G.R. No. L-78325; January 25, 1990
DEL MONTE CORPORATION and PHILIPPINE PACKING CORPORATION, petitioners, vs. COURT OF APPEALS and SUNSHINE SAUCE MANUFACTURING INDUSTRIES, respondents.

FACTS

Petitioner Del Monte Corporation, a U.S. company, and its domestic licensee, Philippine Packing Corporation (Philpack), held registered trademarks for “DEL MONTE” and its logo, and a certificate for its distinctive catsup bottle configuration. Respondent Sunshine Sauce Manufacturing Industries, a local manufacturer, registered its “Sunshine Fruit Catsup” logo and was using recycled Del Monte bottles, purchased from junk shops, for its product. Upon reports of this usage and a allegedly confusingly similar logo, petitioners demanded Sunshine to cease and desist. Alleging non-compliance, Del Monte and Philpack filed a complaint for trademark infringement and unfair competition, seeking damages and an injunction.
The Regional Trial Court dismissed the complaint, finding substantial differences between the logos, noting Sunshine had ceased using the bottles, and ruling that purchase from junk shops transferred ownership. It also found an absence of malice or bad faith, deemed essential. The Court of Appeals affirmed this dismissal in toto, prompting the petitioners to elevate the case via certiorari.

ISSUE

Whether the respondent court erred in dismissing the complaint for infringement of trademark and unfair competition.

RULING

The Supreme Court reversed the lower courts’ decisions. On trademark infringement, the Court clarified that while the logos had differences, the test is whether the similarity is sufficient to deceive or cause confusion among ordinary purchasers. The Court found that Sunshine’s label, using similar color schemes, layout, and a concentric circle design, created a confusing similarity to Del Monte’s label, likely to mislead the public. Registration in the Supplemental Register, as held by Sunshine, does not confer immunity from infringement suits if the mark is likely to cause confusion.
On unfair competition, the Court held that the essential element is the likelihood of deception, not the registrant’s malice or bad faith. By using Del Monte’s distinctive bottles, Sunshine clothed its goods with the appearance of the petitioners’ product, which was calculated to deceive the public and pass off its goods as those of Del Monte. The act of purchasing empty bottles from junk shops does not confer the right to use them as containers for one’s own product if such use results in unfair competition. However, the Court found no conclusive proof of actual pecuniary loss. Consequently, it awarded only nominal damages, canceled Sunshine’s registration, and permanently enjoined it from using the similar label and the petitioners’ bottles.