Victorias Milling Company, Inc. vs. Ong Su

Common geometric shapes such as diamonds, when used as vehicles for displaying word marks, do not function as indicia of origin unless they have acquired secondary meaning, and the owner bears the burden of proving such secondary meaning; absent such proof and where the literal portions of competing trademarks are dissimilar in sound, spelling, and connotation, there is no reasonable likelihood of purchaser confusion warranting cancellation.

Victorias Milling Company, Inc. is a domestic corporation engaged in the manufacture and sale of refined granulated sugar, owning the trademark "VICTORIAS" and diamond design registered with the Philippine Patent Office on November 9, 1961. Ong Su is engaged in the repacking and sale of refined sugar, doing business under the name "Valentine Packaging," and owns the trademark "VALENTINE" and design registered with the Philippine Patent Office on June 20, 1961, under Certificate of Registration No. 8891. Both marks are used on refined sugar sold in bags, and the dispute centers on whether the concurrent use of the two marks on the same class of goods creates a likelihood of purchaser confusion.

Victorias Milling Company, Inc. is a domestic corporation engaged in the manufacture and sale of refined granulated sugar, and is the owner of the trademark "VICTORIAS" and diamond design registered with the Philippine Patent Office on November 9, 1961. Ong Su is engaged in the repacking and sale of refined sugar, doing business under the name and style "Valentine Packaging," and is the owner of the trademark "VALENTINE" and design registered with the Philippine Patent Office on June 20, 1961, under Certificate of Registration No. 8891. Both marks are used on refined sugar sold in bags of varying weights.

According to the petitioner's only witness, Pacifica V. Vijandre, its vice-president and stockholder, Victorias Milling Company had used the trademark "VICTORIAS" and diamond design with colors of red and black on sacks of sugar since 1947, in weights of 5 lbs., 10 lbs., 25 lbs., 50 lbs., and 100 lbs. The company had sales transactions with local dealers such as Kim Kee, Chu Yu & Co., Limouan & Co., Luzon Merchandising Corp., and ARCA, with average sales from 1958 to 1962 of ₱30,000,000 and ₱46,000,000 for the whole year of 1962. The company learned that the trademark "VALENTINE" appeared in the market in 1962 through reports from its field agents, and according to Vijandre, except for the words "Valentine" and "Victorias," the design and wordings of the bags were practically the same.

For his part, Ong Su declared that he adopted and began using his trademark "VALENTINE" and design before and continuously after World War II in the Philippines, particularly on paper bags used as containers for starch, coffee, and sugar, and that since January 1955 he continued using said trademark on repacked sugar. Arturo Chicane, a distribution agent of Ong Su, testified that he had never come across an instance where Ong Su's product was mistaken for the petitioner's product. He also testified that the diamond design was quite common in combination with other words used as trademarks — such as "DIAMOND," "EAGLE," and "SUNRISE," not belonging to the petitioner — which were also used on repacked sugar by various dealers, and that such designs and colors had not been regarded as trademarks but as ornamentation.

On October 4, 1963, Victorias Milling Company filed with the Philippine Patent Office a petition to cancel the registration of Ong Su's trademark "VALENTINE," alleging that its "VICTORIAS" trademark and diamond design had been distinctive of its sugar long before respondent used his trademark; that the registration of "VALENTINE" had caused and would cause great damage through mistake, confusion, or deception among purchasers because of its similarity to the "VICTORIAS" trademark; that the registration was fraudulently obtained; and that "VALENTINE" falsely suggested a connection with Saint Valentine or an institution or belief connected therewith. Ong Su answered that the two marks were different and that there was absolutely no likelihood of confusion, mistake, or deception to purchasers through their concurrent use on sugar.

The Director of Patents denied the petition, finding that the literal designations were different — one being "VALENTINE" and the other "VICTORIAS" — with no similarity in sound and connotation. He held that the diamond design had not been shown to have acquired secondary meaning, that the colors black and red were primary colors commonly used in the printing business and did not function as trademarks, and that the printing arrangement of legends pertaining to weight, contents, and manufacturer was merely a matter of "dress of the goods" involving unfair competition over which the Patent Office had no jurisdiction. Victorias Milling Company elevated the decision to the Supreme Court, assigning twelve errors.

• Diamond Design as Index of Origin: Petitioner argued that its registered diamond design is an index of origin identifying its sugar, and that the Director of Patents erred in holding otherwise.
• Secondary Meaning: Petitioner contended that the Director of Patents erred in requiring it to establish that its diamond design had acquired a secondary meaning, and in holding that it had not acquired such secondary meaning.
• Likelihood of Confusion: Petitioner maintained that purchasers of sugar are likely to be confused by the similarities between the "VICTORIAS" and "VALENTINE" trademarks, enumerating eleven points of similarity including the diamond design, color scheme, printing sequence, and arrangement of legends.
• Holistic Comparison: Petitioner argued that the Director of Patents erred in confining his comparison to one sole item of design, ignoring the complete labels as actually used in trade and seen by consumers.
• Unfair Competition Jurisdiction: Petitioner asserted that the Director of Patents erred in taking the position that he had no jurisdiction over obvious acts of unfair competition in trademark cancellation cases.
• Color as Trademark: Petitioner argued that its registered color design functions as a trademark.
• Actual Confusion: Petitioner contended that the Director of Patents erred in assuming that the owner of an imitated trademark must establish actual purchaser confusion, and sought to present rebuttal witness Ernesto Duran to prove consumer confusion.
• Procedural Due Process: Petitioner claimed it was denied procedural due process when the Director of Patents refused to allow Ong Su and witness Ernesto Duran to testify as rebuttal witnesses.
• Fraudulent Registration: Petitioner alleged that the registration of the "VALENTINE" trademark was fraudulently obtained.
• Admission of Exhibits: Petitioner argued that the hearing officer erred in admitting respondent's exhibits pertaining to one "Mariano Ang," whose identity as an alias of Ong Su had not been clearly established.

• Dissimilarity of Marks: Respondent countered that the trademarks "VICTORIAS" with diamond design and "VALENTINE" with a design are two different marks, and that there is absolutely no likelihood of confusion, mistake, or deception to purchasers through their concurrent use on sugar.
• Minor and Insignificant Similarities: Respondent maintained that the alleged similarities pointed out by petitioner are minor and insignificant, and that words like "Pure Refined Sugar" are merely descriptive and commonly applied to sugar and cannot be exclusively appropriated by the petitioner.
• Prior Use: Respondent asserted that he had adopted and used the "VALENTINE" trademark since before World War II, well before the petitioner's registration, making it impossible that he imitated the petitioner's mark.

• Diamond Design as Indicia of Origin: Whether the diamond design in petitioner's trademark functions as an index of origin without proof of secondary meaning.
• Secondary Meaning: Whether petitioner was required to establish, and failed to establish, that its diamond design had acquired secondary meaning.
• Likelihood of Confusion: Whether the similarities between the "VICTORIAS" and "VALENTINE" trademarks, including design, color, and arrangement, create a reasonable likelihood of purchaser confusion.
• Holistic Comparison: Whether the Director of Patents erred in confining his comparison to the diamond design rather than considering the complete labels as used in trade.
• Unfair Competition Jurisdiction: Whether the Director of Patents has jurisdiction over unfair competition issues arising in a trademark cancellation proceeding.
• Color as Trademark: Whether the colors black and red used in petitioner's trademark function as a trademark.
• Actual Confusion: Whether the owner of an allegedly imitated trademark must establish actual purchaser confusion, and whether the proposed testimony of Ernesto Duran constitutes sufficient evidence of confusion.
• Procedural Due Process: Whether the refusal to allow Ong Su and Ernesto Duran to testify as rebuttal witnesses constituted reversible error and denial of procedural due process.
• Fraudulent Registration: Whether the registration of the "VALENTINE" trademark was fraudulently obtained.
• Admission of Exhibits: Whether the hearing officer erred in admitting exhibits pertaining to "Mariano Ang."

• Diamond Design as Indicia of Origin: No. Common geometric shapes such as diamonds ordinarily are not regarded as indicia of origin unless they have acquired secondary meaning, which petitioner failed to prove.
• Secondary Meaning: Yes, the requirement was proper and petitioner failed to meet it. The burden of showing that a design portion of a mark has been so used that purchasers recognize it as indicating goods from the registrant rests on the party relying on it.
• Likelihood of Confusion: No. The words "VICTORIAS" and "VALENTINE" are not similar in spelling and do not have a similar sound when pronounced, and the diamond designs are different, the "VALENTINE" design having protruding lines at the corners.
• Holistic Comparison: No error. The dominant features of the trademarks are the words "Valentine" and "Victorias" and the names and places of business of the respective parties, and no substantial similarity was established warranting cancellation.
• Unfair Competition Jurisdiction: No. Under Section 27 of the Trademark Law (R.A. No. 166), actions for unfair competition shall be brought before the proper Court of First Instance, not the Patent Office.
• Color as Trademark: No. Color alone, unless displayed in a distinct or arbitrary design, does not function as a trademark; the colors black and red are primary colors commonly and freely used in the printing business.
• Actual Confusion: No. The proposed testimony of Ernesto Duran about a single instance of alleged confusion is not sufficient evidence that the two trademarks are so similar that buyers of sugar are confused; even an illiterate person can see the difference between the two diamond designs.
• Procedural Due Process: No. The refusal to allow rebuttal testimony was not reversible error, as petitioner had already extensively cross-examined Ong Su on the alias issue, and the proposed rebuttal evidence did not directly contradict prior testimony.
• Fraudulent Registration: No. There is no evidence that Ong Su obtained registration by fraud, and his trademark was registered before the petitioner's.
• Admission of Exhibits: No. The record shows Ong Su had used the name Mariano Ang in his business, making the licenses and permits in either name properly admissible.

• Diamond Design as Indicia of Origin: The Court applied the principle that common geometric shapes such as circles, ovals, squares, triangles, and diamonds, when used as vehicles for display of word marks, ordinarily are not regarded as indicia of origin for goods to which the marks are applied, unless they have acquired secondary meaning. Petitioner failed to present evidence that the diamond design component of its mark had been so used that purchasers recognized the design, standing alone, as indicating goods emanating from the registrant. The word "Victorias" is what identifies the sugar as the petitioner's product, and indeed the petitioner had advertised its sugar in bags marked "Victorias" with oval, hexagon, and other designs, undermining any claim that the diamond design specifically identified its goods.
• Secondary Meaning: The Court affirmed the Director of Patents' ruling that when a registrant of a design relies upon registration in proceedings based on likelihood of confusion, the registrant assumes the burden of showing that the design portion of the mark has been so used that purchasers recognize the design, standing alone, as indicating goods emanating from the registrant. The Court found absolutely nothing in the record to support a ruling that the diamond design had acquired secondary meaning with respect to petitioner's sugar business.
• Likelihood of Confusion: The Court found that the words "Valentine" and "Victorias" are the dominant features of the respective trademarks and are dissimilar in spelling and sound. Even the diamond designs differ, as the "VALENTINE" design has protruding lines at the corners. The Court noted that even an illiterate person can see the difference between the two diamond designs. The eleven points of similarity enumerated by petitioner — including color scheme, printing sequence, and arrangement of descriptive words like "PURE," "REFINED SUGAR," "FINE GRANULATED," and "CANE SUGAR" — were insufficient because these words are merely descriptive of sugar and cannot be exclusively appropriated, and the geometric design and primary colors do not function as indicia of origin.
• Holistic Comparison: The Court agreed with the Director of Patents that the dominant features are the word marks and the names and places of business of the parties. No substantial similarity was established between the two trademarks as to warrant cancellation. The descriptive words and common design elements are not protectable features.
• Unfair Competition Jurisdiction: The Court held that the Director of Patents correctly ruled that he had no jurisdiction over the issue of unfair competition. Under Section 27 of the Trademark Law, Republic Act No. 166, actions for unfair competition shall be brought before the proper Court of First Instance. The printing arrangement of legends pertaining to weight, contents, and manufacturer is merely a matter of "dress of the goods" involving unfair competition, over which the Patent Office has no jurisdiction.
• Color as Trademark: The Court affirmed that color alone, unless displayed in a distinct or arbitrary design, does not function as a trademark. The colors black and red are primary colors commonly and freely used in the printing business and are not displayed by the petitioner in a distinct or arbitrary design.
• Actual Confusion: The Court found the proposed testimony of Ernesto Duran — that he once bought a bag of sugar he thought was "VICTORIAS" but turned out to be "VALENTINE" — insufficient to prove that the two trademarks are so similar that buyers are confused. The Court noted that the words are not similar in spelling or sound, and that even an illiterate person can distinguish the two diamond designs. The Court also held that the Director of Patents did not err in sustaining the objection to Duran's testimony as rebuttal, since it did not directly contradict the testimony of respondent's witness Chicane.
• Procedural Due Process: The refusal to allow Ong Su to testify on rebuttal was not reversible error because the only purpose was to ask whether he had judicial authority to use the alias "Mariano Ang," which was immaterial — petitioner's counsel had already extensively cross-examined Ong Su on this point, and there was evidence that the "VALENTINE" trademark had been used under either name even before World War II. Having made a formal offer of proof, petitioner cannot complain of denial of due process.
• Fraudulent Registration: The Court found no evidence that Ong Su obtained registration by fraud. Ong Su's trademark was registered on June 20, 1961, before the petitioner registered its trademark on November 9, 1961, and Ong Su had been using the mark since before the last World War, while petitioner started using its mark only in 1947. It cannot be said that respondent imitated petitioner's trademark.
• Admission of Exhibits: The record and evidence show that Ong Su had used the name Mariano Ang in his business, so the licenses and permits in the name of Ong Su and/or Mariano Ang were correctly admitted as evidence.

• Geometric Shapes as Non-Distinctive Trade Dress — Common geometric shapes such as circles, ovals, squares, triangles, and diamonds, when used as vehicles for display of word marks, ordinarily are not regarded as indicia of origin for goods to which the marks are applied, unless they have acquired secondary meaning. The Court applied this doctrine to hold that petitioner's diamond design did not function as an index of origin absent proof of secondary meaning.
• Burden of Proving Secondary Meaning in Design Marks — When a registrant of a design relies upon registration in proceedings based on likelihood of confusion of purchasers, the registrant assumes the burden of showing that the design portion of the mark has been so used that purchasers recognize the design, standing alone, as indicating goods emanating from the registrant. The Court found petitioner failed to discharge this burden.
• Color Alone Not a Trademark — Color alone, unless displayed in a distinct or arbitrary design, does not function as a trademark. Primary colors such as black and red are commonly and freely used in the printing business and cannot be appropriated as trademarks absent a distinct or arbitrary design.
• Dominant Feature Test — In comparing trademarks for likelihood of confusion, the dominant features of the marks — typically the word marks and names — control over minor similarities in design, color, or descriptive wording. The Court held that the words "Valentine" and "Victorias" are the dominant features and are dissimilar.
• Patent Office Lacks Jurisdiction Over Unfair Competition — Under Section 27 of the Trademark Law (R.A. No. 166), actions for unfair competition shall be brought before the proper Court of First Instance, not the Patent Office. Matters pertaining to the "dress of the goods" such as printing arrangement of legends are unfair competition issues outside the Patent Office's jurisdiction.

• "Common geometric shapes such as circles, ovals, squares, triangles, diamonds, and the like, when used as vehicles for display on word marks, ordinarily are not retarded as indicia of origin for goods to which the marks are applied, unless of course they have acquired secondary meaning." — This passage, quoted from the Director of Patents' decision and affirmed by the Supreme Court, articulates the controlling doctrine on geometric shapes in trademark law and remains a canonical formulation in Philippine trademark jurisprudence.
• "It is the common practice for trademark owners to register designs forming outline of their distinguishing mark, but when the registrant of such design relies upon registration in proceeding based upon likelihood of confusion of purchasers, he assumes the burden of showing that the design portion of the mark has been so used that purchasers recognize the design, standing alone, as indicating goods emanating from the registrant." — This defines the burden of proof for design mark owners in confusion proceedings, establishing the secondary-meaning requirement for geometric designs.
• "The words 'Victorias' and 'Valentine' are not similar in spelling and do not have a similar sound when pronounced. Even the diamond designs are different. The diamond design of the trademark 'Valentine' has protruding fines at the comers. Even an illiterate person can see the difference between the two diamond designs." — This states the Court's conclusion on the likelihood of confusion issue, applying the dominant feature test and emphasizing the dissimilarity of the word marks as the controlling factor.
• "It seems clear that the words 'Valentine' and 'Victorias' and the names and places of business of Victorias Milling Company, Inc. and Ong Su are the dominant features of the trademarks in question." — This identifies the dominant feature test as the framework for trademark comparison, prioritizing word marks over design elements.

• Bausch & Lomb Optical Co. vs. Overseas Finance & Trading Co., Inc. (Comm'r Pats) 112 USPQ 6 — Cited by the Director of Patents and affirmed by the Supreme Court for the principle that a registrant relying on a design in likelihood-of-confusion proceedings bears the burden of showing the design has been used such that purchasers recognize it as indicating the registrant's goods.
• Menzi & Co., Inc. vs. Andres Co., Dec. No. 59 dated Oct. 31, 1952, Dir. of Patents — Cited for the principle that the Patent Office has no jurisdiction over questions of unfair competition.
• A. E. Staley Manufacturing Co., Inc. vs. Andres Co. vs. Tan Tong — Cited for the proposition that tribunals of the Philippines Patent Office have no jurisdiction over unfair competition, citing in turn Gillette Safety Razor Co. vs. Triangle Mechanical Laboratories, 31 USPQ 24; Aladdin Mfg. Co. vs. Mantle Lamp Co., 21 USPQ 58; and J. C. Eno (U.S.) Limited vs. Deshayas, 29 USPQ 179.

• Section 27, Trademark Law, Republic Act No. 166 — Provides that actions for unfair competition shall be brought before the proper Court of First Instance. The Court applied this provision to affirm the Director of Patents' ruling that he lacked jurisdiction over unfair competition issues raised in the trademark cancellation proceeding.

Teehankee (Chairman), Makasiar, Muñoz Palma, Martin, and Guerrero, JJ., concurred.