[24] SERI SOMBOONSAKDIKUL, petitioner, vs. ORLANE S.A., respondent.

Same; Same; In determining colorable imitation, we have used either the dominancy
test or the holistic or totality test.—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 prices, 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.

DECISION

JARDELEZA, J.:

Administrative Law; While it is an established rule in administrative law that the Assailed in this petition is the Decision1 of the Court of Appeals (CA) in CA-
courts of justice should respect the findings of fact of administrative agencies, the G.R. SP No. 105229 dated July 14, 2009 which affirmed the decision of the
courts may not be bound by such findings of fact when there is absolutely no evidence Director General of the Intellectual Property Office (IPO) denying the
in support thereof or such evidence is clearly, manifestly and patently insubstantial; application for the mark "LOLANE."
and when there is a clear showing that the administrative agency acted arbitrarily or
with grave abuse of discretion or in a capricious and whimsical manner, such that its Facts
action may amount to an excess or lack of jurisdiction.—While it is an established rule
On September 23, 2003, petitioner Seri Somboonsakdikul (petitioner) filed an
in administrative law that the courts of justice should respect the findings of fact of
application for registration2 of the mark LOLANE with the IPO for goods3
administrative agencies, the courts may not be bound by such findings of fact when classified under Class 3 (personal care products) of the International
there is absolutely no evidence in support thereof or such evidence is clearly, Classification of Goods and Services for the Purposes of the Registration of
manifestly and patently insubstantial; and when there is a clear showing that the Marks (International Classification of Goods).4 Orlane S.A. (respondent) filed
administrative agency acted arbitrarily or with grave abuse of discretion or in a an opposition to petitioner's application, on the ground that the mark LOLANE
capricious and whimsical manner, such that its action may amount to an excess or lack was similar to ORLANE in presentation, general appearance and
of jurisdiction. Moreover, when there is a showing that the findings or conclusions, pronunciation, and thus would amount to an infringement of its mark. 5
Respondent alleged that: (1) it was the rightful owner of the ORLANE mark
drawn from the same pieces of evidence, were arrived at arbitrarily or in disregard of
which was first used in 1948; (2) the mark was earlier registered in the
the evidence on record, they may be reviewed by the courts. Such is the case here. Philippines on July 26, 1967 under Registration No. 129961 for the following
goods:6
Mercantile Law; Trademarks; Words and Phrases; A trademark is defined under
Section 121.1 of Republic Act (RA) No. 8293 as any visible sign capable of x x x perfumes, toilet water, face powders, lotions, essential oils, cosmetics,
distinguishing the goods.—A trademark is defined under Section 121.1 of RA 8293 as lotions for the hair, dentrifices, eyebrow pencils, make-up creams, cosmetics
any visible sign capable of distinguishing the goods. It is susceptible to registration if & toilet preparations under Registration No. 12996.7
it is crafted fancifully or arbitrarily and is capable of identifying and distinguishing the
goods of one manufacturer or seller from those of another. and (3) on September 5, 2003, it filed another application for use of the
trademark on its additional products:

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x x x toilet waters; revitalizing waters, perfumes, deodorants and body both marks had the same last syllable so that if these marks were read aloud,
deodorants, anti-perspiration toiletries; men and women perfume products for a sound of strong similarity would be produced and such would likely deceive
face care and body care; face, eye, lips, nail, hand make-up products and or cause confusion to the public as to the two trademarks.16
make-up removal products, towels impregnated with cosmetic lotions; tanning
and instant tanning sunproducts, sunprotection products, (not for medical use), Petitioner filed a motion for reconsideration but this was denied by the Director
after-suncosmetic products; cosmetic products; slimming cosmetic aids; of the BLA on May 7, 2007.17 The BLA ruled that the law did not require the
toiletries; lotions, shampoos and hair care products; shave and after shave marks to be so identical as to produce actual error or mistake as the likelihood
products, shaving and hair removing products; essential oils; toothpastes; of confusion was enough. The BLA also found that the dominant feature in
toiletry, cosmetic and shaving kits for travel, filled or fitted vanity-cases[.]8 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
Respondent adds that by promotion, worldwide registration, widespread and resemblance was amplified by the relatedness of the goods.18
high standard use, the mark had acquired distinction, goodwill, superior quality
image and reputation and was now well-known.9 Imputing bad faith on the On appeal, the Director General of the IPO affirmed the Decision of the BLA
petitioner, respondent claimed that LOLANE' s first usage was only on August Director. Despite the difference in the first syllable, there was a strong visual
19, 2003.10 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
In his answer,11 petitioner denied that the LOLANE mark was confusingly lane."19 Also, the mark ORLANE is a fanciful mark invented by the owner for
similar to the mark ORLANE. He averred that he was the lawful owner of the the sole purpose of functioning as a trademark and is highly distinctive. Thus,
mark LOLANE which he has used for various personal care products sold the fact that two or more entities would accidentally adopt an identical or similar
worldwide. He alleged that the first worldwide use of the mark was in Vietnam fanciful mark was too good to be true especially when they dealt with the same
on July 4, 1995. Petitioner also alleged that he had continuously marketed and goods or services.20 The Director General also noted that foreign judgments
advertised Class 3 products bearing LOLANE mark in the Philippines and in invoked by petitioner for the grant of its application are not judicial
different parts of the world and that as a result, the public had come to precedents.21
associate the mark with him as provider of quality personal care products.12
Thus, petitioner filed a petition for review22 before the CA arguing that there is
Petitioner maintained that the marks were distinct and not confusingly similar no confusing similarity between the two marks. Petitioner maintained that
either under the dominancy test or the holistic test. The mark ORLANE was in LANE is not the dominant feature of the mark and that the dominancy test did
plain block upper case letters while the mark LOLANE was printed in stylized not apply since the trademarks are only plain word marks and the dominancy
word with the second letter L and the letter A co-joined. Furthermore, the test presupposes that the marks involved are composite marks. 23 Petitioner
similarity in one syllable would not automatically result in confusion even if pointed out that the IPO had previously allowed the mark GIN LANE under
used in the same class of goods since his products always appear with Thai Registration No. 4-2004-006914 which also involved products under Class 3.24
characters while those of ORLANE always had the name Paris on it. The two While petitioner admitted that foreign judgments are not judicial precedents,
marks are also pronounced differently. Also, even if the two marks contained he argued that the IPO failed to recognize relevant foreign judgments, i.e., the
the word LANE it would not make them confusingly similar since the IPO had Australian Registrar of Trademarks and the IPO of Singapore which ruled that
previously allowed the co-existence of trademarks containing the syllable "joy" there was no confusing similarity between the marks LOLANE and ORLANE.25
or "book" and that he also had existing registrations and pending applications Lastly, the Director General should have deferred to the findings of the
for registration in other countries.13 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
The Bureau of Legal Affairs (BLA) rejected petitioner's application in a position to determine whether there already exists a registered mark or mark
Decision14 dated February 27, 2007, finding that respondent's application was for registration. Since petitioner's application for registration of the mark
filed, and its mark registered, much earlier.15 The BLA ruled that there was LOLANE proceeded to allowance and publication without any adverse citation
likelihood of confusion based on the following observations: (1) ORLANE and of a prior confusingly similar mark, this meant that the Trademark Examiner
LOLANE both consisted of six letters with the same last four letters - LANE; was of the view that LO LANE was not confusingly similar to ORLANE. 26
(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) The CA Ruling
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The CA denied the petition and held that there exists colorable imitation of Finally, the CA did not give merit to petitioner's contention that the Director
respondent's mark by LOLANE.27 General should have deferred to the findings of the Trademark Examiner.
According to the CA, the proceedings before the Trademark Examiner are ex-
The CA accorded due respect to the Decision of the Director General and ruled parte,38 and his findings are merely prima facie. Whatever his decision may be
that there was substantial evidence to support the IPO's findings of fact. is still subject to review and/or appeal.39
Applying the dominancy test, the CA ruled that LOLANE' s mark is confusingly
or deceptively similar to ORLANE. There are predominantly striking similarities The Petition40
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 Petitioner maintains that the CA erred in its interpretation of the dominancy
similarity is highlighted when the two marks are pronounced considering that test, when it ruled that the dominant feature of the contending marks is the
both are one word consisting of two syllables. The CA ruled that when suffix "LANE."41 The CA failed to consider that in determining the dominant
pronounced, the two marks produce similar sounds.28 The CA did not heed portion of a mark, significant weight must be given to whether the buyer would
petitioner's contention that since the mark ORLANE is of French origin, the be more likely to remember and use one part of a mark as indicating the origin
same is pronounced as "ORLAN." Filipinos would invariably pronounce it as of the goods.42 Thus, that part which will likely make the most impression on
"OR-LEYN."29 The CA also noted that the trademark ORLANE is a fanciful the ordinary viewer will be treated as the dominant portion of conflicting marks
name and petitioner was not able to explain why he chose the word LOLANE and given greater weight in the comparison.43
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 Petitioner argues that both LOLANE and ORLANE are plain word marks which
of the ORLANE mark.30 are devoid of features that will likely make the most impression on the ordinary
viewer. If at all, the very word marks themselves, LOLANE and ORLANE are
The CA rejected petitioner's assertion that his products' cheaper price and low- each to be regarded as dominant features.44 Moreover, the suffix LANE is a
income market eliminates the likelihood of confusion. Low-income groups, and weak mark, being "in common use by many other sellers in the market. "45
even those who usually purchased ORLANE products despite the higher cost, Thus, LANE is also used in the marks SHELLANE and GIN LANE, the latter
may be led to believe that LOLANE products are low-end personal care covering goods under Class 3. Moreover, the two marks are aurally different
products also marketed by respondent.31 since respondent's products originate from France and is read as "OR-LAN"
and not "OR-LEYN."46
The CA upheld the applicability of the dominancy test in this case. According
to the CA, the dominancy test is already recognized and incorporated in Petitioner also claims that the CA completely disregarded the holistic test, thus
Section 155.1 of Republic Act No. 8293 (RA 8293), otherwise known as the ignoring the dissimilarity of context between LOLANE and ORLANE.
Intellectual Property Code of the Philippines.32 Citing McDonald's Corporation Assuming that the two marks produce similar sounds when pronounced, the
v. MacJoy Fastfood Corporation,33 the CA ruled that the dominancy test is also differences in marks in their entirety as they appear in their respective product
preferred over the holistic test. This is because the latter relies only on the labels should still be the controlling factor in determining confusing similarity.47
visual comparison between two trademarks, whereas the dominancy test
relies not only on the visual, but also on their aural and connotative
Besides, there has been no explicit declaration abandoning the holistic test.48
comparisons, and their overall impressions created.34 Nonetheless, the CA
Thus, petitioner urges us to go beyond the similarities in spelling and instead
stated that there is nothing in this jurisdiction dictating that the dominancy test consider how the marks appear in their respective labels, the dissimilarities in
is applicable for composite marks.35 the size and shape of the containers, their color, words appearing thereon and
the general appearance,49 hence: (1) the commonality of the marks ORLANE
The CA was not swayed by the alleged favorable judgment by the IPO in the and LOLANE starts from and ends with the four-letter similarity-LANE and
GIN LANE application, ruling that in trademark cases, jurisprudential nothing else;50 (2) ORLANE uses "safe" or conventional colors while LOLANE
precedents should be applied only to a case if they are specifically in point.36 uses loud or psychedelic colors and designs with Thai characters;51 and (3)
It also did not consider the ruling of the IPOs in Australia, South Africa, ORLANE uses the term "Paris," indicating the source of origin of its products.52
Thailand and Singapore which found no confusing similarity between the
marks LOLANE and ORLANE, stating that foreign judgments do not constitute
Petitioner likewise claims that consumers will be more careful in their choice
judicial precedent in this jurisdiction.37 because the goods in question are directly related to personal hygiene and
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have direct effects on their well-being, health and safety.53 Moreover, with the arbitrarily or in disregard of the evidence on record, they may be reviewed by
huge price difference between ORLANE and LOLANE products, relevant the courts.64 Such is the case here.
purchasers are less likely to be confused.54
There is no colorable imitation between the marks LOLANE and ORLANE
Finally, petitioner notes that respondent has neither validly proven nor which would lead to any likelihood of confusion to the ordinary purchasers.
presented sufficient evidence that the mark ORLANE is in actual commercial
use in the Philippines. Respondent failed to allege in any of its pleadings A trademark is defined under Section 121.1 of RA 8293 as any visible sign
submitted to the IPO's BLA and the IPO Director General the names of local capable of distinguishing the goods. It is susceptible to registration if it is
outlets that products bearing the mark ORLANE are being marketed or sold to crafted fancifully or arbitrarily and is capable of identifying and distinguishing
the general consuming public.55 the goods of one manufacturer or seller from those of another.65 Thus, the
mark must be distinctive.66 The registrability of a trademark is governed by
Respondent's Comment56 Section 123 of RA 8293. Section 123.1 provides:

Respondent reiterates the decisions of the CA and the IPO.57 It maintains that Section 123. Registrability. -
ORLANE is entitled to protection under RA 8293 since it is registered with the
IPO with proof of actual use.58 Respondent posits that it has established in the 123 .1. A mark cannot be registered if it:
world59 and in the Philippines an image and reputation for manufacturing and
selling quality beauty products. Its products have been sold in the market for
d. Is identical with a registered mark belonging to a different proprietor or a
61 years and have been used in the Philippines since 1972.60 Thus, to allow
mark with an earlier filing or priority date, in respect of:
petitioner's application would unduly prejudice respondent's right over its
registered trademark.61 Lastly, respondent argues that decisions of
administrative agencies such as the IPO shall not be disturbed by the courts, i. The same goods or services, or
absent any showing that the former have acted without or in excess of their
jurisdiction, or with grave abuse of discretion.62 ii. Closely related goods or services, or

Issue iii. If it nearly resembles such a mark as to be likely to deceive or cause

confusion;
We resolve the issue of whether there is confusing similarity between ORLANE
and LOLANE which would bar the registration of LOLANE before the IPO. e. Is identical with, or confusingly similar to, or constitutes a translation of a
mark which is considered by the competent authority of the Philippines to be
Our Ruling well-known internationally and in the Philippines, whether or not it is registered
here, as being already the mark of a person other than the applicant for
registration, and used for identical or similar goods or services: Provided, That
We find that the CA erred when it affirmed the Decision of the IPO. in determining whether a mark is well-known, account shall be taken of the
knowledge of the relevant sector of the public, rather than of the public at large,
While it is an established rule in administrative law that the courts of justice including knowledge in the Philippines which has been obtained as a result of
should respect the findings of fact of administrative agencies, the courts may the promotion of the mark;
not be bound by such findings of fact when there is absolutely no evidence in
support thereof or such evidence is clearly, manifestly and patently In Mighty Corporation v. E. & J Gallo Winery,67 we laid down the
insubstantial; and when there is a clear showing that the administrative agency
acted arbitrarily or with grave abuse of discretion or in a capricious and
whimsical manner, such that its action may amount to an excess or lack of requirements for a finding of likelihood of confusion, thus:
jurisdiction.63 Moreover, when there is a showing that the findings or
conclusions, drawn from the same pieces of evidence, were arrived at There are two types of confusion in trademark infringement. The first is
"confusion of goods" when an otherwise prudent purchaser is induced to

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purchase one product in the belief that he is purchasing another, in which case prevalent or dominant features of the competing trademarks that might cause
defendant's goods are then bought as the plaintiffs and its poor quality reflects confusion, mistake, and deception in the mind of the purchasing public. More
badly on the plaintiffs reputation. The other is "confusion of business" wherein consideration is given on the aural and visual impressions created by the
the goods of the parties are different but the defendant's product can marks on the buyers of goods, giving little weight to factors like process,
reasonably (though mistakenly) be assumed to originate from the plaintiff, thus quality, sales outlets, and market segments.72 On the other hand, the holistic
deceiving the public into believing that there is some connection between the test considers the entirety of the marks as applied to the products, including
plaintiff and defendant which, in fact, does not exist. 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
In determining the likelihood of confusion, the Court must consider: [a] labels.73
the resemblance between the trademarks; [b] the similarity of the goods
to which the trademarks are attached; [c] the likely effect on the The CA's use of the dominancy test is in accord with our more recent ruling in
purchaser and [d] the registrant's express or implied consent and other UFC Philippines, Inc. (now merged with Nutria-Asia, Inc. as the surviving
fair and equitable considerations. (Citations omitted, emphasis supplied.)68 entity) v. Barrio Fiesta Manufacturing Corporation.74 In UFC Philippines, Inc.,
we relied on our declarations in McDonald's Corporation v. L.C. Big Mak
While Mighty Corporation enumerates four requirements, the most essential Burger, Inc.,75 Co Tiong Sa v. Director of Patents,76 and Societe Des Produits
requirement, to our mind, for the determination of likelihood of confusion is the Nestle, S.A. v. Court of Appeals77 that the dominancy test is more in line with
existence of resemblance between the trademarks, i.e., colorable imitation. the basic rule in trademarks that confusing similarity is determined by the aural,
Absent any finding of its existence, there can be no likelihood of confusion. visual and connotative and overall impressions created by the marks. Thus,
Thus we held: based on the dominancy test, we ruled that there is no confusing similarity
between "PAPA BOY & DEVICE" mark, and "PAPA KETSARAP" and "PAPA
Whether a trademark causes confusion and is likely to deceive the public BANANA CATSUP."
hinges on "colorable imitation" which has been defined as "such similarity in
form, content, words, sound, meaning, special arrangement or general While there are no set rules as what constitutes a dominant feature with
appearance of the trademark or trade name in their overall presentation or in respect to trademarks applied for registration, usually, what are taken into
their essential and substantive and distinctive parts as would likely mislead or account are signs, color, design, peculiar shape or name, or some special,
confuse persons in the ordinary course of purchasing the genuine article." easily remembered earmarks of the brand that readily attracts and catches the
(Citations omitted.)69 attention of the ordinary consumer.78 In UFC Philippines, Inc., what we
considered as the dominant feature of the mark is the first word/figure that
We had the same view in Emerald Garment Manufacturing Corporation v. catches the eyes or that part which appears prominently to the eyes and
Court of Appeals,70 where we stated: ears.79

Proceeding to the task at hand, the essential element of infringement is However, while we agree with the CA's use of the dominancy test, we arrive
colorable imitation. This term has been defined as "such a close or ingenious at a different conclusion. Based on the distinct visual and aural differences
between LOLANE and ORLANE, we find that there is no confusing similarity
imitation as to be calculated to deceive ordinary purchasers, or such
resemblance of the infringing mark to the original as to deceive an ordinary between the two marks.
purchaser giving such attention as a purchaser usually gives, and to cause
him to purchase the one supposing it to be the other." 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
Colorable imitation does not mean such similitude as amounts to identity. Nor two marks confusingly similar.
does it require that all the details be literally copied. x x x (Citation omitted,
emphasis supplied.)71

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

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First, an examination of the appearance of the marks would show that there Respondent failed to show proof that the suffix LANE has registered in the
are noticeable differences in the way they are written or printed as shown mind of consumers that such suffix is exclusively or even predominantly
below:80 associated with ORLANE products. Notably and as correctly argued by
petitioner, the IPO previously allowed the registration of the mark GIN LANE
As correctly argued by petitioner in his answer before the BLA, there are visual for goods also falling under Class 3, i.e., perfume, cologne, skin care
differences between LOLANE and ORLANE since the mark ORLANE is in preparations, hair care preparations and toiletries.85
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.81 We are mindful that in the earlier cases of Mighty Corporation and Emerald,
despite a finding that there is no colorable imitation, we still discussed the
Second, as to the aural aspect of the marks, LOLANE and ORLANE do not nature of the goods using the trademark and whether the goods are identical,
sound alike. Etepha v. Director of Patents, et al.82 finds application in this case. similar, competing or related. We need not belabor a similar discussion here
In Etepha, we ruled that there is no confusing similarity between PERTUSSIN considering that the essential element in determining likelihood of confusion,
and ATUSSIN. The Court considered among other factors the aural i.e., colorable imitation by LO LANE of the mark ORLANE, is absent in this
differences between the two marks as follows: case. Resemblance between the marks is a separate requirement from, and
must not be confused with, the requirement of a similarity of the goods to which
the trademarks are attached. In Great White Shark Enterprises, Inc v. Caralde,
5. As we take up Pertussin and Atussin once again, we cannot escape notice
Jr.,86 after we ruled that there was no confusing similarity between Great White
of the fact that the two words do not sound alike-when pronounced. There is
not much phonetic similarity between the two. The Solicitor General well- Shark's "GREG NORMAN LOGO" and Caralde's "SHARK & LOGO" mark due
to the visual and aural dissimilarities between the two marks, we deemed it
observed that in Pertussin the pronunciation of tbe prefix "Per", whether
unnecessary to resolve whether Great White Shark's mark has gained
correct or incorrect, includes a combination of three letters
recognition as a well-known mark.
P, e and r; whereas, in Atussin the whole starts with the single letter A added
to suffix "tussin".1âwphi1 Appeals to the ear are dissimilar. And this, because Finding that LOLANE is not a colorable imitation of ORLANE due to distinct
in a word combination, the part that comes first is the most pronounced. An visual and aural differences using the dominancy test, we no longer find it
expositor of the applicable rule here is the decision in the Syrocol-Cheracol necessary to discuss the contentions of the petitioner as to the appearance of
controversy. There, the ruling is that trademark Syrocol (a cough medicine the marks together with the packaging, nature of the goods represented by the
preparation) is not confusedly similar to trademark Cheracol (also a cough marks and the price difference, as well as the applicability of foreign
medicine preparation). Reason: the two words "do not look or sound enough judgments. We rule that the mark LOLANE is entitled to registration.
alike to justify a holding of trademark infringement", and the "only similarity is
in the last syllable, and that is not uncommon in names given drug WHEREFORE, the petition is GRANTED. The Decision of the Court of
compounds". (Citation omitted, emphasis supplied.)83 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
Similar to Etepha, appeals to the ear in pronouncing ORLANE and LOLANE International Classification of Goods is GRANTED.
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 SO ORDERED.
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.84
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