G.R. No. L-8937; March 21, 1914
ALHAMBRA CIGAR AND CIGARETTE MANUFACTURING CO., plaintiff-appellee, vs. PEDRO N. MOJICA, defendant-appellant.

FACTS:
The plaintiff, Alhambra Cigar and Cigarette Manufacturing Co., had for many years manufactured cigars using a distinctive paper band or ring of a chocolate-brown color with gold lettering and lines. This band was divided into three parts, bearing the words “Manila,” “Excelentes” and “Alhambra” (the latter in quotation marks), and the letters “A. C. Cy.” The band had become well-known to the trade and was valuable for the sale of its cigars. The defendant, Pedro N. Mojica, began using a very similar band on his cigars. The defendant’s bands were of two types: one was brown (the same shade as the plaintiff’s) and the other was green, but both had the same shape, gold markings, and three-part division. The brown band contained the words “Manila,” “Excelentes” and “La Progresiva” (the latter in quotation marks), and the words “I. Luzon.” The green band was similar but substituted “Excelentes” with “Best Quality.” Furthermore, the defendant’s cigars were almost identical to the plaintiff’s in form, size, and wrapper color. The plaintiff filed an action for unfair competition.

ISSUE:
Whether the defendant’s use of the cigar bands, taken together with the overall appearance of his cigars, constitutes unfair competition under Act No. 666 .

RULING:
Yes, but only with respect to the brown-colored band. The Court affirmed the judgment of the Court of First Instance, finding unfair competition in the defendant’s use of the brown band, but reversed it concerning the green band.

The Court held that unfair competition consists in passing off one’s goods or business as that of another, deceiving the public. Under Section 7 of Act No. 666 , unfair competition exists when goods are given the general appearance of another’s goods in a manner likely to influence purchasers to believe they are buying the goods of another, provided there is an intent to deceive, which may be inferred from the similarity.

In determining deception, the Court must consider all features of the article, including the cigar’s appearance, size, shape, wrapper, and band. The defendant’s cigars, with the brown band, were substantially identical in overall appearance to the plaintiff’s, making deception not only possible but probable for an ordinary purchaser exercising reasonable care. The similarity was such that a close examination of the lettering was required to tell them apart.

The universal test is whether the public is likely to be deceived. An actual fraudulent intent need not be proven if the necessary and probable tendency of the defendant’s conduct is to deceive. Here, the use of the brown band, combined with the identical cigar characteristics, had that tendency.

However, regarding the green band, the Court found it clearly and easily distinguishable from the plaintiff’s chocolate-brown band. An ordinary purchaser could distinguish them at a glance. Therefore, its use did not constitute unfair competition.

The judgment was affirmed insofar as it perpetually enjoined the defendant from using the brown band, but reversed as to the green band. Costs were imposed on the appellant.