SERI SOMBOONSAKDIKUL VS. ORLANE S. A.

G. R. NO. 188996, 01 FEBRUARY 2017

Facts: On September 23, 2003, petitioner Seri Somboonsakdikul (petitioner) filed an application for registration of the mark
LOLANE with the IPO for goods classified under Class 3 (personal care products) of the International Classification of Goods
and Services for the Purposes of the Registration of Marks (International Classification of Goods). Orlane S.A. (respondent)
filed an opposition to petitioner's application, on the ground that the mark LOLANE was similar to ORLANE in presentation,
general appearance and pronunciation, and thus would amount to an infringement of its mark. Respondent alleged that: (1) it
was the rightful owner of the ORLANE mark which was first used in 1948; (2) the mark was earlier registered in the
Philippines on July 26, 1967 under Registration No. 129961 for the following goods:

x x x perfumes, toilet water, face powders, lotions, essential oils, cosmetics, lotions for the hair, dentrifices, eyebrow
pencils, make-up creams, cosmetics & toilet preparations under Registration No. 12996.
and (3) on September 5, 2003, it filed another application for use of the trademark on its additional products:

x x x toilet waters; revitalizing waters, perfumes, deodorants and body deodorants, anti-perspiration toiletries; men
and women perfume products for face care and body care; face, eye, lips, nail, hand make-up products and make-up removal
products, towels impregnated with cosmetic lotions; tanning and instant tanning sunproducts, sunprotection products, (not
for medical use), after-suncosmetic products; cosmetic products; slimming cosmetic aids; toiletries; lotions, shampoos and
hair care products; shave and after shave products, shaving and hair removing products; essential oils; toothpastes; toiletry,
cosmetic and shaving kits for travel, filled or fitted vanity-cases.

Respondent adds that by promotion, worldwide registration, widespread and high standard use, the mark had
acquired distinction, goodwill, superior quality image and reputation and was now well-known. Imputing bad faith on the
petitioner, respondent claimed that LOLANE' s first usage was only on August 19, 2003.

In his answer, petitioner denied that the LOLANE mark was confusingly similar to the mark ORLANE. He averred
that he was the lawful owner of the mark LOLANE which he has used for various personal care products sold worldwide. He
alleged that the first worldwide use of the mark was in Vietnam on July 4, 1995. Petitioner also alleged that he had
continuously marketed and advertised Class 3 products bearing LOLANE mark in the Philippines and in different parts of the
world and that as a result, the public had come to associate the mark with him as provider of quality personal care products.

Petitioner maintained that the marks were distinct and not confusingly similar either under the dominancy test or the
holistic test. The mark ORLANE was in plain block upper case letters while the mark LOLANE was printed in stylized word
with the second letter L and the letter A co-joined. Furthermore, the similarity in one syllable would not automatically result
in confusion even if used in the same class of goods since his products always appear with Thai characters while those of
ORLANE always had the name Paris on it. The two marks are also pronounced differently. Also, even if the two marks
contained the word LANE it would not make them confusingly similar since the IPO had previously allowed the co-existence
of trademarks containing the syllable "joy" or "book" and that he also had existing registrations and pending applications for
registration in other countries.

The Bureau of Legal Affairs (BLA) rejected petitioner's application in a Decision dated February 27, 2007, finding that
respondent's application was filed, and its mark registered, much earlier. The BLA ruled that there was likelihood of confusion
based on the following observations: (1) ORLANE and LOLANE both consisted of six letters with the same last four letters -
LANE; (2) both were used as label for similar products; (3) both marks were in two syllables and that there was only a slight
difference in the first syllable; and (4) both marks had the same last syllable so that if these marks were read aloud, a sound of
strong similarity would be produced and such would likely deceive or cause confusion to the public as to the two trademarks.
Petitioner filed a motion for reconsideration but this was denied by the Director of the BLA on May 7, 2007. The BLA
ruled that the law did not require the marks to be so identical as to produce actual error or mistake as the likelihood of
confusion was enough. The BLA also found that the dominant feature in both marks was the word LANE; and that the marks
had a strong visual and aural resemblance that could cause confusion to the buying public. This resemblance was amplified by
the relatedness of the goods.

On appeal, the Director General of the IPO affirmed the Decision of the BLA Director. Despite the difference in the
first syllable, there was a strong visual and aural resemblance since the marks had the same last four letters, i.e., LANE, and
such word is pronounced in this jurisdiction as in "pedestrian lane." Also, the mark ORLANE is a fanciful mark invented by
the owner for the sole purpose of functioning as a trademark and is highly distinctive. Thus, the fact that two or more entities
would accidentally adopt an identical or similar fanciful mark was too good to be true especially when they dealt with the
same goods or services. The Director General also noted that foreign judgments invoked by petitioner for the grant of its
application are not judicial precedents.

Thus, petitioner filed a petition for review before the CA arguing that there is no confusing similarity between the two
marks. Petitioner maintained that LANE is not the dominant feature of the mark and that the dominancy test did not apply
since the trademarks are only plain word marks and the dominancy test presupposes that the marks involved are composite
marks. Petitioner pointed out that the IPO had previously allowed the mark GIN LANE under Registration No. 4-2004-006914
which also involved products under Class 3. While petitioner admitted that foreign judgments are not judicial precedents, he
argued that the IPO failed to recognize relevant foreign judgments, i.e., the Australian Registrar of Trademarks and the IPO of
Singapore which ruled that there was no confusing similarity between the marks LOLANE and ORLANE. Lastly, the Director
General should have deferred to the findings of the Trademark Examiner who made a substantive examination of the
application for trademark registration, and who is an expert in the field and is in the best position to determine whether there
already exists a registered mark or mark for registration. Since petitioner's application for registration of the mark LOLANE
proceeded to allowance and publication without any adverse citation of a prior confusingly similar mark, this meant that the
Trademark Examiner was of the view that LO LANE was not confusingly similar to ORLANE.

The CA denied the petition of the petitioner for the very reason that there was substantial evidence to support the IPO's
findings of fact. Applying the dominancy test, the CA ruled that LOLANE' s mark is confusingly or deceptively similar to
ORLANE. There are predominantly striking similarities in the two marks including LANE, with only a slight difference in the
first letters, thus the two marks would likely cause confusion to the eyes of the public. The similarity is highlighted when the
two marks are pronounced considering that both are one word consisting of two syllables. The CA ruled that when
pronounced, the two marks produce similar sounds. The CA did not heed petitioner's contention that since the mark
ORLANE is of French origin, the same is pronounced as "ORLAN." Filipinos would invariably pronounce it as "OR-LEYN."
The CA also noted that the trademark ORLANE is a fanciful name and petitioner was not able to explain why he chose the
word LOLANE as trademark for his personal care products. Thus, the only logical conclusion is that he would want to benefit
from the established reputation and goodwill of the ORLANE mark.

The dominancy test is also preferred over the holistic test. This is because the latter relies only on the visual
comparison between two trademarks, whereas the dominancy test relies not only on the visual, but also on their aural and
connotative comparisons, and their overall impressions created. Nonetheless, the CA stated that there is nothing in this
jurisdiction dictating that the dominancy test is applicable for composite marks.

ISSUE: Resolving the issue of whether there is confusing similarity between ORLANE and LOLANE which would bar the
registration of LOLANE before the IPO.

RULING OF THE SUPREME COURT

The CA erred in its Decision when it affirmed the Decision of the IPO.

There is no colorable imitation between the marks LOLANE and ORLANE which would lead to any likelihood of
confusion to the ordinary purchasers.

In determining colorable imitation, we have used either the dominancy test or the holistic or totality test. The
dominancy test considers the similarity of the prevalent or dominant features of the competing trademarks that might cause
confusion, mistake, and deception in the mind of the purchasing public. More consideration is given on the aural and visual
impressions created by the marks on the buyers of goods, giving little weight to factors like process, quality, sales outlets, and
market segments. On the other hand, the holistic test considers the entirety of the marks as applied to the products, including
the labels and packaging, in determining confusing similarity. The focus is not only on the predominant words but also on the
other features appearing on the labels.

While there are no set rules as what constitutes a dominant feature with respect to trademarks applied for
registration, usually, what are taken into account are signs, color, design, peculiar shape or name, or some special, easily
remembered earmarks of the brand that readily attracts and catches the attention of the ordinary consumer. What we
considered as the dominant feature of the mark is the first word/figure that catches the eyes or that part which appears
prominently to the eyes and ears.

However, while we agree with the CA's use of the dominancy test, we arrive at a different conclusion. Based on the
distinct visual and aural differences between LOLANE and ORLANE, we find that there is no confusing similarity between the
two marks.
 The suffix LANE is not the dominant feature of petitioner's mark. Neither can it be considered as the dominant
feature of ORLANE which would make the two marks confusingly similar.

First, an examination of the appearance of the marks would show that there are noticeable differences in the way they
are written or printed.

As correctly argued by petitioner in his answer before the BLA, there are visual differences between LOLANE and
ORLANE since the mark ORLANE is in plain block upper case letters while the mark LOLANE was rendered in stylized word
with the second letter L and the letter A co-joined.

Second, as to the aural aspect of the marks, LOLANE and ORLANE do not sound alike.

It appeals to the ear in pronouncing ORLANE and LOLANE are dissimilar. The first syllables of each mark, i.e., OR
and LO do not sound alike, while the proper pronunciation of the last syllable LANE-"LEYN" for LOLANE and "LAN" for
ORLANE, being of French origin, also differ. We take exception to the generalizing statement of the Director General, which
was affirmed by the CA, that Filipinos would invariably pronounce ORLANE as "ORLEYN." This is another finding of fact
which has no basis, and thus, justifies our reversal of the decisions of the IPO Director General and the CA. While there is
possible aural similarity when certain sectors of the market would pronounce ORLANE as "ORLEYN," it is not also impossible
that some would also be aware of the proper pronunciation--especially since, as respondent claims, its trademark ORLANE
has been sold in the market for more than 60 years and in the Philippines, for more than 40 years.

Respondent failed to show proof that the suffix LANE has registered in the mind of consumers that such suffix is
exclusively or even predominantly associated with ORLANE products. Notably and as correctly argued by petitioner, the IPO
previously allowed the registration of the mark GIN LANE for goods also falling under Class 3, i.e., perfume, cologne, skin care
preparations, hair care preparations and toiletries.

Finding that LOLANE is not a colorable imitation of ORLANE due to distinct visual and aural differences using the
dominancy test, we no longer find it necessary to discuss the contentions of the petitioner as to the appearance of the marks
together with the packaging, nature of the goods represented by the marks and the price difference, as well as the applicability
of foreign judgments. We rule that the mark LOLANE is entitled to registration.

WHEREFORE, the petition is GRANTED. The Decision of the Court of Appeals dated July 14, 2009
is REVERSED and SET ASIDE. Petitioner's application of the mark LOLANE for goods classified under Class 3 of the
International Classification of Goods is GRANTED.

SOORDERED.