration alleging that it
introduced the marketing of SAKURA products in the Philippines and itowned said
SAKURA products and was the first to use, introduce and distribute said products.

Issue:

Whether the registration of the Sakura Mark with Uni-Line for goods falling under Class
07, Class 09 and Class 11 is proper.

Held:

Registration of the Sakura Mark with Uni-Line for the goods under Class 07, Class 09
and Class 11 is proper.

I. The SAKURA mark can be appropriated

Uni-Line insists that the SAKURA mark is not copyrightable for being generic. Such
insistence is unacceptable.To be noted is that the controversy revolves around the
SAKURA mark which is not a copyright.

The distinction is significant. A mark is any visible sign capable of distinguishing

the goods (trademark) or services (service mark) of an enterprise, and includes a
stamped or marked container of goods. In contrast, a copyright is the right to literary
property as recognized and sanctioned by positive law; it is an intangible, incorporeal
right granted by statute to the author or originator of certain literary or artistic
productions. Obviously, the SAKURA mark is not an artistic or literary work but a sign
used to distinguish the goods or services of one enterprise from those of another.
 An examination of the pertinent laws also reveals that Uni-Line mistakenly argues
that the SAKURA mark was not capable of registration for being generic.

Section 123(h) of the Intellectual Property Code prohibits the registration of

a trademark that consists exclusively of signs that are generic for the goods or services
that they seek to identify. It is clear that what is prohibited is not having a generic
mark but having such generic mark being identifiable to the good or service.

In Asia Brewery, Inc., v. Court of Appeals, the Court ruled that there was no
infringement of San Miguel Brewery's Pale Pilsen trademark because Pale Pilsen could
not be appropriated.

The Trademark Law provides:

"Sec. 4.... The owner of trade-mark, trade-name or service-mark used to

distinguish his goods, business or services from the goods, business or services of
others shall have the right to register the same [on the principal register], unless
it:

xxx   xxx  xxx

"(e) Consists of a mark or trade-name which, when applied to or used in

connection with the goods, business or services of the applicant is merely
descriptive or deceptively misdescriptive of them, or when applied to or used in
connection with the goods, business or services of the applicant is primarily
geographically descriptive or deceptively misdescriptive of them, or is primarily
merely a surname."

The words "pale pilsen" may not be appropriated by SMC for its exclusive use
even if they are part of its registered trademark: SAN MIGUEL PALE PILSEN, any
more than such descriptive words as "evaporated milk," "tomato ketchup,"
"cheddar cheese," "com flakes" and "cooking oil" dealer in shoes cannot register
"Leather Shoes" as his trademark because that would be merely descriptive. It
would be unjust to deprive other dealers in leather shoes of the right to use the
same. Inasmuch as all persons have an equal right to produce and vend similar
articles, they also have the right to describe them properly and to use any
appropriate language or words for that purpose. No person can appropriate to
himself exclusively any word or expression, properly descriptive of the article, its
 qualities, ingredients or characteristics, and thus limit other persons the right to
the use of such language being common to all. The true test is not whether they
are exhaustively descriptive of the article designated, but whether in themselves,
and as they are commonly used by those who understand their meaning, they are
reasonably indicative and descriptive of the thing intended.

This, however, is not the situation herein. Although SAKURA refers to the
Japanese flowering cherry and is, therefore, of a generic nature, such mark did not
identify Kensonic's goods. Kensonic's DVD or VCD players and other products could
not be identified with cherry blossoms. Hence, the mark can be appropriated.

II. Uni-Line's goods classified under Class 07 and Class 11 were not related to
Kensonic's goods registered under Class 09

Kensonic contends that the goods of Uni-Line classified under Class 07 and Class
11 were covered by the prohibition from registration for being within the normal
potential expansion of Kensonic.

The contention is unwarranted.

The prohibition under Section 123 of the Intellectual Property

Code extends to goods that are related to the registered goods, not to goods
that the registrant may produce in the future. To allow the expansion of coverage
is to prevent future registrants of goods from securing a trademark on the basis of
mere possibilities and conjectures that may or may not occur at all.

Non-competing goods may be those which, though they are not in actual
competition, are so related to each other that it can reasonably be assumed that they
originate from one manufacturer, in which case, confusion of business can arise out
of the use of similar marks. They may also be those which, being entirely unrelated,
cannot be assumed to have a common source; hence, there is no confusion of
business, even though similar marks are used.

Thus, there is no trademark infringement if the public does not expect

the plaintiff to make or sell the same class of goods as those made or sold by
the defendant.
III. Uni-Line's Class 09 goods were not related to Kensonic's Class 09 goods

In resolving whether goods are related, several factors come into play:

(a) the business (and its location) to which the goods belong

(b) the class of product to which the goods belong

(c) the product's quality, quantity, or size, including the nature of the package, wrapper or container

(d) the nature and cost of the articles

(e) the descriptive properties, physical attributes or essential characteristics with reference to their form,
composition, texture or quality

(f) the purpose of the goods

(g) whether the article is bought for immediate consumption, that is, day-to-day household items

(h) the fields of manufacture

(i) the conditions under which the article is usually purchased and

(j) the channels of trade through which the goods flow, how they are distributed, marketed, displayed and
sold. (Citations omitted)

An examination reveals that the goods of Uni-Line were not related to the goods
of Kensonic by virtue of their differences in class, the descriptive attributes, the
purposes and the conditions of the goods.

The mere fact that goods belonged to the same class does not
necessarily mean that they are related. The factors listed above should be
taken into consideration.

The classification of the products under the NCL is merely part and parcel of the
factors to be considered in ascertaining whether the goods are related. It is not
sufficient to state that the goods involved herein are electronic products under Class 9
in order to establish relatedness between the goods, for this only accounts for one of
many considerations.
 Clearly, it is erroneous for Kensonic to assume that all electronic products are
related and that the coverage of one electronic product necessarily precludes the
registration of a similar; mark over another.

The list of products included in Class 9 can be sub-categorized into five (5)
classifications, namely: (1) apparatus and instruments for scientific or research
purposes, (2) information technology and audiovisual equipment, (3) apparatus and
devices for controlling the distribution and use of electricity, (4) optical apparatus and
instruments, and (5) safety equipment.

From this subclassification, it becomes apparent that Uni-Line’s products,

belong to audiovisual equipment, while that of Kensonic, consisting of automatic
voltage regulator, converter, recharger, stereo booster, AC-DC regulated power supply,
step-down transformer, and PA amplified AC-DC, generally fall under devices for
controlling the distribution and use of electricity. Also, the Class 09 goods of
Kensonic were final products but Uni-Line's Class 09 products were spare
parts.

In view of these distinctions, the Court finds agrees with Uni-Line that its Class
09 goods were unrelated to the Class 09 goods of Kensonic.