2/15/2017 G.R.No.

L14761andL17981

TodayisWednesday,February15,2017

RepublicofthePhilippines
SUPREMECOURT
Manila

ENBANC

G.R.No.L14761January28,1961

ARCESONSANDCOMPANY,petitioner,
vs.
SELECTABISCUITCOMPANY,INC.,ETAL.,respondents.

xx

G.R.No.L17981January28,1961

ARCESONSANDCOMPANY,plaintiffappellee,
vs.
SELECTABISCUITCOMPANY,INC.,defendantappellant.

ManuelO.ChanandRamonS.Ereetaforplaintiffappellee.
E.VoltaireGarciafordefendantappellant.

BAUTISTAANGELO,J.:

OnAugust31,1955,SelectaBiscuitCompany,Inc.,hereinafterreferredtoasrespondent,filedwiththePhilippine
PatentOfficeapetitionfortheregistrationoftheword"SELECTA"astrademarktobeuseinitsbakeryproducts
allegingthatitisinactualusethereoffornotlessthantwomonthsbeforesaiddateandthat"nootherpersons,
partnership, corporation or association ... has the right to use said trademark in the Philippines, either in the
identical form or in any such near resemblance thereto, as might be calculated to deceive." Its petition was
referred to an examiner for study who found that the trademark sought to be registered resembles the word
"SELECTA" used by the Acre and Sons and Company, hereinafter referred to as petitioner, in its milk and ice
cream products so that its use by respondent will cause confusion as to the origin of their respective goods.
Consequently, he recommended that the application be refused. However, upon reconsideration, the Patent
Officeorderedthepublicationoftheapplicationforpurposesofopposition.

In due time, petitioner filed its opposition thereto on several grounds, among which are: (1) that the mark
"SELECTA"hadbeencontinuouslyusedbypetitionerinthemanufactureandsaleofitsproducts,includingcakes,
bakeryproducts,milkandicecreamfromthetimeofitsorganizationandevenpriortheretobyitspredecessorin
interest,RamonArce(2)thatthemark"SELECTA"hasalreadybecomeidentifiedwithnameofthepetitionerand
itsbusiness(3)thatpetitionerhadwarnedrespondentnottousesaidmarkbecauseitwasalreadybeingused
by the former, but that the latter ignored said warning (4) that respondent is using the word "SELECTA" as a
trademarkasbakeryproductsinunfaircompetitionwiththeproductsofpetitionerthusresultinginconfusionin
trade (5) that the mark to which the application of respondent refers has striking resemblance, both in
appearanceandmeaning,topetitioner'smarkastobemistakenthereforbythepublicandcauserespondent's
goods to be sold as petitioner's and (6) that actually a complaint has been filed by the petitioner against
respondentforunfaircompetitionintheCourtofFirstInstanceofManilaaskingfordamagesandfortheissuance
ofawritofinjunctionagainstrespondentenjoiningthelatterforcontinuingwiththeuseofsaidmark.

On September 28, 1958, the Court of First Instance of Manila rendered decision in the unfair competition case
perpetuallyenjoiningrespondentfromusingthename"SELECTA"asatrademarkonthegoodsmanufactured
and/orsoldbyitandorderingittopaypetitionerbywayofdamagesalltheprofitsitmayhaverealizedbytheuse
of said name, plus the sum of P5,000.00 as attorney's fee and costs of suit. From this decision, respondent
broughtthematteronappealtotheCourtofAppealswhereinthecasewasdocketedasCAG.R.No.24017R.

Inasmuchastheissuesofthefactsinthecaseofunfaircompetitionaresubstantiallyidenticalwiththoseraised
beforethePatentOffice,thepartiesatthehearingthereof,agreedtosubmittheevidencetheyintroducedbefore
the Court of First Instance of Manila to said office, and on the strength thereof, the Director of Patents, on
December 7, 1958, rendered decision dismissing petitioner's opposition and stating that the registration of the
trademark "SELECTA" in favor of applicant Selecta Biscuits Company, Inc. will not cause confusion or mistake
nor will deceive the purchasers as to the cause damage to petitioner. Hence, petitioner interposed the present
petitionforreview.

OnSeptember7,1960,thisCourtissuedaresolutionofthefollowingtenor:

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InG.R.No.L14761(ArceSonsandCompanyvs.SelectaBiscuitsCompany,Inc.,etal.),consideringthat
the issue raised and evidence presented in this appeal are the same as those involved and presented in
Civil Case No. 32907, entitled Arce Sons and Company vs. Selecta Biscuit Company, Inc. of the Court of
First Instance of Manila, presently pending appeal in the Court of Appeals, docketed as CAG.R. No.
24017R, the Court resolved to require the parties, or their counsel, to inform this Court why the appeal
pendingbeforetheCourtofAppealsshouldnotbeforwardedtothisCourtinorderthatthetwocasesmay
beconsolidatedandjointlydecided,toavoidanyconflictingdecision,pursuanttotheprovisionsofsection
17,paragraph5,oftheJudiciaryActof1948(RepublicActNo.296).

Andhavingbothpetitionerandrespondentmanifestedinwritingthattheydonotregisteranyobjectionthatthe
case they submitted on appeal to the Court of Appeals be certified to this Court so that it may be consolidated
withthepresentcase,thetwocasesarenowbeforeusforconsolidateddecision.

Thecaseforpetitionerisnarratedinthedecisionofthecourtaquoasfollows:.

"In1933,RamonArce,predecessorininterestoftheplaintiff,startedamilkbusinessinNovaliches,Rizal,
usingthename'SELECTA'asatradenameaswellasatrademark.Hebegunsellinganddistributinghis
productstodifferentresidences,restaurantsandoffices,inbottlesonthecapsofwhichwereinscribedthe
words 'SELECTA FRESH MILK.' As his business prospered, he thought of expanding and, in facts, he
expanded his business by establishing a store at Nos. 711713 Lepanto Street. While there, he began to
cater, in addition to milk, ice cream, sandwiches and other food products. As his catering and ice cream
businessprosperedinabigway,heplacedasignsignboardinhisestablishmentwiththename'SELECTA'
inscribedthereon.Thissignboardwasplacerightinfrontofthesaidstore.Forthesakeofefficiency,the
Novaliches place was made the pasteurizing plant and its products were distributed through the Lepanto
store.Specialcontainersmadeoftincanswiththewords'SELECTA'writtenontheircoversand'embossed
orblown'onthebottlesthemselveswereused.Similarly,exclusivebottlesformilkproductswereordered
from Getz Brothers with the word 'SELECTA 'blown on them. The sandwiches which were sold and
distributed were wrapped in carton boxes with covers bearing the name 'SELECTA.' To the ordinary cars
beingusedforthedeliveryofhisproductstoserveoutsideorderswereaddedtoafleetoffive(5)delivery
trucks with the word 'SELECTA ' prominently painted on them. Sales were made directly at the Lepanto
store or by means of deliveries to specified addresses, restaurants and offices inside Manila and its
suburbs and sometimes to customers in the provinces. As time passed, new products were produced for
sale, which as cheese (cottage cheese) with special containers especially ordered from the Philippine
EducationCompanywiththe'SELECTA'writtenontheircovers.

ThewarthatbrokeoutonDecember8,1941,didnotstopRamonArcefromcontinuingwithhisbusiness.
After a brief interruption of about a mouth, that is, during the end of January, 1942, and early February,
1942,heresumedhisbusinessusingthesametradenameandtrademark,butthistime,onalargescale.
Heenteredtherestaurantbusiness.Dairyproductsicecream,milk,sandwichescontinuedtobesoldand
distributedbyhim.However,RamonArcewasagainforcedtodiscontinuethebusinessonOctober,1944,
because time was beginning to be precarious. American planes started to bomb Manila and one of his
sons, Eulalio Arce, who was managing the business, was seized by the Japanese. Liberation came and
immediately thereafter. Ramon Arce once more resumed his business, even more actively, by adding
another store located at the corner of Lepanto and Azcarraga Streets. Continuing to use the name
'Selecta,'headdedbakeryproductstohislineofbusiness.Withafirewoodtypeofoven,aboutonehalfthe
sizeofthecourtroom,hemadehisownbread,cookies,pastriesandassortedbakeryproducts.Incidentally,
Arce'sbakerywastransferredtoBalintawak,QuezonCityanotherexpansionofhisbusinesswhere
the bakery products are now being baked thru the use of firewood, electric and gas oven. These bakery
products,likehisotherproducts,arebeingsoldthestoreitselfand/ordeliveredtopeopleorderingthemin
ManilaandevenBaguio.Liketheotherproducts,specialcartonboxesindifferentsizes,accordingtothe
bakeryproducts,withthename'Selecta'ontopofthecoversareprovidedforthesebakeryproducts.For
the cakes, special boxes and labels reading 'Selecta Cakes for all occasions' are made. For the milk
products, special bottle caps and bottles with the colored words 'Quality Always Selecta Fresh Milk, One
Pint' inscribed and blown on the sides of the bottles an innovation from the old bottles and caps used
formerly.Similar,specialboxeswiththename'Selecta'areprovidedforfriedchickensoldtocustomers.

Businessbeingalreadywellestablished,RamonArcedecidedtoretire,sothathischildrencangoonwith
thebusiness.Forthispurpose,hetransferredandleasedtothemallhisrights,interestandparticipations
inthebusiness,includingtheuseofthenameof'Selecta,'sometimeintheyear1950,atamonthlyrental
ofP10,000.00,laterreducedtoP6,500.00.HefurtherwrotetheBureauofCommerceletterdatedFebruary
10,1950,requestingcancellationofthebusinessname'SelectaRestaurant'togivewaytotheregistration
ofthesame'Selecta'andaskedthatthesameberegisteredinthenameofArceSons&Company,aco
partnership entered into by and among his children on February 10, 1950. Said copartnership was
organized,soitsarticlesofcopartnershipstate,'conductafirstclassrestaurantbusinesstoengageinthe
manufactureandsaleoficecream,milk,cakesandotherdairyandbakeryproductsandtocarryonsuch
other legitimate business as may produce profit' Arce Sons & Company has thus continued the lucrative
business of their predecessor in interest. It is now, and has always been, engaged in the restaurant
business,thesaleofmilk,andtheproductionandsaleofcakes,dairyproductsandbakeryproducts.Arce
Sons&Companyarenowmakingbakeryproductslikebreadrolls,pandenavaro,pandesal,andother
types, of cookies and biscuit of the round, hard and other types, providing thereof special boxes with the
same"Selecta'.

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Pursuingthepolicyofexpansionadoptedbytheirpredecessor,ArceSons&Companyestablishedanother
store the now famous 'Selecta Dewey Boulevard', with seven (7) delivery trucks with the 'Selecta '
conspicuouslypaintedonthem,toserve,deliver,andcatertocustomersinandoutsideofManila.".

Thecaseforrespondentontheotherhand,isexpressedasfollows:

Defendant was organized and registered as a corporation under the name and style of Selecta Biscuit
Company,Inc.onMarch2,1955(Exhibit2Ap.3,April17,1958)butstartedoperationasabiscuitfactory
onJune201955(t.s.n.p.3,id).Thename'Selecta'waschosenbytheorganizersofdefendantwhoare
Chinese citizens as a translation of the Chinese word 'Ching Suan' which means 'mapili' in Tagalog, and
Selected'inEnglish(t.s.n.p,id.).Thereupon,theArticlesofIncorporationofSelectaBiscuitCompany,Inc.
were registered with the Securities and Exchange Commission (t.s.n. P.5. id.), and at the same time
registered as a business name with the Bureau of Commerce which issued certificate of registration No.
55594 (Exhibit 3 Exhibit 3A). The same name Selecta Biscuit Company, Inc. was also subsequently
registeredwiththeBureauofInternalRevenuewhichissuedRegistrationCertificateNo.35764(Exhibit4,
t.s.n., p. id.). Inquiries were also made with the Patent Office of 'Selecta' after an official of the Patent
referred to index cards information was furnished to the effect that defendant could register the name
'Selecta'withtheBureauofPatents(t.s.n.,p.7,id).Accordingly,thecorrespondingpetitionforregistration
oftrademarkwasfiled(Exhs.5,5A,Exhibit5B).DefendantactuallyoperateditsbusinessfactoryonJune
20,1955,whilethepetitionforregistrationoftrademark'Selecta'wasfiledwiththePhilippinePatentOffice
onlyonSeptember1,1955,forthePhilippinePatentOfficeinformedthedefendantthatthenameshould
first be used before registration (t.s.n. p.8 ,id.). The factory of defendant is located at Tuazon Avenue,
NorthernHills,Malabon,Rizal,showingplainlyonitswallfacingthestreetsthename'SELECTABISCUIT
COMPANY, INC.' (Exhs. 6, 6a 6B, t.s.n., p. 9, id.). It is significant to note that Eulalio Arce, Managing
Partneroftheplaintiffresidedandresidesnearthedefendant'sfactory,onlyaround150metersawayin
fact,Arceusetopassinfrontofthefactoryofdefendantwhilestillunderconstructionanduptothepresent
time (t.s.n., pp. 9, 10, id.). Neither Eulalio Arce nor any other person in representation of the plaintiff
complainedtothedefendantabouttheuseofthename'SelectaBiscuit'untilofthepresentcomplaint.

Thereareotherfactoriesusing'Selectaastrademarkforbiscuit(t.s.n.,p.12Exhs.7,7A,7BExhibit8,
8A,8BExhibitsExhibit9,9A,9B)defendantinfactusesdifferentkindsoftrademark(Exhibit10,10A,
to10W,t.s.n.,p.17).

The biscuits, cookies, and crackers manufactured and sold by defendant are wrapped in cellophane
pouches and place inside tin can (Exh. 11 t.s.n. p. 19) the products of defendant are sold through the
lengthandbreadthofthePhilippinesthroughagentswithmorethanonehundred600storesascustomers
buying on credit (t.s.n.) pp. 19, 20, Exh. 12 t.s.n., p. 10, June 20, 1958). Defendant employs more than
one hundred (100) laborers and employees presently although it started with around seventy (70)
employees and laborers (t.s.n. p. 24) its present capitalization fully paid is Two Hundred Thirty Four
Thousand Pesos (P234,000.00.)additional capitalization's were duly authorized by the Securities and
ExchangeCommission(Exhs.13,13A)therewasnocomplaintwhatsoeverfromplaintiffsawdefendant's
businessgrowingbiggerandbiggerandflourishing(t.s.n.,p.21)whenplaintifffileditscomplaint.

Defendantadvertisesitsproductsthroughradiobroadcastandspotannouncement(Exhs.14,14Ato14
L inclusive Exhs. 15, 15A, 15B, 15C Exh. 16, 16A, 16B to 16E, inclusive Exhs. 17, 17B to 17L,
inclusive) the broadcasts scripts announced therein through the radio clearly show, among others, that
Selecta Biscuit are manufactured by Selecta Company, Inc. at Tuazon Avenue, Northern Hills, Malabon,
Rizal,withTelephone]No.21327(Exhs.23A23B,23D,23E,23F).

Besides the signboard, 'Selecta Biscuit Company, Inc.' on the building itself, defendant has installed
signboardalongthehighwaystoindicatethelocationofthefactoryofdefendant(Exhs.18,18A)delivery
trucksdefendantareplainlycarryingsignboardsSelectaBiscuitCompany,Inc.,TuazonAvenue,Northern
Hills Malabon, Rizal, Telephone No. 21327 (Exhs. 19, 19A, 19B, 19C 19D,19E,19F). Defendant is
using modern machineries in its biscuit factory (Exhs. 20, 20A, 20B, 19C, 20D, 20E). The defendant
sells its products thoughout 20C, 20D,20E). The defendant sells its product throughout the Philippines,
including Luzon , Visayas, Mindanao its customers count, among others, 600 stores buying on credit its
stores buying on cash number around 50 (t.s.n.), p. 10). Sales in Manila and suburbs are minimal, (Exh.
12).Defendantisawholesalerandnotaretailerofbiscuits,cookiesandcrackers.Thisisthenatureofthe
operationofthebusinessofthedefendant."

Attheoutsetonecannotbutnotethatinthetwocasesappealedbeforeuswhichinvolvethesamepartiesand
the same issues of fact and law, the Court a quo and the Director of Patents have rendered contradictory
decisions. While the former is of the opinion that the word 'SELECTA' has been used by the petitioner, or its
predecessorininterest,asatrademarkinthesaleanddistributionofitsdairyandbakeryproductsasearlyas
1933totheextentthatithasacquiredaproprietaryconnotationsothattoallowrespondenttouseitnowasa
trademarkinitsbusinesswouldbeanusurpationofpetitioner'sgoodwillandaninfringementofitspropertyright,
the Director of Patents entertained a contrary opinion. He believes that the word as used by the petitioner
functions only to point to the place of business or location of its restaurant while the same word as used by
respondentpointstotheoriginoftheproductsitsmanufacturesandsellsandhepredicatesthisdistinctionupon
thefactthatwhilethegoodsofpetitionerareonlyservedwithinitsrestaurantorsoldonlyonspecialordersinthe
City of Manila, respondent's goods are readymade and are for sale throughout the length and breadth of the
country.Heisoftheopinionthattheuseofsaidtrademarkbyrespondenthasnotresultedinconfusionintrade
contrarytothefindingofthecourtaquo.Whichofthisopinionsiscorrectistheissuenowfordetermination.

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ItappearsthatRamonArce,predecessorininterestofpetitioner,startedhismilkbusinessasearlyas1933.He
soldhismilkproductsinbottlescoveredwithcapsonwhichthewords'SELECTAFRESHMILK'wereinscribed.
Expandinghisbusiness,heestablishedastoreatLepantoStreet,CityofManila,wherehesold,inadditiontohis
products,icecream,sandwichesandotherfoodproducts,placingrightinfrontofhisestablishmentasignboard
withthename'SELECTA'inscribedthereon.Specialcontainersmadeoftincanswiththeword'SELECTA'written
ontheircoverswereusedforhisproducts.Bottlewiththesamewordembossedontheirsideswereusedforhis
milk products. The sandwiches he sold and distributed were wrapped in carton boxes with covers bearing the
samename.Heusedseveralcarsandtrucksfordeliverypurposesonthesidesofwhichwerewrittenthesame
word.Asnewproductswereproducedforsale,thesamewereplacedincontainerswiththesamenamewritten
on their covers. After the war, he added to his business such items as cakes, bread, cookies, pastries, and
assortedbakeryproducts.Thenhisbusinesswasacquiredbypetitioner,acopartnershiporganizedbyhissons,
thepurposesofwhichare"toconductafirstclassrestaurantbusinesstoengageinthemanufactureandsaleof
icecream,milk,cakesandotherproductsandtocarryonsuchotherlegitimatebusinessasmayproduceprofit."

Theforegoingunmistakablyshowthatpetitioner,throughitspredecessorininterest,hadmadeuseoftheword
"SELECTA"notonlyasatradenameindicativeofthelocationoftherestaurantwhereitmanufacturesandsells
itsproducts,butastrademarkisused.Thisisnotonlyinaccordancewithitsgeneralacceptationbutwithourlaw
onthematter."

Trademark' or tradename', distinction being highly technical, is sign, device, or mark by which articles
producedaredealtinbyparticularpersonororganizationaredistinguishedordistinguishablefromthose
producedordealtinbyother."(ChurchofGodv.TomlinsonChurchofGod,247SW2d,63,64)"

A'trademark'isadistinctivemarkofauthenticitythroughwhichthemerchandiseofaparticularproducer
ormanufacturermaybedistinguishedfromthatofothers,anditssolefunctionistodesignatedistinctively
theoriginoftheproductstowhichitisattached."(Reynolds&ReynoldsCo.v.Nordic,et.al.,114F2d,278)
"

The term 'trademark' includes any word, name, symbol, emblem, sign or device or any combination
thereofadoptedandusedbyamanufacturerormerchanttoidentifyhisgoodsanddistinguishthemfrom
thosemanufactured,soldordealtinbyothers."(Section38,RepublicActNo.166).

Verily,theword'SELECTA'hasbeenchosenbypetitionerandhasbeeninscribedonallitsproductstoservenot
onlyasasignorsymbolthatmayindicatethattheyaremanufacturedandsoldbyitbutasamarkofauthenticity
that may distinguish them from the products manufactured and sold by other merchants or businessmen. The
DirectorofPatents,therefore,erredinholdingthatpetitionermadeuseofthatwordmerelyasatradenameand
notasatrademarkwithinthemeaningofthelaw.1

Theword'SELECTA',itistrue,maybeanordinaryorcommonwordinthesensethatmaybeusedoremployed
byanyoneinpromotinghisbusinessorenterprise,butonceadoptedorcoinedinconnectionwithone'sbusiness
as an emblem, sign or device to characterize its products, or as a badge of authenticity, it may acquire a
secondary meaning as to be exclusively associated with its products and business.2 In this sense, its used by
anothermayleadtoconfusionintradeandcausedamagetoitsbusiness.Andthisisthesituationofpetitioner
whenitusedtheword'SELECTA'asatrademark.Inthissense,thelawgivesitsprotectionandguaranteesits
usedtotheexclusionofallothersa(G.&C.MerriamCo.v.Saalfield,198F.369,373).Anditisalsointhesense
thatthelawpostulatesthat"Theownershiporpossessionofatrademark,...shallberecognizedandprotected
inthesamemannerandtothesameextent,asareotherpropertyrightsknowntothelaw,"therebygivingtoany
person entitled to the exclusive use of such trademark the right to recover damages in a civil action from any
personwhomayhavesoldgoodsofsimilarkindbearingsuchtrademark(Sections2Aand23,RepublicActNo.
166,asamended).

Theterm'SELECTA'maybeplacedatparwiththewords"AngTibay"whichthisCourthasconsiderednotmerely
as a descriptive term within the meaning of the Trademark Law but as a fanciful or coined phrase, or a trade
mark.Inthatcase,thisCourtfoundthatrespondenthasconstantlyusedtheterm"AngTibay",bothasatrade
markandatradename,inthemanufactureandsaleofslippers,shoesandindoorbaseballsfortwentytwoyears
beforepetitionerregistereditasatradenameforpantsandshirtssothatithasperformedduringthatperiodthe
functionofatrademarktopointdistinctively,orbyitsownmeaningorbyassociation,totheoriginorownership
ofthewarestowhichitapplies.Andholdingthatrespondentwasentitledtoprotectionintheuseofthattrade
mark,thisCourtmadethefollowingcomment:

The function of a trademark is to point distinctively, either by its own meaning or by association, to the
originorownershipofthewarestowhichitisapplied.'AngTibay'asusedbytherespondenttodesignate
his wares, had exactly performed that function for twentytwo years before the petitioner adopted it as a
trademarkinherownbusiness.'AngTibay'shoesandslippersare,byassociation,knownthroughoutthe
Philippines as products of the 'Ang Tibay" factory owned and operated by the respondent. Even if
'AngTibay', therefore, were not capable of exclusive appropriation as a trademark, the application of the
doctrine of secondary meaning could nevertheless be fully sustained because, in any event, by
respondent's long and exclusive appropriation with reference to an article on the market, because
geographicallyorotherwisedescriptive,mightneverthelesshavebeenusedsolongandexclusivelybyone
producer with reference to his article that, in that trade and to that branch of the purchasing public, the
wordorphrasehascometomeanthatarticlewashisproduct."(Angv.Teodoro,supra.).

TherationaleintheAngTibaycaseappliesonallfourstothecaseofpetitioner.

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But respondent claims that it adopted the trademark 'SELECTA' in good faith and not precisely to engage in
unfaircompetitionwithpetitioner.Ittriedtoestablishthatrespondentwasorganizedasacorporationunderthe
nameofSelectaBiscuitCompany,Inc.onMarch2,1955andstartedoperationsasabiscuitfactoryonJune20,
1955 that the name 'SELECTA' was chosen by the organizers of respondent who are Chinese citizens as a
translationoftheChineseword"ChingSuan"whichmeans"mapili"inTagalog,and"Selected"inEnglishthat,
thereupon,itregistereditsarticlesofincorporationwiththeSecuritiesandExchangeCommissionandthename
'SELECTA' as a business name with the Bureau of Commerce which issued to it Certificate of Registration No.
55594 and that it also registered the same tradename with the Bureau of Internal Revenue and took steps to
obtainapatentfromthePatentOfficebyfilingwithitasapplicationfortheregistrationofsaidtradename.

The suggestion that the name 'SELECTA' was chosen by the organizers of respondent merely as a translation
fromaChineseword"ChingSuan"meaning"mapili"inthedialectisbetrayedbytheverymannerofitsselection,
for if the only purpose is to make an English translation of that word and not to compete with the business of
petitioner,whychosetheword'SELECTA',aSpanishword,andnot"Selected",theEnglishequivalentthereof,as
was done by other wellknown enterprises? In the words of petitioner's counsel, "Why with all the words in the
English dictionary and all the words in the Spanish dictionary and all the phrases that could be coined, should
defendantappellant (respondent) choose 'SELECTA' if its purpose was not and is not to fool the people and to
damageplaintiffappellee?"Inthisrespect,wefindappropriatethefollowingcommentofthetrialcourt:

Eventually, like the plaintiff, one is tempted to ask as to why with the richness in words of the English
languageandwiththeaffluenceoftheSpanishvocabularyor,forthatmatter,ofourowndialects,should
thedefendantchoosethecontrovertedword"Selecta",whichhasalreadyacquiredasecondarymeaning
byvirtueofplaintiff'spriorandcontinueduseofthesameasatrademarkortradenameofitsproducts?
The explanation given by Sy Hap, manager of the defendant, that the word 'Selecta' was chosen for its
bakeryproductsbytheorganizersofsaidcompanyfromtheChineseword'ChingSuan'meaning'mapili',
whichinEnglishtranslation,istosaytheleast,veryweakanduntenable.SyHaphimselfadmittedthathe
hadknownEulalioArce,thepersonmanagingplaintiff'sbusiness,since1954thatsincehebegantoreside
at10thAvenue,GracePark,hehadknowntheSelectaRestaurantonAzcarragaStreetandDeweyBlvd.
andthatheevenhadoccasiontoeatinoneoftherestaurantsoftheplaintiff.Allofthesecircumstances
tend to conspire in inducing one to doubt defendant's motive for using the same word "Selecta" for its
bakery products. To allow the defendant here to use the word "Selecta" in spite of the fact that this word
has already been adopted and exploited by Ramon Arce and by his family thru the organization of Arce
Sons and Company, for the maintenance of its goodwill, for which said plaintiff and its predecessor have
spenttime,effortandfortune,istopermitbusinesspiratesandbuccaneerstoappropriateforthemselves
andtotheirprofitandadvantagethetradenamesandtrademarksofwellestablishedmerchantswithall
theirattendantgoodwillandcommercialbenefit.Certainly,thiscannotbeallowed,anditbecomestheduty
of the court to protect the legitimate owners of said tradenames and trademarks, for under the law, the
sameconstituteonekindofpropertyrightentitledtothenecessarylegalprotection.

Otherpointsraisedbyrespondenttoshowthatthetrialcourterredinholdingthattheadoptionbyitoftheword
'SELECTA' is tantamount to unfair competition are: (1) that its products are biscuits, crackers, and cookies,
wrappedincellophanepackages,placeintincontainers,andthatitsproductsmaylastayearwithoutspoilage,
while the ice cream, milk, cakes and other bakery products which petitioner manufactures last only for two or
threedays(2)thatthesaleanddistributionofpetitioner'sproductsareonretailbasis,limitedtotheCityofManila
and suburbs, and its place of business is localized at Azcarraga, corner of Lepanto Street and at Dewey Blvd.,
Manila, while that of respondent is on a wholesale basis, extending throughout the length and breadth of the
Philippines (3) that petitioner's signboard on its place of business reads 'SELECTA' and on its delivery trucks
"Selecta,QualityAlways,RestaurantandCaterer,Azcarraga,DeweyBlvd.,BalintawakandTelephonenumber,"in
contrast with respondent's signboard on its factory which reads "Selecta Biscuit Company, Inc.," and on its
deliverytrucks"SelectaBiscuitCompany,Inc.,TuasonAvenue,Malabon,Rizal,TelephoneNo.21327(4)that
thebusinessnameofpetitionerisdifferentfromthebusinessnameofrespondent(5)thatpetitionerhasonlya
capitalinvestmentofP25,000.00whereasrespondenthasafullypaidupstockintheamountofP234,000.00out
of the P500,000.00 authorized capital, (6) that the use of the name 'SELECTA' by respondent cannot lead to
confusioninthebusinessoperationoftheparties.

We have read carefully the reasons advanced in support of the points raised by counsel in an effort to make
inroads into the findings of the court a quo on unfair competition, but we believe them to be substantial and
untenable.Theyappeartobewellansweredandrefutedbycounselforpetitionerinhisbrief,whichrefutationwe
do not need to repeat here. Suffice it to state that we agree with the authorities and reasons advanced therein
whichincidentallyconstitutethebestsupportofthedecisionofthecourtaquo.

With regard to the claim that petitioner failed to present sufficient evidence on the contract of lease of the
businessfromitspredecessorininterest,wefindthatunderthecircumstancessecondaryevidenceisadmissible.

Inviewoftheforegoing,weholdthattheDirectorofPatentscommittedanerrorindismissingtheoppositionof
petitioner and in holding that the registration of the trademark 'SELECTA' in favor of respondent will not cause
damagetopetitioner,andconsequently,weherebyreversehisdecision.

Consistentlywiththisfinding,weherebyaffirmthedecisionofthecourtaquorenderedinG.R.No.L17981.No
costs.

Paras,C.J.,Bengzon,Labrador,Reyes,J.B.L.Barrera,GutierrezDavid,ParedesandDizon.,JJ.,concur.
Padilla,andConcepcion,JJ.,tooknopart.

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