7/28/2019 001 - La Insular Cigar v. B.E. Jao Oge

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La Insular Cigar and Cigarette Factory, Inc. v. B.E. Jao Oge

Summary: La Insular filed a complaint against B.E. Jao Oge, theproprietor of La Ciudad for infringing its trademark or for unfair

competition. It alleged that through the use of B.E. Jao Oge of 2 different

labels on packages of its cigarettes, the defendant herein deceives thepublic and defrauds the plaintiff. The defendant interposed a general

demurrer on the ground that the facts did not constitute a cause of

action. The SC reversed this decision and remanded the case to the

court of origin. It was of the opinion that the packaging used by the La

Ciudad closely imitates the label and mark of La Insular and that the

defendant is giving his cigarettes the appearance of cigarettesmanufactured and offered for sale by the plaintiff, and this, said the

Court, is enough to interpose unfair competition or trademark. The

difference between the two is merely academic, but both have the same

remedies. It is apparent that there is resemblance in the labels, thus ademurrer cannot be sustained. The person filing a complaint is not

really required to indicate the particular provision of law upon whichhe relies for relief. If he does so and is mistaken, it does not precludehim from obtaining relief under a different conception of the case.

FACTS

La Insular is a Corporation engaged in the tobacco business and it is theowner of a registered trademark, which it places upon the

wrappers of its cigarettes and by which its products is generally

recognized throughout the Philippine Islands and elsewhere.

The complainant set forth ownership of the above trademark and the

continuous use of the same for nearly 40 years. It alleges that thedefendantBE Jao (La Ciudad proprietor) began to use 2different

labels on packages of its cigarettes offered for sale which areinfringing imitations of the plaintiffs mark.

To this complaint, the defendant interposed a general demurrer on the

ground that the facts stated did not constitute a cause of action.

Such demurrer was sustained by the trial court hence, judgment wasentered dismissing the complaint.

ISSUE

Real issue in the case: WON the demurrer must be sustained NO

Related to Trademark: Whether or not there is a case for infringement

or unfair competition. YES

RATIOThe complaint is sufficient and the order sustaining the demurrer

must be dismissed. An action for infringement of a trademark lies in

favor of the injured person against any one who sells goods of a similarkind bearing such trademark. This interpretation would make the

remedy available in very few cases since most traders desirous of

filching the trade of others in this way will use colorable imitations orsuggestive reproductions of the trademark which they intend to

appropriate rather than exact counterfeits. But if a litigants right is

doubtful under infringement, he only needs to claim the benefit of

the section dealing with unfair competition which gives precisely

the remedies that he would have contained under the other

provision and under this section, it is immaterial what form thedeceptive practices of the infringer take.

In cases of infringement of trademarks, the law primarily takes no

account of the actual intent on the part of the infringer to mislead the

public and defraud the owner of the trademarks. On the other hand, in

cases of unfair competition actual intent to deceive the public and

defraud the person injured is declared to be essential to the

maintenance of the action but it is immediately added that such intentmay be inferred from similarity of appearance of the goods as packed or

offered for sale to those of the complaining party.

7/28/2019 001 - La Insular Cigar v. B.E. Jao Oge

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The elements of unfair competition are:

1. The person complained of shall have given to his goods the generalappearance of the goods of the complaining party either in wrapping,

devices or words;

2. That the person complained of should have clothed the goods withsuch appearance for the purpose of deceiving the public and defrauding

the complaining party of his legitimate trade.

It is not always easy to point out exactly where one ends and the other

begins, but together they comprise all actionable injuries which oneperson may inflict upon another as the result of the unfair use of names,

marks, and other trade devices.

The person injured is not really required to indicate the particular

provision of law upon which he relies for relief, and if he does so and is

mistaken, this will not preclude him from obtaining relief under adifferent conception of the case, provided always that the facts statedand proved justify such relief.

The packaging used by the La Ciudad closely imitatesthe label and

mark of La Insular and there is a further allegation that thedefendant is giving his cigarettes the appearance of cigarettes

manufactured and offered for sale by the plaintiff. The intent to

deceive may be inferred from similarity in the appearance of the goodsas packed or offered for sale.

It is too clear from the allegations of the complaint, taken in

connection with the exhibits that there is actionable imitation on the part of the defendant. The offending marks submitted for

purposes of actual comparison tell the story to the eye.

The judgment of demurrer must therefore be reversed, and the cause

was remanded to the court of origin for further proceedings inconformity with this opinion.