G.R. No. L-27906. January 8, 1987.
CONVERSE RUBBER CORPORATION, petitioner, vs. UNIVERSAL RUBBER PRODUCTS, INC. and TIBURCIO S. EVALLE, DIRECTOR OF PATENTS, respondents.

FACTS

Respondent Universal Rubber Products, Inc. applied to register the trademark “UNIVERSAL CONVERSE AND DEVICE” for its rubber shoes and slippers. Petitioner Converse Rubber Corporation, a Massachusetts-based company not licensed to do business in the Philippines, opposed the application. It argued that the mark was confusingly similar to the dominant word “CONVERSE” in its corporate name, likely to deceive the public and cause injury to its business reputation under the Trademark Law. The parties stipulated that petitioner was not doing business in the Philippines and used the trademarks “CHUCK TAYLOR” and “ALL STAR AND DEVICE” on its rubber shoes. Petitioner’s evidence consisted of testimony from a local merchant, Mrs. Carmen Pacquing, who had been selling imported Converse shoes since 1956, with invoices describing the goods as “Converse Chuck Taylor” or similar variants.
The Director of Patents dismissed the opposition and gave due course to the application. The Director ruled that petitioner failed to prove that the word “CONVERSE” alone had become so identified with its corporation in the public mind within the Philippines, especially since its market entry was through insignificant, indirect sales and it did not use “CONVERSE” as a standalone trademark on its goods. Petitioner’s motion for reconsideration was denied, prompting this petition for review.

ISSUE

Whether the respondent’s partial appropriation of the word “CONVERSE” from the petitioner’s corporate name in its trademark application is calculated to deceive or confuse the public to the injury of the petitioner.

RULING

The Supreme Court set aside the decision of the Director of Patents and denied respondent’s application. The legal logic centers on the protection of a trade name or corporate name under the Trademark Law ( R.A. No. 166 ) and the Paris Convention for the Protection of Industrial Property, to which the Philippines is a party. The Court held that the word “CONVERSE” is the dominant and distinctive part of petitioner’s corporate name “CONVERSE RUBBER CORPORATION,” identifying its business. Ownership of a trade name is a property right protectable against damage from public confusion.
Critically, the Court rejected the Director’s finding that petitioner’s lack of direct business operations in the Philippines negated protection. Citing the Paris Convention (Article 8) and implementing provisions in Section 37 of R.A. No. 166 , the Court ruled that a trade name shall be protected without the obligation of filing or registration, irrespective of whether it forms part of a trademark, for nationals of member countries. Petitioner, as a U.S. national, is entitled to this protection. The evidence, including invoices from a local merchant describing the goods with the word “Converse,” demonstrated that petitioner’s goods had become known in the Philippine market. Therefore, respondent’s use of “CONVERSE” in its mark was calculated to cause confusion, constituting unfair competition and warranting denial of registration to prevent injury to petitioner’s trade name and goodwill.